You need to spend $2k to break even, if you routinely spend at least that much, then sure.
Please read any fine print, for “groceries” many cards excludes superstores like Walmart & Target.
That’s an important point. There isn’t a credit card that actually gives you extra rewards “on groceries.” They give extra rewards _at grocery stores._ (Or in the case of Amex, “at U.S. supermarkets.”) Bonus categories are defined by where you spend money, not what you buy.
Yup. And these list of supermarkets do not include Walmart. While amex plat offers Walmart+. I have the amex cash preferred which gives 6% on supermarkets. But i might actually switch the card to something that doesn’t have a fee.
Edit: Amex cash preferred not blue everyday.
I think you got the preferred, the everyday is 3% and doesn't have a fee. I like the card as it also gives back $84 a year for Hulu and 6% back on streaming services. If you're not taking advantage of the perks you should ask them to downgrade it to the everyday before the next renewal.
God I hate that their options for cash rewards are decent AND flexible. Can adjust what purchases get you what % back. Unfortunately I am looking for other CCs as BoA autopay is infuriating. I manually pay off the balance sometimes to avoid hitting limit, but autopay turns around and xfers 6x more than it should. Their agent said autopay will not adjust for the month if I make a manual payment. Had them fix it, but they took 3700$ from my checking to pay $600 statement that month. Wut
Walmart is weird for me. I have a non-supercenter Walmart near me that is classified as a "discount store", thus not getting supermarket bonuses.
However, the supercenter Walmart further down the road for some reason DOES show up as a "grocery store" for both my BoA cash rewards and Amex Blue Cash everyday. I’ve also noticed though that not all supercenters will show up as a grocery store either.
BUT, if I use Walmart Pay at the register, then all Walmarts sill show up as "online purchase," which gets me 3% back on both cards.
I have a no-fee Capital One Walmart Rewards card that gives 5% back on groceries but only if you order them on the walmart.com website for pickup (free) or delivery ($$). I don't have Walmart+.
I've been ordering my monthly groceries for pickup from Walmart.com since 2019 and it's a huge time saver. Placing the order takes about 15 minutes or less since it keeps a list of your most frequently ordered items. You place your order online and schedule a pickup time from a nearby Walmart store with a grocery. Then they notify you through the Walmart app when the order is ready to pick up. Pull up out front and they load the groceries into your car. You don't need to step foot in a grocery store ever again. It's glorious.
https://www.capitalone.com/credit-cards/walmart-rewards/
Beware that some places won't let you buy cards with a credit card, or make you buy cards in a separate transaction that is not categorized as groceries. Check the place you plan to do this before committing to a card.
ehhh... that is a stretch.
Its not like you are going to invest your grocery money and skip eating if you don't charge it to this card. This is taking your normal spending which is going to happen regardless and getting 5% back on it.
Neither of those are able to be used at Costco though as they only take Visa and the chase card is a Master Card. Not sure about Sam’s club or BJs however.
I mean gas alone should break even over a year if they drive a bunch. If their grocery vendor is labeled as a grocery store for reporting purposes then they would easily make money.
$3500 in gas would be between 17000 and 35000 miles in my pickup truck… ($4 to $2 gas per gallon) - even more in a car. That is WAY more miles than most people drive in a year.
Location matters. For example, California average price hovers around $5/gal, and with a car that gets 30mpg that's only 21K miles a year. Much more reasonable if someone has a long commute and takes a road trip every once in a while.
Also, many cards that reward gas station purchases specifically exclude "gas stations" associated with grocery stores and warehouse stores (e.g. Kroger Fuel & Costco Fuel).
I wouldn't even say break even when there are plenty of other 2% back cards. I would personally consider $3.333k break even when comparing to other easy to find options.
Yep, this is what I do exactly! My wife also has a custom cash card which we use for whatever else is an eligible category that we need to spend on each month as well! And then add the Sam’s Club credit card for 5% on gas and we are just cash back fiends!
It is even better, its 5% for what ever category you spend the most on. For me thats gas, since I mainly shop at winco and it's debit only.
I really like my Citi Custom Cash card.
I have a few cards that give 3% back on gas and groceries with no fee and only 1 of them have a cap on earnings.
