How do I choose the best cash back credit card?

November 10, 2009
By: Curtis Arnold

Question: My husband and I have great credit and are looking for the best cash back rewards credit card. We usually charge over $2,000 per month on our card and pay in full most of the time. We make the majority of our purchases at the supermarket, gas stations, and for entertainment. How do I choose the best credit card?

Answer: That is becoming a common question as more people become credit savy. It sounds like you have the potential at that spending level to earn some nice cash rebates. My only concern is that you may occasionally carry a balance. Carrying a balance on any rewards credit card is a bad idea and can easily wipe out any rebates that you might earn. In fact, you could easily end up in the negative.

So, in general, I would suggest that you use a low interest credit card for purchases you know you aren't going to pay in full and a cash back card for all other purchases.

Some of my favorites are the Charles Schwab and Fidelity cards both of which give a 2% cash back rebate. I also like the True Earnings Card from Costco and American Express which gives a 3% rebate on gas purchases, a 3% rebate on restaurant purchases and an unlimited earnings cap.

Important Note! The information in this article is believed to be accurate as of the date it was written. Please keep in mind that credit card offers change frequently. Therefore, we can not guarantee the accuracy of the information in this article. Please verify all terms and conditions of any credit card prior to applying.

 

About the Author

Curtis Arnold, a nationally recognized consumer educator and advocate, has been educating consumers about credit cards since 1998. New! Curtis is the author of "How You Can Profit from Credit Cards: Using Credit to Improve Your Financial Life and Bottom Line" (FT Press, 2008). He is also the co-author of the upcoming Complete Idiot's Guide to Person-to-Person Lending (Alpha Books/Pengiun Group USA, April 2009), a contribitor to The Ultimate Allowance (InnerWealth Publishing, 2008) and is extensively featured in 42 RulesTM for Driving Success With Books (Super Star Press, January 2009).




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