Maximizing Cash Back

There is no point in building up points quickly if you travel infrequently or prefer not to leave the country. You could use them for domestic hotel stays or trips to the occasional resort, but if your preference is to stay local, there is a better way to Max Your Plastic.

Many cards are designed for this type of customer. These are usually in the form of cash back cards. These cards offer to reward you a percentage of each transaction back to your account. For example, if you have a card that rewards 1.5% cash back, your account will be credited with $1.50 for each $100 you spend. On top of that, cash back cards often offer a sign-up cash back bonus of $100 - $500 for meeting an initial spend criteria. This is a parallel to points earning cards offering sign-up bonuses of thousands of points. See Earning Points.

There are several cards that offer 2% cash back on all purchases. If your annual spend is $24,000, that means you’re receiving $400 per year, just for using one of those cards. That is a sweet deal!

I would offer, though, that 2% is the bare minimum you should seek with cash back cards. There are cards that offer 3%, 4%, 5% or even more cash back for spends in particular categories or with particular vendors.

Curating the right cash back cards to match your lifestyle and spending patterns can earn you closer to 4% or 5% on average, and save you hundreds or even thousands of dollars annually in the process.

Let Max Your Plastic guide you in curating your credit cards to maximize your cash back and save you money.