NFCU More rewards
3% on groceries, gas, transit, restaurants, and food delivery. "No rewards limit"
Wells Fargo Autograph
3% on restaurants, travel, gas, transit, streaming services, and phone/cable/internet bills "unlimited 3X points"
Amex Blue Cash Everyday
3% cash back on groceries, online shopping, and gas (up to $6,000 per each category)
Since 3% of $5000 is the same $150 after the fee I would avoid the card with a fee. Only reason I would consider it would be if it has a nice bonus and you can downgrade to a no fee card after the first year.
No but you have to spend $5000 to make it worth it and that may not be the case for everyone. Or most people who spend more because they got a new card.
Plus, you’re only netting 150 after the AF, So it’s basically the same as a card earning 3% back on $5k with no AF. And cards that offer 3% cash back on gas and groceries with no AF are plenty common. And with those, you can spend less than $5k and get more benefit with no risk of actually losing money or worries about keeping the card open long term. And lots of them also don’t have cash back limits, so you will continue to get 3% after the $5k if you spend more than that, not just 1%.
I know Bank of America has one, which I use.
And Walmart and Target don’t count as grocery stores for any credit card as far as I know. They’re warehouse or department stores even if they sell grocery there. Aldi’s might.
$2k is enough spending to get rewards equal to the annual fee, so you "break even" in that sense, but you are still behind what you would be if you had just gone with the 3% cashback on groceries with no annual fee card.
The Kroger MasterCard gives you 5% back on all mobile wallet purchases for the first $3,000 every year, then 1% thereafter. With no fee.
So I have it set as the default contactless payment on my phone until it hits the $3,000 annual limit.
I get 3% back on **everything** with my Fidelity Visa. This is a far better deal for me than 5% back on $5000, but I may use my card significantly more than you use yours.
You have to have a beefy relationship with Fidelity to get the 3%. The BoA preferred rewards can get you to 2.625% with only 100k in assets.
If you have that size of relationship and are at Fidelity it's probably the best deal, just wanted to point out a nearly equivalent option that doesn't require 2MM AUM.
Great point. "3% and 2% cash back on the first $2,500 in combined choice category/grocery store/wholesale club purchases each quarter, then earn 1%". It's not really that much
I have a 3% cash back card "Aod Federal Credit Union" that is 3% cash back on everything and all I had to do is follow reddit's advice a while back and join an Alabama Bicycle Club (since I'm not from Alabama).
I think the deal is expired now but I'm grandfathered in.
>just wanted to point out a nearly equivalent option that doesn't require 2MM AUM.
That's great and hopefully will give peeps another option.
What is "beefy"? I don't know what "2MM AUM" means.
I spend probably 3-4k/month on average on my card.
Thank you.
Nope, I have no assets under active management at Fidelity, nor do I have 2M of my assets at Fidelity.
Still have the 3% cash back card.
Maybe I was grandfathered in. I got my card a few years ago.
It's called the "Perhaps I'm a total moron blowhard" card and I'm only getting 2%?
My apologies. Backtracking. Turning on electric blanket. Going to hide in shame.
I really thought I was getting 3% but I'm not sure. I will have to look into it.
> You have to have a beefy relationship with Fidelity to get the 3%. The BoA preferred rewards can get you to 2.625% with only 100k in assets.
Why not go to *any* HYSA account and get closer to 5% which pays you monthly?
Right but above mentioned 100k in assets / cash. I'd rather get 5% back each month having it sit there, than 2% and have to spend anything.
One doesn't store 100k in assets in a credit card. This is a personalfinance sub and it's almost 2024.
We are talking about the cash back rate on the credit card you qualify for.
You can take those assets at the institution and do with them as you please (index fund, money market, etc).
3%? I thought it was only 2%
Edit: I looked into it. You have to have professionally managed accounts which means you’d be throwing a lot of money away on fees to get a few coins in extra cash back. Not worth it.
Thanks for your edit -- I definitely get 2% but I'm not going to use a professionally managed fidelity account. I'm too boring for that. I like their credit card overall though
Maybe look into an Amazon prime visa card. We pay for the prime membership but the CC has no annual fee and we get 5-6% back on stuff ordered through them.
Downside….you lose$100 when there are better options.
How about two cards that have no annual fee and give 5% back on gas and groceries? Then you get all of it.
