Ask an Expert: Which Cash-Back Card Is Best?

I review dozens of credit card offers each week to find the best deals. Check out more on our credit card page.

Recently, a Money Talks News reader contacted me with the following question…

Hi Jason:

We have excellent credit (over 800) and don’t carry a balance. I’m tired of American Express’s limited acceptance, and I want to go back to a MasterCard. The Capital One Cash Credit Card for Excellent Credit looks likes something I would want – the 50 percent cash back bonus looks like a real value add. We don’t pay an annual fee for cards, and the interest rate is not a deciding factor, since we pay in full each month.

Do you have any insight or thoughts on the Capital One Cash card? Do you have any other suggestions? I’ve looked at your MoneyTalksNews page at the Chase and Citi cards.

Thanks,
Dave

Thanks for the question, Dave! Here’s your answer.

I often hear AmEx customers express their frustration when they’re unable to use their card at particular merchants. In fact, even their biggest fans tend to carry a Visa or MasterCard as a backup for these situations.

The first card you suggested, the Capital One Cash card, is part of the MasterCard network. So it can be used wherever credit cards are accepted. It offers an immediate 1 percent cash back on all purchases and an additional 50 percent annual bonus, for the equivalent of 1.5 percent cash back. This is a very competitive rate, especially among cash-back cards with no annual fee. I also like Capital One because they’ve never charged foreign transaction fees.

Still, let’s look at three other options for you, each with no annual fees…

1. Freedom

Chase’s leading cash-back product is the Freedom card. It offers 1 percent cash back on most purchases and 5 percent cash back at various categories of merchants that change each quarter. It also has no annual fee, but Chase does add a 3 percent foreign transaction fee on all charges processed outside the United States.

2. Dividend Platinum

Citi’s leading cash-back card is its Dividend Platinum Select card. It also offers 1 percent cash back at most merchants and a 5 percent bonus cash-back rate at specific stores that change each quarter. In addition, their current offer includes a sign-up bonus of $100 cash back when new applicants make $500 in purchases within three months of opening an account. The Citi card also comes with a range of benefits that include retail purchase protection, price protection, and several different travel insurance policies. Unfortunately, Citi adds a 3 percent foreign transaction fee as well.

3. BankAmericard

Finally, another idea you might consider is the BankAmericard Cash Rewards card. It offers 1 percent cash back on all purchases, 2 percent cash back on groceries, and 3 percent back on gas. Their current offer includes a sign-up bonus of $100 after your first purchase.

It’s always smart to look for the most cash back possible without incurring an annual fee. And by having both an American Express card and one from another payment network, you can be assured that you’ll receive cash back no matter where you shop.