Best cash back credit card combo?

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flroots
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Best cash back credit card combo?

Postby flroots » Thu Jan 08, 2015 5:45 am

We have reviewed cash back credit cards and come up with what we believe to be the best combination.Our requirements were:

no rotating categories: too complicated
reward is cash back.
maximum of 3 credit cards not counting our debit card for use at ATMs
pay balance in full each month to avoid all finance charges
ignore sign up bonuses in evaluation: interested in long term benefits



We came up with the following 3 card combo:

Blue Cash Preferred AmEx - 6% at supermarkets and 3% at select department stores
Pentagon Federal CU Visa - 5% fuel pay at pump
Citi Double Cash MC - 2% on everything else



The negatives of the AmEx are an annual fee of $75 and a cap of $6000 on supermarket purchases. A nice positive of the AmEx is that you can buy gift cards at the supermarket and receive the 6% cash back at gas stations, Home Depot, Lowes, etc. Also, our local Publix supermarket frequently offers a 20% discount on gas cash cards which means we then receive a 26% discount on gas.

A negative of both the AmEx and MC is that you have to request reward redemption when the reward >= $25 whereas the Visa provides automatic redemption.

Did we overlook something? Comments appreciated.


takeshi
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Postby takeshi » Thu Jan 08, 2015 9:11 am

Would be easier to provide recommendations if you listed your top spend categories and the volumes you put through them.

flroots wrote:The negatives of the AmEx are an annual fee of $75 and a cap of $6000 on supermarket purchases.

You have to run the numbers versus just assuming that the AF and cap are negatives. It's total cost/benefit that you need to compare to the alternatives. For certain levels of spend the BCP is a good fit. For other levels of spend the Sallie Mae or the old Blue Cash may be a better fit.

flroots
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Postby flroots » Thu Jan 08, 2015 9:40 am

takeshi wrote:Would be easier to provide recommendations if you listed your top spend categories and the volumes you put through them.


You have to run the numbers versus just assuming that the AF and cap are negatives. It's total cost/benefit that you need to compare to the alternatives. For certain levels of spend the BCP is a good fit. For other levels of spend the Sallie Mae or the old Blue Cash may be a better fit.

We spend $400-800/mo at the supermarket. The reason it varies so much is that we tend to stock up on BOGOs when they are available for things we buy. The other reason is that our local supermarket, Publix frequently offers gas cash cards with a 20% discount. When that happens we stock up on those and save 20 + 6 for a total of 26%. In all liklihood, we are most likely to reach the $6000/year cap and earn the $360 - 75 = $285 reward. At that point we will switch to our Citi Double Cash MC to earn 2% cash back.

Brad Bishop
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Postby Brad Bishop » Thu Jan 08, 2015 11:05 am

flroots wrote:We have reviewed cash back credit cards and come up with what we believe to be the best combination.Our requirements were:

no rotating categories: too complicated
reward is cash back.
maximum of 3 credit cards not counting our debit card for use at ATMs
pay balance in full each month to avoid all finance charges
ignore sign up bonuses in evaluation: interested in long term benefits



I got a bit of a chuckle out of:
"no revolving categories - too complicated"
and then the complex way you could get cash back by buying gift cards at Public using Amex and then use those at other places.

For me the Discover deal with the normal 1% back + revolving categories is super easy to remember. Right now (Jan-Mar 2015) the categories is ground transportation which basically means: gas and rental cars. Got it - buy gas with Discover. Oct-Dec 2014 was shopping retail/online. Got it - buy Christmas gifts w/ Discover.

flroots
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Postby flroots » Sat Jan 10, 2015 5:12 am

Based upon comments received at other forums, I have decided to retire my Pentagon Fed CU Visa in favor of the Sallie Mae MC. Both cards are widely accepted, have no annual fee, can be redeemed with $25 in rewards, and offer 5% cash back on fuel. The SM does have a cap of $250, but I typically spend no more than half that amount in a month. The SM card also offers 5% cash back on groceries and books (eg, Amazon). I've heard conflicting information as to whether the card will receive 5% cash back at Walmart. Apparently it depends on how the Walmart is coded. My 3 card combo will now consist of:
1. Blue Cash Preferred AmEx: 6% on groceries and 3% on select department stores
2. Sallie Mae MC: 5% on gas, groceries, and books (Amazon)
3. Citi Double Cash MC: 2 % on everything else (including Sams Club)

The gas feature will only be used when traveling away from home since I receive a 26% (20+6) discount when purchasing gas cash cards at my local supermarket (Publix). I need to decide how to divide grocery spending between the BCP and SM cards. At the moment I favor using BCP as my primary grocery card and reserve SM for Amazon and possibly Walmart.

