Which 1.5 percent cash back card is right for you?
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If you prefer to be rewarded for your spending with cash or statement credits instead of points or miles, a cash back rewards credit card is the way to go. There are a large variety of cards that offer cash back bonuses on specific purchases, such as dining and gas. But
for those who want to earn cash back on every purchase without the hassle of dealing with rotating categories or complicated rewards structures, a flat-rate credit card is a great option.
With the recent launch of the Cash Magnet card from American Express, there are now several credit cards on the market that offer 1.5 percent cash back on every purchase.
Comparing 1.5 percent cash back cards
Once you narrow down that a flat-rate, 1.5 percent cash back card is the right fit for you, there are a variety of other factors you need to consider. For example, at first glance, the Cash Magnet card may appear to be the best choice – since it offers the highest yearly rewards value and the highest sign-up bonus among these cards. However, the card’s $7,500 spend threshold required to receive the entire $300 bonus may not be in your budget.
See what else we found when comparing these cards:
|Introductory bonus||Annual fee||Average yearly earnings ($15,900 spend)|
|American Express Cash MagnetSM||
|Wells Fargo Cash Wise Visa||
|Chase Freedom Unlimited||
|Capital One Quicksilver Cash Rewards||$150 if you spend $500 in the first 3 months||$0||$288|
|U.S. Bank Cash 365 American Express||$150 if you spend $500 in the first 90 days||$0||$288|
|Navy Federal Credit Union Cash Rewards||
|Ultimate Cash Bank card from Santander Bank||$100 if you spend $500 in the first 90 days||$0||$271|
|M&T Visa Signature||$100 if you spend $500 in the first 90 days||$0||$271|
|First National Bank of American Express||$100 if you spend $500 in the first 90 days||$0||$271|
|USAA Preferred Cash Rewards Visa Signature||None||$0||$238|
|Capital One® QuicksilverOne® Cash Rewards||None||$39||$212|
As you can see, typically, cards that offer 1.5 percent cash back also don’t charge annual fees – aside from the Capital One QuicksilverOne Cash Rewards card.
Which card is best?
It depends on what you’re looking for in a card. For example, if you’re interested in earning a sign-up bonus, the USAA Cash Rewards Visa Signature and Capital One QuicksilverOne cards are not the right fit for you. Here are some other factors you should consider:
You want to earn the highest yearly rewards value
If you’re interested in earning the highest yearly rewards value from a 1.5 percent cash back card, the Cash Magnet card is your best bet. By our estimates, the average consumer who spends approximately $15,900 each year on gas, food, clothing and general purchases, can earn approximately $338 worth of rewards annually with the Cash Magnet card.
But keep in mind that – although the Cash Magnet currently pays an introductory bonus of up to $300 after meeting the required spend threshold – the offer is only available for a limited time. After July 18, 2018, the introductory bonus will most likely decrease – which will also decrease the estimated value of the card.
You plan to carry a balance on your card
If you want to purchase a big-ticket item and pay it off over time, or you just plan to carry a balance on your card (though we recommend that you pay off your balance in full each month), the Capital One Quicksilver Cash Rewards, Cash Magnet and Chase Freedom cards offer the longest interest-free introductory periods on purchases among these cards.
With the Quicksilver card, you won’t be responsible for paying interest on purchases for the first 15 months. Once the introductory period is up, the variable APR on purchases is 14.74 to 24.74 percent. The Cash Magnet card offers a 0 percent intro APR on purchases for 15 months as well, followed by a variable APR of 14.74 to 25.74 percent. The Chase Freedom card also offers a 0 percent introductory APR on purchases for 15 months, with a regular variable APR of 16.74 to 25.49 percent.
You plan to transfer a balance
If you have a substantial amount of credit card debt, you may be looking for a card that lets you transfer your balance without charging you interest. The Quicksilver Cash Rewards card, the Cash Magnet card and the Freedom Unlimited card each offers a generous, interest-free period of 15 months for balance transfers. Once the introductory periods are over, the variable APRs are 14.74 to 24.74 percent for the Quicksilver card, 14.74 to 25.74 percent for the Cash Magnet and 16.74 to 25.49 percent for the Freedom Unlimited.
You don’t want to spend a large sum of money up front
If you don’t want to spend a lot of money up front, in addition to looking for a card that doesn’t charge an annual fee, you should be on the lookout for a card that doesn’t require a large spend threshold to receive the sign-up bonus. Among the cards listed in the table, the Freedom Unlimited, the Quicksilver Cash Rewards and the U.S. Bank Cash 365 American Express cards require the lowest spend thresholds to earn a $150 sign-up bonus. The Freedom Unlimited and Quicksilver cards both offer $150 after spending $500 in the first three months of card membership, while the Cash 365 card offers $150 after $500 spend in the first 90 days.
Bonus tip: You can earn an additional $25 bonus from the Freedom Unlimited card just by adding an authorized user and making your first purchase in the first three months.
Note – If you do decide to apply for the Cash Magnet card, just remember that the limited time bonus offer is only available until July 18, 2018.
How about a 2 percent cash back card instead?
We would also note that there are a few flat-rate cards that offer a higher rate than 1.5 percent cash back. For instance, the Citi Double Cash card offers up to 2 percent cash back – 1 percent when you make a purchase and another 1 percent when you pay your bill on time. It doesn’t include a sign-up bonus, so it’s less valuable in the short term, but if you are looking for a great cash back card for the long haul, the Citi Double Cash card could be your best bet.
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