5% Cash Back Credit Cards: Rotating Categories Update 2014

4th quarter activation now open for all cards. Holiday shopping is the theme, but I’m buying Amazon gift cards at the end to use over the next few months. The cards below offer a hefty 5% cash back on certain categories that rotate each quarter. With a little extra attention, I can easily rack up hundreds of dollars in additional rewards per year without otherwise changing my spending habits. Sometimes this involves buying Amazon gift cards at stores offering 5% back. None of these have an annual fee, so it costs me nothing to keep them around. New cardmembers often also get an initial sign-on bonus.

Chase Freedom CardChase Freedom® – $100 Bonus
From October 1st through December 31st, 2014 you can earn 5% cash back on up to $1,500 spent in the following categories:

  • Amazon.com
  • Zappos.com
  • Select Department Stores including Macy’s, Nordstroms, Sears, and Kohl’s (full list)

Enroll each quarter at ChaseBonus.com, it’s quick and as long as you activate by the end of the quarter the rewards are retroactive. All other purchases earn 1% back, with no tiers or expiration of rewards. Currently, the Chase Freedom® card is offering $100 bonus cash back if you sign up and make just $500 in purchases in your first three months and a $25 Bonus after you add your first authorized user and make a purchase within this same 3-month period. No annual fee.

Citi Dividend Platinum Select Visa CardCiti® Dividend Platinum Select® Visa® Card
From October 1st through December 31st, you can earn 5% cash back from Citi on eligible purchases at:

  • Best Buy
  • Department Stores
  • Toy Stores

Log into your online account or call 1-800-231-0891 to activate the rewards each quarter (starts upon activation, not retroactive). The total cash back earned with the card is $300 per calendar year.  See Citi Dividend Card Reward Program Information for details. Full 1% cash back on all other purchases and eligible cash advances and rewards do not expire as long as you have activity once every 12 months.

Discover it® CardDiscover it 14 Month BT (RED)
From October 1st through December 31st, 2014 you can earn 5% cash back on up to $1,500 spent in the following categories:

  • Online Shopping (including but not limited to Amazon.com, Apple.com, Target.com, Walmart.com, and Overstock.com)
  • Department Stores (including but not limited to Macy’s, Nordstroms, Sears, and Kohl’s)

Login into your online account to activate the rewards each quarter (starts upon activation, not retroactive). The new Discover it® card now has a flat 1% cash back (no more tiers), free FICO score every month, late-payment forgiveness, and direct-to-human, 100% US-based customer service reps. No annual fee. (If you have an old Discover More card, you should call in and convert it to a Discover It card for free and get the new perks.)

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Comments

  1. The PenFed Platinum Cashback Rewards Card is changing on 01FEB2012 in that while it is still 5% cash back from gas purchases, other purchases drop from 1% to just 0.25%. They are pushing you to switch over to their points card which maintains the old rewards structure, but in points. Not a big fan of the points thing, as I like the auto-pilot of getting the statement credit each month. Chase Freedom Visa is looking good!

  2. I like the old card.
    But signup for new card will offer 5000 points on first purchase and 20,000 point on $1000 purchase in first 3 month starting Feb 1. Its equivalent to $250 bonus which is hard to let go. They have also claimed in FAQ that each 1 point will be valued $0.01.
    You can cash out as Visa Gift Card. One thing which is unknown, what will be minimum value for gift card.

  3. Discover More 5% cashback will only work on stand-alone stations, not warehouse clubs or any other supermarket-attached ones. Just a word of warning.

  4. Jonathan,

    Ever though about putting together an article for readers with a high credit score (readers who could open several cards at a time) to compound on free offers? What are the best offers out there and by combining them what sort of trip could be put together. I am thinking that a Thank you card, A Starwood card and a Southwest Rapid Reward card could be combined for at least a week long vacation? Any ideas or thoughts on the best combination of 3-4 cards to compile and what the total spending would be- ($1k in first 3 mons. or $5k in first 3 months?

  5. Jonathan,
    PenFed is now offering customers the option to convert its 5% gas/1% everything else card to a points-based rewards card. It will earn 5 pts for gas, 3 at supermarkets, 1 for everything else. Converting is optional. They are also offering 25,000 bonus pts (limited time offer) for spending $1,000 within 3 months. Might be worth a quick review. Thanks.

  6. Currently I’m using Citibank Cash Back. Once the accumulated cash back reach $50, it will be credited into my credit card’s account. Based on my monthly credit card expenses, I’m constantly received $50 in every 2 months. Definitely I will not go back to bonus or rewards type credit card.

