As an avid user of Cashback Credit CardI’m happy with me Current Credit Card StrategyBut it’s always good to put in more effort, right? Below are three changes the credit card industry will implement in 2025.
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Higher Bonus Category Expense Cap
If you can do this first, second, or third on the list, you will. It’s very important (and it’s a lot of personal pet peeves).
Many credit cards that increase rewards in certain spending categories have a cap on how much you can earn. As a consumer, I would like to see those restrictions disappear, but I think that makes business sense. My suggestion is not that radical. Occasionally, they settle for inflation adjustments.
For example, I love the 6% cashback I received on grocery spending American Express Blue Cash Preferred Card. I don’t love that my income rate drops to 1% after $6,000 in annual spending in US supermarkets. This $6,000 threshold has not changed since it was enacted in 2013. We indexed inflation, and $6,000 in 2013 equals $8,218 today. According to usinflationcalculator.com.
Twelve years without inflation adjustments have long been a major issue in kitchen table economics, especially in all kinds of inflation and, especially in grocery stores. They are even happy to pay a higher annual fee in exchange for a higher cap.
My annual reward for purchasing grocery products
My four family spends around $12,000 on groceries each year. Thanks to Blue Cash Preferred, you earn a $360 reward (6%) for your first $6,000 and pay an annual fee of $95. This has a profit of $265 (the cards have other bonus categories, such as 6% back to some streaming services and 3% back to gas, but for simplicity, we’ll focus on groceries here).
If my family spends another $6,000 on blue cash-friendly groceries, given current restrictions, we only add $60 to our reward (1%). Getting a $325 reward on a $12,000 spend is not a big profit (2.7%). We actually do better than that ChaseFreedomFlex® Usually, you take on 5% at the grocery store in one of the four quarters of the year (you have a $1,500 cap on bonus category spending and need activation; rewards decrease by 1% after the limit). And we Wells FargoActiveCash® Card We offer unlimited 2% cash rewards for all purchases.
My annual reward after doubled grocery reward cap
But let’s go back to the idea of Amex double the grocery reward cap and double the annual fee. Earning 6% on $12,000 in grocery spending is a reward of $720. Even if you deduct the hypothetical $190 annual fee, you still get a $530 reward.
For now, you’ll earn $265 by making the most of Blue Cash Preferred’s existing grocery limits (after subtracting $95 per year), and another $90 by placing the typical Freedom Flex grocery quarter, and ultimately the remaining $4,500 in active cash. The reward is $430.
If Amex doubled its grocery compensation spending cap, even if the annual fee doubled, it would still be $100 ahead. In fact, there is a way we can do this ourselves now. This is if my wife and I each sign up for blue cash in their own name. Mathematically, it probably should. I hate opening a different account, tracking another monthly bill, and carrying another card and tally when I need to switch from one to the other. The biggest problem, but these stagnant reward caps really bother me. If the limits on existing customers are raised, it is very easy and reasonable.
And it’s not just AMEX. The quarterly limit for Chase Freedom Flex also reaches $6,000 for the entire year. I’ve had that card for over 10 years, but the limits have not changed. Discover your IT® Cashback Card It has a very similar structure that has not changed forever. and City Custom Cash® Card I’ll give a twist to the game in the spin category by switching monthly according to my spending habits, but with a monthly limit of $500, surprise, surprise – $6,000 a year.
American Express 2% cashback card
My next wish is that American Express will join other major issuers and offer a card that will return 2% per purchase. Heck, Amex doesn’t even have a 1.5% back card after pausing the application American ExpressCashMagnet® Card*.
I have been a customer of American Express for nearly 15 years. Their top-notch customer service has won them a first or second position JD Power US Credit Card Satisfaction Survey This is the first time since it was launched every year in 2007. They are on the list more than anyone else and I can guarantee their excellent service. I really love their mobile app experience too, Amex Offermy card offers free shoprunner membership, their Purchase Protection advantage, Extended warranty Coverage and how to post transactions and payments faster than any other card issuer I have done business with.
If American Express offers a 2% cashback card, I’ll sign up for it. Unfortunately, they seem to be pulling back cashback offers and no-fee products. They’re doing very well in Travel rewards We court many big spenders who are willing to pay a large annual fee in exchange for various travel and daily benefits, but we want to give cashback enthusiasts a little more.
A flashy welcome bonus
It’s been a while since my cashback card provided something spectacular Sign Up Bonus. Now there are plenty of cards offering new customers $200 or $250 after spending the range of hundreds to thousands of dollars in the first few months on the card. That’s pretty good, but we think big, do you remember?
Travel cards often offer a bigger bonus, but again, do we cash back people? What does a cashback card need to offer $500 to new customers? Like my push for the bonus category spending cap mentioned above, I’m even happy to pay more for privileges. For example, what if you spend $500 in three months and earn $200 (as some cashback cards offer today), then spend $2,000 in three months and then get $500 bonus? It’s actually a low revenue in the short term (in percentages) but it’s more dollars and if it’s a card I’ve always liked for a long time, I’d be happy to trade. What if Amex offers a $500 bonus on a 2% cashback card? Please sign up.
Some existing Business Credit Card The offer is even more generous:
- Capital 1 Spark Cash: After spending $7,500 in the first 3 months on your card, you earn $750 cashback. Get 2% back on most purchases (5% back with hotels and car rentals booked with Capital One Travel). There is no annual fee for the first year, and then there is $95 a year.
- Ink BusinessUnlimited® Credit Card: A $750 bonus after spending $6,000 within three months of opening an account. Unlimited 1.5% on purchase (5% for Lyft Rides until March 2025). There is no annual fee.
Business credit cards often offer higher bonuses than consumer cards, as many businesses spend far more than typical households. These cards are available, but not always, to freelancers, gig workers, sole owners, and even more established businesses. I’m not crazy to think that a consumer cashback card can offer new customers more than $500.
Conclusion
I will explain the current credit card offer status but great. We’ve seen better and inflation has been reduced to consumer purchasing power. The suggestions I outline here are realistic and ambitious equal parts. If the card issuer is listening, I’d love to see these come true in 2025!
*Information about American ExpressCashMagnet® cards is collected independently by bank rates. Card details have not been reviewed or approved by the issuer.
