Ultimate Money: American Express Blue Preferred Card 2

This technique goes hand-in-hand with my article on the Amazon.com Rewards Visa Card.

Unless I’m purchasing something at Amazon.com, I reach for my American Express Blue Cash Preferred Card wherever it is accepted. This is because the Blue Preferred Card yields cash back upwards of 6%, depending on what the purchase is.  This means that in some situations, your money is worth 6% more, or it is like getting a 6% raise. Why pass that up?

I don’t use the Blue Card at Amazon.com because the Blue Card does not offer as big a return as the Amazon Rewards Visa Card would. Really this only pertains to Amazon.com purchases.  In general, the American Express Blue Cash Card far outweighs the Amazon Visa at nearly every other location.  In practice, at every physical location, I go for the Blue Cash Card; when American Express is not accepted, I simply switch to my Amazon Visa. Between these two credit cards, I’ve never found a need for another. Using this technique, a nice percentage of my money spent always comes back to me.

There is at least two styles of the American Express Blue Cash Card at the time of this writing, so let me draw some points and comparison for you.

1. Regardless of which card you get, either the Blue Cash Preferred Card or the Blue Cash Everyday Card, I’m pretty sure they both only offer a mere 1% reward at Amazon.com. So use the Amazon Rewards Visa when shopping at Amazon.com!
2. The Blue Cash Preffered Card offers higher rewards but has an annual fee; The Everyday Card rewards are less substantial, but there is no fee. You’ll have to do the math and determine if the fee is worth it.  6% cash back on groceries was worth the $75 annual fee. (By my calculations, you have to spend $1,250 on groceries to have the 6% return pay off the annual fee. I do this easily. (If you’re really checking my math, you’ll note that I could have been using the Amazon Visa 1% return on groceries with no fee and would have made $12.50 in the meantime. So to compete with the Amazon Visa card a person would have to spend more than $1450 on groceries. This is not factoring in the higher percentage on gasoline, etc., which would also make this goal much easier to achieve. How do you know how much you are spending on groceries? You should be using Mint.com.))
3. Besides the grocery rewards, the two cards are pretty much the same. They both offer substantial returns at gas stations, department stores, and other places.
4. Be aware that Blue Card’s main reward category (groceries) has a cap of $6000 and then the return drops to 1%. However, since the Amazon card does not offer any more than 1% on groceries at the time of this writing, there is no need to track this number or strategize when to switch cards.  By my calculation, it would be possible to earn a net $285 from groceries alone before the rate drops down to 1%.
5. If your really want to push the limits of this cash back advantage, swipe your credit card at the grocery store for a friend you know and have them pay you cash for their groceries.  You’ll get 6% of the money that they spend.

If it isn’t clear from the daunting explaination, just use a Blue Cash card for every situation other than Amazon.com purchases. For the latter, use the Amazon Visa.

Best of luck to you on all your money-saving endeavors.