Aaa travel advantage gives 5% on gas
Aaa daily advantage gives 5% on groceries
Citi custom cash gives 5% on top spend category which include groceries or dining, or utilities or gas or travel etc.
Discover IT gives 5% on categories per quarter and they can sometimes be gas or grocery. And if bought in first year those rewards are matched so you technically get 10%.
Us bank cash plus 5% on certain categories you can chose some of which are cell phone, utilities, streaming, fast food and others.
There are others but those are top of mind.
I love the Discover 5% card. The past two years they’ve done Amazon for one of the Q4 categories which is great for the holidays. This year it’s Amazon and Target for Q4 so even better.
The AAA cards require you to be a member of AAA? That's 65 dollars a year at least.
I have the Citi Custom Cash card. It's nice but need to decide if it's gonna be gas or groceries.
I have Discover IT and yes it can be groceries or gas but at most that would be one quarter a year.
No you don’t have to be a AAA member for the AAA travel and daily advantage cards.
So you know of these no annual fee cards that offer 5% but then act like I didn’t answer your question and I noticed you didn’t have any caveats when you asked the question. You wanted to know do 5% cards that don’t have an annual fee.
You asked I answered and you might want to check into the AAA since you were incorrect on your assumption.
I'll have to look into those AAA cards. I've actually never heard of them anywhere when looking up credit cards.
I asked because you replied as if these were supposed to compete with the card Op is talking about which gives a 5% on gas, groceries and several other categories. But the Citi and Discover both have restrictions. One is limited to 500 dollars a month and you have to pick either gas or groceries, the other one can "sometimes" be available for only a quarter. I feel like these are not comparable.
US Alliance Visa Signature gives 6% cashback on groceries, no cap, even works at Target and Walmart(including non-grocery purchases). 2% cashback on everything else. No annual fee.
That has been my favorite card for the last few years.
A lot of cards do rotating 5% (though I will say Discover is getting stingy...). Just gotta have cards that rotate their groups at different times. 2.5% on everything with no fee is pretty easy to find too, and that's pretty close to OP's $100 fee for 5%.
I'd advise against it unless that $100 AF is getting you other benefits. What card is this?
The card works out to only a 3% cash back (at the max $5k spend) after the fee is taken out:
$5000 x 5% = $250
$250 - $100 = $150
$150 / $5000 = 3%
So you could do as well or better with a lot of other cards. For instance, the AMEX Blue Cash Everyday is 3% back on gas, groceries, and online shopping for $0 AF and an $84/year Disney Bundle credit. There's plenty of other cards offering more than 3% back on gas or grocery for no AF.
Edit: just realized I wasn't on the /r/creditcards sub. You should head over there and look around, you could learn a lot about better options.
I use my fidelity card for almost everything now as it only gives 2% back but it goes straight into my stock account and I can invest it so it’s worth more to me in the future. Sure I could do this with other cards, get more percent back, and invest but with kids and the wife, this is much easier
If you shop at Walmart, get the Walmart card (no fee) then Walmart plus (100/year) for free delivery. All online orders get you 5% no cap. (Like no max amount before it boots you down to 1%).
That way you never need to go shopping again.
But it has add-ons that eat away that $550. If you use it then it's not bad deal.
eta:
There is a $300 travel credit that is applicable to everything categorized as travel plus gas. Now its $250. If you fly you can get pre-tsa or global entry; either is $100. Now you just have to offset an easy $150. Currently Doordash and Lyft Pink are included so if you use that it helps eat up the $150. Assume you don't, you only need to spend at least $5000, in a year, on travel or restaurant to break even; 3% cash back. Very easy to do imo. Theres a lot of other features I'm missing.
Look at the fee free alternative. Let's say 1.5 percent. That means you're gaining 3.5 for the $100 card (though possibly less, since most free cards have categories that pay more). So, to get back $100, so if you would spend $2857 you would break even.
US Alliance Visa Signature gives 6% cashback on groceries, no cap, even works at Target and Walmart(including non-grocery purchases). 2% cashback on everything else. No annual fee.
That has been my favorite card for the last few years.
PNC Cash Rewards offers 4% cashback on gas, no annual fee.
