BankAmericard Cash Rewards vs. American Express Blue Cash Everyday
May 28, 2013
Some people prefer credit cards that offer travel rewards, but others still prefer to receive cash back from their spending. And while some credit cards compete with each other to offer the highest rates of cash back on all purchases, others feature bonus categories of spending that allow cardholders to earn more than the nominal 1% cash back. Although the highest rates of cash back are reserved for cards that have an annual fee, there are still plenty of great products that are free to use.
American Express offers its Blue Cash Everyday card that features extra cash back on purchases from gas stations and supermarkets. At the same time, Bank of America issues its BankAmericard Cash Rewards with a very similar cash back program.
I don’t know which of these two cards was offered first, but it is clear that they were meant to compete against each other. Let’s take a look at both of these cards, and see which one comes out on top.
BankAmericard Cash Rewards
Bank of America offers new cardholders $100 cash back after spending $500 on this card within the first 90 days of opening an account. Cardholders also earn 3% cash back on gas, 2% cash back on groceries, and 1% cash back on all other purchases. The bonus levels of cash back only apply to the first $1,500 spent by cardholders each quarter. And cardholders who have checking or savings accounts with Bank of America will receive an extra 10% bonus when they choose to have their rewards deposited in a qualifying account.
Cardholders also receive some useful benefits. When traveling customers receive automatic car rental insurance and an emergency assistance service. In addition, lost, damaged, or stolen items are covered under a purchase replacement program.
New cardholders receive 0% APR promotional financing for 12 months on both new purchases and balance transfers. Qualifying balance transfers must be completed within 60 days of opening an account, and there is a 3% balance transfer fee. After the promotional financing expires, the standard interest rate is 12.99-22.99%, depending on the applicant’s credit worthiness. There is no annual fee for this card, but there is a 3% foreign transaction fee imposed on all charges processed outside the United States.
Insider tip:Â One way to maximize the value of the bonus categories of spending is to purchase gift cards from grocery stores or even gas stations. This is definitely worth the effort if you are going to make a large purchase. For example, you might find buy a gift card to a home improvement store that is sold at your grocery store, and then use the gift card to buy a new appliance.
American Express Blue Cash Everyday
Holders of the American Express Blue Cash Everyday card receive 3% cash back at U.S. supermarkets, on up to $6,000 in purchases. 2% cash back is received at U.S gas stations and at select U.S. department stores. 1% cash back is received for all other purchases.
Cardholders also receive car rental insurance, a purchase protection policy, and extended warranty coverage. In addition, cardmembers are also covered by a return protection policy that covers merchants who will not take an item back.
New applicants receive a 0% APR introductory rate for six months that is valid on new purchases. After that, cardholders receive a standard interest rate of between 12.99% to 21.99%, based on their creditworthiness when they applied. There is no annual fee for this card, but American Express has a 2.7% foreign transaction fee that is added to all charges processed outside the United States.
Insider tip:Â American Express uses exact guidelines to determine which purchases are eligible for bonus levels of cash back. You can read those here.
It is not a coincidence that these two cards are very closely matched, so it is important to note the key differences. BankAmericard Cash Rewards offers 2% bank on groceries, and 3% back on gas,Â while American Express Blue Cash Everyday offers the opposite.Â The Amex card also throws in 2% cash back at some department stores.
Bank of America is the clear leader when it comes to promotional financing, with 12 months interest-free for balance transfers and new purchases vs. Amex with 6 months for new purchases only. And finally, Bank of America offers $100 cash back as a sign up bonus, whereas Amex has none.
So the Bank of America card is the clear winner for those who need longer promotional financing terms and crave that $100 bonus. Nevertheless, I could make a case for the Amex card for those who appreciate the broader selection of benefits, and who prefer to earn higher rewards from grocery and department stores.
No one ever said that finding the best reward credit card would be easy, and this comparison of such similar cards shows how hard the banks are competing each other. But for the majority of credit card users, it seems like Bank of America’sÂ BankAmericard Cash Rewards wins by a nose.
Which credit card do you feel is right for you? Leave a comment!
All posts by Jason Steele