Blue Cash card from American Express review

If you have a big family and spend more than a thousand dollars a month on everyday purchases, you could eventually earn a sizable return with this family-oriented cash back card. The Blue Cash card from American Express offers one of the best cash back rates available on a credit card with no annual fee.

But to earn the card’s maximum bonus, you first have to spend a substantial amount of money up front, putting the card’s best feature — a 5 percent bonus on grocery, gas and drugstore purchases — out of reach for some cardholders. Even moderate spenders will have to wait patiently before they earn more than 0.5 percent to 1 percent cash back on their purchases.

A big hurdle for some

Unless you can afford to quickly spend thousands of dollars on your card, don’t expect to earn a large amount quickly with this tiered rewards card. The Blue Cash card offers just 0.5 percent cash back on regular purchases and 1 percent cash back on groceries, gas and drugstore purchases until you spend $6,500 on your card. That means the most you’ll be able to earn for your first $6,500 in purchases is $65.

After you reach the card’s $6,500 spending threshold, you’ll start earning 5 percent cash back on groceries, gas and select drugstore purchases and 1 percent cash back on regular purchases. That’s a generous haul for a card with no annual fee; but unless you’re a voracious monthly spender, you’ll have to wait awhile to earn those sizable benefits. For a cardholder who typically spends $1,325 a month on a credit card, it could take 5 months to start earning the maximum bonus.

Modest spenders need not apply

Families on a budget could have a harder time taking full advantage of this card. If you spend just $800 a month, for example, it will take you more than eight months to clear the card’s $6,500 threshold, giving you less than four months to enjoy the 5 percent bonus before the card’s rewards calendar restarts. If you spend less than $500 a month, you won’t earn the 5 percent bonus at all. After 12 months, cardholders have to spend $6,500 again to earn the 5 percent bonus. To really get a substantial amount of benefit from this card, you need to be able to spend several thousand dollars in the first few months (or $6,500 all at once), which can be tough for many families to pull off.

No additional bonuses

The Blue Cash card doesn’t offer online applicants any sign-up bonuses either, which is surprising for a card of its caliber. Many of its competitors — including similar cards from American Express — offer new cardholders at least $100 or more in exchange for signing up. It also doesn’t contain any 0 percent promotions. Cardholders who transfer a balance or make a purchase on the card and carry over the balance will have to start paying the card’s standard APR as soon as the first billing cycle.

High APR

One of the biggest downsides to the Blue Cash card — besides its tiered rewards system — is the card’s surprisingly high APR, which is well above average for a cash back card. Cardholders with the best credit scores are offered a minimum APR of 18.24 percent, which is more than 2 percentage points higher than what the average cash back card charges. A typical cash back card, for example, charges a minimum rate of 15.60 percent, according to CreditCards.com data. Other cardholders, meanwhile, could be charged a rate as high as 23.24 percent. That means if you use your Blue Cash card for all or most of your spending, you could get hit with a substantial bill if you can’t afford to repay your purchases in full.

Better options exist for American Express fans

If you’re eager to earn a large amount of cash back on your everyday purchases and can afford to pay a significant amount of money up front, you are almost certainly better off ponying up a two-figure annual fee than spending $6,500 just to get 5 percent cash back. The Blue Cash Preferred® Card from American Express, for example, charges a $95 annual fee ($0 intro annual fee for the first year) and offers 6 percent cash back on U.S. supermarket purchases (up to $6,000 in purchases per year, then 1 percent), 3 percent cash back on U.S. gas station purchases and 1 percent cash back on regular purchases, starting from day one. Depending on how much you spend, you should be able to recoup your ongoing annual fee payment relatively quickly. You’ll also get a $250 statement credit if you spend $3,000 in eligible purchases on the Blue Cash Preferred card within the card’s first six months.

Why get the Blue Cash card from American Express?

• You spend a lot on groceries, drugstore and gas station purchases and want to earn a higher bonus on your everyday spending.
• You don’t want to pay an annual fee and don’t mind waiting to earn the card’s maximum rewards.
• You can afford to spend $6,500 relatively quickly.

How to use the Blue Cash card from American Express:

• Try to meet the card’s $6,500 spending threshold as quickly as possible by using your card for all or most of your everyday purchases.
• Consider stocking up on household supplies and other pricey items you were already planning to buy within the card’s first few months.
• Pay off your purchases in full in order to avoid paying a hefty APR.

Eligibility and Benefit level varies by Card. Terms, Conditions and Limitations Apply. Please visit americanexpress.com/benefitsguide for more details. Underwritten by Amex Assurance Company.

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