Best Credit Card for Groceries: Grocery Cashback Options Compared

Groceries and household supplies can end up being a huge expense category for most of us. Estimates put average grocery spending at around 5-10% of annual expenditures for the typical American. Thus, any way we can save more on groceries can free up a lot of spare cash to save, invest or spend elsewhere. One great way to save money is to rack up rewards by using the best credit card for groceries for all your grocery store purchases.

By using the best credit card for grocery stores, you can earn bonus cashback on every purchase – anywhere from 2% to 6% cashback. Over time, this can add up to some serious savings! For even more savings opportunities, check out our guide to saving money on groceries.

What is the Best Credit Card for Groceries?

There’s no single “best” option for all people – the right choice will depend on a number of factors. One big thing to consider is whether or not you want to pay an annual fee on your card. Most of the time the no-fee cards don’t earn as much rewards, but the fee cards charge you a flat fee every year. Be sure to do the math for your individual situation to see what makes the most sense.

Best Grocery Credit Card for Families & Big Spenders: Amex Blue Cash Preferred

Annual fee: $95
Earning rate: 6% cashback at US supermarkets, 3% at US gas stations & department stores; 1% on everything else
Signup bonus: $200 after spending $1000 in the first 3 months
Introductory APR: 0% APR on purchases and balance transfers for 12 months
Best for: Big spenders in the grocery category, large families

The American Express Blue Cash Preferred is the best credit card for groceries for many people – particularly those who spend a lot on groceries.

The card earns a whopping 6% cashback at US supermarkets, although that rate is capped at $6,000 in annual spend. Amounts beyond $6,000 annually will only earn 1% cashback.

The card has a $95 annual fee, which is only worthwhile if you spend a decent amount on groceries. The cap on 6% cashback earnings is $6,000 per year, which works out to $500 per month. If you spend in the range of $350-$500 per month on groceries, this card is likely worth the annual fee – if not, you’ll probably be better off with a no-fee version.

Best Grocery Credit Card with No Annual Fee: Amex Blue Cash Everyday

Annual fee: None
Earning rate: 3% cashback at US supermarkets, 2% at US gas stations & department stores; 1% on everything else
Signup bonus: $150 after spending $1000 in the first 3 months
Introductory APR: 0% APR on purchases and balance transfers for 15 months
Best for: Those wanting a cashback card with no annual fee to worry about

The American Express Blue Cash Everyday is the no-annual fee version of the popular Blue Cash Preferred card. The card still offers great cashback rates, with 3% back on grocery store purchases (capped at $6,000/year in spend), 2% on gas and 1% on everything else.

This card makes more sense for those who don’t spend a whole lot on groceries. For big spenders, the Preferred will likely win out in the long run. See our comparison section below to learn more.

Blue Cash Preferred vs Everyday

For many people, choosing the best credit card for groceries will be a choice between the Everyday and the Preferred. Here’s a recap:

The Blue Cash Preferred earns 6% cashback on groceries, but has a $95 annual fee ($200 sign-up bonus currently)
The Blue Cash Everyday earns 3% cashback on groceries, but has no annual fee ($150 sign-up bonus currently)

You should do the math for your particular situation, but as a rule of thumb, here are our recommendations:

If you spend more than $3,200 per year ($266/month) on groceries, the Preferred is the better option
If you spend less than $3,200 per year ($266/month) on groceries, stick with the no-annual-fee version

Keep in mind that these figures ignore the signup bonuses (as they change frequently), and also ignore the different earning rates on gas purchases. Again, we recommend running the numbers for your specific situation.

Best Grocery Credit Card for Simplicity: Citi Double Cash

Annual fee: None
Earning rate: 2% cashback on all purchases
Signup bonus: None currently, sometimes offers $100 cash bonus
Introductory APR: 0% APR on balance transfers for 18 months
Best for: Those wanting just one credit card for all purchases

The Citi Double Cash credit card is the best credit card for groceries for those who crave simplicity in their lives. With this card there are no bonus categories, no caps on earnings, and no annual fee – just a flat 2% cashback on ALL purchases, not just groceries.

This card tops our list of the best cash-back credit cards because it offers a great earning rate with no annual fee to worry about. The great thing about this card is that you always know you’ll earn 2% back, regardless of where you make the purchase. With other cards with specific category bonuses, you may or may not earn the bonus rewards depending on how the merchant codes. For example, purchases at Costco or other warehouse clubs don’t usually code as groceries, so a card like the Blue Cash won’t earn the bonus points.

