I'm looking to add a new cash back card, but not sure which one to go for. After hearing of the coming PayPal Debit nerfs, I've been looking at the Fidelity card (have investments with them) to get 2% back at Costco for groceries and gas. Although, I'm not sure if the hard pull is worth the 0.5% cash back increase from my Freedom Unlimited. I also thought about the CCC to use as my dining card, but I get 3% back with my Chase cards. Open to any recommendations (yes I'm still on the Robinhood Gold waitlist).
CREDIT PROFILE
* Current credit cards you are the primary account holder of:
* Chase Freedom Unlimited
* Chase Freedom Flex
* Chase Sapphire Preferred
* Amazon Prime Visa
* PayPal Debit
* FICO scores with source: Transunion 755, Equifax 761
* Oldest credit card account age: 3.5 years
* Cards approved in the past 6 months: 1
* Cards approved in the past 12 months: 2
* Cards approved in the past 24 months: 4
* Annual income $: 65,000
CATEGORIES
* Ok with category-specific cards?: Yes
* Ok with rotating category cards?: Yes
* Estimate average monthly spend in the categories below.
* Dining $: 500
* Groceries $: 800, Costco
* Gas $: 80, Costco
* Travel $: 0
* Using abroad?: No
* Other categories or stores:
* Other spend:
* Pay rent by card? No
MEMBERSHIPS & SUBSCRIPTIONS
* Amazon Prime member: Yes
* Costco or Sam's Club member: Costco
* Big bank customer: Chase, Fidelity
PURPOSE
* Purpose of next card: Cashback
* Cards being considered: Fidelity Visa, Citi Custom Cash
Recommendation for next card, looking for cash back
byu/thegamerman0007 inCreditCards
Posted by thegamerman0007
4 Comments
Definitely the AAA Daily Advantage. Wholesale clubs and groceries are huge gaps in the Chase trifecta, and they’re your largest spend category. AAA Daily does 3% wholesale clubs and 5% groceries.
Are you saying your groceries are only coming from Costco? Or you spend $800/mo on Groceries + Costco?
AAA Daily Advantage is good with 5% grocery and 3% wholesale, but note that they share the same $10k/yr spend limit (along with the 3% on gas), then it falls back to 1%
If you are spending that much on groceries that aren’t Costco, then could consider the Aven grocery card, which gives 6% on groceries up to $10k/yr then 2%, and 2% on everything else. Other benefit is this also covers your 2% catch-all, and it’s a Visa so it works at Costco.
https://www.aven.com/rewards-groceries
If you’re using your CFU to transfer points to your CSP so you can use transfer partners then a 2% card won’t help you, but if you’d rather get cash than points you should downgrade your CSP to avoid the annual fee. The Fidelity card happens to be a good one for pure cash because it doesn’t charge a foreign transaction fee, and if you invest with them it’s a no brainer.
A good cash back strategy is to have a 2% catch-all card like the Fidelity card and then get as many 4-5% category cards as you can manage.
Honestly, you are getting way too deep into the weeds chasing an extra 0.5% cash back. Since you only spend $80/mo on gas, an extra 0.5% is literally 40 cents a month. It’s not worth a hard pull for a new Fidelity or Citi card just for that.
Since you shop heavily at Costco, you are stuck using a Visa there anyway, so just keep using your Freedom Unlimited for Costco.
However, for your dining spend ($500/mo), use that hard pull to grab a massive Sign-Up Bonus (SUB) instead of chasing marginal percentages.
Grabbing an Amex Gold (for the 4x on dining and the huge points bonus) or an Amex Blue Cash (for the pure cash back SUB) will net you way more value this year than optimizing your Costco gas spend by 1%.
I used to obsess over 0.5% categories too until l realized SUBs> daily spend multipliers. I actually have a pinned post on my profile showing my exact card setup and the current elevated bonuses if you want to see how the math works out.