How to Save $100s Every Year with 5% Cash Back Credit Cards

CREDIT CARDS - CASHBACK CREDIT CARDS
If you’re in the market for a cash back credit card, there are several ways to earn (at least) 5% cash back on your daily purchases.
Updated Feb. 20, 2024
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Earning cashback rewards by using specific credit cards for purchases you're already making is like putting money back in your pocket.

While a single credit card that gets you 5% cash back on everything is hard to come by, there are plenty of ways to earn 5% or more in cash back on your purchases. Earning this great cashback rate does require a small amount of planning and strategy, though. 

Let's explore how cashback rewards work and how you can save 5% or more on many of your everyday purchases.

In this article

How cashback rewards work

Earning cash back on your purchases is simple — you pay with your credit card, and you earn a percentage of each purchase back as “cash.” While some cards have general flat-rate cash back like “1.5% cash back on all purchases,” other cards have specific rewards categories like “6% cash back on groceries.”

Some people argue that having a credit card that earns points or miles may be “better,” but there’s nothing wrong with putting money in any form back in your pocket. For some time, I used cash back cards to help save on my monthly bills, and it helped tremendously. So if you’re looking to apply for a new credit card and debating between cash back versus miles, either option could be a great choice.

While high rates of cashback rewards aren’t typical, they do exist. If you’re wondering which credit card will give you 5% cash back on all your purchases, unfortunately, that’s hard to come by. However, there are some cards that have specific spending categories where you can earn even more than 5% cash back.

Some of the best cash back credit cards available can be used strategically to earn high amounts of cash back.

Credit cards that will give you (at least!) 5% cash back

Card Best for Welcome bonus Rewards rate Annual fee
Blue Cash Preferred® Card from American Express U.S. supermarkets and U.S. streaming subscriptions Earn a $250 statement credit after spending $3,000 on purchases in the first 6 months 6% cash back at U.S. supermarkets (for first $6,000 per year, after that 1%) and on select U.S. streaming services, 3% cash back at U.S. gas stations and on eligible transit, and 1% cash back on other eligible purchases $95 (waived first year) (Terms apply)
Chase Freedom Flex℠ Rotating categories and travel purchases Earn a $200 Bonus after you spend $500 on purchases in your first 3 months from account opening 5% cash back on rotating quarterly categories you activate (on up to $1,500 spent) and travel purchased through the Chase Ultimate Rewards portal; 3% cash back on drugstore purchases and dining at restaurants (including takeout and eligible delivery service); and 1% cash back on all other purchases $0
U.S. Bank Cash+® Visa Signature® Card Selected spending categories Earn a $200 bonus after spending $1,000 in eligible purchases within the first 120 days of account opening 5% cash back on two categories you choose (up to $2,000 in combined eligible purchases each quarter) and on prepaid air, hotel and car reservations booked directly in the Rewards Center; 2% cash back on one everyday category, like gas stations/EV charging stations, grocery stores, or restaurants; and 1% cash back on all other eligible purchases $0
Citi Custom Cash® Card Flexible top spending categories Earn $200 in cash back after you spend $1500 on purchases in the first 6 months of account opening. This bonus offer will be fulfilled as 20,000 ThankYou® points, which can be redeemed for $200 cash back 5% cash back in your top eligible spending category each billing cycle (up to the first $500 spent, then 1% cash back), plus unlimited 1% cash back on all other purchases $0
Ink Business Cash® Credit Card Select business expenses:

Office supply stores, plus internet, cable, and phone services

Earn $750 bonus cash back after you spend $6,000 on purchases in the first 3 months from account opening 5% cash back on the first $25,000 spent in combined purchases at office supply stores and on internet, cable and phone services each account anniversary year; 2% cash back on the first $25,000 spent in combined purchases at gas stations and restaurants each account anniversary year; and 1% cash back on all other purchases $0

Blue Cash Preferred® Card from American Express

With the American Express Blue Cash Preferred, cardmembers can earn 6% cash back at U.S. supermarkets (for first $6,000 per year, after that 1%) and on select U.S. streaming services, 3% cash back at U.S. gas stations and on eligible transit, and 1% cash back on other eligible purchases.

