American Express Cashback Rewards Program (Ultimate Guide and Extensive Review)

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American Express is one of the largest banks and credit card issuers in the United States. They offer a wide range of credit cards, charge cards, banking products, loans and more. On the credit card side, there are basically three categories of American Express cards:

  • American Express Membership Rewards cards, which earn points
  • American Express Co-Branded cards, which earn miles or points with partners like Delta Airlines
  • American Express Cashback cards, which earn straight cash back (in the form of Rewards Dollars)

This article will take a look at AMEX Cashback credit cards. We’ve put together a full American Express Cashback Rewards program review, to show you everything you need to know about this lucrative rewards program.

 

American Express Cashback Program Review

American Express has its Cashback Rewards Program on three different credit cards. All of these cards earn cashback on each purchase you make. You will accrue cashback in your account in “Reward Dollars”, until you reach $25, at which point you can redeem the Reward Dollars for a statement credit. A statement credit will be applied to your next bill, lowering the amount you owe. So if you have $200 in charges on your credit card bill, and you redeem $25 in cashback, you will only owe $175.

Keep in mind that there is a $25 minimum before you can redeem your rewards. You will accrue Reward Dollars in your account from day one, but you can’t actually redeem them until you have at least $25 built up.

The Cashback cards from AMEX are marketed as earning “cash back”, but really they earn Rewards Dollars. These Rewards Dollars can be redeemed for statement credits, or for a variety of gift cards, products and more.

Let’s look at some of the credit cards that earn these Reward Dollars, then we’ll move on to to more information about how the rewards program works.

 

American Express Cashback Credit Cards

American Express Cashback Credit Cards

There are three different cards in the American Express Cashback Rewards Program:

  • Cash Magnet (no annual fee)
  • Blue Cash Preferred ($95 annual fee)
  • Blue Cash Everyday (no annual fee)

These three cards are all part of the same program. They all earn Rewards Dollars, which can be redeemed for statement credits. However, there are some differences between the cards.

 

Amex Cash Magnet

American Express Cash MagnetAnnual Fee: $0
Cashback Rate: 1.5% on all purchases
Signup Bonus:
$150 bonus cashback after spending $1000 in the first 3 months
Intro APR:
0% intro APR on purchases and balance transfers for the first 15 months

The American Express Cash Magnet card is a simple cashback card that earns 1.5% cashback on all purchases. There are no complicated bonus categories or special restrictions to think about, making this a good choice for those who like to keep things simple.

The Cash Magnet has no annual fee, and comes with a $150 signup bonus after you spend $1,000 on the card in the first 90 days. There’s also a lucrative intro APR offer, where you can pay 0% interest for the first 15 months. This promo applies to both new purchases and balance transfers from other credit cards, so if you have existing credit card debt, this promo can be used to save a good bit of money on interest over the next 15 months.

Rewards-wise, this card is solid. 1.5% cashback is a good rate for a card with no annual fee. With that said, if you’re looking to maximize your rewards as much as possible, going with one of the Blue Cash cards may be a better option.

 

Amex Blue Cash Preferred

Blue Cash Preferred

Annual Fee: $95
Cashback Rate: 6% on supermarkets and streaming services, 3% on gas and transit, 1% on everything else
Signup Bonus:
$300 bonus cashback after spending $1,000 in the first 3 months
Intro APR:
0% intro APR for the first 12 months, on purchases and balance transfers

The American Express Blue Cash Preferred is another great credit card from AMEX. This one does have an annual fee, of $95 per year. However, for many households, the increased earning rate on the card will more than offset the extra annual fee.

The Blue Cash Preferred has a tiered earning structure:

  • 6% cashback on US supermarkets (capped at $6,000 per year in purchases)
  • 6% cashback on select US streaming services
  • 3% cashback on US gas stations
  • 3% cashback on select US transit, including ridesharing, parking, tolls, etc.
  • 1% cashback on everything else

The biggest selling point of this card is the 6% back at grocery stores. If you spend $500 per month on groceries, you will max out the benefit and earn $360 in cashback per year! Obviously this more than makes up for the $95 annual fee – and that’s before any of the other benefits of this card.

We recommend the Blue Cash Preferred for those who want to maximize their rewards earnings, and who don’t mind a bit more of a complicated earning structure. For simplicity, a card like the Cash Magnet may work better. And for those who want to earn more on groceries but don’t want an annual fee, the Blue Cash Everyday(see below) is a great option as well.

