The Best Cash-Back Credit Cards of January 2020: Compare Current Offers, Rewards and Annual Fees

Maximize your rewards on everyday purchases and save on interest with these top cash-back credit cards.

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Cash-back credit cards offer some of the most valuable benefits consumers can want. Their rewards are extremely flexible — you can use cash for just about anything — and many of the best cash-back credit cards don’t charge an annual fee. And, if you’re looking for an introductory 0% APR promotion, you’re more likely to get it with one with a popular cash-back credit card than with a card that offers points or miles.

CASH BACK: Save Money With the Best Gas Credit Cards

Finding the best cash-back credit card for you can be time-consuming if you don’t know where to look. To help, we’ve put together a list of the best cash-back credit cards to make it easier to narrow down your search.

Best Cash-Back Credit Cards of January 2020

There’s no one credit card out there that’s best for everyone. The right one for you depends on your preferences and spending habits. Here are our top choices:

Review the methodology our credit card experts use to determine the best credit products in various categories.

Jump to frequently asked questions about cash-back credit cards.

1. Best Credit Card for Groceries: Blue Cash Preferred® Card from American Express

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Credit: Twenty20

For credit card users with a hefty grocery budget, you’ll have a hard time beating the Blue Cash Preferred Card from American Express. This card is best for families and others who spend a lot at supermarkets.

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  • Rewards Rate: The card offers an impressive 6% cash back on the first $6,000 spent each year at U.S. supermarkets (then 1%). That breaks down to $500 per month, so if you can manage to max out the category every year, that’s $360 in cash back. That’s not even including the card’s other cash-back rates. It also offers 6% cash back on select U.S. streaming subscriptions, 3% back at U.S. gas stations, and on transit including taxis/ride-share, parking, tolls, trains, buses and more, and 1% back on everything else.
  • Sign-Up Bonus: $250 statement credit after you spend $1,000 in the first three months. You’ll also get an introductory 0% APR on purchases and balance transfers for 12 months.
  • Why We Like the Blue Cash Preferred: We love this card because it makes it easy to rack up rewards in categories where virtually everyone spends money. There are, however, a few drawbacks to consider. First, the card charges a $95 annual fee, which is rare for a cash-back credit card. That said, maxing out the U.S. supermarket spending more than makes up for that. Speaking of supermarkets, it’s also important to note that superstores like Target and Walmart, and warehouse clubs like Sam’s Club and Costco, don’t fall under that category. So, if you do most of your grocery shopping with one of these retailers, you’ll earn just 1% back on those purchases. Finally, the only way to redeem your rewards is as a statement credit. There’s no option to get your cash-back reward deposited into your bank account, which limits your flexibility.
  • Who Should Use This Card? Families that spend a lot on groceries.
  • Annual Fee: $95

2. Best for Gas: Costco Anywhere Visa® Card by Citi

guy uses a gas pump
Credit: iStock.com /Adene Sanchez

If you’re a Costco member, you’ll earn incredible rewards on gas purchases with the Costco Anywhere Visa Card by Citi.

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  • Rewards Rate: 4% cash back on the first $7,000 spent on eligible gas worldwide, 3% back on restaurant and eligible travel purchases worldwide, 2% back on all other Costco and Costco.com purchases, and 1% back on everything else.
  • Sign-Up Bonus: The card doesn’t offer a sign-up bonus or an introductory 0% APR promotion. However, in addition to no annual fee, there’s also no foreign transaction fee, which is uncommon for cash-back credit cards.
  • Why We Like the Costco Anywhere Visa: We like the card because it offers a high rewards rate on gas purchases, doesn’t limit you to certain gas stations and offers great rewards on other common spending categories. Also, note that you only get your rewards once a year, in the form of a certificate you need to take to Costco to use for purchases or get cash back.
  • Who Should Use This Card? Costco Members
  • Annual Fee: The biggest drawback to the Costco Anywhere Visa, however, is that you need a Costco membership, which costs at least $60 per year, to get approved. If you already have a membership, it’s worth applying. But if you don’t, consider the Blue Cash Preferred Card instead.

3. Best for Dining and Entertainment: Capital One® Savor® Cash Rewards Credit Card

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Credit: Twenty20

For people who spend a lot on nights out with friends and family, the Capital One Savor Cash Rewards Credit Card may be a no-brainer.

