Best Cash Back Credit Cards May 2023

Rates checked as of May 1, 2023.

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Have you looked at the perks offered by rewards credit cards and decided that you want cold, hard cash? You’re hardly alone. In a survey from personal-finance site WalletHub (opens in new tab), 79% of people said they are most interested in earning cash back credit card rewards, a significantly higher percentage than those who prefer rewards points or miles.

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To help you in your search, we have compiled a list of great cards that provide cash back on every purchase (or reward you with points that you can easily trade for cash at a strong value).

Interest rates, fees, rewards and other terms listed in this article are subject to change. Before you apply for a credit card, check its current terms and conditions with the issuer.

Best Cards for Flat-Rate Cash Back

These cards provide simple and strong cash back rewards on all spending. They are best for consumers that do not concentrate their spending in just a few areas.

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Farmers Insurance Federal Credit Union Crystal Visa (opens in new tab)

Earn a whopping 3% cash back on all spending the first year you have this card. After that, you get 2.5% back—a strong rate that makes the annual fee worthwhile for those who spend enough to justify it. The amount of spending that exceeds $10,000 each month does not earn rewards, which are given as points that you can trade at a rate of a penny each for cash back.  

How can the card provide such stellar cash back rates? Most cards are issued by large, publicly-traded banking institutions that must deliver gains to stockholders. But as a credit union, Farmers Insurance is member-owned, with the express mission of returning profits to members. The downside of this approach is that the card application process is more lengthy than that of commercial competitors. 

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• Interest rate: 0% for six months, then 12.99% to 18% variable APR
• Annual fee: $99, waived the first year
• Top rewards rate: 3% back on every purchase the first year, and 2.5% back on all spending from the second year on; the amount of spending that exceeds $10,000 each month does not earn rewards
• Redemption: You collect rewards in the form of points, and they’re worth a penny each for a bank account deposit or statement credit ($50 minimum redemption)
• Membership: Anyone can become a member of Farmers Insurance FCU by joining the American Consumer Council and depositing $5 into a savings account
• Sign-up bonus: $100 back if you spend $5,000 in the first three months

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Wells Fargo Active Cash® Card (opens in new tab) 

This card provides 2% cash rewards on all purchases, making it a great card to slip into your wallet if you prefer simple, straightforward rewards.

Three benefits sweeten this card deal. New cardholders earn a $200 cash rewards bonus after spending $500 in purchases in the first 3 months, the card offers a 0% APR on balance transfers and purchases for 15 months, and there is no annual fee.

Skip this card if you are planning significant travel outside the U.S., as there is a 3% foreign transaction fee.

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• Interest rate: 0% intro APR for 15 months from account opening on purchases and qualifying balance transfers, then 19.74%, 24.74%, or 29.74% variable APR
• Annual fee: None
• Top rewards rate: 2% cash rewards on purchases
• Sign-up bonus: $200 back if you spend $500 in the first three months
• Redemption: Statement credit, cash at the ATM with a Wells Fargo debit or ATM card (in $20 increments), gift cards ($25 increments), or a credit to a qualifying Wells Fargo credit card, checking account or mortgage
• Other benefits: Up to $600 per claim of protection for your cell phone against damage or theft if you pay your monthly wireless bill with the card

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Citi® Double Cash Card (opens in new tab)

Get a total 2% cash back on everything you buy: 1% when you make a purchase and an additional 1% when you pay the bill. Rewards are tracked as Citi Thank-You points, which you can exchange at a rate of 1 cent apiece for a statement credit, direct deposit into your bank account or check.  

This card's strength is its simplicity; there's no need to track rotating rewards categories, and the cash back rate of 2% is higher than that of most competing cards with no annual fee. The only downside? The card doesn't offer a welcome bonus, but it does provide a generous 18 months of 0% APR on balance transfers (but not on purchases).

