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In 2023, my household racked up $2,336 in money again bank card rewards — probably the most we’ve ever earned. That represented a 2.8 % return on $84,084 in spending we might have executed anyway.
In 2022, we earned $1,701 in money again (a 2.1 % return). The largest distinction this yr was that we lastly took my very own recommendation in February 2023 and signed up for a card that provides 2 % money again on every part we purchase. Whereas my spouse and I appreciated the simplicity of our earlier two-card technique, I seen there have been a number of holes. A lot of our purchases solely earned 1 % money again, and I knew we might do higher.
How we did it
This yr, our greatest workhorse was our latest card: the Wells Fargo Lively MoneyⓇ Card. We love the easy, beneficiant return it presents: limitless 2 % money rewards on all purchases. We additionally obtained a $200 welcome bonus after spending at the least $500 in our first three months with the cardboard.
In whole, we spent $49,291 on this card in 2023 and redeemed $1,202 in money again. That’s a 2.4 % return, which exceeds the usual 2 % ratio principally due to the sign-up bonus. We additionally received greater than 2 % again on just a few purchases by way of the “My Wells Fargo Offers” digital coupon program.
Our second-most incessantly used card was the Chase Freedom FlexSM*. We spent $22,573 on this card and earned $608 in rewards (a 2.7 % return). We used this primarily for the rotating 5 % quarterly bonus classes and got here near maxing out all 4 quarters in 2023 (the 5 % payout is capped at $1,500 in quarterly bonus spending; activation is required and cardholders earn 1 % again after hitting the brink). This was additionally our go-to card for eating (3 % money again), and I just like the Store By way of Chase portal, which regularly yields additional money again on on-line procuring purchases.
The Blue Money Most popularⓇ Card from American Specific is our third and closing card. I’m an enormous fan of this card for groceries, because it offers 6 % money again at U.S. supermarkets (as much as $6,000 in annual spending, then 1 % again after that). That is additionally our main card for choose streaming subscriptions (6 % money again), gasoline (3 % money again at U.S. gasoline stations) and transit (3 % money again together with parking, tolls, trains and extra).
I’m at all times looking out for good Amex Affords, too. We spent $12,220 on this card and earned $527 in rewards (a 4.3 % return, though in the event you subtract the $95 annual price from the rewards, then it was 3.5 %). Our different two playing cards don’t cost annual charges.
How this is applicable to you
Your spending habits are undoubtedly totally different, however I nonetheless assume there are a number of broad classes that everybody can take away from this train.
One is {that a} no-annual-fee 2 % money again card is a surprisingly profitable choice for all kinds of cardholders. Money again is People’ favourite bank card characteristic, and most of the people don’t need to juggle too many playing cards. My spouse, for instance, at all times will get confused about which playing cards are finest for which forms of purchases. She desires to maintain issues easy.
Nearly all the $49,291 in purchases that we charged to our Lively Money Card in 2023 would have earned simply 1 % money again on our different two playing cards. By incomes 2 % as a substitute of 1 %, that added as much as an additional $493 over the course of the yr.
It’s additionally vital to prioritize your high spending classes. Groceries are an enormous one for us, and in truth, we must always most likely add a second grocery rewards bank card to get across the spending caps.
One other gap in our bank card rewards technique is that we spend so much on journey however aren’t maximizing many of those purchases with the three playing cards we’re at the moment utilizing. The Wells Fargo AutographSM Card is my favourite journey card that emphasizes money again. There are tons of playing cards that provide transferable journey factors and airline miles, too, however I’d relatively keep on with money again as a result of flexibility and ease. I additionally like that the Autograph card doesn’t cost an annual price. That is one we’re contemplating including to our wallets in 2024.
The underside line
Finally, everybody wants to determine what works finest for them. So long as you’re avoiding curiosity by paying in full every month, and so long as you’re solely spending cash you’d have spent anyway, then any rewards you earn symbolize free cash.
There’s no one-size-fits-all reply, however in the event you’re in search of course, money again tends to supply probably the most common attraction. And if you wish to maintain it actually easy, getting 2 % again on every part is a very nice start line — both as your solely card or as a basis upon which you’ll be able to layer extra playing cards that emphasize your high spending classes.
Have a query about bank cards? E mail me at ted.rossman@bankrate.com and I’d be glad to assist.
Issuer-required disclosure assertion
Details about the Chase Freedom Flex has been collected independently by Bankrate. Card particulars haven’t been reviewed or accepted by the issuer.