Merchant Codes & Cashback Earnings

Now that you’ve seen our recommendations for the best credit cards for groceries, there is one thing that you should be aware of.

Any card with category bonus cashback rates will use the merchant category code (MCC) to determine your cashback percentage. Thus, the rate of cashback you earn will depend on the how the purchase codes. And unfortunately, they don’t always code how you might expect.

For instance, Walmart purchases might code as grocery, but they could also code as warehouse store, home goods store, etc. Even stranger, some Walmarts might code differently than others. This can result in some surprises, and is one reason why some people prefer the simplicity of a flat 2% cashback card like the Double Cash.

This guide explains how you can find merchant category codes to determine whether or not a specific merchant will earn bonus cashback. Unfortunately, Visa is the only card issuer to make this data public.

Posted on August 16, 2018 by Austin Meadows 0

How to Save Money on Groceries (Without Extreme Couponing)

The average American spends around $160 to $360 per month on groceries, per person – according to data from the USDA. Other estimates put average grocery spending in the range of 6 to 10% of an individual’s annual budget. Either way you look at it, grocery shopping makes up a good amount of our expenses. Thus, any way we can save money on groceries will help pad our budgets significantly.

This article will explore various ways to save money on groceries. From using cashback credit cards to taking advantage of various rewards programs and shopping apps, there are several strategies you can utilize to lower your grocery bill. Below, find some methods to explore to earn more cashback on groceries, and save money on food purchases!

Grocery Cashback Credit Cards

Savings Potential: 2-6% cashback on all your grocery purchases

Using a rewards credit card can help you earn more cashback on grocery purchases. It’s definitely the easiest way to save money on grocery purchases, simply because it requires no extra effort on your end. Once you have the card, just use it on all your grocery purchases (at any grocery store), and enjoy the bonus cashback rewards!

Good credit cards for groceries include the Amex Blue Cash Preferred and Blue Cash Everyday. These cards earn 6% cashback and 3% cashback, respectively, on grocery store purchases. The Preferred has an annual fee, while the Everyday does not.

There are many other great credit cards for grocery store purchases – see our complete list of grocery store credit cards for details.

Coupons

Savings Potential: $10-$20/month with minimal effort; way more if you’re willing to spend more time on it

Coupons can certainly help you save money on groceries.

We don’t advocate “extreme couponing”, as it usually takes far more time than it’s worth – but a casual couponing strategy can certainly pay off.

There are many ways to go about getting and using coupons. In order of priority, here’s what we’d recommend:

Grocer-specific coupons, usually found in the grocer’s smartphone app and/or weekly mailers
Manufacturer coupons, found via sites like Coupons.com and RetailMeNot Everyday
Other coupons, found on third-party blogs, manufacturer websites, etc.

To save money on groceries using coupons, you should at a minimum check the app of the retailer you shop at the most. This is pretty low-effort and can help save a significant amount on each trip. If you have more free time to contribute, checking coupon aggregation sites like those listed above can make sense.

Ibotta

Savings Potential: $5-$15/month with casual use; significantly more if you spend some time with it

Ibotta is a smartphone app that can help you earn cashback on groceries. Savings come in the form of rebates, after you make the purchase.

It requires you to browse and save offers on specific products at participating retailers. Most major grocers are on the app, including Safeway, Walmart, Kroger, Whole Foods and many more.

The app is simple to use. The basic process is as follows:

Browse Ibotta and add offers for products you may buy
Purchase those products (along with all your groceries) at the retailer
Upload a picture of the receipt
Ibotta will then confirm the offers you redeemed, and issue you cashback!

The earnings from Ibotta can vary significantly, depending on what you buy and the offers available to you.

Most offers are for specific products – for example, buy 2 boxes of Kraft Mac & Cheese and earn $0.50.

Some offers are more versatile. For example, buy 2lbs of apples (any variety), and earn $0.50 cashback. There’s also always an “any item” offer that pays $0.25, but you can only use it every few days.

The great thing about Ibotta is that it stacks with other offers, including store coupons, manufacturer coupons, credit card cash back, and more. In some situations, this can result in free products or even cash rebates on products bought for free! Click here to learn more about Ibotta.

Grocery Store Rewards & Gas Rewards

Savings Potential: 1-3% of your spend at grocery stores

Most grocery store chains have some sort of in-house rewards program. Many also have a fuel rewards program that lets you earn discounts on gas.

