Best Cash Back Credit Cards of 2022
The best cash back credit cards can help pay for your next vacation, your next big purchase, or your next large expense.
Depending on how you use the card, the cash back you earn with the best cash back credit cards is essentially free money.
Even better, the best cash back credit cards typically carry no annual fee and tend to offer relatively high reward rates and sign-up bonuses, making them attractive options for consumers in the long term.
The main goal of the best cash back credit cards is to encourage consumers to spend money. When you make a purchase with a cash back card, you will earn rewards on that purchase. In the case of the best cash back credit cards, you will earn the most cash back on everyday purchases like gas and groceries.
Fortunately, there are hundreds of cash back credit cards that you can choose from. So whatever goal you may have in mind, you can make sure you find the best cash back credit card to help you reach it.
Chase Freedom ® : Best Cash Back Rewards Program
Chase Freedom Unlimited℠ Card: A Different Way to Earn Points with Chase
Citi ® Double Cash: Earn a Flat 2% On Everything
The Citi® Double Cash has a very broad definition of what constitutes a purchase. This means all of your regular expenses – groceries, diapers, gas – will have an earning potential of 2% instead of 1% or 0%. That’s one of the broadest definitions of what’s considered a purchase in the industry. Plus, the Citi Double Cash has one of the highest rewards rates among cash back cards. You’ll earn a flat 2% cash back on everything (an unlimited 1% cash back upon approval and another 1% when you pay).
The Citi Double Cash is a solid choice if you’re not sure that you’ll be able to meet the minimum spending requirements for more interest-bearing cash back cards, or if you want to earn a high rate on all your purchases rather than only the ones that qualify for rewards. This is the only cash back card that offers a flat 2% earning on all purchases.
Discover it ® – Double CashBack your first year
BankAmericard Cash Rewards™ Credit Card: Low Minimum Spending Requirement
This card from Bank of America has been around for some time, and will continue to be a good option for those who are looking to earn cash back on everyday purchases.
Blue Cash Preferred ® Card from American Express: 6% Cash Back at Grocery Stores
Amex EveryDay ® Credit Card from American Express: No Fee, Sweet Signup Bonus
Rules for Maximizing Cashback Credit Cards without Going into Debt
In a world of instant gratification, a cashback credit card is a great bargain. Credit card rewards programs are great, which are why credit card companies are slashing the amount of rewards needed to achieve that coveted free gift. However, the convenience and ease of credit cards also comes with a high cost: compulsive spending and debt.
There are some simple rules to follow to maximize the value of your rewards without going into debt.
The key is to be strategic. When you build a budget, you have to take full advantage of your plan by being strategic about how you allocate your funds. Just as we talked about in the “credit cards don’t solve your financial problems” section, you have multiple goals, wants and needs. What you don’t need, you should be saving for.
The beauty of cash back credit cards is that you can get money back on nearly everything. Here are some of the basic rules you should follow if you want to use cash back credit cards without going into debt.
Rule #1: Use your cash back card for all of your everyday expenses, but as part of a comprehensive spending plan.
You can rack up a lot of cash back or points by using one of the best cash back credit cards, but rewards will be worthless if you treat your purchasing decisions in an impulsive manner. Credit cards are just like regular debit cards. You can spend as much as you want and the bill will arrive at your door regardless of whether you actually have the cash in the bank or not. So, the best way to use cash back credit cards is in combination with a good budgeting plan.
I recommend using a budgeting program to calculate how much you want to spend on different categories in order to remain financially healthy. You then have to cut down on your spending in other areas in order to make room for the new levels of spending in these key areas.
For example, let’s say you’re going to shell out a few hundred extra dollars a month on a new fad diet. If you don’t have a way to adjust your other spending plans and aren’t disciplined enough to spend less than you earn, you’re going to rack up a lot more debt. So make that tough choice and cut out that Netflix subscription or that club membership to free up a little cash for yourself. After all, it’s all about personal responsibility and discipline.
Rule #2: Only charge what you can afford to pay back.
Instead of charging a huge bill every month, which I could never pay off all at once, I charge a small amount. I know I can pay it off in full each month and my credit card won’t charge me much in interest.
The result is I still have a little more disposable income since I don’t have to worry about a high balance and I’m not in credit card debt.
Great credit cards, like the ones on our list, make it easy to pay off a small amount each month. It’s as easy as dropping some cash into a jar every time you use your card. When you get your statement every month, just pay it off with the money in the jar.
Rule #3: Always pay your bill in-full and on time.
In the past, my credit card didn’t come with a great interest rate, but that’s okay. You don’t want to pay too much in interest, but you also don’t want to miss out on the best 0% introductory offer. You only get one chance to take advantage of that deal. If you know you’re not ready to pay it all off at the end of the introductory period, don’t even apply. Simply find a balance transfer offer with a good intro rate. Remember, cash back and rewards card offers can be quite competitive, so make sure you get the best one possible.
