How Americans spend their money

Federal government data show we spend most of our money on food. These credit cards can help you turn that spending into cash


Federal government data show American consumers spend most of their money on food, whether it be groceries or dining at restaurants. Your credit card rewards strategy should start there. Here are a few great options for earning cash back on your food purchases.

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Maximizing credit card rewards can be summarized in two key steps: Pay your bills in full to avoid interest, and match your spending habits with the right cards.

To examine the latter point, I recently analyzed data from the U.S. Bureau of Labor Statistics. It has great insight into how residents of 22 of America’s largest metropolitan areas spend their money.

I focused on groceries, restaurants, gas and transit because those are key credit card rewards categories. I was surprised to see how much the results varied across the country:

  • Average annual grocery spending (what the BLS calls “food at home”) ranged from $3,779 per household in Atlanta to $6,195 in Seattle.
  • Average annual restaurant spending (“food away from home”) fluctuated from $2,761 in Miami to $5,629 in Washington, D.C.
  • Average annual gas expenditures went from $1,514 in New York to $2,706 in Los Angeles.
  • And the average transit outlay (“public/other transportation”) swung from $459 in Tampa to $2,099 in D.C.

The national averages by category were $4,464 (groceries), $3,459 (restaurants), $2,109 (gas) and $818 (transit). Clearly, food is the big winner, so a solid credit card rewards strategy should start there.

See related: Use these credit cards to earn cash back at department stores

Specific card recommendations

The Capital One® Savor® Cash Rewards Credit Card is an excellent choice for foodies because it gives 4% cash back on dining and 2% at grocery stores (plus 8% cash back at Vivid Seats until May 2020, 4% on other entertainment purchases and 1% on everything else). There’s a $300 welcome bonus if you spend $3,000 in the first three months, and a $95 annual fee.

Using the national averages in the four spending categories mentioned above, the typical cardholder would earn $557 the first year (aided by the sign-up bonus) and $257 annually in year two and beyond. Starting in year two, the yearly profit is $162 after subtracting the annual fee. Those are solid returns, plus, remember that any other spending which goes on the card would increase the totals.

Another good option would be the Blue Cash Preferred® Card from American Express. This is my favorite grocery card because it gives 6% cash back at U.S. supermarkets (on up to $6,000 of annual spending, then 1% after that). Select U.S. streaming services earn 6% cash back, too.

This card is also useful for U.S. gas station and transit spending (3% cash back on each), and it gives 1% on everything else. There’s a $300 statement credit after you spend $3,000 in purchases within the first 6 months of card membership, plus a $0 intro annual fee for the first year, then $95.

All of this adds up to a $540 profit the first year (not counting the 20% back on amazon purchases) and $295 in subsequent years, even after subtracting the annual fee.

A third possibility is the Wells Fargo Propel American Express® card* (3x points on popular streaming services, dining and travel, including gas stations, and 1x points on everything else). This one gives 20,000 bonus points (worth $200) to new cardholders who spend $1,000 in their first three months. It does not charge an annual fee. That’s $367 in rewards the first year and $167 annually in year two and beyond.

See related: Best credit cards for grocery shopping

Cash back is king

Two-thirds of rewards credit card holders prefer cash back, according to a 2019 survey.  I’m one of them. I travel some, but it’s not a passion of mine, and it’s not always practical with a young child and a full-time job.

What’s most meaningful to me is earning cash back from purchases I would have made anyway. I earned almost $2,500 in cash back last year; that’s like an extra paycheck. It really adds up, and you can do it too.

Start by maximizing your key spending categories, such as food and transportation, and watch the rewards roll in.

*All information about the Wells Fargo Propel American Express card has been collected independently by and has not been reviewed by the issuer.

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The editorial content on this page is based solely on the objective assessment of our writers and is not driven by advertising dollars. It has not been provided or commissioned by the credit card issuers. However, we may receive compensation when you click on links to products from our partners.

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