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This is part of the reader question series that I started earlier this year – you can view more reader questions here. Feel free to email me at firstname.lastname@example.org if you have a question you’d like answered in a full on post.
Reader Jessica recently emailed me asking:
“I recently read about the American Express SimplyCash card that you wrote about, but I am wondering what you think the best category is to take advantage of the 3% back.”
One of my favorite things about the SimplyCash® Business Card from American Express is that you get to decide on which purchases will receive bonus points – having an input on your card benefits can definitely have it’s advantages. While every card holder gets 5% cash back at US office supply stores and and wireless phones purchased directly from the U.S. wireless provider, you get to decide which category to get 3% cash back instead of the generic 1% cash back on your purchases. American Express gives you 7 categories to select from, which I think is great.(Note that the 5% and 3% cash back is capped at $25,000 per year and is then 1% cash back).
These categories include:
- Airfare purchased from airlines (must purchase your flight directly from a passenger airline that accepts the card; third-party airfare purchases do not qualify)
- Hotel rooms purchased from hotels (must pay for your hotel stay directly with the hotel; booking through a third-party will qualify only if you are paying the hotel directly and not paying the third-party)
- Car rentals purchased from select car rental companies (includes: Alamo, Avis, Budget, Dollar, Enterprise, E-Z, Fox, Hertz, National, Payless, Thrifty).
- U.S gas stations (i.e., Gulf, Murphy, Exxon, Mobile, Hess, Shell; gas stations that are part of supermarkets or warehouse clubs, such as, Costco and Target, are not eligible)
- U.S. restaurants (you might not earn the bonus for restaurants located within another establishment, such as a restaurants inside a hotel, casino, or event venue)
- U.S. purchases for advertising in select media (including: Google, Facebook, Yahoo, NBC National Broadcasting, CBS Radio, etc.)
- U.S. purchases for shipping (including: UPS, FedEx, USPS, etc.)
So out of the list above, you are able to select one category on a yearly basis to receive 3% cash back (up to $25,000 spend a year) and you will receive 1% cash back on all other categories as well as everyday purchases elsewhere.
Of course the category selection depends on your spending habits, but here are my thoughts:
- If you typically use points and miles for travel (airfare and hotel spend), then selecting option Airfare or Hotels won’t do you any good. However, if you typically fly on expensive tickets for company travel and can use a credit card of your choice, getting 3% cash back on airfare could work out very well for you! If it is on personal travel, then I like to use a Chase credit card that comes with trip delay insurance and forgo the bonus points. For hotels, typically the hotel’s co-branded credit card will give you the best value (although this card is part of the OPEN Savings program so can be valuable at Hyatt).
- If you travel often and rent cars, then Car Rentals could be a good option. There aren’t too many cards that give bonuses on car rental spend.
- While Gas Station spend isn’t great for me as I live in NYC and do not drive often, gas could be a worthwhile selection, although there are many other no annual fee credit cards that will give you 3% cash back on gas purchases (as mentioned in this post)
- This card gives a higher bonus at restaurants then any other card (aside from the Chase Freedom during the bonus quarter), so if you spend a lot dining out or paying for company dinners, selecting Restaurants could work out well.
- Advertising and Shipping spend is probably only valuable for a small number of readers, but for those that run their own company and spend a lot in these two areas, this selection option could be worthwhile.
Aside from the bonus cash back categories, this card also comes with a bunch of other benefits that can be very valuable. With this card you can…
- Gain access to the American Express OPEN Savings program. I wrote about this more here, but essentially you can get up to 10% back as a statement credit at participating merchants (for example, 10% back at Hertz). I personally like the OPEN Savings program and have found it quite valuable. Let’s say you rent a car often at Hertz and select “Car rentals purchased from select car rental companies” as your bonus category, you can take advantage of both the 3% cash back opportunity as well as the 10% back offer from the OPEN Savings program. Just remember though, to get the 10% back at Hertz you must spend $2,501+ spend per year.
- Register your card for the Amex Sync offers. This card will allow you to take advantage of more American Express Sync offers and earn statement credits. I love Amex Sync, especially with a card that has no annual fee!
What 3% category will you be selecting?
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