Why I Love My American Express Blue Cash Card
May 25, 2007
Credit cards can be a useful financial tool for those that access credit responsibly; they can actually be used as a way to make some extra money!
Our Rewards Card
I checked the American Express website today and saw that our annual rebate credit came through this month. We earned a cash rebate of $330 for our purchases, not too shabby. In years past when we put big chunks of money such as major home improvements and vacations on our credit card we’ve earned over $600 in cash back!
How Do We Get Hundreds in Cash Back?
We use our American Express Blue for almost everything we buy. Some places don’t accept American Express because they charge higher merchant fees, which is why they can afford to give us cash back. We have a backup Visa Chase rewards card for cases like these that offers cash back as one of their rewards.
When I say we use plastic for everything, I mean everything! I hate spending money but anytime I have to I pull out the credit card. Over the course of a year all these purchases add up and earn us hundreds of dollars cash back.
Why a Rewards Card Works for Us
Credit card cash back is some of the easiest money I’ve ever made. We don’t have to do extra work, just spend money like we normally would. However, rewards cards are not for everyone. This strategy works for us because we have the cash to pay for the things we buy on credit and pay off our balance in full every month.
We also make sure to pay our credit card bills on time. The cash back agreement says if you make one late payment you forfeit your rebate for the whole year. Each month our statements shows how much cash back we’ve earned to date. Our total annual rebate appears as a credit on our statement one month following our card anniversary. Since we get a credit on our card as opposed to actual cash we also have to make sure we don’t spend extra money the month we get the cash back. If we did this we wouldn’t really be making any money on the cash back. We make sure we don’t change our spending habits the month we get the credit.
Avoid the Cash Back Mentality
One trap people fall into is thinking of cash back as saving money rather than making money. A person using the saving money approach might think, “I can buy this item I really want because I’m saving money on it with cash back.” The reality is you’re only getting 1–5% cash back on your credit card so you’re not even saving enough to pay for sales tax. If you look at cash back rewards as a way to make a little extra money by using a credit card to buy as you normally would then you’re less likely to make foolish spending decisions
Why I Love Our Credit Card
I’ve given credit cards some negative coverage in the past and decided it was time for the other side of the coin. Credit cards are not evil. It’s the misuse of cards that causes many people debt problems. There are many advantages other than cash back rewards to using credit cards that I’ll talk about in the future. If you use credit cards responsibly they can make you a little money and make your life a little easier. If you’re one of these people, give American Express Blue Cash a try! Of course, if you don’t have a disciplined approach to using credit then I would recommend not using it at all.
I think of it as saving money. I don’t want to think, “I can generate money by spending…” That to me is a dangerous thought to have.
For instance, “I might as well buy the Ferrari, I’ll be making $900 from my credit card.”
Hey Ben - It was a pleasure speaking with you today!
Also, I totally agree with your statement that it is not the credit cards that are evil, it is people viewing credit cards as cash in the bank.
Credit cards are something to be handled with care and caution. I pay my credit card balance in full every month and use it mainly for business expenses and from that I use the rewards points to treat my family to vacations.
Lazy Man, I see your point. I guess it’s the same concept just worded differently. For example, the mindset that I think is dangerous would say,
“This gadget is expensive but it’s okay to buy since I’ll put it on my cash back card and save money”.
Do you have to pay taxes on cash rebate of over $600?
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Smarty, I’m pretty sure you have to report the cash back rewards as income on your tax form. I know I did.
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I use the exact same card. We’re only up to about $300 this year though. Free money for my normal purchases — car insurance, groceries, gas, etc.
I really like the card, but I dislike the fact that it is American Express. I even would consider signing up for the card, but I really don’t want to carry two cards around for when companies don’t take AMEX. How much is this a problem for you?
-The Happy Rock
[…] Can you recommend any business cards that offer cash back? I’m partial to American Express Blue Cash for our personal cash back card but have to use a Visa card for business expenses because my main supplier doesn’t accept American Express. I’m open to any card for business, American Express, Visa, Mastercard; whichever provides the most cash back. […]
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American Express Blue Cash LIES, scam,
Hi,
Bottom line is you get 5% AFTER you spend $6500 and it doesn’t include the first $6500.
I signed up for this card because I needed it for overseas. I was told about the 5% cashback on purchases once I hit $6500 which I spend $1000 more a year than this. I was told at least twice [I was on the phone 20 minutes with a rep as I went forward, backward, up and down this 5% on WHICH level?] and the rep told me both times that once I hit the magic $6500 level that ALL purchases [WAIT! all like starting $1? yes all.] from $1 up through $7000 those purchases? if they are Supermarket purchases will be 5%? yes they told me twice, 20minutes on the phone.
Well it is not true. Today AMEX tells me after I look at their NEW online calculator. It is 5% on purchases AFTER $6500.01 This means over and above about $6501. So if you spend $7000 a year and the last $500 you spend, say $100 is bought at supermarkets, you will get $5 or 5% X $100=$5
great deal if you put $12000 a year on the card, not so great if you only spend $8000 or less.
If the people who work at AMEX don’t know the answer for sure, why do they try? If you can’t trust the people who work there, who are you supposed to ask? Hire an attorney?
you don’t have to pay taxes on rebates in excess of 600. these are actually deferred savings or discounts rather than income.
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