Cash Back Credit Cards

Cash back credit cards can be a great way to earn rewards for the things you buy every day. Our list of cash back offers is updated monthly to make it easy to find the card that will maximize your savings. The top flat-rate cash back cards will pay you up to 2% cash back on all purchases, while rotating category cards have cash back rates up to 6% in select spending categories. Additionally, the best cash back credit cards can have introductory offers up to $150. Review this list of offers from our partners to find the card that best fits your personal spending profile.

Our up-to-date list of cash back offers makes it easy to find a card that will maximize your savings. See offers from our partners below.

Estimated savings is based on on a total credit card transfer balance of $2,500, current APR of 15.00%, and a monthly repayment of $56.25 for the first 24 months.

Estimated Savings is a CreditCards.com calculation that is used to provide an example of how much you might save by transferring your balances to a new card after factoring in fees, length of promotional periods and interest charges. This amount is based on the transfer amount, assumes you make fixed monthly payments on time, and does not assume rewards or purchases, since those will vary per individual.

PenFed Power Cash Rewards Visa Signature® Card

APPLY NOW

Rewards Rate

1.5%
?

1.5% Unlimited Cash Back On All Purchases w/no caps, limits or category restrictions of rewards. Flexible cash redemption options. Earn up to 2% Cash Back through the PenFed Honors Advantage program

Intro Bonus Value

$100
?

Earn a $100 statement credit when you spend $1,500 in the first 90 days.

Annual Reward Value

$351
?

Annual Reward Value is a CreditCards.com calculation that is used to provide an example of how much you might earn with your new card based on your spending habits. This amount is based on average monthly spend, and actual results will vary by user.

$1,325 monthly spend
Groceries
23%
Restaurants
14%
Travel (airline only)
4%
Travel total
8%
Hotel
2%
Gas
15%
Entertainment
5%
Other
33%

Annual Fee

$0

PenFed Power Cash Rewards Visa Signature® Card

Rewards Rate

1.5%

Intro Bonus Value

$100

Annual Reward Value

$351

Annual Fee

$0

Why should I get this card?

Earn 1.5% unlimited cash back on all purchases with no caps, limits or category restrictions of rewards. Cardmembers also receive benefits such as travel assistance, purchase protection, concierge service, and roadside assistance.

Card Details

  • 0% APR promo balance transfer rate for 12 mos with 3% balance transfer fee. After that, the APR for the unpaid balance and any new balance transfers will be 9.49% to 17.99%.
  • APR will vary w/the market based on Prime Rate. Subject to credit approval. $100 bonus after spending $1,500 in purchase transactions within 3 months of account opening.
  • Rate and offers current as of April 1, 2017 and are subject to change.
  • 1.5% Unlimited Cash Back On All Purchases w/no caps, limits or category restrictions of rewards. Flexible cash redemption options. Earn up to 2% Cash Back through the PenFed Honors Advantage program
  • No Annual or Foreign Transaction Fees
  • Chip Enabled for Added Security and Federally Insured by the NCUA
  • Rates As Low As 9.49% APR

Recommended Credit Score

740 850
Excellent

Rates & Fees

Annual Fee $0
Purchase Intro APR N/A
Regular APR 9.49%-17.99% Variable
Balance Transfers Intro APR 0% for 12 months

Features

EMV
No Foreign Transaction Fees
No Annual Fee
Auto Rental Insurance
Concierge Service
Extended Warranty Program
Lost Luggage Reimbursement
Purchase Protection
Roadside Assistance
Travel Accident Insurance
Travel Assistance
Zero Fraud Liability
Mobile Pay Ready
Visa Signature
View More Details

at Pentagon FCU's
secure site

Discover it® Secured Card

APPLY NOW

Rewards Rate

2%
?

Earn 2% cash back at restaurants & gas stations on up to $1,000 in combined purchases each quarter. Plus, 1% cash back on all your other purchases.

on select categories

Intro Bonus Value

$273
?

Get a dollar-for-dollar match of all the cash back you've earned at the end of your first year, automatically.

Annual Reward Value

$273
?

Annual Reward Value is a CreditCards.com calculation that is used to provide an example of how much you might earn with your new card based on your spending habits. This amount is based on average monthly spend, and actual results will vary by user.'

$1325 monthly spend
Groceries
23%
Restaurants
14%
Travel (airline only)
4%
Travel total
8%
Hotel
2%
Gas
15%
Entertainment
5%
Other
33%

Annual Fee

$0

Discover it® Secured Card

(712 Reviews)

Rewards Rate

2%
on select categories

Intro Bonus Value

$273

Annual Reward Value

$273

Annual Fee

$0

Why should I get this card?

Earn 2% cash back at restaurants and gas stations up to $1,000 in combined purchases each quarter. Plus, there's no annual fee and a security deposit of $200 or more will establish your credit line (up to the amount that can be approved).

