The Best Cash Back Credit Card:
American Express Rewards

The best cash back credit card, in my opinion, is the American Express Membership Rewards Card - the Blue card. But don't sign up for this card just yet. Read why I like it and how I got $70 without using my own money.

Miles not Far Enough?

The Blue Amex card is our household credit card. Before, we used to exclusively use the American Airlines Citicard which gave us airline miles. This was great in the beginning because it paid for my honeymoon flight and for half of our hotel.

But after using the AA Citicard for some time, I realized that there were limitations on the mile points.

  • 100 for 1. For every $100 dollars charged, I would get one point in return (1% in points). 25,000 would typically earn me a free flight. That's around $250, on the low end. Nowadays, I could find cheaper flights that aren't on American Airlines.
  • Block out flights and dates. Your points aren't always redeemable on any flight, nor at any time.
  • Mile and miles of...miles. While you can redeem your points for other products and merchandise, you are pretty limited in how you can redeem your points.

Cash is King

With the American Express Membership Rewards Program, I would get 5% back on groceries (a nice way to save money on groceries), gas, and drugstores and 1% cash back on everything else after spending $6500 annually.

Keep in mind that these rules have changed for this card. Now, it's 3% cash back on groceries, 2% on gas and major department stores, and 1% on everything else without the $6500 spending requirement.

However, these features still make it a popular card for shoppers.

Chances are you eat (groceries), you have a car (gas), and you shop (at department stores).

These are the advantages of credit cards these days. Sign up for the ones that offer you points.

The Drawback

The only drawback with this card is that not everybody accepts this household credit card. Many smaller establishments don't take the card because of its higher processing fees, which make it more expensive to the retailers to take American Express.

I don't blame them but they usually get my stink face.

Because of this, I carry a Discover Cash Back Card (my second best cash back credit card) and CitiBank credit card for back up.

Still, my Blue American Express Card is first in the line-up.

How I got $70 for NOT Using My Own Money

Last year, we had to get our roof replaced. A contractor came out and estimated the damages at $7000. They submitted the proposal to our insurance company and we got the check for $7000 to pay for the replacement.

Payment to the contractor was due after the work was finished. When it came to pay them, I didn't write them a check for $7000 even though we had that money in our bank account.

Instead, I added one more step. I charged the $7000 on my American Express card. When the credit card bill came, I had the $7000 in our bank account from the insurance company to pay it off.

But just the mere act of charging it on the best cash back credit card put an extra $70 in my pocket. I always stress how a credit card can be an asset vs a liability.

That's what I call stretching the plastic.

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