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• APR:  0% Intro APR on balance transfers and purchases for 15 months; after that, the variable APR will be 18.99% to 28.99%, based on your creditworthiness
• Annual fee: None
• Top rewards rate: A total 2% back on all spending - 1% cash back when you buy, plus an additional 1% when you pay 
• Redemption: Rewards come in the form of Citi ThankYou points, which can be redeemed for a statement credit, check or direct deposit into a bank account; or exchange points for gift cards, travel and other options through the ThankYou program, but point values vary for those redemptions
• Sign-up bonus: Citi recently ended the sign-up bonus

Best Cards for Cash Back in Rotating Categories

Earn top rewards in categories that may change each month or quarter. These cards are a good fit for people who can keep track of and plan their charges in categories like online shopping, streaming, and travel.

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U.S. Bank Cash+® Visa Signature® Card (opens in new tab)

This card may prove lucrative if you spend significant bucks on your wireless plan, utilities, or TV and internet services. That's because most of the rotating cash back categories earning 5% cash back (up to the first $2,000 spent) are related to tech and electronics. Travel booked through the U.S. bank rewards center also earns 5% back. 

Cardholders get 2% back in a rotating category of their choice like groceries, gas and EV charging, and 1% back on other purchases. 

New cardholders get a $200 sign-on bonus after spending $1,000 in eligible purchases within the first 120 days of opening the account. The card also offers 15 months of 0% APR for balance transfers and purchases, with no annual fee.

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• Interest rate: 0% for 15 months on purchases and balance transfers, then 19.49% - 29.49%
• Annual fee: None
• Top rewards rate: 5% back in two categories you choose each quarter up to $2,000, then 1%; the options include wireless plans, utilities, and TV and internet services
• Other rewards: 5% back on reservations booked through U.S. Bank's travel center, and 2% on one category of choice among three options: grocery stores, restaurants, or gas stations and electric-vehicle charging stations. Plus 1% cash back on all other eligible purchases; there is no limit to the cash back you can earn in 2% and 1% categories
• Redemption: Redeem cash back as a statement credit, a deposit into a U.S. Bank checking or savings account, or a U.S. Bank prepaid debit card; cash back expires after three years
• Sign-up bonus: $200 back if you spend $1,000 in the first 120 days

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Chase Freedom Flex℠ (opens in new tab)

This card is a cash back workhorse, offering four ways to earn 5% cash back in the first year of card ownership. First, get 5% back on quarterly rotating categories like Amazon.com or gas station purchases, up to $1,500. Second, book travel through Chase Ultimate Rewards® (opens in new tab) for 5% back. Third, get 5% back on Lyft rides through March 31, 2025, and finally, earn 5% cash back on grocery store purchases (excluding Target® and Walmart®) on up to $12,000 spent in the first year (worth $600 cash back).

Dining, takeout and some delivery services earn 3% back, as do pharmacy purchases. And new cardholders get $200 back after spending $500 in the first three months. 

Given that there is no annual fee, this card offers a great value for the potential long-term cash back potential.

• Interest rate: 0% Intro APR for 15 months from account opening on purchases and balance transfers, then a variable APR of 19.74% - 28.49% 
• Annual fee: None
• Top rewards rate: 5% back up to $1,500 for combined purchases in bonus categories that you activate 
• Other rewards: 5% back on travel purchases made through Chase’s Ultimate Rewards program, 3% back on dining at restaurants and drugstore purchases, and 1% back on all other spending; earn 5% cash back on Lyft rides through March 31, 2025; that's 4% cash back in addition to the 1% cash back you already earn
• Sign-up bonus: $200 back if you spend $500 in the first three months
• Redemption: Cash back rewards are redeemed as statement balances or to accounts; travel rewards are tracked as Chase Ultimate Rewards points, which you can redeem at a rate of 1 cent each for cash back, travel bookings or gift cards

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U.S. Bank Shopper Cash Rewards™ Visa Signature® Card (opens in new tab)

This new card from U.S. Bank provides an outstanding 6% cash back on the first $1,500 of combined quarterly spending at two retailers you choose. That's a potential $90 every three months back to you if you spend strategically.  When combined with the $250 sign-up bonus, new cardholders could get some serious bucks back in the first few months of using the card.

If you are willing to book travel through the U.S. Bank travel program, you'll get 5.5% back, and you earn 3% back in another category you select. Moreover, the 1.5% back on other purchases beats many competing cards that only offer 1% outside of preferred categories. While there is no annual fee in the first year, consider your spending habits to ensure that when the $95 fee kicks in the second year, you will more than make up for it with cash back.