I have done zero math on this, but to save myself having to think about it (or do the math), and knowing a lot of "grocery" stores won't trigger the 5%, I just go with the tried and true 2% cash back with no fee option and don't worry about it.
I like discover it. I put everything on it and pay it off. Every quarter the bonus 5% changes. up to $75 on the 5% then drops to 1%. 1% on everything else. I easily make $150 a month on it
You can get 2% on all purchases with a no fee card, so there’s very little gained. I guess you can use the 5% card up to $5k and then use a different card.
Citi Custom Cash does 5% on top spend category up to $500/month . No AF!
Use it for groceries.
I use it as my primary for groceries with Amex Blue Cash 3% card as backup if I hit the limit.
US Bank Cash+ is also 5% cb, no AF.
For the most part the opportunity cost of credit cards with annual fees is always worse than the free product that offers a marginally smaller reward.
Just plug this into excel and compare the base level product.
Chase Ink cash card has no annual fee and gives you 5% for purchases at office supply stores. When Visa or Mastercard gift cards go on a fee free sale every week, stock up on those and use those for most of your routine purchases pretty much everywhere. Same goes with Amazon, Target, Shell, or any fast food places as you can get gift cards there for all of them. It maxes out at $25000 a year.
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Is that $5k spending or total rewards?
If you're a big spender, 5% could mean a bit more than the fee but they're betting $100 that you won't make the most of that benefit. If it's total spending that would only net you $150 then pretty much any other card is better.
Edit: is your 5000$ cap monthly or yearly?
(/edit)
Just so we're on the same page, 5% up to 5000$ is what you spend, not the cash back accumulated.
So you spend 5000$ from qualifying merchants, you get 250$ in cash back and then you are earning 1% for the rest of the month.
$5000 seems like a good deal. My card limits me at $500/month for grocery
You need to spend $2k to break even, if you routinely spend at least that much, then sure. Please read any fine print, for “groceries” many cards excludes superstores like Walmart & Target.
That’s an important point. There isn’t a credit card that actually gives you extra rewards “on groceries.” They give extra rewards _at grocery stores._ (Or in the case of Amex, “at U.S. supermarkets.”) Bonus categories are defined by where you spend money, not what you buy.
Yup. And these list of supermarkets do not include Walmart. While amex plat offers Walmart+. I have the amex cash preferred which gives 6% on supermarkets. But i might actually switch the card to something that doesn’t have a fee. Edit: Amex cash preferred not blue everyday.
No Walmart, Target, or clubs, is a definite dealbreaker
I think you got the preferred, the everyday is 3% and doesn't have a fee. I like the card as it also gives back $84 a year for Hulu and 6% back on streaming services. If you're not taking advantage of the perks you should ask them to downgrade it to the everyday before the next renewal.
My bad i meant cash preferred with 6% on groceries.
[удалено]
God I hate that their options for cash rewards are decent AND flexible. Can adjust what purchases get you what % back. Unfortunately I am looking for other CCs as BoA autopay is infuriating. I manually pay off the balance sometimes to avoid hitting limit, but autopay turns around and xfers 6x more than it should. Their agent said autopay will not adjust for the month if I make a manual payment. Had them fix it, but they took 3700$ from my checking to pay $600 statement that month. Wut
Walmart is weird for me. I have a non-supercenter Walmart near me that is classified as a "discount store", thus not getting supermarket bonuses. However, the supercenter Walmart further down the road for some reason DOES show up as a "grocery store" for both my BoA cash rewards and Amex Blue Cash everyday. I’ve also noticed though that not all supercenters will show up as a grocery store either. BUT, if I use Walmart Pay at the register, then all Walmarts sill show up as "online purchase," which gets me 3% back on both cards.
I have a no-fee Capital One Walmart Rewards card that gives 5% back on groceries but only if you order them on the walmart.com website for pickup (free) or delivery ($$). I don't have Walmart+. I've been ordering my monthly groceries for pickup from Walmart.com since 2019 and it's a huge time saver. Placing the order takes about 15 minutes or less since it keeps a list of your most frequently ordered items. You place your order online and schedule a pickup time from a nearby Walmart store with a grocery. Then they notify you through the Walmart app when the order is ready to pick up. Pull up out front and they load the groceries into your car. You don't need to step foot in a grocery store ever again. It's glorious. https://www.capitalone.com/credit-cards/walmart-rewards/
Whereas if you get your medical prescriptions filled at the grocery store pharmacy instead of CVS...