Rule #4: Don’t go crazy pursuing too many signup bonuses.
It’s not worth it.
Every few months, there’s a new signup bonus worth talking about, but just because there’s always a new signup bonus doesn’t mean that you should always chase them.
Every time you sign up for credit cards you also run the risk of opening up your accounts to the scrutiny of the credit bureaus. If someone you’re dealing with doesn’t like you, it’s easy for them to get your accounts frozen.
While that can be a minor inconvenience while you await the outcome, it can be majorly impactful if you’re applying for a mortgage or auto-loan. Freezing up your accounts can ruin your credit. That’s not worth it.
Rule #5: Keep a simple credit card spreadsheet.
Keeping a simple spreadsheet on the first page of your credit card account statement will help you plan your budget better. It can also help you better manage your credit card balance.
Use the column headers to put your monthly expenses here. The leftmost column is for how much you spend on that category in a month. The rightmost column is for how much you pay towards that category in a month.
The idea is to set aside a certain amount of money that you can put towards your credit card each month. This will help you get out of debt faster.
You could also use a simple credit card spreadsheet to pay down your debt faster.
Simply select the version of the credit card payment calculator template that you need.
Click the image to expand the template.
Here’s the calculation for paying down a credit card debt. The calculator makes things pretty simple. Simply enter your pre-tax credit card monthly payment, the interest rate on the credit card and a monthly payment lower than your credit card payment.
The total number of months until your credit card balance is paid off can be found on the right hand side of the calculation. Also, a simple debt payoff percentage is displayed. Using this, you can easily see how much interest you’re paying every month and how much you’re paying towards your principal balance every month.
Rewards Credit Card Mistakes to Avoid:
First of all, it’s important to remember that rewards credit cards come with certain fees and restrictions. You need to consider all the pros and cons of credit card rewards before signing up to get the most out of your rewards credit card.
The card also needs to fit with your lifestyle and spending habits.
- It’s easy to get carried away with the temptation of earning more rewards, but this can lead to overspending and you may end up paying more in interest charges than the value of the rewards you’re getting.
- It’s possible to build up a huge credit card bill if you keep using your rewards credit card every month to earn rewards.
So, before you sign up for a rewards credit card, be sure to do the math and consider the potential costs and benefits.
Also, to avoid falling into credit card debt, be sure to pay your credit card bill in full each month, and try to pay in cash instead of using a debit card for purchases.
Mistake #1: Missing out on a signup bonus
Taking the time to choose the right rewards card is the only way to get the most value and rewards while making sure you’re not spending too much. The best card for your spending style can vary depending on your preference. The best way to decide on a card is to have all of the information on what each card offers. Checking out websites, or reading this post, can help you decide which is the best type of rewards you want to spend your money on.
Which of the most popular credit cards are worth it?
It’s important to know what you plan on spending on each month so you can figure out which card to get to get the most rewards. So if you plan on spending a lot of money on gas and groceries, then you might want to choose a card that gives the most cash back on those two areas. Alternatively, if you spend a lot on travel, you will want a travel card that gives you points/miles for travel purchases. At the end of the day, finding the right card will help you maximize the rewards you earn and see how you can earn them faster.
Mistake #2: Spending more to earn more rewards
If you have good credit, you can get a credit card that offers cash back rewards and other perks. But for people with bad credit, it’s hard to even get approved for a plain-vanilla credit card.
But don’t just take that as a handicap. With a little creativity, you can shop around for credit cards to find the ones that make the most sense to you.
Here are three things you should consider when choosing a cash back card.
Mistake #3: Forgetting how often you can earn a signup bonus
Depending on how often you apply for credit cards and when you earned your current cards, you may have already earned your signup bonus. You may have already earned all the points that card can give you. If so, I am deeply convinced that you do not need another credit card.
If you want more credit cards, sign up for them in the right order.
The first card that you should get is a general cash back credit card offering 1% cash back on all purchases. Your spending should fall into one of the categories that earns you 3% or 4% cash back, but you should get the baseline 1% cash back card as this will be your default credit card.
Over time, you’ll be twice as likely to use your 3% or 4% card, and it will serve to improve your credit score more effectively so you may see higher limits on your credit cards or a lower interest rate on any mortgages or loans that you acquire in the future because your credit score will reflect responsible use of credit.
Mistake #4: Carrying a balance
Clearly, there is nothing good about carrying a balance month to month. If you are carrying any type of balance on your credit card, you are losing money!
Here’s why: if you are charged an interest rate of, for example, 16%, and you make only the minimum payment at the end of the month, it’s basically like giving your credit card company 16% of your money.
If anything happens and you can’t make your minimum payment, you will get hit with a late fee. That will lead to a higher interest rate, which will cost you more in the long run. Plus, with a late fee, you will have bad credit, and bad credit also costs you more money in the long run.
