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The average American family spends $3,465 per year on groceries. A cash back rewards card could bring some of that money back if you use it wisely. Which cards are good to use at grocery stores? Let’s find out!
American Express Blue Cash Everyday
[#Amex_Blue_Cash_Everyday_Review#]Blue Cash Everyday(SM) Card from American Express offers 3% cash back at U.S. stand-alone supermarkets, 2% cash back on gasoline at U.S. stand-alone gas stations and select major department stores; 1% cash back on other purchases. It has no annual fee and a 0 percent APR for the first 12 months, so you won’t have to pay any interest if you go overboard on your grocery spending during the first year. If your family spends the typical $3,465 annually on groceries, then you’ll get $103.95 back right there.
Additionally, other items can be bought at grocery stores. Let’s say you buy all of your alcoholic beverages and personal care items at the grocery store as well. The average American family spends $458 and $588 on those items, respectively. At 3 percent cash back, you’ll get another $31.38 back for a total of $135.33. You could pay for nearly 2 weeks worth of groceries with that!
This card also offers 2 percent cash back on gas station and department store purchases along with 1 percent cash back on all other purchases. If you’re looking for a good cash back card for your grocery store purchases that offers other benefits as well, this is a good card to consider signing up for.
American Express Blue Cash Preferred Card
[#Amex_Blue_Cash_Everyday_Preferred_Review#]Blue Cash Everyday(SM) Preferred Card from American Express card offers 6% cash back at U.S. stand-alone supermarkets, 3% cash back on gasoline at U.S. stand-alone gas stations and select major department stores; 1% cash back on other purchases. While this may make it seem like a much better card, it comes with a $95 annual fee.
This card also offers 3% cash back at U.S. stand-alone gas stations and department stores and 1% cash back on all other purchases. So, it is a slightly better deal than the Blue Cash Everyday card in this regard, as well.
Taking our previous examples, you’ll get $270.66 in rewards on your yearly grocery store purchases – a net gain of $40.33 after the annual fee is taken into consideration. So, although the real value of the rewards won’t be as high as they may seem, it is still a better card to have than the Blue Cash Everyday card.
There are several credit cards that offer 5 percent cash back on grocery purchases. The catch is that such purchases are generally part of a rotating rewards system, meaning that you’ll only get 5 percent cash back on grocery purchases over a 3 month period each year. Most offer 1 percent cash back during the other 9 months, which makes for a bit of a mixed bag. After all, groceries are a year-round expense, not seasonal.
Such cards include Chase Freedom and Discover it Card cards. Those may be worth looking into if you are looking for a card that you can earn 5 percent with across multiple categories and you are comfortable with keeping up with the rotating categories. Then, you’ll be able to get 5 percent cash back on your groceries for 3 months and be able to work in the other categories, as well.