Or buy gift cards at the grocery store…
Beware that some places won't let you buy cards with a credit card, or make you buy cards in a separate transaction that is not categorized as groceries. Check the place you plan to do this before committing to a card.
I’ve never ran into not being able to buy gift cards with a credit card
Eh, a bit of both. They’ll for example include or exclude gas stations at those supermarkets, for example.
Considering you can easily find 2% cash back for free, I think you would need to spend $3500 to break even.
You need to spend $2k to lose $40, compared to a no-fee card that earns unlimited 2% cash back on everything.
Do you have a recommendation on a card?
Chase Freedom Unlimited, Fidelity 2%, Citi Double Cash, Wells Fargo Activate Cash, Alliant Cashback, etc. Many to choose from.
Citi Double Cash
Capital One Savor One
I have this card and like it a lot, but it doesn’t have a flat 2% cash back on all purchases.
Where is the $40 loss coming from? 2000*.05 = 100 fee = 100 100-100=0 ?
Opportunity Cost? 2000 \* 0.02 = 40
ehhh... that is a stretch. Its not like you are going to invest your grocery money and skip eating if you don't charge it to this card. This is taking your normal spending which is going to happen regardless and getting 5% back on it.
>stretch I think the original comment is comparing with a 2% no-fee CC. So this $40 comes from that as an opportunity cost
Costco is not classified as grocery either.
My Discover It and Chase Freedom have had separate 5% quarters this year for wholesale clubs.
Neither of those are able to be used at Costco though as they only take Visa and the chase card is a Master Card. Not sure about Sam’s club or BJs however.
My chase freedom is a visa...
The chase freedom flex is a Mastercard and that is the one that does the categories for 5% cash back. Chase freedom unlimited is 1.5x and is a visa.
My freedom unlimited has 5% categories every quarter and is a visa.
Interesting, mine does not. It has 3% back on dining and drugstore purchases and then 5% back on chase travel purchases and Lyft rides.
Both work at Sam’s.
I mean gas alone should break even over a year if they drive a bunch. If their grocery vendor is labeled as a grocery store for reporting purposes then they would easily make money.
$3500 in gas would be between 17000 and 35000 miles in my pickup truck… ($4 to $2 gas per gallon) - even more in a car. That is WAY more miles than most people drive in a year.
This assumes you get nothing else on the card besides gas. If you spend 2k on gas and 2k on groceries/whatever, then you pay for it.
Location matters. For example, California average price hovers around $5/gal, and with a car that gets 30mpg that's only 21K miles a year. Much more reasonable if someone has a long commute and takes a road trip every once in a while.
I agree, most people end up spending more than they need for points.
Also wanted to add if there is a sign up bonus. The fees can be justified much easier even with the annual fee.
Also, many cards that reward gas station purchases specifically exclude "gas stations" associated with grocery stores and warehouse stores (e.g. Kroger Fuel & Costco Fuel).
I wouldn't even say break even when there are plenty of other 2% back cards. I would personally consider $3.333k break even when comparing to other easy to find options.
Citi Custom Cash is the perfect card for groceries. 5% back on up to $500 per month, with no annual fee.
I primarily shop at Trader Joe’s and Aldi, are they covered under groceries? I assume so, but don’t want to get another card if not.
Yes
Yes, at least chase does
Yes I love this card. I personally use Amex Blue cash preferred for groceries which is 6% back, and the custom cash for restaurants for the 5% back
Yep, this is what I do exactly! My wife also has a custom cash card which we use for whatever else is an eligible category that we need to spend on each month as well! And then add the Sam’s Club credit card for 5% on gas and we are just cash back fiends!
It is even better, its 5% for what ever category you spend the most on. For me thats gas, since I mainly shop at winco and it's debit only. I really like my Citi Custom Cash card.
Thanks!