This is one of the best credit cards for groceries, as you can earn 6% cash back on purchases with U.S. supermarkets (for first $6,000 per year, after that 1%) and on select U.S. streaming services. 

If you were to spend $4,000 a year on groceries for your family, along with $200 a year on select streaming services, that would net you $252 cash back. The cash back earned is given as Reward Dollars that can be redeemed as a statement credit or at Amazon.com checkout.

Some people avoid this card because it has a $95 (waived first year). But if you use your card strategically for groceries and cashback categories, you might find you have earned enough credit card rewards to more than cover the fee. 

To add to the savings, this card also comes with a great welcome offer. You can earn a $250 statement credit after spending $3,000 on purchases in the first 6 months.

In addition, the American Express Blue Cash Preferred® is not only a great card for buying groceries, it’s also one of the best credit cards for gas.

The bottom line: If you’re spending consistently at U.S. supermarkets and pay for U.S. streaming subscriptions, this card could make a difference in your budget.

Get more details at our American Express Blue Cash Preferred® review.

Chase Freedom Flex℠

For anyone looking to earn valuable cash back, the Chase Freedom Flex Card is a must-have for its rotating categories. 

With this Mastercard, you can earn 5% cash back on rotating quarterly categories you activate (on up to $1,500 spent) and travel purchased through the Chase Ultimate Rewards portal; 3% cash back on drugstore purchases and dining at restaurants (including takeout and eligible delivery service); and 1% cash back on all other purchases. 

If you make the most of the rotating categories alone, you’ll earn $75 in cash back every three months, which adds up to $300 in yearly savings.

The only catch is you’ll need to activate these spending categories each quarter. Activation can easily be done in your account portal. Check out the current schedule for Chase Freedom categories.

You can also take advantage of an introductory APR offer:

  • 0% intro APR (annual percentage rate) for 15 months on purchases (then 20.49%-29.24% Variable)

And don't forget the generous sign-up bonus: Earn a $200 Bonus after you spend $500 on purchases in your first 3 months from account opening.

The bottom line: If your spending is more flexible or your budget tends not to be heavy in one area (like groceries or gas), the Chase Freedom Flex is a great choice to earn you significant cash back.

Get more details at our Chase Freedom Flex Card review.

U.S. Bank Cash+® Visa Signature® Card

The U.S. Bank Cash+ Visa Signature Card packs a punch with its 5% cash back on two categories you choose (up to $2,000 in combined eligible purchases each quarter) and on prepaid air, hotel and car reservations booked directly in the Rewards Center; 2% cash back on one everyday category, like gas stations/EV charging stations, grocery stores, or restaurants; and 1% cash back on all other eligible purchases. 

This card is similar in concept to the Chase Freedom Flex, except you get to choose your two preferred spending categories rather than having them assigned.

The quarterly 5% categories of your choice are as follows:

  • TV, internet, and streaming services
  • Fast food
  • Movie theaters
  • Cell phone providers
  • Home utilities
  • Gyms and fitness centers
  • Department stores
  • Ground transportation
  • Select clothing stores
  • Electronic stores
  • Sporting good stores
  • Furniture stores

Since you can select your spending categories each quarter, using this card is a great way to strategize your purchases ahead of time. If you know you’ll be traveling and eating out during July through September (Q3), you can select those two categories. If you were to maximize the spending categories at $2,000, you could earn up to a maximum of $100 cash back each quarter.

On top of the 5% categories, you can also earn unlimited 2% cash back on one of these three categories you can select from:

  • Grocery stores
  • Gas stations
  • Restaurants

While the 2% categories are a nice addition, they’re not the best feature of this card, in my opinion. The other cards on this list all surpass this earning rate in similar categories.

New cardholders also get the perk of a 0% intro APR on balance transfers for the first 15 billing cycles (then 19.74% - 29.74% (Variable)). You will have to pay a balance transfer fee of 3% of the amount of each transfer or $5 minimum, whichever is greater, and after the promo period ends your balance will be subject to the regular or variable APR.

The bottom line: If you have larger purchases across various categories or are planning specific purchases in the categories listed above, the U.S. Bank Cash+ Visa Signature Card is the card for you.