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• Interest rate:  Variable 19.49% to 29.49% APR for purchases and balance transfers
• Annual fee: No annual fee in the first year, then $95 thereafter
• Top rewards rate:  Get 6% cash back on the first $1,500 of combined quarterly spending at two retailers you choose from 24 major stores, including Amazon.com, Home Depot, Kohl’s, Lowe’s, Target and Walmart; you also get 3% back on the first $1,500 in quarterly spending in one category you choose; the options are wholesale clubs, gas and EV charging stations, and bills and utilities. 
• Other rewards: Earn 5.5% back on prepaid travel reservations through the U.S. Bank travel portal and 1.5% on all other spending—a higher rate than the 1% most cards offer outside their maximum-rebate categories 
• Sign-up bonus: Get $250 back if you spend $2,000 in the first 120 days
• Redemption: Redeem cash back as a statement credit, a prepaid debit card or a deposit into a U.S. Bank account 

Best Cash Back Credit Cards for Savers

You get the best value with these cards if you stash rewards in a bank or investment account. 

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TD Double Up Visa (opens in new tab)

If you’re a TD Bank customer, consider the Double Up card, which provides a total of 2% cash back on all spending when you redeem rewards into an eligible TD deposit account. 

While there are some real advantages to the card, such as no annual fee and unlimited rewards, there are also some drawbacks. There is no way to earn more than 2% back, as many cards now offer. And the card is only available to customers residing in the 15 states (and the District of Columbia) where TD Bank operates.

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• Interest rate: 0% introductory APR on balance transfers for first 15 billing cycles, then 19.74%, 24.74%, 29.74% variable APR
• Annual fee: None
• Top rewards rate: 2% back on all spending when you deposit rewards into an eligible TD Bank deposit account
• Sign-up bonus: $100 back if you spend $1,000 in the first 90 days
• State residence requirement: This card is only available to customers residing in Connecticut, Delaware, Florida, Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New York, North Carolina, Pennsylvania, Rhode Island, South Carolina, Vermont, Virginia, and Washington, D.C.
• Redemption: Each purchase you make earns one point per dollar. When you redeem points into your TD account, they are worth a penny each, and TD deposits an additional 1 cent into your account for each point redeemed, producing a 2% return on card spending

Fidelity Rewards Signature® Visa</strong></a></p> <p>This card is a perennial winner for the 2% rewards rate that Fidelity Investments customers can earn on every dollar spent. In fact, Kiplinger has included the card in its annual list of best rewards credit cards five years in a row. There's no need to keep track of spending categories and no limit to the cash back you can earn.</p> <p>As a Signature tier Visa card, you get additional perks, including travel accident insurance, lost luggage reimbursement, roadside dispatch, and other benefits.</p>" data-widget-type="deal" data-render-type="editorial">

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Fidelity Rewards Signature® Visa (opens in new tab)

This card is a perennial winner for the 2% rewards rate that Fidelity Investments customers can earn on every dollar spent. In fact, Kiplinger has included the card in its annual list of best rewards credit cards five years in a row. There's no need to keep track of spending categories and no limit to the cash back you can earn.

As a Signature tier Visa card, you get additional perks, including travel accident insurance, lost luggage reimbursement, roadside dispatch, and other benefits.

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• Interest rate: 18.74% 
• Top rewards rate: 2% back on every purchase when you deposit rewards into an eligible Fidelity account
• Other rewards: For Fidelity Wealth Management clients, cash-back rates are higher: 2.25% for those with at least $250,000, on up to 3% for those with $2 million or more
• Annual fee: None
• Redemption: You can divide rewards among up to five accounts—including a brokerage account, cash management account, 529 college-savings plan, retirement account, donor-advised fund, Fidelity Go robo-adviser account and health savings account

high-yield savings account</a>, Sofi offers up to a 4.00% APY on savings deposits.*&nbsp;</p> <p>The card has no annual fee and perks tailored to tech-savvy clientele, like cell phone damage insurance up to $1,000.&nbsp;</p>" data-widget-type="deal" data-render-type="editorial">

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SoFi Credit Card (opens in new tab)

This credit card from financial-technology company SoFi offers 2% cash back on all spending if you deposit your rewards into a SoFi investment or banking account or apply them to a SoFi student loan or personal loan. What's most attractive for savers is that as an online bank with a high-yield savings account, Sofi offers up to a 4.00% APY on savings deposits.* 

The card has no annual fee and perks tailored to tech-savvy clientele, like cell phone damage insurance up to $1,000. 