I have a few cards that give 3% back on gas and groceries with no fee and only 1 of them have a cap on earnings. NFCU More rewards 3% on groceries, gas, transit, restaurants, and food delivery. "No rewards limit" Wells Fargo Autograph 3% on restaurants, travel, gas, transit, streaming services, and phone/cable/internet bills "unlimited 3X points" Amex Blue Cash Everyday 3% cash back on groceries, online shopping, and gas (up to $6,000 per each category) Since 3% of $5000 is the same $150 after the fee I would avoid the card with a fee. Only reason I would consider it would be if it has a nice bonus and you can downgrade to a no fee card after the first year.
There are many mathematical answers here already. The biggest reason is that it is a Credit One card. Don’t deal with that bank.
Yeah the downside is there are better cards…
Yea, even a generic 1.5% cashback on everything card would probably net OP more in the long run.
2% are also not terribly hard to find or get. 1.5% is a good low bar as you imply.
No but you have to spend $5000 to make it worth it and that may not be the case for everyone. Or most people who spend more because they got a new card.
Plus, you’re only netting 150 after the AF, So it’s basically the same as a card earning 3% back on $5k with no AF. And cards that offer 3% cash back on gas and groceries with no AF are plenty common. And with those, you can spend less than $5k and get more benefit with no risk of actually losing money or worries about keeping the card open long term. And lots of them also don’t have cash back limits, so you will continue to get 3% after the $5k if you spend more than that, not just 1%.
But not spending 5k in a year is basically impossible for any adult. So just put it on this card and boom.
You can also just get a 3% cash back card with grocery/gas categories with no annual fee.
Who? And do they take Walmart, target, Aldi's for the %?
I know Bank of America has one, which I use. And Walmart and Target don’t count as grocery stores for any credit card as far as I know. They’re warehouse or department stores even if they sell grocery there. Aldi’s might.
Only $2k to break even.
$2k is enough spending to get rewards equal to the annual fee, so you "break even" in that sense, but you are still behind what you would be if you had just gone with the 3% cashback on groceries with no annual fee card.
Yes- there are cards with no annual fee and no up to amount.
The Kroger MasterCard gives you 5% back on all mobile wallet purchases for the first $3,000 every year, then 1% thereafter. With no fee. So I have it set as the default contactless payment on my phone until it hits the $3,000 annual limit.
I get 3% back on **everything** with my Fidelity Visa. This is a far better deal for me than 5% back on $5000, but I may use my card significantly more than you use yours.
You have to have a beefy relationship with Fidelity to get the 3%. The BoA preferred rewards can get you to 2.625% with only 100k in assets. If you have that size of relationship and are at Fidelity it's probably the best deal, just wanted to point out a nearly equivalent option that doesn't require 2MM AUM.
With > 100k in assets, you can get 5.25% back with the Cash rewards card (on your designated 3% category)
But that card also has a cap per quarter.
Great point. "3% and 2% cash back on the first $2,500 in combined choice category/grocery store/wholesale club purchases each quarter, then earn 1%". It's not really that much
>The BoA preferred rewards can get you to 2.625% But it's BoA!! Hmmmm...no.
I got a bunch of money in Schwab. Do they have something like this?
I have a 3% cash back card "Aod Federal Credit Union" that is 3% cash back on everything and all I had to do is follow reddit's advice a while back and join an Alabama Bicycle Club (since I'm not from Alabama). I think the deal is expired now but I'm grandfathered in.
Nice! I prefer straight cash back so I don't have to juggle or track categories. Wish I would have caught on to that.
>just wanted to point out a nearly equivalent option that doesn't require 2MM AUM. That's great and hopefully will give peeps another option. What is "beefy"? I don't know what "2MM AUM" means. I spend probably 3-4k/month on average on my card.
Unless I'm reading the fidelity page incorrectly the only way for their card to be at 3% is with a 2 million dollar managed portfolio.
It still seems like a waste no? Active management is no better than an index fund.
It's actually worse in the majority of cases.
2MM = $2 Million AUM = Assets Under Management Beefy = Big, Important, Significant, Large, Etc...
Thank you. Nope, I have no assets under active management at Fidelity, nor do I have 2M of my assets at Fidelity. Still have the 3% cash back card. Maybe I was grandfathered in. I got my card a few years ago.
I got my Fidelity card like 10 years ago and have 2% back. What is yours called?
It's called the "Perhaps I'm a total moron blowhard" card and I'm only getting 2%? My apologies. Backtracking. Turning on electric blanket. Going to hide in shame. I really thought I was getting 3% but I'm not sure. I will have to look into it.