Card Details

  • No Annual Fee, cash back on every purchase, and helps you build your credit with responsible use.
  • Your Secured Card requires a refundable security deposit up to the amount we can approve of at least $200 which will establish your credit line.
  • You will need to provide your bank information when submitting your security deposit.
  • We will automatically begin reviewing your account starting at 8 months to see if we can transition you to an unsecured line of credit.
  • Earn 2% cash back at restaurants & gas stations on up to $1,000 in combined purchases each quarter. Plus, 1% cash back on all your other purchases.
  • Get a dollar-for-dollar match of all the cash back you've earned at the end of your first year, automatically.
  • New! Free Social Security Number alerts, we'll monitor thousands of risky websites when you sign up.*

Recommended Credit Score

300 669
Poor to Fair

Rates & Fees

Annual Fee $0
Purchase Intro APR N/A
Regular APR 23.99% Variable
Balance Transfers Intro APR 10.99% for 6 months

Features

EMV
No Foreign Transaction Fees
No Annual Fee
Free Credit Score
Auto Rental Insurance
Extended Warranty Program
Purchase Protection
Price Protection
Zero Fraud Liability
Mobile Pay Ready
View More Details

at Discover's
secure site

See Rates & fees
PenFed Platinum Rewards Visa Signature®  Card

APPLY NOW

Rewards Rate

1%
?

Earn 5 points on gas purchases at the pump. Fuel purchases for airplanes and boats do not receive cash back rewards, 3 points on supermarket purchases, and 1 point on all other purchases

Intro Bonus Value

$100
?

Earn a $100 statement credit when you spend $1,500 in the first 90 days.

Annual Reward Value

$289
?

Annual Reward Value is a CreditCards.com calculation that is used to provide an example of how much you might earn with your new card based on your spending habits. This amount is based on average monthly spend, and actual results will vary by user.'

$1325 monthly spend
Groceries
23%
Restaurants
14%
Travel (airline only)
4%
Travel total
8%
Hotel
2%
Gas
15%
Entertainment
5%
Other
33%

Annual Fee

$0

PenFed Platinum Rewards Visa Signature® Card

Rewards Rate

1%

Intro Bonus Value

$100

Annual Reward Value

$289

Annual Fee

$0

Why should I get this card?

Earn 5 points on gas purchases at the pump, 3 points on supermarket purchases and 1 point on all other purchases. Plus, there's no annual fee!

Card Details

  • 0% APR promo balance xfer rate for 12 mos w/3% balance xfer fee. After that, APR for unpaid balance + new balance xfers will be 9.24%-17.99%. APR will vary w/market based on Prime Rate.
  • 3% balance transfer fee per transaction. Subject to credit approval.
  • $100 bonus after spending $1,500 in purchase transactions within 3 months of account opening.
  • Rate and offers current as of April 1, 2017 and subject to change.
  • Earn 5 points on gas purchases at the pump. Fuel purchases for airplanes and boats do not receive cash back rewards.
  • Earn 3 points on supermarket purchases, Earn 1 point on all other purchases
  • No annual fee, Chip Enabled for Added Security
  • Federally insured by NCUA

Recommended Credit Score

740 850
Excellent

Rates & Fees

Annual Fee See Terms
Purchase Intro APR N/A
Regular APR See Terms
Balance Transfers Intro APR 0% for 12 months

Features

EMV
No Foreign Transaction Fees
No Annual Fee
Free Credit Score
Auto Rental Insurance
Concierge Service
Extended Warranty Program
Lost Luggage Reimbursement
Purchase Protection
Roadside Assistance
Travel Accident Insurance
Travel Assistance
Zero Fraud Liability
Mobile Pay Ready
Visa Signature
View More Details

at Pentagon FCU's
secure site

Mastercard® Gold Card™

APPLY NOW

Rewards Rate

1%
?

Double Points Value When Redeemed for Airfare and 2% Value for Cash Back Statement Credit Redemptions

Intro Bonus Value

N/A

Annual Reward Value

$159
?

Annual Reward Value is a CreditCards.com calculation that is used to provide an example of how much you might earn with your new card based on your spending habits. This amount is based on average monthly spend, and actual results will vary by user.'

$1325 monthly spend
Groceries
23%
Restaurants
14%
Travel (airline only)
4%
Travel total
8%
Hotel
2%
Gas
15%
Entertainment
5%
Other
33%

Annual Fee

$995

Mastercard® Gold Card™

Rewards Rate

1%

Intro Bonus Value

N/A

Annual Reward Value

$159

Annual Fee

$995

Why should I get this card?

Cardmembers receive 2% value for cash back statement credit redemptions and luxury card concierge with the Mastercard® Gold Card™. Plus, there's no foreign transaction fees, travel assistance, and private jet access.

