Blue Cash Everyday: new favorite credit card?

For many years, the Blue Cash Preferred® card from American Express has been my family’s favorite credit card. We switched to the Blue Cash Everyday® card from American Express because, as our household grew from two to three and now to four, the higher grocery rewards justified the annual fee. But a refresh on the benefits of Blue Cash Everyday has us thinking about going back.

Blue Cash Everyday now offers 3% cash back on up to $6,000 in US online retail purchases each year. That’s a very generous rate on a key spend category that hasn’t been addressed by many rewards cards. We currently only earn 1% cash back on these purchases with Blue Cash Preferred and the other card we use regularly, the Chase Freedom Flex℠.

If we go back to Blue Cash Everyday, our grocery rewards rate will be cut in half. However, we’ll likely still be in the lead due to Blue Cash Everyday’s new expanded online retail category, lower annual fee, new Disney Bundle discount, and the fact that I travel far less than by the past.

Here’s a full breakdown of both cards’ reward structures:

Races

Blue Cash Preferred offers 6% cash back on up to $6,000 in annual US supermarket spend (then 1% cash back thereafter). Blue Cash Everyday only gives 3% cash back in US supermarkets with the same annual spending cap (also 1% cash back after that).

My family easily exceeds that $6,000 limit, so 6% of $6,000 is $360, compared to $180 if we only earned 3% of $6,000. However, if you take into account Blue Cash Preferred’s $95 annual fee versus $0 on Blue Cash Everyday, it’s really only an $85 perk for Blue Cash Preferred ($265 in rewards instead of $180).

Online retail

It’s the potential game-changer as Blue Cash Everyday now offers 3% cash back on up to $6,000 in annual US online retail purchases (then 1% thereafter). Blue Cash Preferred only gives 1% cash back on all such purchases. Based on our typical spending habits, my family would exceed the $6,000 limit. With Blue Cash Everyday, that would be $180 (3% of $6,000), compared to just $60 (1% of $6,000) on Blue Cash Preferred. That extra $120 gives Blue Cash Everyday an advance of $35 per year after taking into account grocery rewards and annual fees.

An Amex representative tells me that Blue Cash Everyday’s online retail category is defined very broadly. “There is no specific list of eligible merchants,” the Amex rep says. “This does not only apply to purchases made in-store or services purchased online, such as travel reservations or online food delivery. But from pet supplies to the latest kitchen gadget to new shoes, and just about everything in between, card members will be rewarded with 3% cash back when they shop online, up to $6,000 per year.

Gas

Both cards offer 3% cash back at US gas stations. Blue Cash Everyday caps that rate at $6,000 in annual purchases (card members earn 1% again thereafter), while Blue Cash Preferred doesn’t cap its gas rewards rate. It’s a washout for us, since my family spends well under $6,000 a year on gas. Note that until recently, Blue Cash Everyday only offered 2% cash back on gas.

Diffusion

Blue Cash Preferred is the winner here as it offers 6% cashback on select streaming subscriptions, compared to just 1% on Blue Cash Everyday. However, my family doesn’t spend much on streaming services. We’ll probably only spend about $250 in this category over the entire year, so the difference between 6% and 1% cash back is only about $12.50 for us.

Plus, Blue Cash Everyday has a new streaming benefit: up to $84 in annual Disney Bundle credits. It’s the $13.99 monthly subscription that includes Disney+, Hulu, and ESPN+. The discount is applied as a monthly credit of $7 after spending $13.99 or more each month. Although my family does not currently subscribe to this, we have already thought about it. Kids would love Disney+, and I would love all the sports content on ESPN+, especially access to over 1,000 live National Hockey League games.

Since this would represent new expenses, I hesitate to say that we would “save” $84 — since the subscription would actually add about $84 to our annual expenses — but we would put it to good use. And it would be much more cost effective to subscribe to the Blue Cash Everyday discount rather than pay full freight with Blue Cash Preferred, despite Blue Cash Preferred’s higher refund on streaming services. Paying $13.99 a month would be $167.88 a year, and 6% of that amount is only $10.07. Much more attractive is Blue Cash Everyday’s $84 annual rebate.

Meal kits

The Blue Cash Everyday has also added an annual Home Chef credit of $180 (up to $15 in monthly statement credits). My family has occasionally ordered from one of Home Chef’s competitors in the past. We don’t currently receive any meal kits, so I’m not factoring that into my calculations, but it’s something we might try on occasion.

Transit

Blue Cash Preferred offers 3% cash back on public transportation, including taxis, rideshares, parking, tolls, trains, buses and more. Before the pandemic, I was spending about $350 a month ($4,200 a year) on train tickets to and from the office. Three percent of that was about $126 a year in cash back. But now that I work from home most of the time, this category of awards is no longer important to me. Getting 1% cash back on Blue Cash Everyday wouldn’t be a big loss.

The bottom line

I’ll think about it a bit more, but there’s a good chance I’ll go back to Blue Cash Everyday. The math is slightly in his favor, and the timing could be advantageous because my Blue Cash Preferred annual fee is due again in the fall. I will also likely hit the 6% annual grocery spending limit by the end of the month. These developments are additional incentives to make the switch soon.

Have a question about credit cards? Email me at [email protected] and I’d be happy to help.

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