Over the past five years, cash back credit cards have undergone tremendous changes. Although first made popular by Discover in the 1980ís, cash back rewards cards really started taking off in the past decade. Unfortunately, cash back cards not only took off, but shot to the moon, causing many credit card companies to lose money on these offers.
In 2007, for example, it was possible to get a full 5% cash back on gas, groceries and drug store purchases with no restrictions or limits to what could be earned. Smart consumers jumped on these offers and made a killing. Just think, a family that spends $200 a week on gas and groceries could have earned $520 a year on just these purchases. That was a great time to have a cash back card.
Todayís cash back credit cards arenít remotely as generous as their high flying 5% predecessors, though many cards still advertise ďup to 5% cash back.Ē The new breed of 5% cash back credit cards are complicated to use, riddled with restrictions, and extremely less useful than the original, true 5% cash back credit cards. Because of this, it is important to skip past boldly advertised cash back claims and seek out cards that offer above average cash back where you spend the most.
At present, one such card is the Capital One Cash card. This is perhaps the easiest to use cash back card, as it offers a straight 1% cash back on everything and a 50% bonus on cash back earned at the end of the year, bringing the total rewards rate to 1.5%.
Another card that may be beneficial to people who spend a lot on gas and eating out is the Discover Open Road Card. This card offers 2% cash back on gas and restaurant purchases, so itís more for the drive in the car and eat out three meals a day crowd.
A third cash back card that does offer 5% cash back to heavy spenders is American Express Blue Cash. The Blue Cash Preferred Card offers 6% cash back on groceries as well as 3% cash back on gas. This is by far the best cash back card for families, but it does carry a high interest rate, making it a bad choice for those who carry debt from month to month.
Apart from these three cards, Chase, Citibank and Bank of America also offer credit cards with 1% cash back and the opportunity to earn bonus cash back of up to 5% in categories that change every few months. These arenít bad cards, but for those who want a straightforward cash back card, Capital One Cash is likely the best offer on the market today.
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