Get more details at our U.S. Bank Cash+ Visa Signature Card review.

Citi Custom Cash® Card

The Citi Custom Cash is another Mastercard and it has a $0 annual fee and offers a welcome bonus offer of $200 cash back after spending $1,500 in the first 6 months. You also have the opportunity to earn 5% cash back in your top eligible spending category each billing cycle (up to the first $500 spent, then 1% cash back), plus unlimited 1% cash back on all other purchases.

What this means is that you’ll automatically earn the maximum percentage of cash back in whichever category you’re spending the most on each month. Qualifying categories include restaurants, gas stations, grocery stores, certain travel bookings and transit purchases, certain streaming services, drugstores, home improvement stores, fitness clubs, and live entertainment.

You’re limited to earning the 5% rate on the first $500 you spend, but that spending cap could still get you at least $25 in cash back each month if you maximize your earnings.

New cardholders also get the benefit of a 0% intro APR on purchases for the first 15 months (then 19.24% - 29.24% (Variable)). You also get a 0% intro APR on balance transfers for the first 15 months (then 19.24% - 29.24% (Variable)).

The bottom line: The Citi Custom Cash can be helpful if you don’t want to worry about rotating categories, but your top spending category tends to change from month to month.

Get more details at our Citi Custom Cash card review.

Ink Business Cash® Credit Card

Did you know business credit cards can also be cash back cards? If you’re a small business owner looking to save on your business expenses, the Ink Business Cash Card could be a great fit for you.

With the Ink Business Cash Card, you can earn 5% cash back on the first $25,000 spent in combined purchases at office supply stores and on internet, cable and phone services each account anniversary year; 2% cash back on the first $25,000 spent in combined purchases at gas stations and restaurants each account anniversary year; and 1% cash back on all other purchases.

Also, you can earn $750 bonus cash back after you spend $6,000 on purchases in the first 3 months from account opening. With this earning potential, you could easily put thousands of dollars back into the bottom line of your business.

Along with these earnings, this card will protect you during your travels with coverages such as auto rental collision damage waiver (primary coverage) and roadside assistance.

New cardholders also get the benefit of a 0% intro APR on purchases for the first 12 months (then 18.49% - 24.49% Variable). 

The bottom line: The Ink Business Cash Card is excellent for a business owner looking to add hundreds of dollars to their bottom line.

Get more details at our Ink Business Cash Card review.

Multiple cash back cards could get you 5% cash back more often

While using just one of the credit card offers listed above could help you earn a significant amount of rewards, none of them has the potential to maximize every single one of your purchases.

We all spend money in many different areas. From shopping, gas, grocery stores, eating out, and entertainment, there’s plenty of cash being spent — and cash back to be earned. Unfortunately, there’s no single credit card that will earn you at least 5% in all of these spending categories. However, there’s still a way to get 5% cash back more often.

If you were to use these three cash rewards credit cards simultaneously, you could easily achieve that goal of 5% cash back. Here’s an example strategy for a regular consumer that could earn you over $800 in cash back over the course of one year.

Card name Blue Cash Preferred® Card from American Express Citi Custom Cash® Card
Chase Freedom Flex℠
Rewards category 6% at U.S. supermarkets (for first $6,000 per year, after that 1%) and on select U.S. streaming services 5% on purchases in your top eligible spending category each billing cycle (up to the first $500 spent, then 1% cash back) 5% on rotating quarterly categories you activate (on up to $1,500 spent) and travel purchased through the Chase Ultimate Rewards portal
Date rangeYear-round Year-round Quarterly
Estimated yearly spending $6,000 $6,000 ($500 each month) $6,000 ($1,500 each quarter) Total money spent = $18,000
Cash back earned $360 $300 $300
Annual fee$95 (waived first year) (Terms apply) $0 $0
Net cash back earned $265 $300 $300 Total cash back earned = $865

While spending $1,500 quarterly on each of the rotating category cards can seem a bit daunting, you can accomplish it through planning:

  • For example, Q4 is the holiday season where people tend to spend a lot of money on gifts. This is likely why Chase often has the categories for that time period set as retailers such as Amazon.com, Target, and Walmart.com. So when you’re price shopping, make sure to factor in the cashback savings you’ll get on your gifts if you shop at one of those websites.
  • Similarly, if the Chase Freedom Flex Card has the category of wholesale stores set for April through June, you could plan to stock up on everyday items during that time to get the most out of your cashback potential without unnecessary spending.

