The Blue Cash Everyday Card is an American Express cash back rewards credit card with no annual fee. It gives 3% cash back for supermarket spending, 2% cash back for spending at gas stations and department stores, and 1% cash back on everything else.
- Annual fee
- $0 For First Year
- $0 Ongoing
- Cashback Rate
- up to 3%
- $100 statement credit after you spend $1,000 in purchases on your new Card within the first 3 months.
- No annual fee.
- 3% cash back at U.S. supermarkets (on up to $6,000 per year in purchases, then 1%).
- 2% cash back at U.S. gas stations and at select U.S. department stores, 1% back on other purchases.
- Low intro APR: 0% for 12 months on purchases and balance transfers, then a variable rate, currently 13.99% to 24.99%.
- Expanding merchant acceptance: Over 1 million more places in the U.S. started accepting American Express® Cards in the last year.
- Cash back is received in the form of Reward Dollars that can be easily redeemed for statement credits, gift cards, and merchandise.
- Terms Apply.
- See Rates & Fees
For an introductory deal, the Blue Cash Everyday Card offers up to $150 in statement credits. During your first 6 calendar months of card membership, you can earn one $25 statement credit after you spend $250 in purchases on the Card in that month. The rewards program includes a decent amount of fine print for each cash back category.
Here’s what you need to know:
3% cash back at U.S. supermarkets up to $6,000 per year
Fine print: Superstores, warehouses, and specialty stores are not included. So keep in mind, if you visit your local fishmonger or butcher a few times a month, the cash you spend there probably won’t count as grocery shopping. Also, spending money at Amazon, Target, and Walmart specifically won’t earn you 3% cash back.
Here are samples of grocery stores that will earn you 3% cash back:
- Stop and Shop
- Whole Foods
- Online supermarkets such as FreshDirect
2% cash back at gas stations and select department stores
Fine print: Superstores, supermarkets, and warehouse clubs that happen to sell gas are not included in the 2% cash back category. American Express gives examples of gas stations and a list of department stores that qualify for 2% cash back.
Here are some examples of gas stations:
- Murphy Express
- Murphy USA
Here are the department stores:
- Bon Ton Stores
- Century 21 Department Stores
- J.C. Penney (JCP)
- Lord & Taylor
- Neiman Marcus
- Saks Fifth Avenue
- Stein Mart
1% cash back on all other purchases
Fine print: The 1% cash back applies to all purchases that don’t qualify for 2% or 3% and grocery shopping you do beyond the $6,000 annual cap.
How does American Express determine cash back for each purchase?
American Express uses merchant codes to determine how much cash you earn for each purchase. Merchant codes (or MCCs) are four-digit codes assigned to merchants that classify their business. You need to buy gas and groceries from stores that have an eligible merchant code to get 2% or 3% cash back. For full cash back category terms, head here.
The cash back you earn can also be impacted by the way you choose to process your payments. According to the American Express terms and conditions:
“Purchases made through a third-party payment account or on an online marketplace (with multiple retailers) will not receive a higher percentage reward. A purchase may not receive a higher percentage reward if the merchant submits the purchase using a mobile or wireless card reader or if you use a mobile or digital wallet.”
By “higher percentage reward,” American Express means more than the basic 1% back. The best bet at making sure you get the highest reward possible from your spending is keeping things super simple.
Focus on shopping at the supermarkets, gas stations, and department stores American Express has on the example lists above. At checkout, swipe your Blue Cash Everyday Card the old-fashioned way to pay for your shopping haul.
At first look, the 3% cash back on groceries seems legit because you’re earning cash back with no fee. However, shoppers who spend any more than $3,000 per year on groceries should take a look at the upgraded Amex Blue Cash Preferred Card instead to see if it offers a higher reward.
The Blue Cash Preferred Card gives 6% cash back on groceries and has a $95 annual fee, but you shouldn’t let that cost deter you.
If you spend just $3,200 on groceries per year with the Blue Cash Preferred Card, the 6% cash back minus the $95 fee offers a greater amount of cash back than what you would earn spending the same amount on the free Blue Cash Everyday Card.
Here’s how it works out:
- Blue Cash Everyday – $3,200 x 0.03 = $96 cash back
- Blue Cash Preferred – $3,200 x 0.06 = $192 – $95 annual fee = $97 cash back
Yes, the difference initially may seem small.
But as you spend more on groceries, the cash back earned from the Blue Cash Preferred Card surpasses the Blue Cash Everyday Card at a higher margin. Plus, the Preferred card offers a higher 3% cash back on gas and department stores as well.
How I got $3,200.
In this review, we’ll first explain the basics of the Blue Cash Everyday rewards program. Then, we’ll give you a scenario of when it still makes sense to apply for the Blue Cash Everyday Card instead of other cash back cards, including the Blue Cash Preferred Card.
How Cash Back Works
Cash back earned from the Blue Cash Everyday Card is tracked in Blue Cash Rewards Dollars. You can redeem cash back through the account dashboard for statement credit in increments of 25. You can’t use cash back to make your monthly minimum payment.