  • Rewards Rate: The card offers an impressive 4% back on dining and entertainment, 2% back at grocery stores and 1% back on everything else. You’ll also earn 8% back on tickets at Vivid Seats through May 2020 and a one-time $300 cash bonus after you spend $3,000 in the first three months.
  • Sign-Up Bonus: $300 bonus after spending $3,000 within the first three months of opening an account.
  • Why We Like the Capital One Savor: We like the card because it makes it easy to earn as much cash back as possible when you’re out on the town. The Capital One Savor Cash Rewards Credit Card is best for people who spend a lot on dining out and attending concerts, sporting events and more.
  • Who Should Use This Card? People who dine out frequently.
  • Annual Fee: $95, which is waived the first year. This gives you some time to determine whether it’s the right fit.

4. Best for No-Annual-Fee: Chase Freedom Unlimited®

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Credit: iStock.com /ljubaphoto

Most of the best cash-back credit cards have no annual fee, but if you’re looking to maximize the value of your rewards without that yearly charge, the Chase Freedom Unlimited may be the way to do it. We love the card because of its potential to provide much more value than most cash-back credit cards with no annual fee. To maximize that value, though, you will need to apply for another credit card.

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  • Rewards Rate: Unlimited 1.5% cash back on every purchase you make.
  • Sign-Up Bonus: $150 cash back after you spend $500 in the first three months, and you can use your rewards to get cash back, buy gift cards, book travel and more. It also offers an introductory 0% APR on purchases and balance transfers for 15 months.
  • Why We Like the Chase Freedom Unlimited: What makes the card especially valuable is that if you have the Chase Sapphire Preferred® or Chase Sapphire Reserve®, you can pool your rewards with points earned with those cards. Both cards offer more value if you use your rewards to book travel through Chase (25% and 50% more, respectively). Also, they allow you to transfer your points to several airline and hotel rewards programs, giving you the chance to get even more value out of them.
  • Who Should Use This Card? People who want to maximize their rewards for travel with no annual fee.
  • Annual Fee: $0

5. Best Flat-Rate Credit Card: Citi® Double Cash Card

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Credit: iStock.com /Dean Mitchell

Making the most of certain everyday spending categories can provide more value for some. But if you’d rather have a straightforward cash-back rewards program, consider the Citi Double Cash Card. Read our full review of the Citi Double Cash Card to learn how to maximize rewards earnings.

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  • Rewards Rate: Flat 2% cash back on every purchase you make — that’s 1% back when you make a purchase than another 1% back when you pay it off.
  • Sign-Up Bonus: While there’s no sign-up bonus, you’ll also get an introductory 0% APR on balance transfers for 18 months, which can save you hundreds or even thousands on interest.
  • Why We Like the Citi Double Cash Card: We love the card because of its simplicity and high rewards rate — there aren’t many cards that offer this much or more as a base rewards rate. The card also doesn’t have an annual fee, which makes it a solid fit for people wanting to save as much as possible.
  • Who Should Use This Card? People who prioritize simplicity.
  • Annual Fee: $0

6. Best Rotating Categories Credit Card: Chase Freedom®

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Credit: Twenty20

If you spend a lot in different categories or you’re a rewards maximizer, the Chase Freedom could be an excellent choice.

  • Rewards Rate: 5% cash back on up to $1,500 in combined purchases in bonus categories each quarter you activate, and 1% back on everything else. Historically, the card’s 5% categories have included gas stations, tolls, drugstores, grocery stores, home improvement stores, select streaming services, department stores and purchases made using PayPal and Chase Pay.
  • Sign-Up Bonus: $200 cash bonus when you spend $500 in the first three months (this offer is valid only if you apply through Chase).  The card also offers an introductory 0% APR promotion on purchases and balance transfers for 15 months.
  • Why We Like the Chase Freedom: We like the card because it creates an opportunity to learn how to maximize your rewards on different spending categories. As with the Chase Freedom Unlimited, you can transfer rewards earned with this card to one of the Sapphire credit cards and get more value on travel redemptions.
  • Who Should Use This Card? People who spend a lot in different categories.
  • Annual Fee: $0

7. Best for Balance Transfers: Discover it® Balance Transfer

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Credit: Twenty20

If you have high-interest credit card debt and are hoping to maximize your interest savings, the Discover it Balance Transfer should be on your radar. The card offers an introductory 0% APR on balance transfers for 18 months and on purchases for six months.

