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Cash back rewards strategy

If you are just getting started with credit card rewards, cash back is usually the best place to start. This guide covers basic cash back rewards strategy for those new to credit card rewards and experienced users of credit cards alike.

Cash rewards are easy to understand and are usable, regardless of your credit card rewards goals. Cash can fund travel. Or it can fund your retirement savings. If you’re into credit card rewards, cash should be part of your plan.

This guide will give you the basics of earning cash back using rewards credit cards. If you’re new to credit card rewards, take it one step at a time. The sections on this guide are generally in the order that I recommend for most people.

Baseline: 2% cash back

To do: Get a 2% cash back card in your wallet.

A decade ago, the best you could hope to earn on every purchase was 1.5% cash back. Citibank upped this game when it introduced the Citi® Double Cash Card (), a card that earns 1% when you make your purchase, and 1% when you pay, an effective 2% cash back on all purchases. Since then, several banks launched cards with no annual fee that earn 2% cash back on all purchases. If you have one credit card in your wallet, it likely should be a 2% cash back card.

Why should you have a 2% cash back card? Having a 2% cash back card in your wallet increases your rewards and reduces complexity. A 2% cash back card is a good default credit card to put spending on. Unless you have a reason to put spending on a different credit card, you have one card that you can pull out and use for everyday purchases.

One 2% cash back card stands above the rest for most people. Remember: You can earn 2% cash back on every purchase by using a card with no annual fee. In very rare cases, should you ever earn less than 2% rewards on your spending.

What to pay attention to

Beyond getting a 2% cash back credit card in your wallet, there are a handful of things you can do to go after increased cash back credit card rewards. These sections are generally in the order I recommend to most people. You don’t have to add a ton of credit cards to your wallet, and at some point you hit diminishing returns. Just going after one or two new cardmember welcome bonuses can earn you plenty of rewards.

Here are the ways you can earn more cash back rewards.

Welcome bonuses

To do: Bookmark and check our lists of the best welcome bonuses whenever you are in the market for a new card.
To do: Bookmark our Welcome Bonus Database and use it for research when searching for a new cardmember welcome bonus.

By far the fastest way to earn credit card rewards is to go after a new cardmember welcome bonus. Most new cardmember welcome bonuses grant you a large amount of cash back or points that can be turned into cash back after you spend a certain amount on the card within a few months.

Why go for credit card welcome bonuses? Simple. A new cardmember welcome bonus can be the best way to get the largest amount of credit card rewards for the least amount of spending. Most new cardmember welcome bonuses offer at least $200 cash back after a modest amount of spending. But it isn’t uncommon to see new cardmember bonuses north of $500.

New cardmember bonuses change all the time, so the best. Our monthly post of the best credit card welcome bonuses is a good place to start. But also check out the articles below:

Cash back categories

To do: Figure out what “categories” you spend the most money in.
To do: Get cards that offer cash back in the categories where you spend the most.

Some credit cards offer increased cash back rewards in spending categories like gas, groceries, or dining. Adding a card or two to your wallet can earn you additional rewards on this spending. If you always use a certain card for gas or always use a certain card for groceries, you can keep the card in your car. For most people, gas and groceries will be at the top of this list.

Why go for cash back category cards? Having a cash back category card can earn you more rewards on the purchases you spend the most on each month.

Rotating 5% category cards

To do: Add rotating category cards to your wallet for additional cash back
To do: Check the Cards and Points front page to see this quarter’s rotating category card bonuses

Some credit cards offer 5% cash back rewards in categories that change every few months. These rotating category cards offer increased rewards on spending in categories like grocery stores, restaurants, or gas. And sometimes big box stories like Target, Walmart and Amazon are included in the categories that rotate quarterly. Most rotating category cards carry no annual fee.

Why use rotating category cards? Rotating category cards are an easy way to increase the rewards you earn for spending in the cards’ featured bonus categories.

Citi Custom Cash℠ Card card art
Citi Custom Cash℠ Card

The most useful rotating category card is the Citi Custom Cash℠ Card. The Custom Cash gives you 5% cash back on the first $500 you spend in the one “eligible category” where you spend the most each month. Eligible categories include restaurants, gas stations, grocery stores, select travel, select transit, select streaming services, drugstores, home improvement stores, fitness clubs and live entertainment.