American Express is one of several credit card issuers that offers a pre-qualification screening. The benefit of this feature is you can find out whether you have a good chance of getting approved for an American Express card without impacting your credit score.
To see if the Blue Cash Everyday Card is one you pre-qualify for, go here. Then, scroll down to about the middle of the page where you’ll see the pre-qualified offers section. Here’s what it looks like:
Your goal with the Blue Cash Everyday Card is to spend enough in the higher cash back categories to beat the flat 2% on all purchases you can get with a card like the Citi Double Cash Card.
To throw another variable in the mix, if you plan to shop big in the grocery category, you should compare the Blue Cash Everyday Card against the Blue Cash Preferred Card before making a decision.
So, how do these cards stack up against each other?
Here’s a real-world example of when the Blue Cash Everyday Card will benefit you more than the Blue Cash Preferred Card or the Citi Double Cash Card.
For a quick recap:
- Blue Cash Everyday – 3% cash back on groceries up to $6,000 annually, 2% cash back on gas and department stores, 1% cash back on all other purchases
- Blue Cash Preferred – $95 annual fee, 6% cash back on groceries up to $6,000 annually, 3% cash back on gas and department stores, 1% cash back on all other purchases
- Citi Double Cash – 2% cash back on all purchases with no cap
The sample scenario
Marc is a family of one and lives a simple life. He commutes 30 minutes to and from work each day. He’s not a big credit card user. He uses the card primarily to feed himself, to fill up his gas tank, and to take his partner out to an affordable dinner at a place of her choosing once or twice a month.
Here are Marc’s spending specs:
- $2,000 per year on groceries
- $2,400 per year on gas
- $1,500 per year on miscellaneous purchases
This is the cash back he would earn from the Blue Cash Everyday Card, Blue Cash Preferred Card, and Citi Double Cash Card:
Marc is a pretty reserved spender, so he’ll earn more cash back with the Blue Cash Everyday Card compared to the Blue Cash Preferred Card because there’s no annual fee eating away at his earnings.
Cash back from the Citi Double Cash Card comes close to the Blue Cash Everyday Card, but the 3% on groceries is more of a benefit to him than unlimited 2% cash back because of his spending habits.
Now, let’s say Marc had his partner move in and the grocery bill increased to $3,000 per year.
Here’s the updated specs:
- $3,000 per year on groceries
- $2,400 per year on gas
- $1,500 per year on miscellaneous purchases
The Blue Cash Preferred Card with the $95 annual fee would take the earnings edge away from the Blue Cash Everyday Card in this second scenario. So, again, the Blue Cash Everyday Card may not be the best cash back deal available for someone who spends in the $3,000 range on groceries per year.
Although, every situation is unique, and small fluctuations in spending habits can make a huge difference in cash back potential. Do a similar cash back comparison on your own before settling on a rewards card.
Besides cash back rewards, American Express cardholders get to take advantage of the following premium benefits:
- Car rental loss and damage insurance
- Roadside assistance
- Global assistance hotline
- Travel accident insurance
- Extended warranties
- Return protection
- Purchase protection
- Fraud protection
If you decide to apply for the Blue Cash Everyday Card, know that American Express is a card that you may have difficulty getting accepted by smaller retailers and abroad. However, American Express having limited acceptance may not be too problematic for Blue Cash Everyday cardholders.
Mom-and-pop corner markets that don’t accept American Express may not have a merchant code that qualifies for 3% cash back anyway. Plus, the Blue Cash Everyday Card has a 2.7% foreign transaction fee, so it’s probably not a card you’re going to take abroad frequently as your travel companion either.
That said, consumers who will benefit the most from this cash back card are ones who plan to shop primarily stateside at major supermarkets, gas stations, and department stores that qualify for the highest reward.
No, Blue Cash points do not expire as long as your account is open and in good standing. So, you can save your points for higher value rewards including electronics and travel.
Anything over 1.5% cash back is a good deal. There are some cards that offer more — as much as 5% or 6% cash back on purchases. But sometimes those offers are too good to be true. Banks don’t like to lose money and will pepper the fine print with all sorts of limitations. For example, they may offer 5% cash back on only purchases at certain types of retailers and only for certain periods of time. And those categories may change every quarter, which can make it hard to keep track.
Don’t let those cash back promises pressure you into spending more than you can afford. If you don’t pay your statement balance in full each month, you could get slapped with sky-high interest charges. That would totally negate any benefit you might get from earning cash back. Cash back cards are only valuable if you can pay your bill in full and capture the entirety of your cash back rewards.
It depends on the card. Some cards allow you to redeem cash back dollar for dollar as a statement credit, which can help lower your total balance. Just keep in mind that applying cash back to your card statement does not count as a monthly payment. Other cards will increase the value of your cash back if you spend on certain categories, like travel. Review your terms carefully to be sure you’re getting the most bang for your buck.
Find the card that fits your day-to-day spending needs best, beyond the flashy sign-up bonus offers and cash back promises. Pay your bill in full each month (spend only what you can afford to pay off).
The post Amex Blue Cash Everyday Review: Good For Grocery Shoppers appeared first on MagnifyMoney.