  7. Jonathan – I think you made a clerical error. For Freedom, you talk about the second quarter (April 1 to June 30) but for the other two, the first quarter (January 1 to March 31). It’s not 100% clear that you are talking about second quarter rewards for Citi and Discover. (I’m guessing that you cut and pasted an earlier post, but missed these edits/update?)

    @PenFed users: I can’t say about your program, but Chase is basically a points system (with a cash-back option) that is better than, say, Costco Amex’s cash back. It’s better because you can (but don’t need to) get a better return if used for airfare, and because you can take cash-back as a statement credit at any time, where Amex makes you wait for an annual check.

  8. Penfed points system is a knock-off of Chase Ultimate Rewards with 2 differences:

    1. Bonus category: Does not change – it’s always 5% off gas purchases (and 3% off supermarket purchases).
    2. No option to withdraw cash into checking account. One can order Visa giftcards ($50 minimum). Not clear if the giftcard will charge some monthly ‘maintenance’ charge.

  9. @Jason – You’re right, fixed!

  10. Can anyone confirm that buying gas at Sam’s Club during the 5% gas rewards quarter qualifies for the Discover 5% cashback? Thx.

  11. Newlyfrugal says:

    Phil, I asked the same question of a Discover CSR in 2011. The first one told me that as long as it is Murphy’s station at Sam’s, I get 5% cashback, so “look for the Murphy’s sign.” Months later, I asked again and was told, “No, Sam’s Club gas does not count for 5%, but if a CSR told you that, we will credit your account.”

    So it depends on which CSR answers your call. I wish they would train their people better. I don’t chance it and no longer use Discover card at any Sam’s gas station. If they don’t give you 5%, you get only .25% at Sam’s.

    If you call Discover and learn something different, please post here.

  12. Green Jacket says:

    I have had the Chase Freedom card for several years and back when I signed up, there was no sign up bonus. Has anyone had any luck calling Chase to see if they will give the $200 credit to existing card holders? I put a decent amount of money on it each month.

  13. CardResearch says:

    Apply for the Discover More, Chase Freedom, Citi Dividend Platinum for the different 5% cash back rotating category and select one card for 3% at gas station.

  14. I hate having to signup every quarter. I wish they would just offer 2% cash back year round and stop playing these games.

  15. I calculated that last year I made $695 in bonuses, cash backs, etc from tips on your website. This year I’m at $485 plus another $165 pending. At sub 1% interest rates this free money is a welcome boost to the average yield on my everyday cash accounts.

  16. I am so with Steve on this one. I don’t have any of these cards – what a pain!!

  17. For Steve and other that also find quarterly sign up annoying. I use the American Express Blue to get 6% Grocery, 3% Gas in combination with the Citi Forward Card to get 5% on all Amazon and Restaurants and Movies. It a simple good all around system and gets maximum rewards most of the year anyway.

    Signup for Discover/Chase only if it’s something special and/or have the option to buy gift cards from Grocery stores to earn 6% on other purchases.

  18. Jonathan: It seems that clerical points are all I’m good for – you have the comments from your last (2nd quarter) post on this (third quarter) update post. Some of them are still good points but not sure if you intended it!

  19. I like the cards that get us travel rewards. We haven’t used a cash back card in a long time. I may have to check them out again.

  20. personal finance says:

    This list of cash back credit cards is really useful. I was just about to get one and was doing some research about it and here I am. I found what I was looking for. Thanks for such a valuable information. Now I know which card to pick!

  21. I think the U.S. Bank Cash+ visa is the best I’ve seen. You get to pick two 5% categories, one 2% category every quarter. You get 1% on everything else. Lots of categories to choose from including Bill Payments, Groceries etc. If you redeem after accumulating $100, you get a $25 bonus, making your effective cash back on those categories even higher. I’ve had it for couple months now and love it.

  22. I hate the stupid rotating rewards game. It’s just a gimick to get you to apply for their card because they fool you into thinking that 5% cash back on your $100 worth of gas you spend in a month is a good deal. Like another commenter said, just give me 2% back on everything (Capital One Venture), and then I don’t have to think about it.

  23. @Pete – I respect your opinion. Everyone has their own preferences. But your Venture card has a $59 annual fee and is only 2% cash back when redeemed towards travel, and it has to be of the same size of your rewards. If you have $175 in rewards saved up and book a $200 plane ticket, you can’t cash out. So it has its own hurdles

    Compare with an AmEx that gives 2% cash back automatically into any Fidelity account, or the Capital One cash card that gives flat 1.5% cash back (better than 2% with $59 annual fee if you charge less than $11,800 per year since it has no annual fee):

    http://www.mymoneyblog.com/best-cash-back-rewards-credit-cards.html

  24. I just applied for the Capital One Venture card with no fees though, what $59 dollar are you talking about? Whatever the case these cards requires a lot of purchases to even get a nice vacation

  25. I think rotating categories are great!

    I use them in addition to websites that offer cash back. For example one credit card may offer 5% back at Best Buy for one quarter. I use websites like ebates to get an additional 5% back so that i actually get 10% back.