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• Interest rate: 17.74% to 29.74% APR variable on purchases and balance transfers
• Top rewards rate: Get 2% cash back on all spending if you deposit your rewards into a SoFi investment or banking account or apply them to a SoFi student loan or personal loan
• *Other benefits:  SoFi’s Checking and Savings account is an attractive choice for rewards deposits, yielding a healthy 4.00% APY on the savings component of the balance and 1.20% APY on the checking portion if you have a direct deposit into the account as of March 17, 2023 (opens in new tab)
• Annual fee: None
• Redemption: Points may be redeemed for statement credits or rewards offered through the SoFi Member Rewards Program

Best Cash Back Cards for Groceries

These cards offer ample cash back on purchases at grocery stores.

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Blue Cash Preferred® Card from American Express (opens in new tab) 

This card offers an unrivaled 6% cash back on up to $6,000 in U.S. supermarket spending each year, then 1%. The card's $95 annual fee kicks in the second year, but with a $250 intro bonus (after you spend $3,000 in purchases on your new Card within the first 6 months), your first three years of annual fees are more than covered.

The Card has a 2.7% foreign transaction fee, so select another credit card for travel abroad. See rates and fees (opens in new tab). 

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• Interest rate: Low intro APR: 0% for 12 months on purchases from the date of account opening, then a variable rate, 18.99% to 29.99% variable (See Rates and Fees (opens in new tab))
• Annual fee: $95, $0 introductory annual fee (See Rates and Fees)
• Top rewards rate: 6% back on up to $6,000 in annual U.S. supermarket spending, then 1%; and 6% on select U.S. streaming services
• Other rewards: 3% back at U.S. gas stations and on transit, and 1% back on other spending
• Redemption: Redeem cash back as a statement credit 
• Intro bonus: Earn a $250 statement credit after you spend $3,000 in purchases on your new card within the first 6 months
• Terms Apply

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Citi Custom Cash℠ Card (opens in new tab)

Get 5% cash back automatically in whichever of 10 categories you spend the most each month up to the first $500 spent, 1% cash back thereafter. Grocery-store and gas-station spending are among the qualifying categories.

The card has a 3% foreign transaction fee, so look for a good travel rewards credit card if you are headed out of the U.S.

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• Interest rate: 0% Intro APR on balance transfers and purchases for 15 months; after that, the variable APR will be 18.99% to 28.99%, based on your creditworthiness 
• Annual fee: None
• Top rewards rate: 5% back in whichever of 10 categories you spend the most each month up to the first $500 spent, 1% cash back thereafter
• Redemption: Earn rewards as Citi ThankYou points, which you can trade for a statement credit, direct deposit or check; you can also trade points for other rewards
• Sign-up bonus: $200 back if you spend $1,500 in the first six months

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Verizon Visa® Card (opens in new tab)

You have to be a Verizon Wireless customer to apply for this card, and it’s worth a look for those who qualify. Get 4% back on groceries and gas, 3% back on dining and take out, 2% on Verizon purchases and 1% on all other purchases. There are no limits or expiration dates.

The downside? You earn "Verizon Dollars" that can only be redeemed for a credit on your Verizon bill or for other goods or services offered by Verizon. If you have a family with multiple cell phones (up to twelve will qualify), you may have a high enough monthly phone bill to make this card worthwhile.