TheSwarm
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Postby TheSwarm » Mon Jan 12, 2015 11:20 pm

I have really been liking something similar. I spend around $250/month on groceries and $250/month on gas.

Sallie Mae - gas / groceries / Amazon
Freedom - 5% categories with my fiancé as an AU
Barclay Arrival+ - everything else

I have recently found myself traveling out of the country quite a bit. The no FTF and chip+pin has been great. Plus I put a pretty good amount of MS through it.

flroots
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Postby flroots » Tue Jan 13, 2015 2:28 am

I've decided to use my Blue Cash Preferred card as my 'go to' grocery card. I've started graphing BCP spending along side the ideal line having a slope of $500/month ($6000/yr). If I go above the line, I'll shift some grocery shopping to SallieMae. When I dip below the line, I'll consider buying gift cards for stores we shop at. The tracking will be relatively easy since there are no month-to-month caps to balance. SallieMae will be used for grocery shopping when above the line, Amazon, and gift cards as needed. Unfortunately, my Save-A-Lot doesn't accept AmEx so I'll use SallieMae there as well. I'll use my Citi Double Cash MC at Sam's Club and everything else. My biggest concern going forward is that benefits are reduced on one or more of my new cards. I've read that others put many of their bills onto their credit cards rather than using a checking account. I need to look into that. I do know that my car insurance is paid with my USAA MC. I can shift that to Citi Double Cash to double the rewards.

flroots
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Postby flroots » Wed Jan 21, 2015 5:05 am

I've changed my mind again ;) We now plan to convert the BCP to BCE as soon as we've met the promotional spending limit to avoid the annual fee going forward. We have applied for and received approval for a 2nd SM MC for my wife. We'll use both SM cards to double the grocery cap to $500/mo. One of the key factors affecting our decision was that SM has a much broader definition of what constitutes a grocery store compared to the AmEx. Another factor was that our local Save-A-Lot does not accept AmEx. The negative is having to balance the spending between the two SM's each month. In summary the 3 cards we carry going forward will be:
  1. SM MC #1: 5% on groceries, gas, and books (Amazon)
  2. SM MC #2: 5% on groceries, gas, and books (Amazon)
  3. Citi Double Cash MC: 2% on everything else including Sams Club
Does anyone know if you get 5% cash back at Sams club with the SM card? I know they accept all MasterCards.

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Vattené
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Postby Vattené » Wed Jan 21, 2015 5:20 pm

I would suspect not, but you can always swipe the SM next time you're there to find out for sure. For what it's worth, Discover codes it as Warehouse Clubs, and I bet it would be something similar (like discount stores or something like that).
-Vattené
FICO-8:
EX - 809 (11/16) | TU - 803 (11/16)
Primary Cards:
American Express EveryDay - $20,000 (10/14)
Discover it - $23,000 (2/14)
AU on Barclay Sallie Mae - $10,000 (8/15)
plus several store accounts of varying usefulness now

flroots
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Postby flroots » Wed Jan 21, 2015 5:53 pm

flroots wrote:I've changed my mind again ;) We now plan to convert the BCP to BCE as soon as we've met the promotional spending limit to avoid the annual fee going forward. We have applied for and received approval for a 2nd SM MC for my wife. We'll use both SM cards to double the grocery cap to $500/mo. One of the key factors affecting our decision was that SM has a much broader definition of what constitutes a grocery store compared to the AmEx. Another factor was that our local Save-A-Lot does not accept AmEx. The negative is having to balance the spending between the two SM's each month. In summary the 3 cards we carry going forward will be:
  1. SM MC #1: 5% on groceries, gas, and books (Amazon)
  2. SM MC #2: 5% on groceries, gas, and books (Amazon)
  3. Citi Double Cash MC: 2% on everything else including Sams Club
Does anyone know if you get 5% cash back at Sams club with the SM card? I know they accept all MasterCards.
Thanks. What do you mean by swipe? Is there some immediate way to see if it's coded as a grocery store? I've assumed I would need to purchase something and wait to see how it gets posted.



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