Card Details

  • 24K-Gold Plated Stainless Steel - Patented Card Design
  • 2% Value for Airfare Redemptions
  • 2% Value for Cash Back Redemptions
  • 24/7 Luxury Card Concierge™
  • Exclusive Luxury Card Travel Benefits
  • $200 Annual Airline Credit Toward Qualifying Purchases
  • $100 Global Entry Application Fee Credit
  • Annual Fee: $995 ($295 for each Authorized User)

Recommended Credit Score

740 850
Excellent

Rates & Fees

Annual Fee $995
Purchase Intro APR N/A
Regular APR 15.99% Variable
Balance Transfers Intro APR 0% for 15 months

Features

EMV
No Foreign Transaction Fees
0% Introductory APR
Free Credit Score
Airport Lounge Access
Auto Rental Insurance
Concierge Service
Extended Warranty Program
Lost Luggage Reimbursement
Purchase Protection
Price Protection
Roadside Assistance
Travel Accident Insurance
Travel Assistance
Trip Cancellation Insurance
Zero Fraud Liability
Private Jet Access
Mobile Pay Ready
MasterCard World Elite
View More Details

at Luxury Card's
secure site

ABOC Platinum Rewards Credit Card

APPLY NOW

Rewards Rate

1%
?

Earn Points on Every Purchase! It’s simple: $1 = 1 Point

Intro Bonus Value

$100
?

Earn 10,000 ABOC Rewards Points after you spend $1,000 on purchases within the first 90 days from account opening.

Annual Reward Value

$192
?

Annual Reward Value is a CreditCards.com calculation that is used to provide an example of how much you might earn with your new card based on your spending habits. This amount is based on average monthly spend, and actual results will vary by user.'

$1325 monthly spend
Groceries
23%
Restaurants
14%
Travel (airline only)
4%
Travel total
8%
Hotel
2%
Gas
15%
Entertainment
5%
Other
33%

Annual Fee

$0

ABOC Platinum Rewards Credit Card

Rewards Rate

1%

Intro Bonus Value

$100

Annual Reward Value

$192

Annual Fee

$0

Why should I get this card?

Earn 10,000 Bonus ABOC Rewards Points after you spend $1,000 on purchases within the first 90 days from account opening with the ABOC Platinum Rewards Credit Card. Rack up unlimited points that don't expire!

Card Details

  • 0% Intro APR on Purchases for 12 months; after that the variable APR will be 13.90% - 23.90%, based on your creditworthiness
  • Earn 10,000 Bonus ABOC Rewards Points after you spend $1,000 on purchases within the first 90 days from account opening
  • Unlimited Points That Don't Expire
  • Earn Points on Every Purchase! It’s simple: $1 = 1 Point
  • No Annual Fee
  • Select Your Rewards Your Way

Recommended Credit Score

670 850
Good to Excellent

Rates & Fees

Annual Fee $0
Purchase Intro APR 0% for 12 months
Regular APR 13.90% - 23.90% Variable APR on purchases and balance transfers
Balance Transfers Intro APR N/A

Features

EMV
No Annual Fee
0% Introductory APR
Auto Rental Insurance
Price Protection
Travel Accident Insurance
Zero Fraud Liability
View More Details

at Amalgamated Bank of Chicago's
secure site

Discover it® chrome for Students

APPLY NOW

Rewards Rate

2%
?

2% cash back at restaurants and gas stations on up to $1,000 in combined purchases every quarter—no sign-ups needed. 1% cash back on all your other purchases.

on select categories

Intro Bonus Value

$80

Annual Reward Value

$80
?

Annual Reward Value is a CreditCards.com calculation that is used to provide an example of how much you might earn with your new card based on your spending habits. This amount is based on average monthly spend, and actual results will vary by user.

$300 monthly spend
Groceries
23%
Restaurants
14%
Travel (airline only)
4%
Travel total
8%
Hotel
2%
Gas
15%
Entertainment
5%
Other
33%

Annual Fee

$0

Discover it® chrome for Students

(594 Reviews)

Rewards Rate

2%
on select categories

Intro Bonus Value

$80

Annual Reward Value

$80

Annual Fee

$0

Why should I get this card?

Earn 2% cash back at restaurants and gas stations on up to $1,000 in combined purchases each quarter - no sign-ups needed! The Discover it® chrome for Students also rewards good grades with $20 cash back each school year your GPA is 3.0 or higher for up to the next 5 years.

Card Details

  • New! Free Social Security Number alerts, we'll monitor thousands of risky websites when you sign up.*
  • Get a dollar-for-dollar match of all the cash back you've earned at the end of your first year, automatically.
  • 2% cash back at restaurants and gas stations on up to $1,000 in combined purchases every quarter—no sign-ups needed. 1% cash back on all your other purchases.
  • Good Grades Rewards: $20 cash back each school year your GPA is 3.0 or higher for up to the next 5 years.
  • No annual fee. No late fee on first late payment. No APR change for paying late.
  • Get 100% U.S. based customer service & your FICO® Credit Score for free on monthly statements, on mobile and online.
  • Freeze It® on/off switch for your account that prevents new purchases, cash advances & balance transfers in seconds.
  • 0% intro APR on purchases for 6 months, then the standard variable purchase APR of 13.99% - 22.99%.