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• Interest rate: For New Accounts: Variable Purchase APRs are 26.24% or 30.24% for the Verizon Visa Credit Card or 23.24%, 26.24% or 30.24% for the Verizon Visa Signature Credit Card 
• Annual fee: None
• Top rewards rate:  Get 4% back on grocery store and gas purchases
• Other rewards: Get 3% at restaurants, 2% on Verizon purchases and 1% on other spending
• Redemption: Earn cash back as Verizon Dollars, which you can use for various Verizon purchases, including paying your Verizon wireless or internet bill; you forfeit unused Verizon Dollars if your account is inactive for 24 months 
• Sign-up bonus:  $100 back if you make a purchase within 90 days 

Best Cash Back Cards for Gas and EV Charging

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Abound Credit Union Platinum Visa (opens in new tab)

This card can help you save on gas, offering 5% cash back on fuel purchases paid at the pump plus 5% back in quarterly rotating categories (opens in new tab). It also boasts a lower APR than many competitors.

Since Abound is a credit union, signing up for the card may be more time consuming than signing up for competing credit cards. Other cards also offer high rewards at the pump, but have limits on how much you can get back in a given year up to $6,000 or $7,000, whereas the Abound card does not. This card is best suited then to people who drive commercially or spend more than $7,000 per year on gas.

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• Interest rate: 15.00%
• Annual fee: None
• Top rewards rate: 5% back on gas purchases as well as in categories that change each quarter, plus 1% cash back on all other purchases
• Redemption: Cashback is automatically credited to your monthly statement
• Membership: Anyone nationwide can become a member of Abound CU by joining the nonprofit organization USA Cares (no fee), paying a one-time, $10 membership fee to the credit union and depositing $5 into a savings account

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Costco Anywhere Visa® Card By Citi (opens in new tab)

Members of Costco Wholesale can apply for this card, which provides 4% cash back on up to $7,000 per year spent at gas and EV charging stations. 

If you want easy access to your cash rewards, this is not the card for you. Cash back is released to cardholders at the end of February each year, and you can lose your rewards if you close your account before February. In addition, you'll need to do some sleuthing to make sure you can get credit at your local gas station; some stations linked to a convenience store are not eligible. 

These drawbacks likely won't concern loyal Costco customers, and Costco gas tends to be cheaper (opens in new tab) than many competitors.

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• Interest rate: Variable APR of 20.24% for purchases and balance transfers
• Annual fee: None for Costco members, but see annual membership fees
• Top rewards rate: Get  4% cash back on up to $7,000 per year spent at gas and EV charging stations, then 1%
• Other rewards:  Cardholders also get 3% on restaurant and travel spending, 2% on Costco purchases and 1% on other spending 
• Redemption:  You receive cash back as a certificate each year after your February billing statement closes, and you can exchange it for cash or merchandise at Costco warehouses; certificates are redeemable through December 31 each year 
• Membership: Anyone can be a Costco member; the cost is $60 annually for a Gold Star membership or $120 annually for an Executive membership 

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Sam’s Club® Mastercard® (opens in new tab)

If you’re a member of Sam’s Club consider this card for the 5% cash back it provides on up to $6,000 spent in the first year on gas. After the first year, you only earn 1% back on gas, so you may decide to swap out your gas card at that point.

You can get the 5% back on your card at any gas station that accepts Mastercard, and you can also get 5% for EV charging.

Cash back is redeemable only at Sam's Club stores or online site, so be sure you can spend enough at Sam's Club to make the rewards worth it.

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• Interest rate: Variable APR of 20.40% to 28.40% for purchases
• Annual fee: None, but see annual membership fees
• Top rewards rate:  Get 5% cash back on up to $6,000 spent in the first year on gas or EV charging, then 1%
• Other rewards:  Restaurant spending earns 3% back, and so do Sam’s Club purchases if you’re a Plus member; all other spending (including Sam’s Club purchases for Club members) earns 1% back 
• Redemption:  Rewards are issued as Sam’s Cash, which you can redeem for purchases at Sam’s Club stores 
• Sign-up bonus: Get a $30 statement credit when you open a new account and make
  $30 in Sam’s Club purchases within 30 days
• Membership:  Anyone can be a member of Sam's Club; it costs $50 annually for a Club membership or $110 annually for a Plus membership; through January 31, 2024, Sam's Club is offering new Club membership at 50% off, for $25

Best Cash Back Retail Cards

For shoppers who drop a pretty penny at Target, Walmart, or Amazon (and its subsidiary, Whole Foods), a retail card may pay off over time. After providing a handsome reward, usually 3% to 5% for in-store or online purchases, these cards typically reward 2% for categories like gas and restaurants and 1% for all other purchases. So rather than use your retail card everywhere, you will earn more if you pair it with a cash back card that provides more than 1% back.

