Although I’ve had an American Express Blue Cash card for a number of years, its been collecting dust in my wallet for as long as I can remember. The archaic structure of the old Blue Cash card with its spending tiers and annual reset was just too much to worry about. That all changed the minute American Express unleashed the Blue Cash Preferred Card, which I consider to be the ultimate cash back card.
How Much Can You Save with American Express Blue Cash Preferred
For starters, grocery purchases earn 6% cash back, with no cap on earnings. Since my family spends about $200 a week on groceries, we’ll net just over $620 in this category alone. With the now defunct Capital One No Hassle Cash Rewards card, we were earning 2% and were content. Now we’ll bank an extra $400.
Gas station and department store purchases earn 3% with Blue Cash Preferred. On gas, our weekly spending of $75 will net us just under $120 a year, bringing our rewards total up to $740. Department stores aren’t a huge spending category for us, but others may benefit nicely from this as well.
All other purchases made with the Blue Cash Preferred Card earn a respectable 1%. This is inline with most other cash back cards, but less than what can be earned with the Capital One Venture Rewards Card, which I will likely use on all other purchases, as that card offers 2% in the form of double miles.
The Drawbacks
Unfortunately, Blue Cash Preferred isn’t without its drawbacks. The biggest drag is its $75 annual fee. New card-members get a $100 cash back sign up bonus that offsets this for the first year, but if you are upgrading from the old Blue Cash, you can’t get the bonus (even if you call five times!). Assuming I only use the card for gas and groceries, the annual fee reduces my net rewards from $740 to $665, which is still more than double what I’d earn with any other card.
The only other drawback impacts people who carry balances from month to month. The lowest APR available is 17.24% and the rate can run as high as 21.24%. Even though Blue Cash Preferred comes with a 0% intro APR on purchases for either six or twelve months, this interest rate is a deal-breaker for anyone who tends to carry more than a few hundred dollars of debt on a monthly basis. If you fall into this category, a low rate or 0% APR balance transfer card is likely a better option.
Final Thoughts on the Blue Cash Preferred Card
If you spend heavily on groceries and gas, this version of the Blue Cash Card can’t be beat. In fact, only using this card for gas and groceries is a very good way to rack up rewards and make sure you are able to pay your bill in full every month. While the $75 annual fee may seem steep, you actually earn back this fee by spending $25 a week on groceries – everything else is all cream.