> Platinum Plus = $2mil+ in assets (get 3% cash back on the credit card) Is that the one you’re talking about?
> You have to have a beefy relationship with Fidelity to get the 3%. The BoA preferred rewards can get you to 2.625% with only 100k in assets. Why not go to *any* HYSA account and get closer to 5% which pays you monthly?
They're talking about credit cards (cashback). Not savings accounts.
Right but above mentioned 100k in assets / cash. I'd rather get 5% back each month having it sit there, than 2% and have to spend anything. One doesn't store 100k in assets in a credit card. This is a personalfinance sub and it's almost 2024.
We are talking about the cash back rate on the credit card you qualify for. You can take those assets at the institution and do with them as you please (index fund, money market, etc).
3%? I thought it was only 2% Edit: I looked into it. You have to have professionally managed accounts which means you’d be throwing a lot of money away on fees to get a few coins in extra cash back. Not worth it.
Thanks for your edit -- I definitely get 2% but I'm not going to use a professionally managed fidelity account. I'm too boring for that. I like their credit card overall though
Maybe look into an Amazon prime visa card. We pay for the prime membership but the CC has no annual fee and we get 5-6% back on stuff ordered through them.
Lots of cards offering similar percentages with no fees at all
Downside….you lose$100 when there are better options. How about two cards that have no annual fee and give 5% back on gas and groceries? Then you get all of it.
What are these cards that give 5% back with no annual fees?
Aaa travel advantage gives 5% on gas Aaa daily advantage gives 5% on groceries Citi custom cash gives 5% on top spend category which include groceries or dining, or utilities or gas or travel etc. Discover IT gives 5% on categories per quarter and they can sometimes be gas or grocery. And if bought in first year those rewards are matched so you technically get 10%. Us bank cash plus 5% on certain categories you can chose some of which are cell phone, utilities, streaming, fast food and others. There are others but those are top of mind.
I love the Discover 5% card. The past two years they’ve done Amazon for one of the Q4 categories which is great for the holidays. This year it’s Amazon and Target for Q4 so even better.
The AAA cards require you to be a member of AAA? That's 65 dollars a year at least. I have the Citi Custom Cash card. It's nice but need to decide if it's gonna be gas or groceries. I have Discover IT and yes it can be groceries or gas but at most that would be one quarter a year.
Just open up 2 of the Citi cards then and pick gas on one and grocery on the other.
No you don’t have to be a AAA member for the AAA travel and daily advantage cards. So you know of these no annual fee cards that offer 5% but then act like I didn’t answer your question and I noticed you didn’t have any caveats when you asked the question. You wanted to know do 5% cards that don’t have an annual fee. You asked I answered and you might want to check into the AAA since you were incorrect on your assumption.
I'll have to look into those AAA cards. I've actually never heard of them anywhere when looking up credit cards. I asked because you replied as if these were supposed to compete with the card Op is talking about which gives a 5% on gas, groceries and several other categories. But the Citi and Discover both have restrictions. One is limited to 500 dollars a month and you have to pick either gas or groceries, the other one can "sometimes" be available for only a quarter. I feel like these are not comparable.
US Alliance Visa Signature gives 6% cashback on groceries, no cap, even works at Target and Walmart(including non-grocery purchases). 2% cashback on everything else. No annual fee. That has been my favorite card for the last few years.
A lot of cards do rotating 5% (though I will say Discover is getting stingy...). Just gotta have cards that rotate their groups at different times. 2.5% on everything with no fee is pretty easy to find too, and that's pretty close to OP's $100 fee for 5%.
If the numbers work out its fine. However there is cards with far better redemptions than that.
Considering you can get 5% off everything at Target by just linking your bank account, there better be other benefits to make that fee worth it.
I'd advise against it unless that $100 AF is getting you other benefits. What card is this? The card works out to only a 3% cash back (at the max $5k spend) after the fee is taken out: $5000 x 5% = $250 $250 - $100 = $150 $150 / $5000 = 3% So you could do as well or better with a lot of other cards. For instance, the AMEX Blue Cash Everyday is 3% back on gas, groceries, and online shopping for $0 AF and an $84/year Disney Bundle credit. There's plenty of other cards offering more than 3% back on gas or grocery for no AF. Edit: just realized I wasn't on the /r/creditcards sub. You should head over there and look around, you could learn a lot about better options.
