What are the best flat-rate cash back credit cards?

Cash back credit cards are worth it if the value of the cash back is greater than the cost of the card. The best cash back credit cards with the highest rewards rates and signup bonuses sometimes have annual fees. In that case, you need to be sure the cash back that you earn will offset the cost of the annual fee (and then some). For cash back cards that have no annual fees, the cash back is free money as long as you don’t get charged interest.… read full answer

Many cash back credit cards let cardholders earn more cash back than the cost of the annual fee. However, what you really want is a card that allows you to earn cash back as efficiently as possible. Some cash back cards give a flat cash back rate for all purchases. There are also cash back cards that will reward you more for bonus categories, like gas, groceries, or dining. The highest flat cash back rate is 2.5%. For bonus categories, you can earn up to 6% cash back.

Wherever you spend the most money on your credit card will determine whether a flat-rate cash back card is better for you, or a card that’ll earn you bonus cash back in specific categories. How many credit cards you want to have in total matters, too, as does your credit standing. The better your credit is, and the more income you have relative to your debt, the more credit card options you’ll have and the more worthwhile they’ll be.

If you’re looking for a new cash back card, check out the best cash back credit cards and find the one that’s most worth it for you. But remember, as with any card, you need to be sure to use a cash back credit card responsibly for it to be worthwhile in the long run. No credit card, regardless of the cash back rate, is worth it if you overspend and find yourself in debt with a damaged credit score.

Cash back vs. miles is a frequent debate among rewards credit card shoppers, but it’s like comparing apples and oranges. Both are fruit, or rewards that you earn on every purchase, in this case. And both have their virtues, though a lot depends on your personal tastes. For example, you always know how much cash back is worth, while miles tend to be more mysterious. Miles are also associated with travel, which is fun. But much like you can eat both an apple and an orange, there’s room in your wallet for a … read full answercash back credit card and a credit card with miles. The best approach is to use a cash back card with a high baseline earning rate for everyday purchases and a credit card with miles for travel expenses.

It’s still good to know how these two major rewards currencies compare, no matter how many credit cards you decide to get. So let’s take a look at some of their biggest similarities and differences.

Cash Back vs. Miles: Key Categories

• Best Credit Card: Citi® Double Cash Card – 18 month BT offer vs. Barclaycard Arrival® Plus World Elite Mastercard®
• Average per $1: 1.06 cents vs. 1.17 miles
• Average Initial Bonus: $139 vs. 15,732 miles
• Can Be Devalued? No vs. Yes
• Expiration: Possible vs. Possible
• Typical Redemption Method: Statement credit vs. Eligible travel expenses

Averages are from WalletHub’s Q2 2018 Credit Card Landscape Report. And if you’re wondering, rewards devaluation is when a credit card company increases the number of points or miles needed for a certain amount of redemption value, which decreases the value any unredeemed points or miles you may have. That’s not a concern with cash back because a credit card company can’t change the value of a dollar.

Cash back is just a lot more straightforward than miles because it’s already in dollar terms. So you’ll always know exactly how much you’re earning on a particular purchase as well as how much your unredeemed rewards are worth. With credit card miles, you have to compare the number needed for a certain redemption item – a flight, for example – to how much that item would cost if purchased normally.

But cash back and miles credit cards have a lot in common, too. For example, you’ll find a similar mix of rewards programs among both types of cards. Some offer the same rewards earning rate on all purchases. Some give you more rewards in designated bonus categories, if only up to a certain amount spent. And others offer even higher bonus rates in categories that change every few months. You’ll also find initial bonuses on both types of cards but only on some offers in each group.

For more information, check out WalletHub’s Credit Card Rewards Guide.

The best 2% cash back credit card is Citi Double Cash. It gives unlimited 2% Cash Back on purchases: 1% when you buy something and another 1% when you pay for it. And the annual fee is $0. Plus, the card offers an intro APR of 0% for 18 months on balance transfers with a transfer fee of 3% (min $5). You will need good credit or better to be approved for this card.… read full answer

For a rewards credit card, 2% cash back on everything is about the best you can aim for. That’s why Citi Double Cash is the best cash back credit card on the market right now. But there are a few other great 2%+ cash back credit cards to consider when shopping for the best deal.

Best 2% cash back credit cards:

• 2% cash back on all purchases: Citi Double Cash.
• 2% cash back at grocery stores and wholesale clubs: BankAmericard Cash Rewards for Students.
• 2% cash back at Costco (plus 4% on gas at Costco): Costco Anywhere Visa.
• 2% cash back at gas stations and select department stores (like Kohl’s & Macy’s): Amex Blue Cash Everyday.
• 2% cash back on $1,000 in restaurant and gas station purchases per quarter: Discover it Chrome.

At the end of the day, Citi Double Cash is the best 2% cash back credit card because it offers an unlimited 2% cash back rate on all purchases. Most 2 percent cash back credit cards put a cap on the amount you can earn with 2%+ rates. Or they only give the rate on certain categories of purchases.

Many of these 2% cash back credit cards offer some other great features in addition to their 2% earn rates. BankAmericard Cash Rewards for Students offers 3% cash back on gas, online shopping, dining, travel, drug stores, or home improvement/furnishings – you get to choose the category. But its 2% and 3% cash back rates only apply to your first $2,500 spent in those categories combined.

Some other great features of these credit cards: The Costco Anywhere Visa gives 4% cash back on your first $7,000 spent per year on Costco gas and other eligible gas, and 3% back on restaurants and travel. Blue Cash Everyday offers 3% cash back on $6,000 spent annually at supermarkets. Discover it Chrome’s most rewarding categories are gas stations and restaurants, which give 2% cash back, but this card matches your first year’s cash back which can be substantial if you’re maximizing your 2% category spending every quarter.

And to top it off, none of these cards have annual fees.