  • Rewards Rate: Earn a substantial 5% cash back on bonus categories that rotate every quarter when you activate them, up to $1,500 spent quarterly. In 2020, those categories include grocery stores, Walgreens, CVS, gas stations, Uber, Lyft, wholesale clubs, restaurants, PayPal, Amazon.com, Walmart.com and Target.com.
  • Sign-Up Bonus: The card doesn’t offer a traditional sign-up bonus, but Discover will match all the cash back you earn during the first year. So, you’re essentially earning 2% back on most purchases and 10% back on bonus categories.
  • Why We Like the Discover It Balance Transfer: We love this card because it combines valuable savings on balance transfers and incredible rewards on everyday spending, especially during the first year.
  • Who Should Use This Card? Cash-back fans who need to pay down some credit card debt.
  • Annual Fee: $0

8. Best for Sign-Up Bonus Offer: Bank of America® Premium Rewards® Visa® Credit Card

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Credit: Twenty20

If you’re looking to get as much value as possible up front, consider the Bank of America Premium Rewards Visa credit card. The card offers 2 points per dollar on travel and dining and 1.5 points per dollar on everything else. Here’s the kicker, though: If you’re a Bank of America Preferred Rewards client, you could earn up to 75% more rewards — that’s 3.5 points per dollar on travel and dining, and 2.62 points per dollar on everything else. To qualify for the program, you need to have three-month-average combined balances of $20,000 or more in qualifying Bank of America banking accounts and/or Merrill investment accounts.

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  • Rewards Rate: 2 points per dollar spent on travel and dining. 1.5 points per dollar spent on everything else.
  • Sign-Up Bonus: You’ll earn 50,000 bonus points after you spend $3,000 in the first 90 days, which is worth $500 in cash back or travel booked through Bank of America.
  • Why We Like Bank of America Premium Rewards Visa: We love this card because it acts as a travel card with its perks, but you can still get the flexibility of cash back. The card charges a $95 annual fee, but you can easily get that money back each year through its annual $100 airline incidental statement credit, which is automatically triggered when you pay for certain purchases, such as seat upgrades, baggage fees, in-flight services and airline lounge fees. You’ll also get an application fee credit every four years for Global Entry or TSA PreCheck, which is worth up to $100.
  • Who Should Use This Card? People who travel at least a couple of times per year.
  • Annual Fee: $95
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Credit: iStock.com /Chaay_Tee

Methodology: How We Select the Best Cash-Back Credit Cards

We chose our best cash-back credit cards based on the total value they offer based on certain spending categories, preferences (flat rate versus rotating categories), sign-up bonuses and other features. Because everyone has a different idea of what they want from a credit card, we included as many different angles as possible.

While most cash-back credit cards don’t charge an annual fee, we included a few that do, but only because they offer enough value to make up for the fee on an ongoing basis. As you consider which card is right for you, compare these cards, as well as other top credit card offers, to make sure you get the best fit for you.

Frequently Asked Questions About Cash-Back Credit Cards

Are you ready to start saving money on groceries, gas, travel, dining and just about any other place you spend money, but you’re still uncertain about how cash-back credit cards work? No problem! Scroll through some of the most common questions people have about cash-back credit cards.

Table of Contents

Click the links to quickly navigate the topics covered in the frequently asked questions.

How Cash-Back Credit Cards Work

Unlike travel rewards credit cards, you don’t have to be a pro at playing the credit card game to benefit. Cash-back cards are easy to keep track of and user-friendly. These types of cards typically fall in one of the following categories:

  • Flat Rate: A flat rate card usually offers 1.00–2.50% back on all purchases, whether you buy a trip to Italy or a gallon of milk. The benefit of flat-rate cash back is that you can keep a minimal wallet and have an easier time keeping track of your credit card spending.
  • Tiered: Tiered cards vary the cash-back rewards based on what you purchase. A tiered card might offer a flat 1% cash back on the majority of purchases and 3% back on gasoline spending. Many times, the higher-earning tier is capped. A tiered card can help you earn more, as long as you select a card that rewards you the most for what you spend the most on.
  • Rotating Categories: Credit cards with rotating cash-back categories usually have a set 1% cash-back rate and then a higher rate, like 5% back on select categories. These categories rotate with the quarters of the year. For example, you might earn 5% back on all grocery purchases in the first quarter of the year.

Common Cash-Back Categories

buying groceries
Credit: Twenty20

New credit cards are released frequently and some like to gain attention with attention-grabbing cash-back offers, like offering 6% back for your favorite streaming service. Most cards, however, offer cash-back perks in the same core categories:

  • Supermarkets
  • Restaurants
  • Gas stations
  • Transportation
  • Wholesale
  • Entertainment

To find the best cash-back credit card, you need to keep track of your spending. Where do you spend the most money? If you spend more money on restaurants than groceries each month, then look for cards that will give you more back for dining out. If your spending is even throughout the cash-back categories, then a higher, unlimited, flat-rate, cash-back card might be a better choice for your finances.

Cash-Back Credit Cards Versus Travel Credit Cards

Cash-back credit cards and travel cards are very similar. With travel-branded credit cards, you will earn more back when you spend on travel-related purchases, such as airfare or hotels. Most travel cards also offer the best reward rate when you redeem your rewards toward travel, either through the credit issuer’s travel platform or by transferring points to a travel partner.