For example, most Kroger-owned stores have a 1% cashback reward program, which issues reward certificates every 3 months. On top of that, they have a fuel rewards program with every $1 spent earning 1 point. 100 points is equal to $0.10 off per gallon at the pump. This can result in another 1-2% back in the form of savings on gas, depending on how big your tank is and how much you shop at that retailer.

The specifics of each program vary significantly, so we won’t spend much time on this topic. Bottom line – look into the rewards & fuel rewards programs at the retailers you shop at to save more money on groceries!

Comparison Shopping

Savings Potential: 5-15%+ of your grocery spending

While sticking to the same grocery store is certainly convenient, it doesn’t necessarily result in the lowest prices. It’s always worthwhile to do some comparison shopping occasionally, to ensure you’re shopping at the retailer with the best prices.

We don’t advocate driving across town to 3 different stores every time you go shopping – the savings will likely be eliminated by the gas and time wasted. However, we do recommend visiting each major grocer from time to time, to get a feel for their pricing.

You can also pick up each store’s weekly flier, to check out sale items as well as their standard pricing on staples.

How to Save Money on Groceries by Stacking Deals

The options listed above are some basic strategies you can use to lower your grocery bill every month. Where things start to get really interesting, however, is when you stack multiple deals for extra savings!

Let’s take a look at a hypothetical example of how this could work out.

Say you go out and buy $100 worth of groceries at your favorite store. Of that $100 purchase, you save in the following ways:

3% cashback on your credit card = $2.70
1% cashback via grocery store rewards program = $0.90
100 fuel points via fuel rewards program = $1.50 (10 cents off per gallon, 15 gallon tank)
Store coupons via app = $5
Manufacturer coupons = $3
Ibotta rebates via app = $5

In this example, you saved $18 on a $100 purchase, or 18% off your grocery bill! Based on the average American’s spending on groceries, implementing savings strategies like the ones listed here could easily save you more than $500 per year!

Posted on August 16, 2018March 18, 2021 by Austin Meadows 0

Best Cashback Credit Cards of 2018: Cash Back Cards Compared

There are hundreds of different options when it comes to choosing a credit card. So many choices can make things confusing! In the end, you’ll probably want a card with some kind of rewards – either cashback, airline miles or hotel points. In this guide, we’ll focus on cards that earn cash back. Below, find the best cashback credit cards of 2018.

In this guide, we’ll cover specific recommendations for good cashback cards. We’ll also explain why you might want to choose a cash back credit card (over a card that earns points or airline miles), and cover how the earning and redeeming processes work. Let’s get started!

Why choose a cashback credit card?
Earning cashback rewards
Redeeming cashback rewards
The best cash back credit cards

Best 2% cashback card
Best tiered cashback card
Best 5% rotating categories card
Best signup bonus
Best cashback card for business

Why Cashback?

There are several different types of rewards that you can earn from credit cards. They range from hotel points to airline miles to flexible rewards points. And, of course, cashback. But why choose a cashback credit card?

Cashback is simple, easy to redeem, and very flexible. After all, who couldn’t use a bit more cash?

With good cashback cards, there are no complicated award charts to deal with, no travel black-out dates, no high minimums for redemption, and no fuss. Earning rates are clearly defined, and you’ll be able to easily redeem your rewards for transfers to your bank account. And, if you choose one of the best cashback credit cards, you’ll be earning a significant amount of cash back on all your purchases!

Earning Cashback Rewards

Most cards earn between 1% and 2% cashback
Some cards have rotating categories, earning up to 5%
Cashback is typically earned on all purchases

Earning cashback is fairly straightforward. Any charge you put on your card will earn cashback, according to the rates offered by your card. Generally speaking balance transfers and cash advances do not earn cashback, while all purchases (including bills) do earn rewards.

Good cash back credit cards will typically earn between 1% and 2% cashback on all purchases. The best cashback credit cards will offer around 2% cashback, while also having no annual fee.

Some cards offer bonus categories, earning up to 5% cashback on certain types of purchases. Some products, like the Uber card, offer tiered cashback – 1/2/3/4% cashback, depending on the type of purchase. Others, like the Chase Freedom, earn 1% on everything, and 5% on a select rotating category.