    I’ve saved a ton doing it that way.

  26. Anyone come across a better bonus sign up link for the Chase Freedom card? I remember they used to have bonus offers for $200, $300 and $350.

  27. Has anyone ever used rewards2cash.com? You can sell Amex, chase, united points etc… Their pay rates seem very good, but I know nothing about them. I figure this would be a good place to ask.

  28. DollarBill says:

    Better watch those Discover cash back bonus calculations on your bill. I had 3 on-line purchases during my last billing period but only received a cash back bonus of 0.25%. I called Discover and they were able to verify my purchases as being on-line, and they cheerfully added 4.75% to my cash back balance which in my case amounted to over $25.

  29. I think its worth noting, if you shop online through the discover “every day rewards” website, you get that bonus PLUS the 5%. For example, I bought my father a TV through the discover website at sears which was offering 10%. So I got 10% off for going through the discover website plus another 5% for making an online purchase with the discover card. It was $40 cheaper than buying on amazon even when factoring in sales tax paid at sears.

  30. A bit off topic…. but don’t forget the SouthWest Chase Credit Card posted here about a month ago. Charge $2000 within the first 3 months and get 50000 pts in a Southwest Mileage account. You can use the points for airline tickets, but I’ll be redeeming mine for $500 in Gift Cards (Amazon/Walmart —- $50 for 5000 points).

  31. Maybe Im just out of the loop but I just like having two cards. One I use the other just for emergency. I dont even know if I get cash back on these cards. Travel rewards would be nice to things I am already spending money on though.

  32. “Enroll each quarter at ChaseBonus.com, it’s quick and as long as you activate by the end of the quarter the rewards are retroactive.”

    Actually, the activation deadline isn’t at the END of the quarter. It’s the 14th day of the third month; for this upcoming period, the deadline to activate is September 14.

    https://creditcards.chase.com/freedom/Activate.aspx

    A couple of quarters back, I missed that deadline by procrastinating until the 15th, and lost out on the extra cash back.

  33. The rotating categories are such a pain. I use one card that gets 6% back for groceries and 3% on gas. Then the other card gets 2% on everything else. I don’t think I am able to stay on top of all the rotating changes.

  34. I can’t believe Discover only has gas this quarter. Ridiculous.

  35. The Chase, Citi and Discover cards are the grand-daddies of quarterly 5% cashback cards promotions. However, the Citi Diamond Preferred Mastercard has also been offering 5% cashback on quarterly rotating categories (since October 2012 if I recall correctly) – however, the maximum purchase amount eligible for this promotion is limited to $500 for each quarter. Also, they send you snail mail in the first month of the quarter in order for you to sign up for the promotion (haven’t they heard of email or the internet???!)

    As another posted put it, in the current ultra-low rate environment, I’ll take any incentives my credit cards offer! As with most credit card rewards hounds, I never carry a balance =).

  36. “Sometimes this involves buying Amazon gift cards at stores offering 5% back.”

    Can you please explain the details of this? IT would seem to me that youre changing spending habits just to get points….wondering why you would lock yourself into having to use Amazon

    • I already shop at Amazon quite regularly, certain baby food pouches coupled and some ethnic foods with Subscribe & Save discount is significantly cheaper than buying locally + cost of time/gas. So I’m not changing my buying habits, just getting another 5% off.

  37. Oh and diapers and wipes! More info here:

    http://www.mymoneyblog.com/amazon-mom-and-subscribe-save-tips.html

  38. Hey Jonathan, Great article, but maybe I missed something: Where can one “buy Amazon gift cards at stores offering 5% back?”

    thx, -JR

    • Many stores sell Amazon gift cards. If one of these stores happens to be eligible for 5% back, then you can essentially get 5% at Amazon by purchasing gift cards. I’ve bought Amazon gift cards at grocery stores (Safeway), office supply stores (Staples), home improvement stores (Home Depot), and so on. With Discover and Online Shopping, you could just straight-up purchase up to $1,500 in Amazon gift cards from Amazon itself and use it for future purchases. Hope that helps!

      • I’ve just never seen 5% discount offered for gift cards, but then I haven’t been looking. Is this a 5% promotion that some retail stores offer from time to time, or is it a discount/rebate you are getting some other way? Thx again.

  39. An important addendum to the information about Discover’s 5% on online purchases is that it includes those made using PayPal. They’ve done this for the past several years and I checked with their customer service again this year just to make sure that purchases made with Discover using PayPal qualify for the 5% cashback bonus.

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