EARN: Everything You Need To Know About Saving Money With Gas Credit Cards

Many times, redeeming travel rewards card points for cash means you are getting a lower cash-back rate. It is wise to know how far points will go toward travel versus cash before redeeming them. Travel credit cards can also come with more travel perks, such as access to airport lounges or travel insurance. With these perks can also come annual fees, so it is best to weigh the fee with the perks before signing up.

When trying to decide which card is best for you, consider how much travel you plan on doing. If you love the idea of traveling but aren’t gung-ho to explore the world just yet, a cash-back card might be an easier card to start with.

How To Compare Cash-Back Credit Cards

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Not all cash-back credit cards are the same. The card that your friend can’t stop raving about might not be a good fit for your spending habits. Here’s what you need to look at before deciding which card is for you:

  • Annual Fee: If the card has an annual fee, is it worth paying? Some annual fees seem expensive up front, but when you consider how much cash back you receive, along with other perks, you might realize it is worth paying. Remember, even if a card has $1,000 worth of perks that make a $250 annual fee seem worth paying for, it is only worth it if you actually use those perks.
  • Bonus Offer: Sign-up bonuses sweeten the pot. However, make sure you can afford to meet the sign-up bonus. If spending $4,000 in three months will put you into financial hot water, look for a card with a lower bonus offer spending requirement.
  • Redemption: How easy is it for you to redeem your cash back? Look for cards that make it easy to transfer your rewards back to your bank account or that will allow you to spend them on Amazon for the same redemption rate.
  • Intro APR: Looking to make a big purchase up front? A 0% intro APR can save you money on interest and give you more time to pay off your purchases.
  • Special Features and Benefits: Do the cards come with special perks that will save you money throughout the year?
  • Ongoing Rewards: Look for cards with regular opportunities to earn more back rather than choosing a card that only has amazing rewards during the first year.

Pros and Cons of Using a Cash-Back Card

Everything in life has its pros and cons, and cash-back cards are no different. Consider these points before making your decision:

Pros:

  • Simplicity: Cash-back cards are easy to keep track of and it is quick to convert your rewards to cash back in your bank account.
  • No or Low Annual Fees
  • Low Bonus Requirements: You won’t have to dish out a lot of cash to get the sign-up bonus.
  • Builds Credit

Cons:

  • Lack of Travel Benefits
  • Cash Back Can Expire: Some cards say cash back never expires but this is only true if you use your card regularly.
  • Low Sign-Up Bonuses: While you won’t have to spend a lot up front to earn the bonus, the sign-up bonus is also a lot smaller than what popular travel cards offer.
  • Fewer Perks

How To Make the Most of a Cash-Back Card

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Credit: Twenty20

Once you have decided on the right cash-back card for your wallet, you want to make sure you get the most out of the card. Here are a few tips to increase your perks after approval:

  • Plan to get the bonus. Divide the spending requirement by the sign-up bonus time frame to ensure you are spending enough each month. For example, if you must spend $3,000 in 90 days, plan how you will spend $1,000 each month without messing with your budget.
  • Use the shopping portal. Don’t forget to browse the card issuer’s shopping portal to increase how much cash back you can receive on a purchase. If you were already planning to send your mom flowers for Mother’s Day, you might as well use a vendor through the shopping portal that is offering 10-15% cash back when you use your card.
  • Look for rewards bonuses and multipliers. Keep your eye on special rewards bonuses offered throughout the year. For example, some cards were giving a $100 credit for spending $500 on select cruises.
  • Take advantage of rotating bonus categories. If your card offers rotating bonus offers, then spend a few minutes of planning to capitalize on them each year. For example, if your first quarter bonus category is 5% for groceries, consider spending more on groceries during those first three months. Buy extra pantry staples and meat to deep freeze, so that you can shop less in the months to come.

NEXT: The Best Rewards Credit Cards: Compare Offers, Rewards and Perks

We want to make sure you get the best deal! Our editors strive to ensure that the information in this article is accurate as of the date published, but please keep in mind that offers can change. We encourage you to verify all terms and conditions of any financial product before you apply. Also, please remember this content wasn’t provided, reviewed or endorsed by any company mentioned in this article.

Ben Luthi

Ben Luthi is a personal finance and travel writer and credit card expert. He has a degree in finance from Brigham Young University and worked in financial planning, banking and auto finance before writing full-time for NerdWallet and Student Loan Hero. Ben is now a full-time freelance writer and enjoys traveling and spending time with his two kids. His work has appeared in several publications, including U.S. News & World Report, USA Today, Money, Success and Slickdeals.

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