Honestly, if you aren’t using a rewards card, like the Amex Blue Cash or Barclaycard Arrival™ World MasterCard® you are literally missing out on free money. That’s because you can simply funnel all those purchases you are making anyway through a rewards card and reap the benefits. Consider how much cash goes into everyday expenses, such as gas, groceries, and clothing. If only there was a card that paid out especially large rewards for those really common purchases… but that would be too good to be true, right?
Nope! Enter the Blue Cash Everyday® Card from American Express, hero of the everyday American consumer.
The Blue Cash Everyday® Card from American Express doles out rewards for your most common buys as follows: earn 3% cash back on supermarket purchases, 2% cash back at gas stations and select department stores, and 1% cash back on everything else. These rewards, accumulated as “Reward Dollars,” can be exchanged for statement credit, gift cards, or merchandise starting at $25. It really is as simple as that — no expiration dates, rotating categories, or other tricks. There isn’t even an annual fee. Combine that with an introductory 0% APR for the first 12 months, as well as a bonus of 50 Reward Dollars when you spend just $1000 in the first 3 months, and it’s hard to see why you wouldn’t try this one out.
Oh yeah, and here’s a real kicker: a lot of supermarkets offer a wide variety of gift cards for other retailers. That means you can nab that sweet 3% rate on a ton of other purchases as well. Ka-ching!
Customers of the AmEx blue series enjoy access to their Blue Savings Program, which features special deals with select restaurants, hotels, and retailers. This card also comes with automatic insurance on certain qualifying purchases, including loss and damage insurance on car rentals, accident insurance on travel by any of the usual means, and extended warranties.
Items you buy also get purchase protection as well as return protection for 90 days for coverage up to $300 per item. In addition, American Express will help you resolve any disputes you may have with merchants, though favorable outcomes are not guaranteed. If you travel more than 100 miles from home, you’ll have access to a 24/7 Global Assist Hotline, where you can get help with common travel issues, such as problems with visa/customs, directories, or simply referrals to local businesses.
And even those that are staying closer to home can enjoy the 24/7 roadside assistance help. You will still have to pay for that tow truck or jumper, but they will call it for you. Finally, if you have friends that might benefit from this card as well, refer them and you receive a $25 reward. Or just ask for additional cards for your friends and family with no fees whatsoever.
If you are wondering what the catch is, the truth is there isn’t one — provided you do a little assessment of your life beforehand. Like any credit card, this one will trip you up if you fail to make your payments on time. After the first year, the APR kicks in, which, based on your credit score, ranges from 12.99% to 21.99%! Ouch! And if you don’t make the minimum payments for 3 billing cycles in a row, you can kiss your rewards for the whole year good-bye.
Consider if this card actually fits your lifestyle, particularly the merchants you are already shopping at. Like we said, the real benefit of rewards cards is that they pay you for purchases you are making anyway. Many merchants don’t even accept American Express. No rewards are given if the seller uses a mobile/wireless card reader or if you use a mobile/digital wallet. Also, the rewards only apply to purchases made in the US. If you are shopping abroad, not only will you miss out on the cash back, but you are also subject to a 2.7% foreign transaction fee.
So which stores qualify, anyway? Basically, for groceries and gas, that has to be the main thing they sell. Gas stations with convenience stores are okay, but gas being sold out of a supermarket will not count as a gas retailer. (But the supermarket rate is better anyway.) Similarly, specialty food stores such as cheese shops or butchers will not count as supermarkets. And watch out: all superstores such as Wal-Mart and Target as well as warehouse clubs such as CostCo or Sam’s Club do not count as either gas or supermarkets, netting only a 1% cash back rate. As for the 2% rate offered on select department stores, AmEx has kindly enumerated exactly which ones count:
• Bon Ton Stores
• Century 21 Department Stores
• J.C. Penney (JCP)
• Lord & Taylor
• Neiman Marcus
• Saks Fifth Avenue
• Stein Mar
Finally, be aware that the 3% rate on groceries only applies for the first $6000 spent in that category in a year. After that, the rewards come at the boring 1% rate. Large families might be affected by this cap, so be sure to count your spending.
Which card to Prefer?
But wait — before you grab the Blue Cash Everyday, you should know there’s another option for those who spend a little more. The Blue Cash Preferred® Card from American Express offers all the same perks, same introductory 0% APR for the first year, and basically the same rewards scheme, but it comes with an annual fee of $75. In return, you get increased rates for cash back: 3% from gas stations, 3% from those select department stores, and a whopping 6% from supermarkets. You also receive an increased referral bonus of $75 and increased sign-up bonus of 100 Reward Dollars when you spend $1000 in the first 3 months.
So which to pick? We did the math for you. The trick is to look at your supermarket spending, as that’s where the huge difference is between the cards. It turns out that a yearly grocery bill of $2500 is the point where you would break even between the two cards. That is, with spending $2500 a year in supermarkets, Blue Cash Everyday holders would be left with $75 in rewards, while Blue Cash Preferred® Card from American Express holders would have $150 in rewards and $75 in costs (the annual fee), leaving them with a net of $75 as well. In other words, if you are spending more than $2500 per year on groceries (that’s $208 per month), then the Blue Cash Preferred card is the better deal for you. We suspect that is the grand majority of our readers, especially when you factor in the bit about buying gift cards at supermarkets.
Of course, when checking your spending to decide on a card, don’t forget to account for other credit cards you might be using. If you are already allocating certain purchases to another card, don’t count them for the potential new one.
If you live in the US, drive a car, buy clothes, and feed your household, get an American Express Blue Cash card! It might as well be cash in your pocket.