Why I Love My American Express Blue Cash Card – Amex Blue Cash Review

December 27, 2010

Blue Cash from American Express

Blue Cash from American Express is one of the top cash back cards, click here to see if you qualify for it’s rewards. Review last updated, September 2011.

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 rebate credit came through this month. We earned a cash rebate of $560 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 – 6% 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.

Card Options
When you’re choosing a card, your spending habits will help you decide which one is the best for you. In the case of this card, you have two options.  The Blue Cash Everyday card doesn’t have an annual fee and pays 3% back at supermarkets and 2% on gas and in department stores.  The second option is called Blue Cash Preferred and it does have an annual fee.  However, it pays a higher cash rebate, 6% on groceries and 3% for gas purchases.  So if you use the card for all your grocery shopping trips like we do, then the Preferred would likely pay off the best.  Like I said, how you use the card will determine which makes the most sense. 

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.


Blue Cash from American Express

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Ben

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Ben
Ben Edwards, the founder of Money Smart Life, saved up enough to buy a Nintendo back when he was 12 years old. When he used the money to buy shares of Wal-Mart stock instead, he knew he wasn't like the other kids... His addiction to personal finance has paid off for his family and now he's helping you to afford the life that you want. Check him out on the web at Google Plus, Twitter and Facebook.

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69 Responses to Why I Love My American Express Blue Cash Card – Amex Blue Cash Review

  • a

    The credit cards offered by Chase Freedom do not have a cash back tier like American Express cards. So every dollar charged ears a minimum of 1% cash back. A customer can earn a maximum of 8% cash back: 1% + 2% (top 3 or 5 of 15 categories) + quarterly 5% promotions (for this last quarter of 2011 they are Dining, Department Stores, Charitable donations, Movie theaters (all totaling 1,500 in purchases) and a separate 1,500 in purchases at Kohls.

    Another credit card that is good is Discover but it has a 3,000 tier to earn 1% and chargess at Walmart or Sams club do not contribute to the 3,000 tier and never earn more than 0.25%. The have a price improvement redemption program where you convert cash into higher dollar gift cards.

  • Sean

    I have an AMEX Blue Cash card. I’ve found that it’s terrible at categorizing purchases. Less than half of my purchases are associated with the correct categories to get my 5% (and I’m well over the $6500 cutoff to get that). I’ve contacted their support, and the first couple of times they corrected it. However, they’re now blaming the merchants for not categorizing the purchases correctly. I don’t buy that though. All of my other cards that offered bonuses in the same categories have correctly applied those bonuses, even my Costco Truearnings card, which is also an AMEX, when I’ve used it at the same gas stations (that one doesn’t offer bonus for grocery or drug stores).

    At any rate, I’m very frustrated at this point and am probably going to look for a different card to use that will actually categorize my purchases correctly so that I can get the Cash Back that is promised.

  • Brad

    I agree with Keith from the 4-26 post. I’ve had the Blue Cash card now for four years. We (family of two plus two dogs) charge everything from a $1 can of soda to $2500 in new appliances. If a favorite place doesn’t take AMEX, we let them know that we’d prefer to shop there, but don’t because they don’t take AMEX. Several places like Trader Joes have switched to accepting AMEX in just the last few years because of the growing number of customers that they previously lost because of not accepting AMEX. Our combined gross income is about 95k a year, and our total charges for the year range around 27k. We usually hit the $6500 mark in the third month and from then on earn 5% on groceries and gas. Last year we earned just shy of $800 back, the year before about $650, and the first year about $450. We always pay the full balance due every month, and have never paid interest. I think AMEX actually wants to get rid of us as a customer because they frequently try to get me to upgrade to their Gold card with a yearly fee. I don’t see a benefit to switching to paying up front to earn points for merchandise, over having $800 knocked off a bill once a year with no up-front cost. We do the bulk of our grocery and gas purchases at non-warehouse or discount retailers, which is important to remember. Once you hit the $6500 mark, you save more overall by filling up your gas tank for $2.05 at a stand-alone gas station versus $1.99 at Costco, Meijer, or another discount store. The best way to figure out what qualifies as a discount store or not, is if the store sells much more than gas or groceries. A customer service rep. said he likes to tell customers “If the store also sells shoes, then they’re classified as a discount store.” Purchases at stand-alone drugstores like CVS also qualify for the 5% cash back, but we’ve found that prices at these stores are generally much higher than say at Target (discount store) to justify shopping there. For toiletries and household goods you save more overall with the significantly lower prices at Target, plus the lower 1.5% cash back (after $6500) that the card pays. The deal is so good, I hope they don’t decide to cancel it one day. I think AMEX must still make a profit of all the transaction fees.

  • keith

    I’m a huge fan of the AMEX Blue Cash Card. If you’re disciplined about paying off your credit card bill every month then there’s no better card out there. Last year I earned almost 750 dollars back, paid nothing in membership fee or interest costs. As an added bonus the AMEX web site is top of the line and their customer service is first rate.

  • MoneySmartLifeLover2000

    Blue from American Express® is an ideal credit card for those with good credit who already have an established credit history and are looking for a card with access to a reward program.

    Various American Express® services and benefits are provided with this card, such as purchase protection, auto rental insurance, a year-end financial statement, and various travel and emergency assistance services.

    Cardholders also have access to Blue’s Membership Rewards Express® program, which offers members the chance to earn points that can be redeemed for various services and products. The rewards program is by far one of the best reward programs offered in the credit card industry, due in part to the variety of rewards offered with no yearly limit and no expiration policy for earned points.

    This card has no annual fee and a reasonably low interest rate for purchases (for those who qualify), which makes it ideal for those who plan to occasionally carry a balance. The card has a 0% introductory rate for up to 12 months of membership that can be applied towards purchases. A 2.99% introductory rate is available on balance transfers for 12 months. It is important to note that the balance transfer introductory rate only applies to those who initiate a transfer when applying for the card.

    Therefore, those who qualify for the lowest rate offered and plan to take advantage of the additional benefits and discounts available by American Express®, especially frequent travelers who can take advantage of the Membership Rewards Express® program with earned points that can be combined with various frequent flyer accounts, will benefit most from what the Blue from American Express® card has to offer.

  • aggressive saver

    you don’t have to pay taxes on rebates in excess of 600. these are actually deferred savings or discounts rather than income.

  • j

    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?

  • The Happy Rock

    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

  • KMull

    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.

  • Ben

    Smarty, I’m pretty sure you have to report the cash back rewards as income on your tax form. I know I did.

  • Smarty

    Do you have to pay taxes on cash rebate of over $600?

  • Ben

    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”.

  • Credit Cards

    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 and Money

    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.”

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