Last week in an online moms’ group, the discussion was about how to make ends meet when one spouse quits work to become a stay-at-home parent. Speaking from experience, I know this transition is difficult both emotionally and financially. One mom shared that she makes extra money by charging everything to a credit card that earns 1% cash back. She pays it off every month and puts the extra cashback into savings. I had to speak up on that strategy because there are several cards that earn more than 1% cashback. I recommend the Citi Double Cash Card.
Is 1% Cashback Good Enough?
I understand that not everybody is looking to turn credit cards into free travel. Cash is king, especially when you go from two incomes to one.
When my husband and I got married, we thought we were being smart with credit card rewards. One of our credit cards had 1% cashback up to $300 a year. We looked forward to getting that bonus money.
But that was 15 years ago. Now, you can do better than 1% cashback, even without paying an annual fee or thinking about rotating categories.
Citi Double Cash Card
In the interest of full disclosure: I rarely recommend credit cards that don’t have sign-up bonuses, and this card is in our affiliate network.
The Citi Double Cash Card gives you 2% cashback—1% when you purchase, and 1% when you pay it off. It has no annual fee. There are no rotating categories, and there is no limit to the cashback.
A new benefit that just started this week is the ability to convert the cashback into Citi ThankYou points. That opens up more rewards options including gift cards, PayPal and Amazon. If you also own the Citi Premier, Prestige or Chairman card, you can transfer your ThankYou points to travel partners.
The Citi Double Cash Card has 3% foreign transaction fees, so if you’re traveling overseas you should use a different card. As with all good rewards credit cards, it has a high interest rate. But if you plan to pay off your balance in full each month, the interest rate is irrelevant.
Bottom Line
If you’re still using a 1% cashback card, you can do much better. It’s time to switch up your credit cards and get more money back. The Citi Double Cash is an easy choice.
CLICK HERE TO VIEW VARIOUS CREDIT CARDS AND AVAILABLE SIGN-UP BONUSES
Author: Nancy
Nancy lives near Dallas, Texas, with her husband and three kids. Her favorite vacations include the beach, cruising and everything Disney.
OH MY GOSH Citi is so frustrating. I downgraded my Premier card in November to Double Cash, and they billed me $95 for the Premier annual fee on my Double Cash. Ahem? The live chat was no help.
I called, and the rep hung up on me. Called back, the next rep said it was a valid charge because it was on the end of the year. I asked to speak with a supervisor. Supervisor confirmed I should not have to pay the fee, they will remove it before this billing cycle is up. We’ll see. I really hope I don’t have to call back later. Getting kind of ridiculous.
When I redeemed my Premier points for a Southwest flight, the phone call took an hour. It’s just appalling, and so different compared to AmEx or Discover.
@Kacie That’s so frustrating! Ugh!
Also worth noting is Fidelity Rewards Visa Signature Card which is also an unlimited 2% cash back card and no annual fee. Foreign transaction fee is only 1% vs Citi’s 3%.
Of course if you don’t travel to foreign countries then CitiDouble, Fidelity and the Paypal MC at par at 2% cashback.
For our summer trip to London and Paris, we racked up $2500 + in souvenirs, restaurants, tickets, passes, groceries and transport cards. I would hate to have paid $75.00 on top of my purchases just because I used the card outside the US. 🙂
Paypal cash back MasterCard has 2% cash back, no cap, no annual fee and zero transaction fee. CitiDouble has 3% foreign trans fee. BofA travel rewards is 1.5% but with preferred rewards can be turned into 2.625% – no cap, no annual fee and zero transaction fee. Both Paypal cash back and all BofA rewards cards are chip and signature with PIN support for those Asian, Canadian and European transactions requiring PINs like unmanned kiosks.
@FinanceDabo Thanks for mentioning those other cards. The cashback with those isn’t quite as flexible–you have to have a PayPal account for one (which really isn’t a big deal) but for the Fidelity card you have to have Fidelity accounts where the cashback goes. The Citi Double Cash has fewer strings attached. But you’re right, you definitely wouldn’t want to use it overseas. Those charges can add up for sure!
Besides Citi Double Cash (DC), are there others that offer 2+%. One card that comes to mind is the BofA Premium Rewards that can have cashback up to 2.62% per dollar spend (with the BofA Preferred Rewards of $100K in deposit. Granted not for everyone); unlike Citi DC, this one has a $95 annual fee.
DiscoverIt is the only other no-fee card I see that has 2%, and that’s only for the first year. Most other cards have tiered rewards by category or an annual fee.