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American Express Blue Cash Credit Card: Everyday or Preferred

by Charles on January 9, 2014 · 4 comments

Many of my friends have been asking me which American Express credit card they should sign up for. The answer really isn’t that simple because it depends on how you will use the card you sign up for. For instance, if you travel frequently, an airline or hotel credit card may be more suitable. If you do a lot of grocery shopping, a cash back rewards credit card may be more suitable. If you shop at Costco often, a Costco branded credit card may make more sense. But usually, when people ask me this question, they’re typically looking for a credit card with the best cash back rewards.

American Express offers two credit cards that provide excellent cash back rewards: Blue Cash Everyday® Card from American Express and Blue Cash Preferred® Card from American Express. Both of these cards are pretty much identical except the Preferred version has an annual fee and provides a deeper cash back rewards.

Blue Cash Everyday® Card from American Express

  • 3% cash back at US supermarkets, on up to $6,000 per year in purchases (then 1%)
  • 2% cash back at US gas stations and select US department stores
  • 1% cash back on other purchases. Terms and limitations apply. Cash back is received in the form of Reward Dollars that can be redeemed as a statement credit.
  • No annual fee
Blue Cash Preferred® Card from American Express
  • 6% cash back at US supermarkets, up to $6,000 per year in purchases (then 1%)
  • 3% cash back at US gas stations and 3% cash back at select US department stores
  • 1% cash back on other purchases. Terms and limitations apply. Cash back is received in the form of Reward Dollars that can be redeemed as a statement credit.
  • Annual fee of $75 per year
So which card is better? It all depends on how much you spend annually on these particular categories. Let’s assume you spend $500 a month on groceries and $500 a month on gas.
Annual Spend Everyday Preferred
Groceries $6,000 $180.00 $360.00
Gas $6,000 $120.00  $ 180.00
Fees  $          -  $  (75.00)
Total $12,000 $300 $465

So using the above metrics, even with an annual fee of $75 for the Blue Cash Preferred® Card from American Express card, you will end up receiving more cash back compared to the Blue Cash Everyday® Card from American Express card.

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{ 4 comments… read them below or add one }

Leonard @ The Wallet Doctor March 16, 2014 at 11:37 AM

Thanks for the breakdown. Its really important to consider these card differences. It can actually make a big impact.
Leonard @ The Wallet Doctor recently posted..How to reduce your food costs

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Carlos @ TheFrugalWeds March 20, 2014 at 9:51 PM

Great post. I literally just had this exact conversation with my co-worker. He had the everyday card and I asked him why he did not have the preferred card. He simply said that he didn’t want to throw away money on an annual fee. I asked if he ever compared and he said no. I made him pro-rate based on Jan/Feb and he saw very quickly that he was leaving money on the table. Every case is unique but it just goes to show that we should due our diligence no matter what.
Carlos @ TheFrugalWeds recently posted..What Do You Do 8pm to 10pm?

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John @ Wild AboutFinance July 26, 2014 at 12:19 AM

Thanks for the malfunction. Its really essential to consider these cards variations. It can actually create a big effect.

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Sally July 30, 2014 at 9:38 PM

Its really essential to consider these cards variations. It can actually create a big effect.
Sally recently posted..Investing In The American Dream – Tips For Buying Real Estate.

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