Understanding your options for cash back can earn you more bang for your buck

NEW YORK, NY, May 06, 2021 /24-7PressRelease/ — When it comes the variety of cash back credit cards available in 2021, the options are almost endless. Finding the best cash back credit card for you comes down to how often you plan to use your card and what kinds of purchases you tend to make.

Here’s a look at the types of cash back cards you can find on the market in 2021.

Types of cash back credit cards

Flat-rate cash back
Flat-rate cash back cards are probably the most common cash back credit cards out there. These types of cards offer the same cash back rewards amount on every single purchase, typically ranging from 1%-2%. These cards can offer a high overall cashback rate although they don’t have bonus categories. Some of these cards also come with a signup bonus or 0% introductory APR balance transfer offer to set themselves apart.

Rotating quarterly categories
There are several cash back credit cards that offer higher cash back rewards on rotating categories every quarter in addition to their standard cash back rate on purchases, which will usually be around 1%.

These cards may offer 3-5% cash back on everyday purchases from specific retailers, like Amazon, or a broader range of types of retailers, like grocery stores, every quarter.

There is one caveat to be mindful of, though. Some of these cards require you to activate or opt-in to the rotating categories to begin using the offer, while other cards will automatically earn your cash back rewards.

Tiered cash back
Cash back cards with tiered rewards offer a higher percentage of cash back on certain categories year-round, as opposed to on a rotating basis. Some of these cards allow you to choose the category you’d like to earn higher rewards on. For example, if most of your monthly spending goes toward streaming platforms, you can select that as your highest tier. If you’re preparing for the holidays, you can switch your highest tier to online shopping.

Gas and restaurant cards are a common type of tiered cash back card. These cards are designed specifically for users who spend a lot of time on the go. The cash back rewards are tailored to purchases made at gas stations and restaurants, which typically include traditional sit-down dining as well as cafes and fast food eateries. Cash back rewards on these purchases usually fall in the 2%-3% range while other purchases earn the standard rate, usually 1%.

No annual fee
Many of the best cash back credit cards have no annual fee, while other cards may waive the annual fee for the first year. Cash back credit cards with no annual fee can fall into any of the above types of cash back cards. While cards with annual fees can offer more perks and benefits, you should try to do some quick math to estimate if the perks will add more value than they cost.

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