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Amazon Rewards Visa Signature Card (opens in new tab) 

Chase offers this co-branded Amazon card, rewarding customers with 3% back on Amazon.com and Whole Foods Market purchases. But upgrade to Amazon Prime membership at $139 per year, and get 5% back on these purchases. 

Cardholders get 2% back on gas, restaurants, and drug stores, and 1% back on all other purchases.

Although there is no introductory APR as many cards offer, there are no foreign transaction fees and no limits to how much cash back you can earn. And new cardholders get (opens in new tab) a $50 Amazon gift card for this card, or a $100 gift card if they are Amazon Prime members.

• Interest rate: 18.99% to 26.99% variable APR for purchases
• Annual fee: None, but see membership fees
• Top rewards rate:  Amazon customers get three points per dollar spent on Amazon and Whole Foods Market purchases
• Other rewards: Get 2% back at restaurants and gas stations, and 1% back on all other purchases; as a Visa Signature cardholder, you can can get extended warranties, and coverage for travel accidents, baggage delays and lost luggage
• Redemption:  Points are worth a penny each if you exchange them for Amazon purchases, cash back, gift cards or travel bookings
• Membership: No membership fee is required for the card, but for higher rewards offered by the Amazon Prime Rewards Visa card (opens in new tab), Prime membership is required at $139 per year
• Sign-up bonus: $50 Amazon gift card upon approval, or $100 gift card for prime members

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Capital One Walmart Rewards® Mastercard® (opens in new tab)

Walmart shoppers get 5% cash back on Walmart.com purchases, including orders for pickup from Walmart stores. Cardholders get 2% when shopping in Walmart stores or gas stations, and 1% back wherever Mastercard is accepted.

Perks include extended price protection, warranty protection, travel accident insurance, 24-hour travel assistance services and other benefits.

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• Interest rate:  17.99% or 29.49% for purchases
• Annual fee: None
• Top rewards rate: Earn 5% when shopping online at Walmart.com, including pickup and delivery
• Other rewards: Get 2% cash back in Walmart® stores, Murphy USA and Walmart® fuel stations, as well as in restaurants or on travel; get 1% back on all other purchases
• Redemption:   You earn rewards as points, which you can trade at a rate of 1 cent apiece for cash back, travel or gift cards
• Sign-up bonus:  Get 5% cash back on in-store Walmart purchases the first year if you use the card through Walmart Pay (Walmart’s mobile-payment app) 

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Target RedCard™ (opens in new tab)

Love to shop at Target? Get a 5% discount on purchases at Target stores (including in-store Starbucks cafés) and at Target.com with this card. 

There's no annual fee, and cardholders get free 2-day shipping and more time to return or exchange unwanted purchases. If using in-car pickup services, you also get 5% off. 

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• Interest rate: 27.65% variable APR for purchases
• Annual fee: None
• Top rewards rate: Get 5% cash back on purchases made at Target stores and at Target.com
• Other rewards:  Get 2% back on restaurant and gas purchases, and 1% back on other spending; cardholders get an additional 30 days to make returns and exchanges at Target, plus free shipping on most items from Target.com 
• Redemption: Cash-back rewards are redeemable toward Target gift cards 

Pros and Cons of Cash Back Cards

Pros

• Cashback cards are easy to understand and use. When it comes to simplicity and clarity, cashback cards are second to none among rewards cards. Cashback is expressed as a percentage of the amount you spend, so you know the exact value of your rewards. With travel-rewards cards and other cards that provide points or airline miles for each dollar spent, the value per point or mile may vary depending on which redemption you choose.
  
• They put cash in your pocket. Cashback is hard to beat if you want extra money to spend. You can often redeem cash-back rewards for a bank-account deposit, check or statement credit that reduces your credit card account balance. Or, as with some of our best cash-back cards for savers, you may even be able to put the cashback in an investment account.
• You get good rewards on everyday spending. With a cashback card, you may get a healthy flat rate of about 2% back on everything you buy, or you may earn as much as 5% or 6% back on staples such as gas and groceries. Travel rewards cards tend to offer the highest rates on purchases of flights, hotels, dining out and other spending that usually falls into the non-essential category.