For cards with more than one earning rate, the rate you get will depend on the type of purchase and how the merchant codes that sale. Usually it should work as intended, but in some cases you might find a merchant codes differently than you might expect. For instance, gas stations attached to grocery stores may code as grocery, instead of gas.

Redeeming Cashback Rewards

Cashback can be redeemed for a statement credit or transfer to your bank account
Redemption minimums are usually low, but check the individual terms of your card
Some cashback cards earn points that can be used for a variety of rewards

Cashback rewards can typically be transferred to your bank account, or redeemed as a statement credit. Statement credits essentially lower the amount you need to pay on your card statement.

The difference between a cash transfer and a statement credit is minimal. Technically, transferring cash to your account is slightly better than redeeming for a statement credit, because you can use that cashback to make purchases on your credit card, earning additional cashback in the process.

Some “cashback” cards actually earn points, which can be used for a variety of things. For instance, the Chase Freedom cards actually earn Chase Ultimate Rewards points, a flexible rewards currency that can be used for cashback, airline tickets, gift cards and more.

You should also be aware of the specific redemption requirements of your card. Most important is the minimum redemption amount. Most of the best credit cards for cash back have a low redemption minimum (or none at all), but there are cards out there that require up to $100 in cashback before you can cash out!

What Are The Best Cashback Credit Cards?

Since there are many different options, we’ve broken it down into categories – see the list below!

Best 2% Cashback Credit Card: Citi DoubleCash

Annual fee: None
Earning rate: 2% cashback on all purchases
Bonus categories: None
Signup bonus: $100 after spending $500 in the first 3 months
Introductory APR: 0% APR on balance transfers for 18 months
Other benefits: Credit card late fee pass, identity theft solutions

The Citi DoubleCash is among the best credit cards for cashback. It offers a simple earning structure, with 2% cashback on every purchase. The unique thing about this card is that you actually earn cashback twice (hence the name!). You earn 1% when you make the purchase, and another 1% when you pay your bill.

The DoubleCash has no annual fee, and is relatively easy to get approved for. And unlike many no-annual-fee cards, it actually offers a signup bonus: $100 cashback after spending $500 on the card in the first 3 months!

If you’re a fan of simplicity and want a no-fee card for use as a “daily driver”, the DoubleCash is an excellent option.

Honorable Mentions: Fidelity Rewards Visa Signature

Best Tiered Cashback Card: Uber Visa

Annual fee: None
Earning rate: 1% cashback on all purchases
Bonus categories: 4% on restaurants & bars, 3% on select travel, 2% on online purchases
Signup bonus: $100 after spending $500 in the first 3 months
Introductory APR: None
Other benefits: No foreign transaction fees, mobile phone insurance, $50 annual streaming service credit

The Uber Visa Card from Barclay’s is the best tiered cashback credit card available today. It offers significant perks for a card with no annual fee, and you can earn up to 4% cashback on select purchases. The card actually earns points, which can be redeemed for cash, gift cards, Uber credit and more.

The Uber card earns 4% on dining, including restaurants and bars. It earns 3% on select travel expenses, including airfare, hotels, and vacation rentals like Airbnb. It earns 2% on online purchases, including Uber fares. And for anything that doesn’t fall into these categories, the card earns a flat 1% cashback. For a no-annual-fee card, these earning rates are fantastic.

Beyond the lucrative cashback rates, the Uber card has a $100 signup bonus, and also offers significant ongoing perks. It has no foreign transaction fees, making it great for international travel. If you pay your cell phone bill with your Uber card, you’ll automatically get mobile phone insurance. And every year that you put at least $5,000 in purchases on the card (equivalent to around $415 per month), you’ll earn a $50 credit to use on select streaming services, like Netflix, Spotify or Amazon Prime.

Depending on your spending habits, this card may beat a flat 2% cashback card in the long run. Given the other benefits and no fee, this is a very solid card for anyone to have.

Honorable Mentions: American Express Everyday (and Everyday Preferred)

Best 5% Rotating Categories Credit Card: Chase Freedom

Annual fee: None
Earning rate: 1% cashback on all purchases
Bonus categories: 5% cashback on a select rotating category (capped at $1,500 in purchases, changes every 3 months)
Signup bonus: $150 after spending $500 in the first 3 months
Introductory APR: 0% intro APR for 15 months on purchases and balance transfers
Other benefits: Earns Ultimate Rewards points, which can be redeemed for many different things

The Chase Freedom is one of the most popular cashback credit cards – and for good reason. It earns a flat 1% cashback on all purchases, but where this card really shines is in the 5% rotating categories. It also comes with a $150 signup bonus after spending $500.

