Cash Back Credit Cards Survey 2011

Credit Card Survey - We have just completed out 2010 cash back credit card survey, where we have surveyed and investigated 19 cash back credit cards in the market (as new cards appear, we will add them to the results). Out of this survey, we are doing a report here about the state of cash rebate credit cards. Here is our outline.

Table of Contents

Editors Choice - For those who don't want to read everything!.
Understanding Cash Back Formula
How Cards Pay Your Cash Rebates?
Caps on Rebates
Cash Back Credit Card Comparison Table


Editor's Choice - Our Top Pick

Most cash back credit cards offer a generic 1% cash rebates for every dollar that you spend on the card. The better ones offer better rebates when you spend on certain categories. The better cards can be separated into two camps. The first group of cards are what i would call rotating category cards. These cards offer 5% rebates on certain categories of expenses which change every quarter. They also have online shopping portals where you can earn anywhere from 2% to 20% with their shopping partners. The second group of cards are those that offer more than 1% rebates on certain categories the whole year round. The rebates tend to range from 2% to 3%. Below are our best recommendations. We're sure one or a combination of them will suit your spending needs and earn you the most rebates.

The Blue Cash Everyday(SM) from American Express is arguable the best cash back card for earning rebates on everday purchases like gasoline and supermarket the whole year round. Cardholders get to earn 3% rebates on supermarket purchases, 2% on gasoline and department store purchases. Unlike cards with "rotating categories, you can earn rebates all year round and not just each quarter with specific categories. I personally have this card also and the customer service is excellent. For a limited time, new cardholders will get $100 cash back bonus after spending $1,000 within the first 3 months.

The Discover® More Card is another great cash back credit card which offers cardholders the chance to earn 5% rebates on various categories each quarter and also through their online shopping portal where they can earn between 5% and 20% rebates with their merchant partners. In fact, their rebates for their online shopping merchants is consistently higher than other credit card shopping portals. Those of you who travel abroad will be also happy to know that Discover cards now also have no foreign transaction fee

The Chase Freedom® Visa - $200 Bonus Cash Back is actually a great cash back credit card. They offer 5% rebates on various categories like gas on a quarterly rotating basis and they also have online shopping portal where they have lots of online merchant partners where you can earn extra rebates shopping with them. Right now, Chase is offering a $200 cash back bonus for new cardholders that spend $500 during the first three months. I personally have this card and can testify that it is a really good card.

The True Earnings Card from Costco and American Express is another card we recommend to Costco members (especially Costco Executive Members). The reason is because you can earn extra rebates on gasoline, dining and travel (see screen shot below). To see why it makes for Costco members to get this card, reader our review of having a costco membership





Before you go on trying to choose the best cash back credit card, it is best that you first understand the different types of cash rebate cards that are available in the market today. Let's go through the different types of cash rebate formulas that credit card issuers offer these days.

Basic Rebates (1%) - Most cash back credit cards offer 1% rebates on all purchases that are made on the card. This is the standard for most rebate cards.

Tier Rebate System - Some cash back cards impose tiers on their rebate formula. That means that you have to spend above a certain amount every year to earn maximum rebates. This isn't necessary bad because cards like that tend to offer higher rebates. One example is the Blue Cash from American Express, which pays 5% rebates on some items only after you spend $6,500 on their card. Below that, the rebate you earn is slightly less.

Reverse Tiers - While some cards pay you the best rebates after you spend a certain amount on the card, some actually give you less rebates when your spending exceeds a certain amount.

More than 1% Rebates on Certain Items - The better cash rebate cards pay more than 1% rebates on certain types of spending. Such items include gasoline spending, spending at supermarkets, drugstore, utilities, travel, restaurants. They range from 2% to 5%. You typically want to choose these cards rather than the ones that simply pay you 1% on everything.

How Cards Pay Your Cash Rebate?

Different credit card issuers present their customers with different ways to redeem their cash rebates.

Statement Credits - Some credit card issuers pay you back the rebates you have earned in the form of statement credits. Many gasoline credit cards used to do this by rolling your statement credits to the following months statement. Hence, the next months statement is actually low by the amount of rebates you have earned the previous month. Some cards like the Blue Cash from American Express gives you a statement credit on the anniversary date. So for one month in the year, cardholders will find that they will have a month where their bill is lower than usual because of the rebates.

Rebate check by request - Some rebate credit cards require the card holder to call the customer service center to have a rebate check mailed to them. Very often, you need to have earned a minimum amount of rebates for them to write the check (usually $50).

Automatic rebate checks - Some cards will simply write you a check automatically once you have earn a certain amount.

Automatic Bank Account Credit - Some cards will automatically debit your bank account once you have earned a certain amount of rebates.

Caps on Rebates

No Caps - The better cash back cards usually have no limits to how much you can earn. For those who spend a lot, this will be an important feature.

Monthly or Annual Cap - Some cards cap the amount of rebates you can earn either monthly or annually. This is not necessarily a bad thing (it just depends on how much you spend versus what is the cap). You can also get more than one rebate card to get around any rebate caps, or if you have a spouse, simply get two identical cards. Some of the caps apply to all types of purchases while some may only apply to certain categories of expenses. For example, when gas prices were skyrocketing not too long ago, some rebate cards capped the rebates they paid only on gasoline spending.

Cash Back Credit Card Comparison Table

Below is a summary of the results of the cash back credit card survey

Different Types of Cash Rebate Credit Cards
There are many types of cash rebates credit cards, each with its own unique formula. In this article, we highlight the main types of cash back credit cards so you will have a better understanding when you make your choice.

A closer look at cash back credit cards that pay 5% rebates
Cash back credit card that pay 5% rebates on certain purchases offer the best value for consumers. In this article, we look at the these cards in greater detail.

How to combine cash back credit cards to earn maximum rebates?
While cash back credit cards that pay 5% rebates on certain purchases is a great way to earn rebates from your credit card purchases, combining cards can allow you to earn even more rebates. Find out how.

The End of 5% cash back credit cards?
Back a couple of years ago, cards with 5% rebates on certain items with no tiers were all the rage. But they have slowly disappeared. Does that signal the end of 5% cash back credit cards? In this post, we'll take a look at developments.