Cash-back credit cards are, of course, great for the rewards that they offer, but when deciding which card is best for you it's also important to consider all other features associated with the card, such as purchase and balance transfer rates, annual fees and the extra perks. The great thing about the American Express Cash Magnet™ Card is that it offers 0 percent APR on purchases and balance transfers for 15 months (then, 14.99% - 25.99% Variable), has no annual fee and, on top of that, comes with decent rewards. Specifically, up to a $250 cash-back bonus for new cardholders who meet the spending thresholds (see below for how to do that), and an unlimited 1.5 percent cash back on all purchases made, with no spending thresholds or categories to worry about.
Whether it's a big renovation project, a new washer and dryer, or maybe something else exciting like a backyard pool or a home entertainment system installation, if you can't pay your bill all at once or need to finance a major purchase, the American Express Cash Magnet™ Card will give you some breathing room to pay the balance off over time with no interest to worry about for 15 months (then, 14.99% - 25.99% Variable). It's also perfect for transferring balances from other high-interest credit cards, all while putting money back in your pocket to help you pay off those final bills, or for the fun things like new pool toys or Blue-ray Discs.
Most Notable Features of the American Express Cash Magnet™ Card
While it's true that you could potentially earn more cash back per $1 spent with some other credit cards, we like that the American Express Cash Magnet™ Card is a flat-rate credit card, meaning there are no categories or spending limits to think about when it comes to earning rewards. Simply every $1 spent on the card earns an unlimited 1.5 percent cash back, which isn't a bad earning rate especially considering the fact that many cards offering higher percentages on certain categories offer just 1 percent on everything that isn't in one of the bonus or higher tier categories.
Additionally, your cash back is recorded as Reward Dollars that can be redeemed as statement credit, which means it can directly help you keep your card balance down and avoid interest payments on a higher balance. You can also redeem your rewards for merchandise and gift cards.
Thanks to its easy-to-grasp rewards structure, plus a new card member offer that's better than many similar no-annual-fee cash-back credit card offers out there, the American Express Cash Magnet™ Card is a solid option for anyone looking to hold a cash back credit card in their wallet, especially those looking to finance a large purchase over time.
If you're willing to keep track of tiered rewards or rotating bonus categories, and depending on your spending habits, it's possible that you could earn more cash back with a card that isn't a flat-rate credit card. The Discover it® Cash Back credit card (full comparison below), for example, offers users 5 percent cash back on different purchases each quarter, such as at gas stations, grocery stores, and restaurants, up to $1,500 spent in those categories that quarter. If you already spend a lot of money in these categories, you might want to think twice about if a flat-rate credit card is the best option for you. However, these categories rotate, so you'll have to plan your spending accordingly, and then another thing to consider is that purchases made outside active categories will usually only earn users 1 percent cash back. If you're not the type of credit card user who likes to think about where and when you should use your credit card, or if you just want a consistent reward no matter the purchase, you're likely better off sticking with a flat-rate card, such as the American Express Cash Magnet™ Card.
Or, if you're willing to use two different cards, combine the American Express Cash Magnet™ Card with a rotating categories card so that you can earn 1.5 percent cash back on all your purchases outside of the other card's bonus categories.
Another important thing to note is that the American Express Cash Magnet™ Card charges a 2.7 percent foreign transaction fee for every purchase made outside of the United States, which means this card might not be an ideal choice for frequent international travelers.
American Express Cash Magnet™ Card vs. Discover it® Cash Back
As we mentioned above, Discover it® Cash Back earns users 5 percent cash back at different places each quarter like gas stations, grocery stores, restaurants, Amazon.com or wholesale clubs, up to the quarterly maximum of $1,500 each time you activate, plus an unlimited 1 percent cash back on all other purchases. As a new cardholder bonus, Discover automatically matches all the cash back you've earned at the end of your first year.
Discover announced its full 2018 bonus categories calendar at the end of 2017, so you can judge for yourself whether the categories are good for your particular spending habits. 2018 categories include: January-March 2018: gas stations and wholesale clubs; April-June 2018: grocery stores; July-September 2018: Restaurants; October-December: Amazon.com and wholesale clubs.
While this can certainly be a good option for credit card users who are willing to plan their purchases around rotating categories, it's important to be aware that the 5 percent earning rate only applies to the first $1,500 spent in a category. After that, the rewards rate drops to 1 percent.
Depending on your spending habits and looking at the final numbers, Discover it® Cash Back could earn you either a little more or a little less than the American Express Cash Magnet™ Card. It really just depends on what type of credit card user you are and what you'll be using your credit card for. For example, if you hardly ever shop Amazon.com or at wholesale clubs, or if you rarely eat out, you might be missing out on an entire quarter (or two) worth of bonus cash earning potential. If you'd rather not have to think about when and where you use your card, something like the American Express Cash Magnet™ Card might be the better way to go.
American Express Cash Magnet™ Card vs. Chase Freedom Unlimited®
A second no-annual-fee credit card that earns users an unlimited 1.5 percent cash back and also has a 15 month 0 percent purchase and balance transfer APR offer (before it goes to 16.99% - 25.74% Variable), Chase Freedom Unlimited® is another worthwhile card option for those looking for a good flat-rate credit card.
The biggest thing that varies between these two cards is the new cardholder bonus offer. With the American Express Cash Magnet™ Card, new users have the opportunity to earn up to $250, versus Chase's offer of $150 cash back after spending $500 within the first three months of account opening. Of course, $250 might seem like the better offer, but remember that you must spend $1,000 within the first three months for the first $150, plus and additional $6,500 in the first 12 months for the next $100. If you're more of a casual spender, Chase Freedom Unlimited®'s lower threshold of $500 might actually be a more appealing, and realistic, option for you.
American Express Cash Magnet™ Card vs. Citi® Double Cash Card - 18 month BT offer
The Citi® Double Cash Card - 18 month BT offer (ongoing APR is 15.49% - 25.49%* Variable) is unique in that it earns users cash back twice – 1 percent on all purchases when you make them, plus an additional 1 percent as you pay for those purchases in full or over time (Citi is a CardRatings advertiser). Similar to the American Express Cash Magnet™ Card, this Citi card has no annual fee and users can earn unlimited cash back with no categories or spending thresholds to worry about.
Two major things that vary between these two cards, though, are the bonus rewards – the Citi® Double Cash Card - 18 month BT offer offers none – and the intro APR offer – this Citi card does not include a 0 percent APR on purchases, but does offer 0 percent APR on balance transfers for 18 months, three months longer than the American Express Cash Magnet™ Card. With the Citi® Double Cash Card - 18 month BT offer, users can take advantage of a 0 percent APR on balance transfers for 18 months (then, 15.49% - 25.49%* Variable), which makes this card a great choice for anyone looking for a little extra time to pay off a high balance on another card.
Thanks to an easy-to-grasp rewards structure and a nice new cardholder offer, the American Express Cash Magnet™ Card is a solid option for anyone looking to make a large purchase or to pay off a balance with no interest to worry about for 15 months (then, 14.99% - 25.99% Variable), all while earning some extra money in the process. And, perhaps most importantly, you can do all of this on a no-annual-fee card.