 

Amex Blue Cash Everyday

Blue Cash Everyday

Annual Fee: $0
Cashback Rate: 3% cashback on supermarkets, 2% cashback on gas & department stores, 1% on everything else
Signup Bonus:
$200 bonus cashback after spending $1,000 in the first 3 months
Intro APR:
0% intro APR for 15 months on purchases and balance transfers

The American Express Blue Cash Everyday is a good option for those who don’t want to pay the annual fee of the Preferred version of the card. Like the Preferred, it has a tiered rewards structure:

  • 3% cashback on US supermarkets (capped at $6,000 in purchases per year)
  • 2% cashback on US gas stations and select US department stores
  • 1% cashback on all other purchases

Like the Preferred, the Everyday’s main selling point is the bonus earnings on grocery store spend. But of course, this card earns 3% instead of 6%, in exchange for having no annual fee.

The choice between this version and the Preferred version mostly comes down to how much you typically spend on groceries. If you spend a lot, the Preferred makes more sense as you will earn enough to more than offset the annual fee. If you’re in a smaller household that spends less on groceries, the Everyday makes more financial sense.

 

Earning Amex Cashback Rewards (“Reward Dollars”)

earning amex cashback rewards

Earning Rewards Dollars is straightforward. Every purchase you make on your credit card will earn Rewards Dollars. The rate at which you earn will depend on which card you have, as well as the category of purchase.

When you look at your credit card statements or your American Express online account, you’ll be able to track how many Reward Dollars you have accumulated, as well as how much you earned on each transaction.

In addition to making purchases on your credit card, you can also earn Rewards Dollars by referring friends. The promotions vary, but often you can earn $50-$100 in bonus rewards if you refer a friend who applies for a new American Express card.

 

Redeeming Amex Cashback Rewards (“Reward Dollars”)

Redeem Amex Reward Dollars

All three of the cards listed above earn the same type of rewards: American Express “Reward Dollars”. Once you accumulate $25 in Rewards Dollars, you can redeem them for a variety of rewards:

  • Cash back, in the form of a statement credit. This is often the best option
  • Gift cards to hundreds of retailers, restaurants and more.
  • Select merchandise from the Amex online reward store

In most cases, it makes the most sense to simply redeem for a statement credit. This allows you to get exactly what you want with your rewards. For example, if you want to splurge on a nice meal out, you can go to a fancy restaurant. If you spend $100, you can then go in and redeem your Rewards Dollars for a statement credit, reducing the amount you owe American Express for dinner.

 

American Express Cashback vs. Membership Rewards

American Express has two primary rewards programs: its Cashback program, discussed here, and the Membership Rewards program.

We’ve already learned all about the Amex Cashback Rewards program – but how does it compare to Membership Rewards?

Well, Membership Rewards is a bit more complicated, but we’ll try to summarize it as best as possible.

Many American Express cards earn Membership Rewards points (MR). These points can be redeemed for a huge variety of rewards, including travel, gift cards, exclusive experiences, and cashback.

Generally speaking, the best use of MR points is travel. You will typically get the best value for your points by redeeming them for flights or hotels, or by transferring them to partners like airlines and hotel chains.

Membership Rewards points are less useful for cashback. While they can be redeemed for statement credits on some cards, the rates given are often poor.

So, in general, we recommend:

  • The Membership Rewards program is best for people who like to travel, and those who like premium credit card perks (often with higher annual fees)
  • The Cashback Rewards program is best for people who like to keep things simple, while maximizing cashback on every purchase

 

Amex Cashback Rewards Review: Wrapping Up

So, to sum up, how good is the AMEX Cashback Program?

In short, it’s pretty great! This program offers an easy way to rack up lots of rewards that can be redeemed for statement credits, saving you a good amount of money in the long run.

Pros:

  • Three cards to choose from
  • Multiple cards with no annual fee
  • Generous rewards rates
  • Easy to redeem for cashback
  • Cashback in the form of statement credits can be used for just about anything

Cons:

  • You can only redeem rewards in increments of $25
  • There are no travel redemption options

We love the Cashback program for its simplicity and competitive earning rates. And particularly with cards like the Blue Cash Preferred earning 6% on groceries, it’s staggering how quickly you can stack up the rewards.

How do you like the American Express Cashback Rewards Program? Let us know in the comments below!

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