The Freedom earns 5% back on a select category – and every 3 months, the category changes. The categories could be gas stations, Amazon.com, grocery stores, utilities, or various other expenses. Note that this cashback rate is capped at $1,500 in purchases per quarter – purchase exceeding that will earn the normal 1% back. Chase publishes a calendar that shows you the next few quarterly 5% cashback categories. The 1% on all purchases is fairly meager, so this card really only makes sense if you can take advantage of the 5% categories.

Also, one important note: while this card is marketed as a cashback credit card, it actually earns Ultimate Rewards points. These points can be redeemed for cashback at 1 cent per point, but they can also be used for travel, gift cards and more. And if you have a premium card from Chase, like the Sapphire Preferred or the Ink Plus, you can transfer the points you earn with your Freedom to get even more valuable redemptions!

Honorable Mentions: Discover IT (see below)

Best Signup Bonus: Discover IT (one of the best cashback credit cards)

Annual fee: None (pretty much standard with best cashback credit cards)
Earning rate: 1% cashback on all purchases
Bonus categories: 5% cashback on a select rotating category (capped at $1,500 in purchases, changes every 3 months)
Signup bonus: $50 if you use a referral link, plus all cashback earned in first year is doubled
Introductory APR: 0% into APR for 14 months on purchases & balance transfers
Other benefits: 100% US-based customer support, free FICO score access

The Discover IT card is very similar to the Chase Freedom (another top rated best cashback credit cards), which is detailed above. It earns a flat 1% cashback on all purchases, plus 5% on select rotating categories. The categories sometimes differ, but they are subject to the same $1,500 cap and function in the same way.

The Discover IT doesn’t have too hefty of a signup bonus ($50 cashback if you use a referral link). However, the real bonus is that all cashback earned in the first year is doubled. That means if you earn $200 cashback in the first 12 months of card membership, you’ll get a $200 bonus for a total of $400 cashback. This bonus applies to earnings from bonus categories and the cashback shopping portal, as well.

This bonus also means that, for the first 12 months, the card earns 2% cashback on everything, and a whopping 10% cashback on bonus categories. If you can max out the quarterly bonus categories (some are easier than others), you’d earn $600 cashback just from the bonus categories!

This signup bonus has the potential to be very rewarding. However, it really depends on your spending habits, and on the bonus categories available. In some cases, you might be better off with an up-front bonus like the Chase Freedom offers.

Honorable Mention: Wells Fargo Cash Wise Visa

Best Cashback Credit Card for Business: Capital One Spark Cash

Annual fee: $59
Earning rate: 2% cashback on all purchases
Bonus categories: None
Signup bonus: $500 after spending $4,500 in the first 3 months
Introductory APR: No special offer
Other benefits: Free employee cards, $0 fraud liability, useful year-end summaries, no foreign transaction fees, no minimum to redeem words, auto rental collision damage waiver, and more

The Capital One Spark Business card is a great option for small business owners, and one of the best cashback credit cards overall. It earns a flat 2% on all purchases, with no limits to earning potential. Even better, it comes with a hefty signup bonus of $500 – making it one of the most lucrative cash signup bonuses out there today.

Keep in mind that this card is designed for small business owners, so it’s not for everyone. With that said, some people have been approved with very small hobby businesses, side hustles, etc. It may be worth a shot even if you don’t have a full-fledged business.

The Spark Cash card does have a $59 annual fee. If you’d rather not pay a fee, there is the Spark Cash Select, which offers 1.5% cashback and no annual fee. You could also get the Spark Cash for a year (for the higher signup bonus) and then product change to the no-annual-fee version.

Honorable Mention: Chase INK Business Cash

With hundreds of different credit cards on the market, this list is far from complete. However, for the average person, we believe the cards listed above are some of the best cash back credit cards available.

The specific best cashback credit cards for you will depend on your individual situation and preferences. For those wanting simplicity, we recommend something like the Citi DoubleCash for a no-frills, easy 2% back on every transaction. For those with a little more active involvement in their finances, tiered cashback cards like the Chase Freedom or Uber Visa might be a better choice.

What is your favorite best cashback credit cards? Let us know in the comments!

Posted on August 2, 2018March 18, 2021 by Austin Meadows 0

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