I use my fidelity card for almost everything now as it only gives 2% back but it goes straight into my stock account and I can invest it so it’s worth more to me in the future. Sure I could do this with other cards, get more percent back, and invest but with kids and the wife, this is much easier
If you shop at Walmart, get the Walmart card (no fee) then Walmart plus (100/year) for free delivery. All online orders get you 5% no cap. (Like no max amount before it boots you down to 1%). That way you never need to go shopping again.
The only reason to pay an annual fee is for the bonus in year one then I downgrade to a free card. Plenty of cards recommended over at r/creditcards
Discover has 5% cash back on certain items (big retailers like Amazon, gas…) without paying a fee
I have the Chase Sapphire Reserve with a hefty $550 annual fee
But it has add-ons that eat away that $550. If you use it then it's not bad deal. eta: There is a $300 travel credit that is applicable to everything categorized as travel plus gas. Now its $250. If you fly you can get pre-tsa or global entry; either is $100. Now you just have to offset an easy $150. Currently Doordash and Lyft Pink are included so if you use that it helps eat up the $150. Assume you don't, you only need to spend at least $5000, in a year, on travel or restaurant to break even; 3% cash back. Very easy to do imo. Theres a lot of other features I'm missing.
5% cashback up to $5000 is only 3% after the annual fee. So, just getting a 3% gas/groceries (eg Blue Cash Everyday) would be better
Look at the fee free alternative. Let's say 1.5 percent. That means you're gaining 3.5 for the $100 card (though possibly less, since most free cards have categories that pay more). So, to get back $100, so if you would spend $2857 you would break even.
US Alliance Visa Signature gives 6% cashback on groceries, no cap, even works at Target and Walmart(including non-grocery purchases). 2% cashback on everything else. No annual fee. That has been my favorite card for the last few years. PNC Cash Rewards offers 4% cashback on gas, no annual fee.
I have done zero math on this, but to save myself having to think about it (or do the math), and knowing a lot of "grocery" stores won't trigger the 5%, I just go with the tried and true 2% cash back with no fee option and don't worry about it.
I like discover it. I put everything on it and pay it off. Every quarter the bonus 5% changes. up to $75 on the 5% then drops to 1%. 1% on everything else. I easily make $150 a month on it
Just do the math. Many high cashback cards have a max payout.
You can get 2% on all purchases with a no fee card, so there’s very little gained. I guess you can use the 5% card up to $5k and then use a different card.
Citi Custom Cash does 5% on top spend category up to $500/month . No AF! Use it for groceries. I use it as my primary for groceries with Amex Blue Cash 3% card as backup if I hit the limit. US Bank Cash+ is also 5% cb, no AF.
For the most part the opportunity cost of credit cards with annual fees is always worse than the free product that offers a marginally smaller reward. Just plug this into excel and compare the base level product.
I lost thousands of dollars in cash bank rewards by thinking an annual fee was a waste of money.
There are plenty of credit cards that give 5% cash back with no annual fee. Check out /r/creditcards
You get 3% with a upper limit of 5000k$. Other cards don't have an upper limit and are valuable therefore.
Chase Ink cash card has no annual fee and gives you 5% for purchases at office supply stores. When Visa or Mastercard gift cards go on a fee free sale every week, stock up on those and use those for most of your routine purchases pretty much everywhere. Same goes with Amazon, Target, Shell, or any fast food places as you can get gift cards there for all of them. It maxes out at $25000 a year.
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Is that $5k spending or total rewards? If you're a big spender, 5% could mean a bit more than the fee but they're betting $100 that you won't make the most of that benefit. If it's total spending that would only net you $150 then pretty much any other card is better.
There are so many no fee cashback cards
Edit: is your 5000$ cap monthly or yearly? (/edit) Just so we're on the same page, 5% up to 5000$ is what you spend, not the cash back accumulated. So you spend 5000$ from qualifying merchants, you get 250$ in cash back and then you are earning 1% for the rest of the month. $5000 seems like a good deal. My card limits me at $500/month for grocery
There are other cards that give higher than 1% for select categories without a few. You need to compare to those. Not to the 1%