Recommended Credit Score

580 740
Fair to Good

Rates & Fees

Annual Fee $0
Purchase Intro APR 0% for 6 months
Regular APR 13.99% - 22.99% Variable
Balance Transfers Intro APR 10.99% for 6 months

Features

EMV
No Foreign Transaction Fees
No Annual Fee
0% Introductory APR
Free Credit Score
Auto Rental Insurance
Extended Warranty Program
Purchase Protection
Price Protection
Zero Fraud Liability
Mobile Pay Ready
View More Details

at Discover's
secure site

See Rates & fees
Charity Charge World MasterCard® Credit Card

APPLY NOW

Rewards Rate

1%
?

Unlimited 1% cash back rewards in the form of an automatic donation to any nonprofit, K-12 school, university, or religious organization of your choice.

Intro Bonus Value

N/A

Annual Reward Value

$159
?

Annual Reward Value is a CreditCards.com calculation that is used to provide an example of how much you might earn with your new card based on your spending habits. This amount is based on average monthly spend, and actual results will vary by user.'

$1325 monthly spend
Groceries
23%
Restaurants
14%
Travel (airline only)
4%
Travel total
8%
Hotel
2%
Gas
15%
Entertainment
5%
Other
33%

Annual Fee

$0

Charity Charge World MasterCard® Credit Card

Rewards Rate

1%

Intro Bonus Value

N/A

Annual Reward Value

$159

Annual Fee

$0

Why should I get this card?

Do good with unlimited 1% cash back rewards in the form of an automatic donation to any nonprofit, K-12 school, university, or religious organization of your choice. Rewards are tax-deductible and there's no annual fee.

Card Details

  • Unlimited 1% cash back rewards in the form of an automatic donation to any nonprofit, K-12 school, university, or religious organization of your choice.
  • No Annual Fee.
  • Rewards are tax-deductible.
  • One time bonus donation of $10 to your chosen nonprofit after your first purchase.
  • Ability to support up to three nonprofits at once. You can change the nonprofits you support at any time through your online donation dashboard.
  • Low APR between Prime + 6.99%-16.99% dependent on creditworthiness. Balance transfer fee of either $10 or 5% of the amount of each Balance Transfer, whichever is greater.
  • Receive all the benefits of a World MasterCard such as: extended warranty, MasterCard global service, concierge services, ID theft protection, price guarantee, and many more exclusive services.
  • Chip and Apple Pay enabled.

Recommended Credit Score

670 850
Good to Excellent

Rates & Fees

Annual Fee $0
Purchase Intro APR 1.99% for 6 monthly billing cycles
Regular APR 10.74%-20.74% (Variable)
Balance Transfers Intro APR 1.99% for 6 monthly billing cycles

Features

EMV
No Annual Fee
Free Credit Score
Auto Rental Insurance
Concierge Service
Extended Warranty Program
Price Protection
Zero Fraud Liability
Mobile Pay Ready
MasterCard World
View More Details

at Charity Charge's
secure site

Target REDcard™

APPLY NOW

Rewards Rate

5%
?

Save 5%* every day at Target and Target.com

Intro Bonus Value

N/A

Annual Reward Value

$222
?

Annual Reward Value is a CreditCards.com calculation that is used to provide an example of how much you might earn with your new card based on your spending habits. This amount is based on average monthly spend, and actual results will vary by user.'

$1325 monthly spend
Groceries
23%
Restaurants
14%
Travel (airline only)
4%
Travel total
8%
Hotel
2%
Gas
15%
Entertainment
5%
Other
33%

Annual Fee

$0

Target REDcard™

Rewards Rate

5%

Intro Bonus Value

N/A

Annual Reward Value

$222

Annual Fee

$0

Card Details

  • Charge your Target and Target.com purchases
  • Save 5%* every day at Target and Target.com
  • Free Shipping* on most items at Target.com and Extended Return Policy*
  • REDcard online account management
  • Stackable with Cartwheel and other discounts
  • Subject to application approval
  • Target also offers a Target Debit card which also qualifies for 5% off* every day at Target and Target.com, Free shipping* on most items at Target.com, Extended Return Policy* and up to $40 cash withdrawal at checkout
  • *Some restrictions apply. See program rules at Target.com/REDcard for details.

Recommended Credit Score

670 850
Good to Excellent

Rates & Fees

Annual Fee $0
Purchase Intro APR N/A
Regular APR 23.15% (Variable)
Balance Transfers Intro APR N/A

Features

EMV
No Foreign Transaction Fees
No Annual Fee
Auto Rental Insurance
Price Protection
Zero Fraud Liability
View More Details

at Target's
secure site

Citi ThankYou® Preferred Card

APPLY NOW

Rewards Rate

1%
?

Earn 2X Points on Dining Out & Entertainment; Earn 1X Points on All Other Purchases

Intro Bonus Value

$166.50
?

Earn 15,000 bonus points after spending $1,000 in purchases within the first 3 months of account opening*.

Annual Reward Value

$54
?

Annual Reward Value is a CreditCards.com calculation that is used to provide an example of how much you might earn with your new card based on your spending habits. This amount is based on average monthly spend, and actual results will vary by user.

