ADVERTISER DISCLOSURE

The American Express Blue Cash: Blue is Best

(4.5/5 - 26 Votes)

by

This post may contain references to products from our partners. We may receive compensation when you click on links to those products. For an explanation of how we make money, please visit this page.

—Aw, nerds! Looks like this offer’s temporarily unavailable.

If you’re looking for unparalleled rewards for your everyday purchases, look no further than the American Express Blue Cash Preferred to fulfill your rewards needs. You earn top-notch rewards on gas and department stores, plus an unparalleled 6% rewards on groceries up to $6,000 spent annually. And since it pays out in cash, you don’t have to contend with gimmicky rewards programs or unwieldy airline miles. So if you eat food, wear clothing and drive cars – which, I venture to say, is a good portion of us – the Blue Cash has the best rewards rate out there.

At a glance
Annual fees $75
Foreign transaction fee 2.7%
Rewards program Cash back
Signup bonus Get 100 Reward Dollars, redeemable for a $100 statement credit, after you make $1,000 in purchases with your new Card in the first three months. Plus, get one year of Amazon Prime after you sign up for a new membership with your Card and meet the spending requirement in the same time period.
Verdict: If you spend money on gas and groceries, this is the card for you.
Good for:
  • Someone who spends a lot on gas or groceries
  • Someone who spends money at places that sell gift cards at grocery stores (we’ll explain later)
  • Someone looking for a solid cash back credit card
Bad for:
  • Someone who spends less than $50 a week on groceries
  • Someone who travels often

In this article:

The Blue Cash Preferred basics
Bluebloods: Blue Cash vs. other cash back credit cards
Blue Cash Preferred vs. Blue Cash Everyday
Where the Blue Cash Preferred shines
Where it falls short
What is a standalone grocery store anyway?

The Blue Cash Preferred Basics

This is pretty much one of the best credit cards out there for gas and grocery spending, and the rewards rate is unparalleled. It gives a full 6% rewards on groceries up to $6,000 spent annually, plus an unlimited 3% on gas and department stores and 1% elsewhere. The 6% rewards is pretty much the best we’ve seen anywhere on any bonus category.

The card’s 6% rewards on groceries opens up an opportunity for a neat trick: you can purchase gift cards for Starbucks, Exxon, the Gap, whatever, at the checkout line, thus securing 6% rewards on virtually anywhere you spend – just keep in mind the $6,000 annual cap.

Don’t be deterred by the $75 annual fee – spend just $25 a week on groceries and you’ve made up for the fee, not to mention the signup bonus. If you’re anti-annual fee, the Blue Cash Everyday is a no-fee, lesser-rewards version of the Preferred. That card gives 3% rewards on groceries, also up to 6% annually, plus 2% on gas and department stores. You can read more about the tradeoff between the Everyday and Preferred here.

Alright, sound good to be true? Nope, it’s real – there are just a few caveats.

First off, there’s the $6,000 a year cap on groceries. Spending past the $6k threshold earns just 1% cash back – an unlimited 6% cash back was just too good to last. Another letdown of the Amex Blue Cash is simply that: its name. Unfortunately, Amex isn’t as widely accepted as other credit card networks, so we recommend having a no-fee Visa or MasterCard as a backup. Also, world travelers be warned: there’s a 2.7% foreign transaction fee. If you frequently travel abroad, check out these cards with no foreign transaction fee.

Bluebloods: Blue Cash vs. the Chase Fredom

Time for the big leagues: How do the Blue Cash cards stack up the cash-back contender?

Chase Freedom - $100 Cash Back Credit Card
Apply Now

on Chase's
secure website

The Chase Freedom offers 5% cash back in bonus categories that change every quarter and can range from gas and drugstores to Amazon.com and Macy’s. It has no annual fee and comes with a Get a $100 Bonus after spending $500 on purchases in your first 3 months from account opening. Earn 5% cash back on up to $1,500 in combined purchases in bonus categories and unlimited 1% cash back on all other purchases, all with no annual fee. signup bonus. It comes with a cap: bonus rewards are limited to the first $1,500 spent every quarter. Basically, if a hefty chunk of your money goes to groceries, go blue; if not, go with a bit more variety.

Blue Cash Preferred vs. Blue Cash Everyday

How do you know whether to get the Blue Cash Preferred or the Blue Cash Everyday? It’s pretty simple. Looking only at grocery rewards, you should get the Blue Cash Preferred if you spend at least $50 a week on groceries (or gift cards at grocery stores). At that spending level, the extra 3% in grocery rewards outweighs the annual fee. If you can’t meet that threshold, go with the Everyday.

Where the Blue Cash Preferred shines

The Blue Cash Preferred is at its best when used by households – people who spend the bulk of their money on feeding the family and shuttling the kids around. If you’re spending $50+ a week on groceries, or if you’re filling up your tank often, this is the ideal card for you.

Where it falls short

As we mentioned above, if you spend less than $50 a week on groceries, you’re better off with the Blue Cash Everyday. Another case where the Preferred isn’t ideal is if you travel often, particularly if you travel internationally. Frequent travelers might want to forgo cash back for potentially more valuable travel points, or aim for a card that gives bonus rewards on travel spending. The Blue Cash Preferred carries a 2.7% foreign transaction fee, and American Express’ international acceptance lags behind Visa and MasterCard’s. You can check out our list of the best travel credit cards to find an ideal card.

What is a standalone grocery store anyway?

The Blue Cash Preferred earns 6% rewards at stand-alone grocery stores, and the Everyday earns 3%, up to the first $6,000 spent. But what counts at a grocery store? Generally speaking, if the main product is food, you’re in the clear – this means Safeway, Whole Foods and Stop & Shop. These do not include superstores and warehouses (such as Costco). Amex Canada’s site can give some color into what consitutes a grocery store:

Purchases at merchants where [grocery] sales are not their primary business (including superstores, wholesale clubs, alcohol retailers and general merchandise retailers) and purchases at sponsors do not qualify for the earn rate in this category.

Per the Blue Cash’s website, though, we can see what Amex considers to be department stores:

Bealls, Belk, Bloomingdale’s, Bon Ton Stores., Boscov’s, Century 21 Department Stores, Dillard’s, J.C. Penney, Kohl’s, Lord & Taylor, Macy’s, Neiman Marcus, Nordstrom, Saks Fifth Avenue, Sears, and Stein Mart

We want to hear from you and encourage a lively discussion among our users. Please help us keep our site clean and safe by following our posting guidelines, and avoid disclosing personal or sensitive information such as bank account or phone numbers. Any comments posted under NerdWallet's official account are not reviewed or endorsed by representatives of financial institutions affiliated with the reviewed products, unless explicitly stated otherwise.