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Who wants free money? We all do, of course. That’s why cash back credit cards are so popular. These cards award a percentage of the purchases you make back to you. While the cash-back amount is generally only about 1 percent to 2 percent each year, those pennies can really add up. Here is a look at the best cash-back cards out there.
Blue Cash from American Express: Offers up to 5 percent cash back on everyday items and up to 1.5 percent cash back on other purchases. The amount of cash back is determined by a tier system: For example: everyday purchases up to $6,500 earn 1 percent while everyday items above that amount earn 5 percent. Cardholders receive their total annual earned rewards at once.
One from American Express: Cardholders receive $50 after their first purchase and 1 percent for all purchases. The funds are automatically disbursed 35 days after the billing cycle in which the purchases are made.
Bank of America Cash Rewards Platinum Plus MasterCard: Cardholders receive 1 percent for all purchases as well as 2,500 points for $25 statement credit. The points can be redeemed for cash or merchandise online or by phone.
Chase Freedom Cards: Chase offers two very similar cards. The Chase Freedom World MasterCard and the Chase Freedom Signature Visa offer a $50 cash bonus after the first account activity. They both award up to 3 percent back on the top three places at which the card was used and 1 percent cash back for all other purchases. Each card gives an extra $50 each time the cardholder saves and redeems $200 in rewards. The difference in the two cards is the World card excludes several types of purchases from the bonuses.
Discover More: Discover is the company that popularized cash back credit cards. Holders of the More card receive 5 percent cash purchases in several categories, such as department stores, gas stations, home improvement centers, pet stores, restaurants and travel. Other purchases receive up to 1 percent cash back, based on a tiered system depending on the amount purchased. Cardholders can receive the funds in cash, credit to the account, electronic deposit, check or gift card. The cash-back bonus can be increased when used as a gift card.
Money Return Platinum Plus Visa Credit Card: This card offers 10 percent of the annual interest paid each year. The funds are awarded by check each January.
Wells Fargo: This card offers up to 1 percent cash back on all purchases in a tiered system. Purchases up to $150 in a billing cycle receive 0.25 percent cash back. Purchases from $151 to $300 receive 0.5 percent. Those from $301 to $450 receive 0.75 percent and those above $450 receive 1 percent. The rewards can be given as a statement credit or a check in $20 increments.
In order to determine which cash-back card is right for you, consider the rewards policy, the interest rate and all fees. Make sure the cash back and other rewards are given in a form you can readily use. If you tend to carry a balance on your credit cards month to month, make sure the interest rate is reasonable. Weigh the benefits of annual fees against the rewards the card offers. They may or may not be worth the extra price.
Consider the details of these cards and soon your plastic may be earning you money.