$300 monthly spend
Groceries
23%
Restaurants
14%
Travel (airline only)
4%
Travel total
8%
Hotel
2%
Gas
15%
Entertainment
5%
Other
33%

Annual Fee

$0

Citi ThankYou® Preferred Card

APPLY BY PHONE

or call Citi at

866-935-2929

Rewards Rate

1%

Intro Bonus Value

$166.50

Annual Reward Value

$54

Annual Fee

$0

Why should I get this card?

With the Citi ThankYou® Preferred Card you can earn 15,000 bonus points after spending $1,000 in purchases within the first 3 months of account opening. 15,000 bonus ThankYou® points are redeemable for $150 in gift cards, electronics and other great rewards.

Card Details

  • Enjoy 0% Intro APR on purchases for 15 months from date of account opening and 0% Intro APR on balance transfers for 15 months from date of first transfer*
  • After that, the variable APR will be 14.49% - 24.49% based upon your creditworthiness*
  • There is a balance transfer fee of either $5 or 3% of the amount of each transfer, whichever is greater*
  • Earn 2X Points on Dining Out & Entertainment
  • Earn 1X Points on All Other Purchases
  • Points are redeemable for gift cards to popular retailers, restaurants, and department and home stores. 2,500 ThankYou® Points can be redeemed for a $25 gift card at thankyou.com.
  • No expiration and no limit to the amount of points you can earn with this card
  • No annual fee*

Recommended Credit Score

740 850
Excellent

Rates & Fees

Annual Fee $0*
Purchase Intro APR 0%* for 15 months on Purchases
Regular APR 14.49% - 24.49%* (Variable)
Balance Transfers Intro APR 0%* for 15 months on Balance Transfers

Features

EMV
No Annual Fee
0% Introductory APR
Free Credit Score
Auto Rental Insurance
Concierge Service
Extended Warranty Program
Lost Luggage Reimbursement
Purchase Protection
Price Protection
Travel Accident Insurance
Trip Cancellation Insurance
Zero Fraud Liability
Mobile Pay Ready
MasterCard World
Presale Tickets
View More Details

at Citi's
secure site

or call Citi at

866-935-2929

Editorial disclosure: All reviews are prepared by CreditCards.com staff. Opinions expressed therein are solely those of the reviewer and have not been reviewed or approved by any advertiser. The information, including card rates and fees, presented in the review is accurate as of the date of the review. Check the data at the top of this page and the bank's website for the most current information.


Compare Cash Back Credit Card Offers

Updated: September 1, 2017

Card Welcome Bonus Bonus Requirement Rewards Rate
Wells Fargo Cash Wise Visa® Card $200 Cash Rewards Bonus Spend $1,000 in the first 3 months Earn unlimited 1.5% cash rewards on purchases
Discover it® Cashback Match™ Get a dollar-for-dollar match of all the cash back you've earned at the end of your first year, automatically Automatic Earn 5% cash back in rotating categories each quarter like gas stations, restaurants, Amazon.com, wholesale clubs and more, up to the quarterly maximum each time you activate

Unlimited 1% cash back on all other purchases
Citi® Double Cash Card N/A N/A Earn cash back twice on every purchase with unlimited 1% cash back when you buy, plus an additional 1% as you pay for those purchases
Chase Freedom Unlimited® $150 Bonus Spend $500 on purchases in your first 3 months from account opening Unlimited 1.5% cash back on every purchase
Barclaycard CashForward™ World Mastercard® $200 Cash Rewards Bonus Spend $1,000 on purchases in the first 90 days after account opening Unlimited 1.5% cash rewards on every purchase
Bank of America® Cash Rewards Credit Card $150 Online Cash Rewards Bonus Spend at least $500 on purchases in the first 90 days of account opening Earn 1% cash back on every purchase, 2% at grocery stores and wholesale clubs, and 3% on gas for the first $2,500 in combined grocery/wholesale club/gas purchases each quarter
Capital One® Quicksilver® Cash Rewards Credit Card $150 Cash Bonus Spend $500 on purchases within 3 months from account opening Earn unlimited 1.5% cash back on every purchase, every day
MLB™ BankAmericard Cash Rewards™ Mastercard® $150 Cash Rewards Bonus Spend at least $500 on purchases in the first 90 days of account opening Earn 1% cash back on every purchase, 2% at grocery stores and wholesale clubs, and 3% on gas for the first $2,500 in combined grocery/wholesale club/gas purchases each quarter
USAA Limitless™ Cashback Rewards Visa Signature® Credit Card N/A N/A Earn 1.5% cash back on credit card purchases

Choose the Right Cashback Card for You

There are few credit cards as versatile as the cashback card.

No matter your purchase habits, there's likely a cashback card for you. You can earn cash without having to think about it. You can max out rewards by pairing this kind of card with a travel rewards card, such as a Chase Freedom or Freedom Unlimited card and a Chase Sapphire Preferred. With a few cashback cards, you can even build your credit when it's not at its best while earning cash back.