Completely avoid this vicious cycle by not carrying any balance on your credit card.
Mistake #5: Getting into long-term debt
Head into 2019 with a clean credit report and a fat wallet. Follow these credit card management tips and make sure to pay off your balance every month.
When you get a credit card, you’re given a limit, which is the maximum amount of money you can charge to the card each month, along with an interest rate, which is the charge a credit card company makes to borrow its money.
Hidden Benefits Your Cash Back Card Might Offer
Cash back credit cards usually come with a great signup bonus and attractive rewards plan, but it’s not just the upfront benefits that you should consider when choosing a cash-back credit card. Many of these cards will also let you pay off your balance in full, giving you considerable flexibility in using your rewards. You should also look for a card that offers an interest rate low enough to make carrying a balance on the card unnecessary. This will then literally “erase” any interest from the card to keep your rewards intact and keep your costs low. ”Recommended” interest rates usually range from 9.99% to 14.99% depending on your credit score and history, so check out the card’s reviews before applying to make sure you can get a low enough rate for your budget.
Cash back rewards cards are a great way to give a gift you know will be used. If your recipient doesn’t need another pair of shoes or a cable subscription, chances are a cash back gift card is more likely to be used to fill out a wish list or contribute to an extra daily expense. Be mindful that some cards carry fees for purchasing cash back, but many are fee-free.
Hidden Perk #1: Extended Returns
Hasn’t happened to you yet? You purchase an item but before it arrives, you change your mind. Maybe you saw something better out there – or maybe you can’t really afford it.
There’s more. Let’s say you make a big purchase. There’s a chance someone will want it and offer you more than you paid for it … But, these are commonplace situations. The big deal is that the merchandise does not arrive. In China, there’s nearly an entire industry of “shopping app” fraud. So you pay, and you wait. Then the merchant disappears.
These are time-honored shopper’s dilemmas.
A credit card with product-protection benefits could solve everything.
For starters, most cashback credit cards offer extended-warranty protection. Your purchase will receive the warranty standard under federal law, in addition to any guarantees the credit card company offers. So, if your new TV breaks after the typical warranty period, and you’re a cardholder, you’ll pay to have the TV fixed.
Hidden Perk #2: Purchase Protection
Hidden Perk #3: Zero Liability Protection
With the exception of one airline credit card, all credit cards offer zero liability protection if you report a stolen credit card within 30 days of the loss. After that time, most credit card companies will only cover actual fraudulent charges, unless the card was used to sign up for recurring services that work like an ongoing bill, such as an online subscription.
Under a zero liability policy, you’re not liable for unauthorized charges if you report them as soon as you notice them. The only credit cards that don’t offer zero liability protection are those that are secured by deposit. Many people don’t realize that. If you end up using one of these cards, you’ll probably end up responsible for the amount of the unauthorized charge.
With zero liability protection, you won’t have to worry about unauthorized purchases and fraudulent use. You’re not liable for any charges made on your credit card unless you authorized them in advance.
Hidden Perk #4: Auto Rental Collision Damage Waiver
Auto Rental Collision Damage Waiver looks like an excellent feature but it’s actually quite difficult to use unless you’re renting the car from an airport.
Car rental agency’s repair process can be long and drawn out and the drama can put a strain on your vacation. ACDW can help insure that your vacation is back on track if you rent your car from an airport.
Since up to 12% of travelers have car rental insurance from their credit cards, this can be a great perk for those who need the extra protection and peace of mind.
Hidden Perk #5: Fraud Alerts
Although credit monitoring services are great at detecting unauthorized credit activity, they’re not so good at detecting fraudulent charges that aren’t tied to credit accounts.
This is where your credit card benefit can actually help. Most credit cards have fraud alert services that will send you a text alert if it detects questionable charges. You can even set up texts to be sent to you any time charges are made on your account.
This is a great way to monitor your credit card activity even when you don’t have credit monitoring.
Improve Your Credit through Credit Card Bonus Offers
Sometimes it seems like the best way to improve your credit score is by closing your credit cards and disputing errors that are dragging your score down … but these options have a downside.
That’s because, in most cases, closing your credit accounts will actually make your credit score worse. So what’s a credit cardholder to do?
The best way to improve your credit score is to utilize your credit cards. Instead of canceling the cards with the lowest credit limits … get new ones. You can also use the cards to make purchases you would have otherwise made with your debit card or cash. By taking this simple step, you’re boosting your credit score by paying your bills on time.
Hidden Perk #6: Extended Warranties
One of the main advantages of credit cards is the extended warranties that come with purchases. In the U.S., your credit card coverage is usually between 1 and 7 years, depending on the card. If you keep good tabs on your card and pay your balance on time (and in full each month), you can generally extend that coverage even further.
