Who should get the Blue Cash Preferred Card from Amex?

If the COVID-19 pandemic has taught us anything about rewards credit cards, it’s that groceries can be a very lucrative bonus category. As people switched from dining out to cooking at home, cash back from groceries began adding up quickly.

As far as the best credit cards for groceries go, few can compete with the Blue Cash Preferred® Card from American Express. The card offers an excellent 6% cash back rate at U.S. supermarkets (on up to $6,000 in spend per calendar year, then 1%) on top of a few other attractive bonus categories.

Considering the Blue Cash Preferred? Let’s take a look at the types of cardholders this popular cash back card can be perfect for.

The Blue Cash Preferred: At a glance

The bonus categories on the Blue Cash Preferred offer cash back on some of the most common expenses, providing an opportunity to earn hundreds of dollars in rewards annually.

“Groceries make up the biggest part of my budget, and I leveraged the card’s 6% cash back on U.S. supermarket purchases to score a whopping $500 back in 2020,” said Emily Sherman, former credit card expert at CreditCards.com.

Blue Cash Preferred® Card from American Express

Why should you get this card? Despite the annual fee after the first year, the Blue Cash Preferred card is one of our favorite cards for families. It helps take the sting out of carpool lines and long commutes by offering a generous rewards rate on U.S. gas station spending, and it offers one of the highest cash back bonuses you can get when you use your card at U.S. supermarkets. Read full review

Rewards rate 6% cash back at U.S. supermarkets (up to $6,000 in purchases per year, then 1%) 6% cash back on select U.S. streaming subscriptions 3% cash back at U.S. gas stations and on transit 1% cash back on general purchases Terms apply Introductory bonus Earn a $250 statement credit after you spend $3,000 in purchases within the first 6 months Annual fee $95 ($0 intro annual fee for the first year) Other things to know Free ShopRunner membership for expedited shipping (enrollment required) Extended warranty, purchase and return protection on eligible purchases Access to Pay it Plan it payment plans (terms apply)

“While it may be a controversial statement in the travel credit card game, the Blue Cash Preferred Card from American Express is my favorite credit card,” Sherman shared. “It offers cash back, which comes with fewer opportunities to maximize rewards redemption for additional value. But, it offers a ton of cash back for the right spender.”

Who should get the Blue Cash Preferred?

Right off the bat, it’s easy to see that the Blue Cash Preferred is best for people who spend a lot on groceries and prefer to earn their rewards as cash back. Let’s dive deeper into the kinds of cardholders the Blue Cash Preferred works best for.

You spend at least $260 per month on groceries

The 6% cash back you can earn with the Blue Cash Preferred is capped at $6,000 in spend annually, after which you’ll earn 1% That’s $500 in monthly spend to maximize your cash back earnings.

While this may be an easy target to hit for families, if you’re a single-person household, $500 might be too high for your monthly grocery budget. It doesn’t mean you can’t get plenty of value out of the card, but there’s also the ongoing annual fee to consider. You don’t want to simply break even – you want to earn enough cash back to make the card worthwhile.

If we only consider the grocery spend, the break-even point for this card is $132 in monthly supermarket spend. But if you want to earn at least twice as much cash back compared to your annual fee, you should spend over $262 on groceries per month.

You spend regularly in other bonus categories

If you maximize the grocery category, you can get up to $360 in annual cash back with the Blue Cash Preferred. After the ongoing annual fee, that’s $265 in value you get from the card. But as you’ve seen from Sherman’s earnings in 2020, there’s potential to earn much more.

The additional bonus categories can help you do just that. Say you spend around $300 per month on gas or transit – that’s $90 in annual cash back with the Blue Cash Preferred. Streaming services have also become a popular spending category in the pandemic, with the average monthly household spend of $47 in in 2020. If your streaming spend is about the same, you can get around $34 in annual cash back. That’s $389 in annual rewards if you combine these two results with maximized grocery spending after the fee.

You prefer simple cash back cards

Earning rewards with the Blue Cash Preferred is easy, as the fixed bonus category structure is straightforward, and you don’t have to worry about point valuations or rotating bonus categories.

Redeeming your cash back is equally simple. You must have a minimum of $25 to redeem, and you may choose between statement credit, gift card or merchandise purchase. For cardholders with already busy lives, you’ll appreciate the limited choices on this card.

Who shouldn’t get the Blue Cash Preferred?

You love maximizing travel rewards

On the other hand, if you’re focused on earning travel rewards and getting premium travel perks, the Blue Cash Preferred might not be the right choice. You may want to look into American Express cards that earn Membership Rewards points instead.

For example, theAmerican Express® Gold Card will also reward you beautifully for buying groceries with 4X points on U.S. supermarket purchases (on up to $25,000 in purchases per calendar year, then 1x), and you’ll be able to redeem rewards for airfare at excellent rates.

You consistently spend over $6,000 in groceries per year

In its April 2022 report, USDA estimated the monthly cost of food for a family of four at around $917 (after adjusting for inflation according to the U.S. Bureau of Labor Statistics’ Consumer Price Index). That amounts to an annual grocery spend of around $11,000 – well over the $6,000 cap on the Blue Cash Preferred.

For families with quickly growing children, especially if you have more than two kids, the Blue Cash Preferred won’t earn you enough rewards to be worth it. In that case, we recommend you apply for a card with no spending cap on groceries or at least a much higher one.

Bottom line

When it comes to cash back, the American Express Blue Cash Preferred is one of the best cash back credit cards on the market. It has a simple rewards structure and can be very lucrative for the right kind of cardholder.

If you’ve determined that the Blue Cash Preferred is the right option for you, now may be a good time to apply. The card currently comes with a welcome offer of a $250 statement credit after you spend $3,000 in purchases within the first six months.

Head over to CardMatch to see if you’re likely to be approved for this card – it’s free to check and doesn’t impact your credit score.