Many have no annual fee. There is also the option of rotating categories or flat cashback percentages. We'll explain all that in easy-to-understand language. Here's what you need to know:

What is a cashback credit card?

A cashback credit card is a card that allows you to earn cash for making purchases. Most require good or excellent credit, which means you need at least a FICO score of 700 before you even think about applying. FICO, the credit scoring model most used by lenders, rates on a scale of 300-850, with 850 as the best.

Cashback cards are an excellent gateway card into travel cards, which can be more complicated to maneuver and typically have an annual fee. Because cashback cards often don’t have annual fees, you don’t have to worry about a minimum spend to make the card worth your while.

Once you’ve built your credit, pick out a cashback card and practice good money-management habits with it. That means keep a budget, plan what you’ll use your card for (only spend what you have the money to repay), and pay in full and on time each month.

After you’ve successfully managed your cashback card for about a year, then it’s time to look at possibly upgrading to a travel or rewards card for more intense benefits.

Why use cashback credit cards?

You may be wondering why you should use a cashback credit card. If you can pay your balance in full and on time each month, you can earn cash back in the hundreds each year. Say you have a card that pays 2% back on everything, and there is no annual fee. If you spend $1,000 a month for a year, you will get $240 back at the end of that year.

Also, by paying in full and on time each month, you will improve your credit, because FICO, the dominant scoring model, loves it when you don't carry a balance on your credit cards, and it really loves when you pay on time.

How do I get a cashback credit card?

When you apply for a cashback credit card, the card issuer will gather some information, including Social Security number, name and address, and income. Fill out the form honestly, because you can have the card revoked if you’re caught in a lie. Income can be money you have access to, rather than just your salary, so if you and your spouse are employed, you can combine the incomes. This is helpful if you are an at-home parent and the family has just one income.

Many cards will approve or decline you within minutes. If you are approved, you may be able to shop online with your new account. Your card will arrive within a few days in the mail.

How do cashback credit cards work?

Cashback credit cards work in a variety of ways, usually offering a percentage back for your purchases.

Say you have a Wells Fargo Cash Wise card, which gives 1.5% back on everything. That means if you spend $1,000 a month on groceries, gas and other expenses, at year end, you'll earn $180 back. And because many cashback cards don't have annual fees, you're not having to clear that “fee hurdle.”

Some cashback cards are a little more complicated. They might pay for quarterly categories, for example, such as the Discover it Cashback Match. Categories can have reward limits -- for example, the Cashback Match gives you 5% back for up to $1,500 a quarter. Categories can include wholesale clubs, restaurants, gas and more. The advantage with a card that has quarterly categories is that you get a higher reward. However, there are usually signups, limits and you have to keep track of which categories qualify.

Depending on the card, cash back can be in the form of credit statements, bank deposit, checks, even merchandise through shopping portals. For example, Discover Deals allows you to get cashback bonuses or money off your purchases. Through these shopping portals, you can shop for clothing, gifts, health and beauty aids, travel and more. Some cards, such as the Wells Fargo Propel, allow you to redeem for gift cards.

What are signup bonuses on cashback cards?

Many cashback cards offer a signup bonus, typically between $100 and $200, with a required spend within a certain amount of time, usually 90 days or 3 months.

The required spend is usually below that of a travel card, typically $1,000 or less. This makes it easier to meet the requirements and earn the cash bonus. For example, the Chase Freedom Unlimited offers $150 after a $500 spend within your first 3 months of card membership.

Make sure you have the cash to pay back the required spend, because if you carry the charge over month-to-month, you basically undo the benefit of the bonus by paying interest fees.

How do you use a cashback credit card to save money?

Using a cashback card to save money only works if you use your card for purchases you plan to make anyway and if you pay your card bill in full and on time each month. That way, you avoid late fees and interest charges. You also want to make sure that your planned spending will put your cash back above any annual fee. So, if you have an annual fee of $95, and the redemption is at 2% on every dollar spent, you want to make sure you plan to spend at least $4,750 in a year.

Ideally, you want to focus on your best cashback, travel or rewards card, and put as many purchases as possible on it so that you earn maximum miles.

How do you strategically use a cashback credit card?

7 strategies to maximize cashback rewards:

What do you look for in a cashback credit card?

Here are 4 things to look for in a cashback credit card:

Why do creditors offer cashback cards?

On the surface, it doesn't make sense why creditors or credit card issuers offer cashback credit cards. Used correctly, you can get hundreds of dollars back each year. But it makes sense, once you understand the issuer business model. Here's how it works:

With all these fees floating around, what do you do? First off, pay in full and on time each month. That will keep you from paying late fees and interest fees. Also, keep an emergency fund so you won't be tempted to take out a cash advance. Finally, ask the merchant if you are being charged a checkout fee for using your Visa or MasterCard. If so and it's a big purchase, you may want to think about shopping elsewhere.

What are typical cashback rates?

