Stand Alone Supermarkets: Amex Blue Cash Capping Grocery Rewards at $6,000
Brace yourselves, Blue Cash Preferred® Card from American Express cardholders. We’re sad to report the Blue Cash will now impose a $6,000 cap on grocery bonus rewards, effective November 1st for new customers and upon renewal in 2013 for existing customers. Alas, what’s good doesn’t last. But does this mean you should write off the Blue Cash altogether? Not so fast. For all that you can’t rewards-hack to your heart’s content anymore, the Blue Cash is still a great way to get rewards on a good majority of your spending.
Capped is the new blue
Blue Cash Preferred® Card from American Express cardholders used to earn an unlimited 6% cash back at standalone grocery stores and 3% on gas and department stores, while Blue Cash Everyday cardholders earned 3% and 2%, respectively. With unparalleled rewards rates on the most typical expenses, the uncapped Blue Cash was a steal for anyone who eats or drives. Which is exactly why it couldn’t last. One main draw of the Blue Cash was that you could earn 6% rewards on almost anything, by purchasing gift cards at the supermarket checkout line. By paying for prepaid cards at the register, you could earn the sky-high rewards rate on Amazon, Starbucks, whatever. And that’s still feasible. In 2011, the average consumer spent$3,800 on groceries, leaving $2,200 for gift card purchases. According to an email from an American Express spokeswoman, few people get close to the $6,000 cap:
The cap preserves our ability to continue rewarding our Cardmembers at 3% and 6% cash back for their supermarket purchases on these cards. We set the cap at $6,000 because it more than covers what the majority of Cardmembers are spending on supermarket purchases.
Left implied is the “…if you’re playing fair.” When it comes down to it, hacks are hacks, and loopholes close. Still, 6% rewards on $6,000 is fairly substantial.
What is a stand-alone grocery store, anyway?
Stores whose primary product is food – such as Safeway, Whole Foods and Stop & Shop – can, generally speaking, be considered stand-alone grocery stores. On the other hand, warehouses like Costco or megastores like Walmart or Target (which sell produce, but don’t consider it their main offer) don’t count. An explanation from American Express Canada might give some insight:
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.
|Blue Cash Preferred® Card from American Express||Blue Cash Everyday® Card from American Express|
|Get $150 back after you spend $1,000 in purchases on your new Card in your first 3 months. You will receive $150 back in the form of a statement credit.||Get $100 back after you spend $1,000 in purchases on your new Card in your first 3 months. You will receive $100 back in the form of a statement credit.|
|Intro APR Promo|
|0% on Purchases for 15 months; 0% on Balance Transfers for 15 months||0% on Purchases for 15 months; 0% on Balance Transfers for 15 months|
Blue Cash versus the competition
In any case, many other groceries rewards cards impose caps as well. Here’s how the Blue Cash cards stack up against major grocery cards: Bank Americard Cash Rewards on Bank of America's
on Bank of America's
- Only groceries are capped. The Bank Americard limits your bonus rewards on both gas and groceries.
- The Bank Americard limits combined purchases. Let’s say you spend $1,500 on gas in a given quarter, and only afterwards spend money on groceries. You’d be stuck earning the 2% gas rewards rate instead of the higher 3% groceries rate.
- Longer capping period. The Bank Americard limits your rewards to $1,500 spent per quarter, or $6,000 per year – the same as the Everyday. But let’s say you spent $1,000 in two quarters and $2,000 in two quarters. With the Bank Americard, you’d earn rewards only on $5,000, whereas on the Everyday you’d earn rewards on the full $6,000.
Nerd note: If you’re a Bank of America® banking customer, you’ll have the opportunity to earn a points dividend of 25%, 50% or 75% through the Preferred Rewards program. The bonus you’ll receive depends on the type of account you have and the total amount of your assets. But even if you don’t qualify for Preferred Rewards status, just having a Bank of America® checking or savings account will give you a boost: You’ll get a 10% dividend on the points you redeem into your account.
The 5% bonus cards on Chase's on US Bank's
on US Bank's