Cons of Cashback Cards:

• They don’t always offer the highest payback. If you prefer to get the maximum possible value out of the rewards you earn with a credit card, a cashback card may not be for you. With travel rewards cards, sometimes you can earn outstanding rewards rates by putting in some legwork. With a card that pays out airline miles, for example, you may squeeze out extra value by combing through flight schedules to find the best redemption rates.
• Sign-up bonuses are smaller. Travel-rewards cards are known for offering hefty initial bonuses to draw in customers. Premium travel card Chase Sapphire Reserve, for example, recently provided 60,000 bonus points–worth $900 in travel redemptions–to new cardholders who spent at least $4,000 on the card in the first three months. Many cash-back cards offer initial bonuses, but their values typically aren’t as high overall.
• Interest rates are high and variable. As with other rewards cards, the annual percentage rate on a cash-back card is usually stiff. Average card rates run close to 20%, and some cards charge maximum rates closer to 30%. Plus, most cards have a variable interest rate tied to an index–often the prime rate. When the Federal Reserve raises short-term interest rates, the APR on your credit card increases, too.

Who Should Use Cash Back Cards?

A cash-back card may be right for you if…

• You pay off your balance in full each month. For a disciplined spender, a cash-back card can be a powerful tool, allowing you to collect hundreds of dollars per year in rewards. But if you carry a balance on the card from month to month, the interest that you pay on the balance will likely erase the advantage of cashback rewards. Cashback cards are best suited to those who pay off their balance monthly and owe no interest.
• You like to keep it simple. With a cashback card, you typically don’t have to think much about redemption values. As long as you redeem rewards for cashback, you should get the advertised percentage payback.
• You prefer to use a single card. Some cashback cards, including our winners for flat-rate cash back, provide 2% or more on every purchase. If you’d rather not carry several rewards cards in your wallet – which involves keeping track of which one provides the best rewards at each merchant you visit–choose a great flat-rate card instead.
• You spend a lot on budget staples. If essentials such as groceries and gas eat a big part of your budget, you may get the most bang for your buck from a cashback card that provides top rewards in those categories.

Which Cash Back Card Is Best for You?

You have a lot of great options among cash-back credit cards. As you narrow down the selection, take stock of the following:

• In what categories do you spend the most money? Take a look at your spending patterns to see where your cash typically flows, and match your top spending categories to a cash-back card that supplies bountiful rewards in those areas.
• Should you pay an annual fee? Reviewing your budget will also help you determine whether the amount of cash back you may earn with a card would overcome the annual fee if it has one. If you don’t think you’ll gain enough in rewards to outweigh the fee, consider a no-fee card instead.
• Can you keep up with rotating categories? Some cards offer the top reward in a category that adjusts each quarter, or they allow you to select the top-earning category each quarter or month. That can be a lucrative strategy, but you’ll have to remember which types of purchases provide the best rewards at a given time. Plus, you may have to activate the maximum-reward category each quarter to earn the heightened cash back. If you’d rather not make the effort to keep it all straight, a simpler cash-back card may be the best choice.
• Can you meet the initial bonus spending requirement? If a card offers a sign-up bonus, check how much you need to spend to earn it. You’ll typically need to spend at least a few hundred dollars — and often $1,000 or more — within a few months of opening the card to get an extra helping of cash back.
• Do you want to finance a large purchase interest-free? Several cards provide an initial period during which purchases (and balance transfers, in some cases) for new card members aren’t subject to interest — often, it lasts 12 months or more. If you’re thinking of making a large purchase, check whether the card offers a 0% window. To avoid interest charges, make a plan to pay off your balance before the 0% offer ends.

Other Best Buy Credit Cards

• Kiplinger's guide to the best rewards credit cards
• Kiplinger's guide to the best business credit cards
• Kiplinger's guide to the best balance transfer credit cards
• Kiplinger's guide to the best travel rewards cards
• Kiplinger's guide to the best student credit cards
• Kiplinger's guide to the best 0% APR credit cards