There is no typical cashback rate. Cards can pay out a flat 1.5% or 2% or they can give a higher rate for specific types of purchases. For example, the Blue Cash Everyday offers 3% back on purchases made at U.S. supermarkets for up to $6,000 a year. (It's 1% after that.) That comes to $180 back. Terms apply.

Some cards, such as the Chase Freedom, pay out for categories that you sign up for each quarter. The Freedom, for example, offers 5% back on quarterly categories for up to $1,500 spend, or $75 back each quarter.

How to compare cashback credit cards

Here's how to compare cashback credit cards:

Track your spending for 2 months. You'll want to see how much you spend on items such as groceries and gas. Also, look at how much you spend at specific stores, such as Sam's Club or Amazon.com.

Study a mix of cashback cards, including Discover it Cashback Match, Blue Cash Preferred and Chase Freedom Unlimited. Each has a specific type of model: The Cashback Match offers quarterly categories (as does the Chase Freedom); Blue Cash Preferred offers yearlong rewards for specific categories; and the Chase Freedom Unlimited (as well as the Wells Fargo Cash Wise) offers a percentage for all purchases.

If Amazon is a go-to for you, the Cashback Match may be a good choice for you. If you have a family and spend a lot on groceries, the Blue Cash Preferred can be a good option. And if you don't want to be pinned down by what you use your card for, the Cash Wise might be the one to choose.

What are rotating categories?

Cards with rotating categories usually give you a higher percentage back than other cards, but only for a quarter. Categories can be restaurants, groceries, gas and more. In the last year, Amazon.com and warehouse clubs have increased in popularity.

You usually have to sign up each quarter, but if you don't mind tracking which categories you'll use each month, you can get as much as 10% back at the end of your first year. One thing, there is usually a limit to how much you can spend toward the quarter, typically $1,500 a quarter. After that it's 1%.

An alternative is the flat rate, which gives you the same amount back regardless of the purchase. The amount is usually 1.5%-2% back. So, if you get 2% back on everything, it doesn't matter what you are using your card for — groceries, clothes shopping, whatever. If you spend $1,000 a month with your card, you get $240 back at the end of your year. And there is no maximum spend.

What are common cashback categories?

There’s no guarantee, and categories change from year to year, but here are common cashback categories:

Restaurants

The Cashback Match is generous with this category, as is the Chase Freedom. This is a good category for the millennial to target if your evenings center around trying out new restaurants or during the workweek checking out the latest lunch spot.

Amazon.com

Do a lot of shopping online? The Cashback Match has featured this category, giving you 5% back on Amazon shopping for up to $1,500 in the selected quarter, up to $75 back -- $150 back at the end of your first year.

Wholesale clubs

This is an increasingly popular category for cashback cards, sometimes as a quarterly category and sometimes in a limited time offer.

Grocery stores

Groceries are a favorite category for cashback cards. In addition, during the quarter when grocery stores were featured, Chase Freedom included drugstores. If you shop for a family, this can be a good category — with the Discover it Cashback Match, for example, you can spend $500 a month on groceries and max out the spend, giving you back $75 for that quarter. And don't forget the additional $75 back at the end of your first year.

Transportation

Some cards give a higher percent for gas, such as the Blue Cash Preferred. Others, such as the Chase Freedom, also give 5% back during specific quarters on parking, tolls and Amtrak purchases. This category is a good choice for the daily commuter or if you do a whole lot of shuttling the kids and the soccer team.

Advantages for cashback credit cards

Cashback credit cards have a number of advantages, including:

A cashback card gives you, well, cash back, sometimes hundreds of dollars a year. If you use it strategically as your card of choice, you can enjoy not only statement credits, but shopping deals as well, depending on the card. By using the card for everything from grocery shopping to furniture purchases, the cash back can add up. Just don’t make purchases you don’t have the money to pay back – remember, a credit card isn’t designed to be a long-term loan.

Another, lesser-known advantage is that cashback cards can be great practice for a travel or rewards card. These cards typically have an annual fee, which you have to factor in when calculating how much money you need to spend in a year to make the card worth your while. Also, travel cards can require some maneuvering to make it worth your while, such as the Chase Sapphire Preferred’s Chase Ultimate Rewards portal. The portal is an excellent way to maximize your points, but it’s a bit more complicated than just spending and getting your periodic statement credit.

Cashback cards also offer variety in structure. If you want something simple and straightforward, you can get a flat-rate card, such as the Wells Fargo Cash Wise. Want to maximize cash back? The Discover it Cashback Match is a great choice. There are also cards that are a mix of the two – such as the Blue Cash Preferred and the Blue Cash Everyday. These cards give you extra cash back for specific categories year-round, plus a minimum cash back for everything else.

Disadvantages to cashback credit cards

From incurring additional debt to impacted credit, there can be disadvantages to cashback credit cards, none of which are insurmountable.

On the plus side, you can earn cash back for using your cashback card. On the downside, you can end up owing more than you can pay off or even harming your credit. Here are possible disadvantages to cashback cards and what you can do about them:

How do you redeem cash rewards?