If your card offers an extended warranty, you should use it. If you are an Amazon shopper, I recommend the Amazon Prime Store Card, the Mastercard, or the American Express.
Here’s what to look for in a good extended warranty:
- Wide variety of eligible products
- High percentage of coverage
- No filing of claims required
Hidden Perk #7: Free FICO Scores
How to Choose the Right Cash Back Card
Apart from secured credit cards, cash back credit cards are by far the most popular type of rewards credit cards. These cards are primarily geared toward helping you earn money back when you spend, making them an excellent choice for budgeting and planning short-term and long-term purchases.”
Cash back credit cards can come with a number of different types of rewards. Some cards pay out only on certain types of purchases, such as gas or groceries. Other cards pay a flat rate on purchases each month, regardless of what you purchase. With these flat-rate cards, you can focus on earning cash back on a wide range of purchases without worrying about trying to remember to use the right card to get the highest rewards on your particular purchase.
Figure out your spending style.
Before you can invest in a credit card, you have to figure out how you spend money. Are you an impulsive spender? Do you like to go on Amazon or other shopping websites where you can easily spend hours looking at cool stuff?
If your answer to these questions is yes, then you probably want a cash-back card. These cards reward you whenever you spend money. It is up to you to decide how you want to redeem your rewards.
You can choose to redeem your cash back for rewards like travel, cash, and gift cards.
Cash-back cards can be a good option to get yourself out of debt, or to get some extra money for things you want. The downside, however, is that cash-back cards have an APR that can be high.
The way a cash-back card is set up determines how much you will get back. Typically, it is a percentage of the amount of money you spent. Different cash-back cards also have different rules and restrictions. Before you sign up for a card, you’ll want to determine which is the best credit card for cash back.
Decide if you want fixed-value rewards or a card with “bonus categories.”
If you’re looking to earn more rewards on a daily basis, then you might want to opt for a cash back credit card that offers bonus rewards on certain categories like gas and restaurants.
If you don’t think you’ll be spending a lot of money on these categories, then consider a card that doesn’t have bonus rewards categories and offers flat-value cash back. You may be able to save money with these cards on certain categories that you already spend a lot on.
Make sure your card has the right perks.
The best general-use cashback cards offer 1% in rewards on all purchases with no spending limit. If your card does not have that option, consider a cashback card that offers a high percentage back on certain categories of spending (such as 3% back at grocery stores or 2% back at gas stations). Some cards offer multiple bonus categories, allowing you to switch your spending around if the card’s rewards rate slows.
Before you can start getting more dosh on your spending, you’ll need to understand your credit scores. We recommend the free website WalletHub to help you check your credit scores and find the right cards for you.
Understand and compare rewards programs.
Everyone loves getting cash back rewards, but what kinds of rewards programs are out there, and which are best?
There are three main types of rewards programs: cash back programs, points programs, and travel programs. Each of these types of rewards programs may also be tied to specific types of credit cards.
Cash back rewards programs are among the most widely used programs. In this type of program, you will typically earn rewards on all the money that you charge. With many cash back programs, you can set up your account to automatically redeem the rewards you earn every month or every week. The rewards you earn can be redeemed for any type of goods or services.
The most frequently used points rewards program is tied to airlines. When you participate in this type of program, you will earn points based on money you charge to your specific credit card. After you accumulate enough points, you can redeem them for airfare.
Travel rewards programs are like cash back rewards programs. However, instead of redeeming your rewards for goods or services, you use your rewards to pay for the travel expenses of you and your family. A travel rewards program can be tied to any type of business including airlines, cruise ships, hotels, or rental car agencies.
Consider pairing more than one card if you can’t decide.
Many credit cards offer cash-back or other special rewards that can help you save money on everything from groceries to plane tickets. Not to mention, the best cash-back credit cards can make your emergency fund seem like a reality.
Look for a card with a simple rewards structure and a straightforward sign-up bonus. For example, the Citi Price Rewind credit card has a sign-up rewards bonus that can help you buy items for your family at no cost. The Chase Freedom Unlimited card, on the other hand, is a good choice for those who want a solid 1.5 percent cash back on all their purchases.
Avoid churning cards. Many credit cards advertise that you can earn sign-up rewards and, in some cases, even multiple bonuses when you sign up for the same card again and again. Though it may seem like a great way to rack up points, the benefits usually don’t outweigh the costs associated with opening and closing too many credit card accounts.
The Bottom Line
While you have to be cautious of certain fees related to rotating categories, and you end up with a pretty big bill at the end of the year, The 7 Best Cash Back Credit Cards For 2022 will allow you to put money back in your pocket. Best of all, the biggest benefit of a cash back card is that you get to use that cash to help pay off your balance.
If you want a smart new credit card experience that can help you earn money back, you want this card. Compare best credit cards in the market here.