Get $500 By Maximizing Cash Rebates
Credit cards can work or against us. It depends how we use them.
As a consumer who pays off balance every month (except 0% APR deals), I have been taking advantage of cash reward credit cards for years. In the past 12 months alone, I earned 2.68% cash back (equivalent to a pre-tax return of 3.83%) for all my purchases charged to credit cards - Here we’re talking about $500-$1,000+ per year!
These are the best credit cards that I used to maximize my cash rebate:
- Chase Freedom Cash - 3% cash back in the top 3 of 15 everyday categories, 1% everywhere else. Get a $50 bonus with $200 in rewards
- My cash rebate: 2.61%
- Chase PerfectCard - 3% cash back at gas stations, 1% everywhere else
- My cash rebate: 2.97%
- Chase Business Cash Rewards - 3% cash back at gas stations, restaurants, office supply stores, hardware and home improvement stores, 1% everywhere else
- My cash rebate: 3.00%
To go a step further, I recently converted Chase PerfectCard to Chase Freedom Cash (2nd) and successfully persuaded my wife to apply for a new Chase Freedom (3rd). Therefore, I anticipate to earn more than 2.68% (inch closer to 3.00+% overall) from here on forward by combining three Chase Freedom’s and Chase Business Cash.
My maximizing strategy will read like this:
| Cash Reward Utilization Table | ||||
|---|---|---|---|---|
| Categories | F1 | F2 | F3 | B |
| Gas Stations & Convenience Stores | X | |||
| Grocery Stores | X | |||
| Quick Service & Fast Food Restaurants | X | X | ||
| Utilities (Gas, Electric, etc.) | X | |||
| Drugstores | X | X | ||
| Cable/Satellite TV & Internet Providers | X | |||
| Department Stores | X | X | ||
| Phone/Cell Phone Bills | X | |||
| Pet Stores & Veterinarian | X | X | ||
| Movie Theatres | X | X | ||
| Gym Memberships | X | X | ||
| Beauty Salons & Spas | X | X | ||
| Movie Rentals | X | X | ||
| Dry Cleaners | X | X | ||
| Local Commuting | X | X | ||
| Restaurants | X | |||
| Home Improvement | X | |||
| Office Supplies | X | |||
| Everything Else | X | |||
F1-F3: Chase Freedom 1-3, B: Chase Business Cash
- Chase Freedom 1
- This is my primary credit card in my wallet. I’ll use it for groceries (such as local chains, Whole Foods, and Trader Joe’s), some seldomly used categories, and everything else.
- Chase Freedom 2
- This card sits at home in the drawer. I’ll only use it to pay monthly/quarterly bills for trash collection (Waste Management), satellite TV/internet provider (DirecTV and AT&T DSL), and cell phone (T-Mobile).
- Chase Freedom 3
- My wife will mainly use it in department stores (Macy’s), pet stores (PetSmart and PETCO), and other seldomly used categories. This is also the card to be used when I max out my top 3 categories of Chase Freedom 1.
- Chase Business Cash
- Other than gas, I’ll bring this card out for the categories that aren’t covered by Chase Freedom - Restaurants, Home Improvement (Lowe’s and Home Depot), and Office Supplies (Office Depot and OfficeMax).
More importantly, since Chase Freedom offers a $50 bonus with $200 in cash rewards (in the other words, 1% will become 1.25%; 3% will become 3.75%), I’ll occasionally rotate my Chase Freedom cards so that each of them will be able to reach the $200 threshold much faster.
After reading this, are you still sure you want to give up the free cash?