You can redeem cash rewards a number of ways, depending on the card. In most cases, you get a statement credit, but some issuers allow you to spend your cash back on shopping or gift cards. In some cases, you can deposit the cash back in a bank account or get a check cut. Issuers might give a better deal for the statement credit, though, so check. Some Bank of America cards give you 10% back when you deposit your credit in a Bank of America checking or savings account. If you have a preferred account, your cash back for deposits increases to 25% and even up to 75%.

What is a statement credit?

Most cashback credit cards give you your cash in what's called a statement credit. That means that on your monthly statement, you'll see a positive balance that you can use toward your monthly bill. Some issuers also allow you to deposit your cash back into a bank account or even get a check cut, however, there can be financial incentives to opt for a statement credit. Some issuers, such as Bank of America, give you incentives to deposit your cash back into a checking or saving account held with that bank. Others give you the option of using your cash back toward an online shopping portal.

Are there limitations on where I can spend my cashback rewards?

There can be limitations on where you can spend your cashback rewards, because issuers have different rules for how you can get your cash back. You usually get your cash through statement credits, but some issuers offer you the option to park your cash in a savings or checking account (you can get a 10% bonus when you do this with your BankAmericard Cash Rewards, provided it's a Bank of America account), while other issuers allow you to redeem with gift cards, such as the Barclaycard CashForward.

Some issuers, such as Discover, also have portals where you can shop with your cash back while getting discounts on goods and gift cards.

Are cashback rewards taxable as income?

Cashback rewards are usually not taxable as income; they are typically considered a discount by the IRS. The same is true of rewards points and miles.

“However, there may be times when you need to reduce the amount of a [business] deduction to reflect the discount that a cash back reward provides you with,” says TurboTax.

TurboTax gives the example of when you are self-employed and you purchase a cellphone that you only use for business. Although your phone is deductible on your taxes, TurboTax points out that you can only deduct your actual cost. So, if you get a $150 rebate for your $200 phone, you really only paid $50 for the phone, and that's how much you can deduct.

How can I maximize my cashback rewards?

There are a number of ways you can maximize your cashback rewards. It starts with choosing your card.

  1. Make a list of your spending habits for a month. Write everything! Then, categorize by type of store — grocery stores, gas stations, wholesale clubs, Amazon.com, restaurants.
  2. Do you see a pattern? If you are spending a lot on groceries, you might want the Blue Cash Preferred. If you spend a fair amount on a mix, such as wholesale clubs and Amazon.com, the Cashback Match may be a good choice. And if your shopping is truly eclectic, or you don't want to get strapped to categories, you'll want to look at a fixed-rate card, such as the Cash Wise.
  3. Look at ways to put charges on the card that you make anyway. Check if you can charge your rent, insurance and utilities, for example.
  4. Figure out how much you will be spending on your card, if this is your go-to card. Just make sure you have it in your budget to pay off the card in full and on time each month.
  5. Don't apply for multiple cards at once. That can sabotage your credit. Pick a card, looking at the annual fee, and any other benefits, such as balance transfer offers. Also, make sure you will earn more than the annual fee.
  6. Some cards, such as the Freedom cards, can be paired with other cards to maximize rewards. For example, you can pair the Freedom products with the Chase Sapphire Preferred, allowing you to fully maximize the Chase Ultimate Rewards portal for travel.

Is a cashback card right for me?

If you’re wondering whether a cashback card is right for you, ask yourself these 4 questions:

What is your FICO score? If it is below 700 on a scale of 300-850, don’t bother to apply except in a few cases. In some cases, a score higher than 750 is required, so do your research. Check your credit at MyFICO.com. If it’s below 700, take out one of your free credit reports at AnnualCreditReport.com and check it for accuracy. Get the credit bureau to correct any inaccuracies, and consider getting a credit-builder card to build your credit. Within months, you’ll see a difference.

Do you have a budget? This is a must to ensure you don’t go over on your spending. You’ll want to only spend on your card what you already have in the bank. Credit cards are for credit building, convenience, and in this case, cash back, not to be used as a long-term loan.

Do you pay your bills on time? If you have any trouble paying your bills on time, having a credit card can be problematic. That’s because you can face late fees and hurt your credit. Instead of a card with rewards or cash back, which takes a little organization, see if you can get a credit-builder card to practice on.

Are you intrigued by travel and rewards cards, but not sure if you have the organizational skills to manage them? A cashback cards might be a good choice. If you choose a simple, flat-rate cashback card, you can use it and forget it. It gives you the opportunity to earn money back while focusing on spending and paying the monthly bill. If you want something that gives you a little more in rewards and practice tracking your spending, choose one with quarterly categories or category spending limits.

Think a cashback card is right for you? Our cash back credit card reviews can help. Take a look and compare today.

See the online credit card applications for details about the terms and conditions of an offer. Reasonable efforts are made to maintain accurate information. However, all credit card information is presented without warranty. When you click on the "Apply Now" button, you can review the credit card terms and conditions on the issuer's web site.

* For additional rates, fees and costs see issuer's website for detailed pricing and terms.