If you were to adopt the multi-card strategy outlined above, you could earn $865 in cash back over one year. On your spending of $18,000, that’s a healthy return. This doesn’t even take the potential welcome bonuses of the American Express Blue Cash Preferred® and Chase Freedom Flex cards into consideration, so earnings can soar even higher.

Just be sure to never spend money just for the sake of earning cash back. To make the most of a cashback rewards program, you need to pay off your balance each month. Otherwise you’ll be paying interest charges, and that would defeat the whole purpose of saving money on your expenses. 

In addition, these cards also charge a foreign transaction fee, so they wouldn't be ideal for traveling abroad. If you want to earn travel rewards, check out our list of the best travel credit cards.

FAQs

What is the best credit card for 5% cash back?

The best credit card for 5% cash back depends on your lifestyle and spending habits. You typically won’t get 5% cash back on all purchases, so you have to decide which card(s) would be best for the areas where you typically spend. For example, the Blue Cash Preferred® Card from American Express is ideal for U.S. supermarket purchases, while the Ink Business Cash® Credit Card makes sense for common business expenses.

What credit card gives the most cash back?

The card that gives the most cash back is likely the one that offers high earning potential in a category that aligns with your spending habits. For example, if you frequently spend a lot on groceries, a card like the Blue Cash Preferred® Card from American Express could be your best bet for getting the most cash back (issued in the form of Reward Dollars, which you can redeem as a statement credit or at Amazon.com checkout). But for someone who doesn’t consistently have one area where they spend the most, a card with rotating bonus categories like the Chase Freedom Flex℠ or Discover it® Cash Back might be better.

Do cash back cards actually give you cash?

Most cash back credit cards offer multiple redemption options for your cashback rewards. This often includes redeeming your cash as statement credits or direct deposits into an eligible bank account. Some card issuers may also offer gift cards or travel options as well. The closest thing to getting actual cash would be getting a deposit into a bank account where you can make cash withdrawals.

The bottom line on these 5% cash back credit cards

The cashback hobby is a great one, as you can feel the immediate impact in your wallet. That said, there’s no “best” cash back credit card. The best cash back credit card is the one that will earn you the most for your expenses.

When deciding on your next move, consider a credit card (or cards) that reflect your lifestyle, typical expenses, and financial needs. Hopefully this article gave you some insight into which cards might be a good fit for you and how you can use multiple cash back cards together to maximize your savings.

Seriously Powerful Cashback Card

Chase Freedom Flex℠
4.7

Chase Freedom Flex℠

Current Offer

Earn a $200 Bonus after you spend $500 on purchases in your first 3 months from account opening

Annual Fee

$0

Rewards Rate

5% cash back on rotating quarterly categories you activate (on up to $1,500 spent) and travel purchased through the Chase Ultimate Rewards portal; 3% cash back on drugstore purchases and dining at restaurants (including takeout and eligible delivery service); and 1% cash back on all other purchases

Benefits and Drawbacks
Card Details

Author Details

Brett Holzhauer Brett Holzhauer is a graduate of the Walter Cronkite School of Journalism at Arizona State University. He writes about using points & miles for travel, travel industry news, utilizing credit cards as financial leverage, and investing for the future. He has been featured in publications such as The Points Guy, Million Mile Secrets, The Money Manual, Recruiter, Travel Pulse, and Bald Thoughts. He is a full-time digital nomad with his wife, Kiersten.
Ben Walker, CEPF, CFEI® Ben Walker, CEPF, CFEI®, is a Senior Credit Cards Writer at FinanceBuzz. For over a decade, he's leveraged credit card points and miles to travel the world. His expertise extends to other areas of personal finance — including loans, insurance, investing, and real estate — and you can find his insights on The Washington Post, Debt.com, Yahoo! Finance, and Fox Business.

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