I’ve been a devout Discover car user for quite some time. With the 1% cashback, it’s a great incentive to stick with Discover. But recently there have been some cards offering a little bit more cashback, and by using certain cards for certain types of purchases you can really maximize this.
Today I signed up for the Citi Dividend Platinum Select MasterCard. This card will get me 5% back on purchases at supermarkets, drug stores and gas stations. That covers a significant portion of my monthly purchases. On other items it gives 1% back. There is one catch. Unlike Discover, this Citi card is capped at $300 per calendar year. That means that at 5% it takes $6000 per year or $500 per month worth of spending before you hit the $300 limit. Given my expense history, I think I’ll be coming right under that amount.
By taking advantage of the Discover card specials (right now it is 5% on gas and some other items) and balancing this new Citi card, I should be able to get a little more cashback over the next year.
Comment (1)
Unfortunately, this card is changing from a 5% card to a 2% card in October 2006.
The recent changes to the cash back rewards of the Citi Dividend MasterCard prompted me to do some personal analysis to find the best mix of cash back cards for my spending patterns.
That personal analysis inspired me to build a general-purpose tool to help anyone determine the single best card or mix of N cards that will maximize their cash back rewards. You just plug in how much you spend each month (broken out by categories for best results) and you’re presented with a list of recommended cards sorted from best to worst by your expected annual reward. If having more than one card and using each card to its strengths could yield a greater total reward, then each combination of the Best N cards is presented as well.
You can see the tool at http://www.creditcardtuneup.com/ .