Blue Cash Preferred® Card from American Express – Review

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The Blue Cash Preferred® Card from American Express is a popular cash back rewards credit card with a relatively high annual fee ($95). It shares many of the same features and benefits as its stablemate, Blue Cash Everyday from American Express.

However, its cash back rewards program is significantly more generous: 6% cash back on purchases made with select streaming and digital media services, such as Amazon Prime, Netflix, HBO, and Audible; 6% cash back at U.S. supermarkets, up to $6,000 spent per year; 3% cash back at U.S. gas stations and certain transit operators (including rideshare providers such as Lyft and Uber); and 1% cash back everywhere else, including supermarket purchases above the annual spending cap. It also has a solid welcome offer and introductory purchase APR offer.

Although its rewards are on the generous side, Blue Cash Preferred is comparable to many other mainstream cash back rewards cards. Popular alternatives include Chase Freedom and the Capital One Quicksilver Credit Card. Keep in mind that Blue Cash Preferred is one of the only cash back cards that carries an annual fee.

Key Features

Welcome Offer

When you spend at least $1,000 within 3 months of signing up, you get a $250 statement credit.

Cash Back Rewards & Redemption

Purchases made with digital media and streaming services, including (but not limited to) Amazon Prime, Netflix, HBO, Apple Music, and Audible, earn 6% cash back.

U.S. supermarket purchases earn 6% cash back, up to a $6,000 annual spending limit ($360 total cash back per year). After the $6,000 cap, supermarket purchases earn 1% cash back.

U.S. gas station and transit (including rideshare) purchases earn 3% cash back.

All other purchases earn 1% cash back.

Cash back can be redeemed for a statement credit once you clear the $25 redemption minimum.

Note that American Express doesn’t include superstores such as Walmart and Target, nor warehouse club stores such as Costco and Sam’s Club, as “grocery stores” for the purposes of this card.

Introductory APR

Blue Cash Preferred comes with a 0% APR on purchases for 12 months.

Important Fees

There’s a $95 annual fee. The foreign transaction fee is 2.7%.

Travel Benefits

The American Express Blue Cash Preferred has several travel perks:

  • 24/7 roadside assistance hotline for all travelers
  • Rental car loss and damage insurance coverage for cardholders who charge the full amount of their rentals to the card
  • 24/7 global concierge service for all cardholders traveling more than 100 miles from home
  • Accidental death insurance for traveling cardholders.

Shopping Benefits

Blue Cash Preferred also has some nice shopping benefits. These include:

  • Extended warranties on items with original warranties of five years or less
  • Up to $300 in per-item coverage ($1,000 total per calendar year) for returns rejected within 90 days of original purchase
  • Up to $1,000 in per-item coverage ($50,000 total per calendar year) for items lost or damaged within 90 days of purchase.

Credit Required

This card requires excellent credit. If you have any noteworthy credit blemishes, you’re unlikely to be approved.

Advantages

  1. Very Generous Cash Back Rewards. Blue Cash Preferred has one of the most generous cash back rewards programs around: 6% back at U.S. supermarkets (up to $6,000 spent per year), 3% back at U.S. gas stations, and 1% cash back everywhere else. If you can max out the grocery store benefit and spend heavily at gas stations, you’ll more than make up for the annual fee and leave other cards in the dust. By comparison, the Amex EveryDay Preferred – still generous by overall cash back standards, though it carries a $95 annual fee – offers 3x points (worth up to $0.01 apiece) at grocery stores (up to $6,000), 2x points at gas stations, and 1 point per $1 spent everywhere else. Capital One QuicksilverOne Cash Rewards Credit Card ($39 annual fee) earns a flat 1.5% on all purchases.
  2. Solid Welcome Offer. Blue Cash Preferred has an above-average welcome offer that’s not matched by most other cash back credit cards. If you’re looking to juice your cash back earnings right out of the gate, Blue Cash Preferred is a great choice.
  3. Nice Intro APR Promotion for Purchases. The 12-month 0% APR promotion for purchases matches offers from popular competitors, including Capital One.
  4. Spending Categories Don’t Change. Blue Cash Preferred’s spending categories never change – you can always expect the same cash back earnings at U.S. supermarkets, gas stations, and everywhere else year-round. That’s a welcome change from cards with rotating categories, including Chase Freedom. Both of those cards change their 5% cash back categories each quarter, and you need to manually activate them to receive the benefit. However, keep in mind that neither carry annual fees.
  5. Gift Card Purchases Can Boost Your Cash Back’s Value. Did you know that American Express will give you cash back on gift card purchases? So if you don’t expect to spend $6,000 per year on groceries, you can still maximize the value of the 6% grocery store cash back offer by purchasing third-party gift cards at the register (which usually don’t come with any added fees). The majority of grocery chains sell a slew of major merchants’ gift cards, including Starbucks, Gap, Home Depot, Shell, Southwest Airlines, and more. Using this method, you can more easily maximize the potential of the card and earn 6% cash back on a variety of different categories. This is a nice advantage over cash back cards that don’t treat grocery store purchases preferentially.

Disadvantages

  1. Statement Credit Is the Only Cash Back Redemption Option. You can only redeem your accumulated cash back rewards for statement credits, not bank account deposits or paper checks. That’s much more restrictive than Chase Freedom, which lets you redeem cash back for pretty much anything, and Citi Double Cash Card, which offers bank account deposits and paper checks in addition to statement credits.
  2. Annual Fee & Foreign Transaction Fee. Blue Cash Preferred’s $95 annual fee is somewhat unusual in the cash back card world. It’s a significant drawback for cardholders who don’t spend enough to justify the outlay – for example, you would need to spend $1,250 extra per year in the 6% cash back category to offset this fee. Meanwhile, the foreign transaction fee is a bummer for frequent international travelers. Bank Americard Cash Rewards, Capital One Quicksilver Cash Rewards Credit Card, and Citi Double Cash all lack annual fees.
  3. Charges Penalty Interest. Blue Cash Preferred’s high penalty APR stands in unfavorable contrast to the nonexistent penalty APR of Chase Freedom.
  4. Requires Excellent Credit. American Express doesn’t go into great detail about Blue Cash Preferred’s approval process, and doesn’t specify the minimum credit score that applicants need to attain to be considered for card membership. However, the company makes no secret of the fact that Blue Cash Preferred requires excellent credit. If you have a few blemishes on your credit report, opt for a less generous card with looser underwriting standards, such as Chase Freedom, and work on building your credit history.

Final Word

The Blue Cash Preferred® Card from American Express has one of the most generous rewards programs of any cash back credit card, but there’s a catch: the $95 annual fee. If you don’t spend enough at the supermarket to approach or exceed the $6,000 annual spending limit, or don’t shop frequently at U.S. gas stations, consider a no-annual-fee cash back credit card with similar, less generous benefits, such as Blue Cash Everyday.

Alternatively, opt for a category-based rewards card, such as Chase Freedom, which makes up for less generous overall cash back benefits with rotating 5% cash back categories and less exacting credit score requirements.

 


Originally posted at https://www.moneycrashers.com/american-express-blue-cash-preferred-review/

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