American Express Blue Cash Showdown: Everyday or Preferred?

Choosing between the Blue Cash Preferred® Card from American Express and the Blue Cash Everyday® Card from American Express comes down to how much you spend on groceries, gas and department stores. Each card offers bonus cash back on all three categories.

The Blue Cash Preferred® Card from American Express comes with higher cash-back rates, but also an annual fee of $75. The Blue Cash Everyday® Card from American Express has a $0 annual fee, but the cash-back rates are lower.

The difference in annual fees is a consideration, but don’t let it completely guide your decision. If you spend a lot of money in these bonus categories, the Blue Cash Preferred® Card from American Express will earn much more cash back.

» CALCULATE: Compare the rewards you’d get on these cards

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Blue Cash Everyday® Card from American Express	Blue Cash Preferred® Card from American Express
Learn More	Learn More

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Comparing the cards

The Blue Cash Preferred® Card from American Express is essentially a souped-up version of the Blue Cash Everyday® Card from American Express made for those who spend more on gas, groceries and department stores.

The main components of each card are broken down and compared below.

Grocery rewards 

• The Blue Cash Preferred® Card from American Express gives you 6% cash back at U.S. supermarkets on up to $6,000 in spending annually, with 1% back beyond that limit.
• The Blue Cash Everyday® Card from American Express gives you 3% cash back at U.S. supermarkets on up to $6,000 a year in spending, and 1% back beyond that.

Nerd tip

Many supermarkets now sell gift cards for a variety of retailers, restaurants and other merchants. By buying gift cards with either of the Blue Cash cards and then using those gift cards yourself, you can effectively extend your bonus cash back to a much wider range of categories.

Gas and department store rewards 

• The Blue Cash Preferred® Card from American Express earns an unlimited 3% cash back at gas stations and select department stores.
• The Blue Cash Everyday® Card from American Express comes in with a slightly lower 2% rate (also unlimited) at gas stations and department stores.
• Both cards offer 1% on all other purchases.

Sign-up bonuses

Both cards come with a sign-up bonus, with the Blue Cash Preferred® Card from American Express offering a bit more. Plus, before mid-June 2016, both cards are augmenting their usual cash sign-up bonuses with a special offer for new cardholders: Get 10% back when you use the card at U.S. wireless telephone service providers in 2016, up to $200. The bonuses:

• The Blue Cash Preferred® Card from American Express: Special Offer - Get up to $350 back. Offer Ends 6/15/2016.
• The Blue Cash Everyday® Card from American Express: Special Offer - Get up to $300 back. Offer Ends 6/15/2016.

» PRE-QUALIFY: NerdWallet now offers American Express Pre-Qualification. See whether you’re eligible for a better offer.

Making the choice

Which of these cards is right for you depends entirely on how much you spend. The chart below uses grocery spending to illustrate the relative value of carrying the Blue Cash Preferred® Card from American Express and paying the annual fee. It shows three scenarios:

1. The amount you’d need to spend with the Blue Cash Preferred® Card from American Express to break even on the $75 annual fee.
2. The amount you’d need to spend with the Blue Cash Preferred® Card from American Express to earn more cash back than you would with the Blue Cash Everyday® Card from American Express, taking into account the cost of the $75 annual fee.
3. The total amount of bonus cash back on the Blue Cash Preferred® Card from American Express when you max out the 6% U.S. supermarket bonus category. (All spending over this amount earns 1% back on either card.)

	Yearly Spending	Weekly Spending	Yearly Cash Back after subtracting Annual Fee
1. Grocery spending needed to break even on annual fee	$1,250	$24	$0
2. Grocery spending needed to beat the Blue Cash Everyday® Card from American Express	$2,516	$49	$76
3. Maximum bonus cash back on groceries	$6,000	$116	$285

Comparing your own spending to this chart helps determine whether you should choose the Blue Cash Preferred® Card from American Express or the Blue Cash Everyday® Card from American Express — but it doesn’t paint the whole picture, since you also have to take into account gas and department store spending. Use our calculator below to see which card is the better deal for you based on your monthly spending patterns.

Note: Grocery rewards apply only at stand-alone grocery stores and supermarkets — not warehouse clubs (e.g., Costco, Sam’s Club) or department stores with grocery sections (e.g., Target, Walmart). Gas rewards apply only at gas stations — not superstores, supermarkets or warehouse clubs that also sell gasoline.

Kevin Cash is a staff writer at NerdWallet, a personal finance website. Email: kcash@nerdwallet.com. Twitter: @kevin_cash.

from NerdWallet
https://www.nerdwallet.com/blog/credit-cards/american-express-blue-cash-everyday-vs-blue-cash-preferred-comparison/