The Citi Custom Cash℠ Card can be a great addition to your wallet, either alone, or in addition to other 5% cash back cards.

Citi Custom Cash℠ Card card art

Learn how to apply.

Annual fee: $0

This is a direct bank link. All information about the Citi Custom Cash℠ Card has been collected independently by

Citi Custom Cash℠ Card sign-up bonus


The 6-month window to earn this bonus makes it an easy bonus to earn.

More about this card

Benefit highlights:
Citi Entertainment® – Access to event ticket pre-sales.

5% cash back on your top eligible spend category each billing cycle, on up to $500 of purchases.
5% eligible categories include restaurants, gas stations, grocery stores, select travel, select transit, select streaming services, drugstores, home improvement stores, fitness clubs, and live entertainment.
1% cash back on all other purchases.
Rewards are earned as ThankYou® Points.

Learn more:
Learn more about the Citi Custom Cash in our review of the card.
See our overview of the ThankYou® Rewards program.

Shopping portals and card-linked offers

To do: Learn about the major card-linked offer programs, Amex Offers, BankAmeriDeals, Chase Offers, and Citi Merchant Offers
To do: Bookmark Cash Back Monitor and check to see which cash back portals are paying a bonus before shopping online.

Shopping portals and card-linked offers are part of my strategy to get 5x everywhere. And these programs can help you juice your cash back earnings as well. These two programs are different, but the end result is the same: Additional cash back when you shop.

Cash back portals offer rewards if you click through to partner merchants and make a purchase. Many online stores pay these sites a commission when you click through their links and shop, and they rebate some of that commission to you. Card-linked offers work similarly, except you have to add offers to your card before making a purchase. The articles on Amex Offers, BankAmeriDeals, Chase Offers, and Citi Merchant Offers explain how these programs work.

Why use shopping portals and card-linked offers? Card-linked offers and shopping portals can get you extra cash back on the things you buy anyway, without the need to open an additional credit card.

What to ignore

Sometimes knowing what you can ignore is as important as knowing what to pay attention to. Some programs don’t offer good value cash back rewards. And programs like airline and hotel loyalty programs don’t offer cash back rewards at all. If you are pursuing a pure cash-back credit card rewards strategy, you can ignore a large swath of the credit card rewards space. Here are the things you can pass up.

Point programs that offer poor cash back

American Express Membership Rewards – Amex Membership Rewards is a great program for high-end travel rewards. But if you are in the market for cash back, the program can largely be ignored. Most American Express Membership Rewards cards offer very poor cash back redemption options. There are ways to get cash out of your Amex Membership Rewards, but they add so much complexity that they aren’t worth it for most people pursuing basic cash back rewards.

Capital One MilesCapital One Miles are easy to use for travel. And the Capital One Venture X card is one of the best options for acquiring airline lounge access on the cheap. But if you want cash back, the miles you earn are only worth 0.5 cents each. Not very compelling.

Airline and hotel loyalty programs

Airline and hotel loyalty programs can offer great rewards if you’re interested in travel, but none of these programs offer cash rewards.

Since these programs don’t offer cash back rewards, you can largely ignore them. You don’t need to worry about earning points in these programs. And you can ignore airline and hotel credit cards. If your rewards strategy solely is focused on cash rewards, this can eliminate a lot of noise.

About the author

  • Aaron Hurd

    Aaron Hurd is a credit card, travel rewards, and loyalty program expert. Over the past 15 years, he has authored over a thousand expert contributions published by leading outlets including WSJ, TIME, Newsweek, Forbes, NerdWallet, The Points Guy, Bankrate, CNET, and many others. He has also served in consulting roles for many of these same outlets, designing content strategy, hiring teams of teams of editors and contributors, developing thought-leadership pieces, and ghost-editing for senior editors. Aaron is well-known in the miles and points community and regularly presents about travel rewards at conferences like the Chicago Seminars and Minnebar. Aaron has enjoyed the game of optimizing credit card rewards since getting his first credit card shortly after he turned 18. He started learning about credit cards and travel rewards from the (now defunct) FatWallet Finance forums and FlyerTalk. He holds more than 40 open credit cards and has first-hand experience with almost every major credit card product.

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