Introduction to American Express Blue Cash
As far as some people are concerned, American Express Blue Cash is considered to be one of the best things created by a financial institution. To be sure, the two cards offered through this program are two of the best cashback credit cards to be found anywhere. They are backed by considerable financial stability and security, and the concept of these cards come with both short-term and long-term benefits. While it is true this card can be very expensive to maintain, we would argue that those who already spend a lot at the grocery store won’t be bothered in the least by the requirements of this card.
Blue Cash is a fairly comprehensive, rather elaborate program that was created by American Express a few years ago. The program quickly became popular for a number of reasons, including no annual fees, but it has also been criticized for a number of reasons. The more you learn about those reasons, the easier it will be to decide if this card is right for you. Without question, this is a pretty good program. It is easy to see why it has gotten fairly good reviews across the board from customers. Nonetheless, there are some issues that can make the card a pain.
American Express Blue Cash Pros And Cons
The lack of annual fees is probably our favorite thing about this card. Some cards give you bonuses or discounts that can be used to cancel out their fees, but that can feel like you’re taking unnecessary steps. The Blue Cash card makes things refreshingly simple. The same can more or less be said of the American Express Blue Cash rewards you stand to receive.
Just remember that the no-annual-fee perk only applies to the Everyday Card. If you choose to apply for the Preferred Card, understand that this is going to come with a $99 fee.
Regardless, the card is pretty strong in the cashback department. Obviously, that is one of your most important considerations. In the first place, you can earn a $150 bonus for spending a grand within the first three months. If you are planning to make this your primary card, it seems likely that you will be able to hit that marker without too much trouble. For the first year, you can also take advantage of a 3% cashback reward on every dollar you spend at any grocery store. Just keep in mind that 3% only applies to the first six thousand dollars you put on the card. Once you hit that milestone, it reverts to 1% cashback on every dollar you spend. If you dislike cards that take away certain bonuses after a certain period of time, this is definitely something you will want to keep in mind.
The American Express Blue Cash card also gives you 2% cashback on every dollar spent at department stores or gas station. This remains consistent, and 2% is certainly not bad for two places where you probably spend a lot of money. You will also want to keep in mind that you get 1% cashback for every dollar spent on anything not covered in the first two tiers. This element is on-par with most cashback credit cards, although the Blue Cash card benefits from including more at their 2% tier.
This card does indeed come with a 0% introductory rate. This only lasts for fifteen months, but we would venture to say that’s a better grace period than what you often find with cards. Indeed, it is more generous than the 3% cashback for the first six thousand dollars spent.
One thing we don’t like with this card? The higher-than-average regular APR. This is far and away the most frustrating flaw with this card. Generally speaking, excellent credit will get you a regular APR in the neighborhood of 14.41%. Believe it or not, but the American Express Blue Cash card has a regular APR that will be higher than that, regardless of how good your credit is. This is certainly something that can influence your long-term interest in the card.
Further Pros And Cons Of American Express Blue Cash Card
Furthermore, if you only have fair credit, the APR is going to be downright disqualifying at a hefty 22.57%. At that point, you are almost certainly better off getting a different card, as there are indeed options out there for people with only fair credit.
Just make sure you can carry the balance from one month to the next, before taking steps to apply for this card.
The 3% balance transfer fee is another reason why you may want to avoid this card. Households with an average credit debt of 75 thousand dollars can expect to pay $200+. If you are trying to use this card to deal with ongoing debt, you are almost certainly going to run into some problems.
Oh, and the fees do not end there. If you travel abroad on a regular basis, this really isn’t a good primary card for your lifestyle. That is largely due to the 2.7% foreign transaction fee. While that doesn’t necessarily mean you shouldn’t get this card, but it does mean it won’t leave your wallet when you’re traveling. In other words, if you’re looking for a good card that you can rely on at all times, this may not be what you’re after.
Not surprisingly, American Express is just not as widely-accepted around the world as titans like Mastercard and Visa.
The lack of over-limit fees on this card is definitely worth noting. These fees largely disappeared in the aftermath of the CARD Act, but some cards still carry them. That isn’t going to be a problem with the American Express Blue Cash card. Just keep in mind that it doesn’t inherently mean you will be approved for an over-limit purchase. Credit card companies have always taken a case-by-case approach to such things.
Additional Considerations With American Express Blue Cash Cards
The word “cash” in the name of the card can prove to be slightly misleading. As you will learn, the card doesn’t reward you with actual cash. Instead, the company offers what are known as Reward Dollars. You can have your Reward Dollars redeemed as a credit on your statement. You can also sometimes have them exchanged for gift cards, or even actual merchandise. This element is a little unpredictable, but it is at least straightforward.
Considering the strong 3-tier reward system with the American Express Blue Cash card, you can be sure you will be racking up the points at a pretty steady pace. Just decide ahead of time if you spend enough money/time at the stores covered by this card to make the whole endeavor worth it. You will be able to redeem your rewards in increments of twenty-five. Should you ever decide to close out the account, make sure you aren’t leaving any valuable points behind.
There are some solid Amex-related benefits to keep in mind with this card, as well. In particular, you will receive ongoing opportunities to take advantage of exclusive entertainment specials. Not surprisingly, that can be defined in a number of ways. It is still a pretty popular and well-regarded aspect of the card. You also get to take advantage of a 24/7 assistance line. American Express isn’t perfect by a long shot, but they do boast some of the strongest customer service ratings to be found anywhere in the world. This is always something you’ll be glad to have in your corner, should you ever need to contact them for one reason or another.
At the end of the day, while this card is not without merit, the American Express Blue Cash card is still mostly useful to those who have excellent credit. With the ridiculously high regular APR for those with fair credit, even a strong reward tier is hard to justify. A regular APR like that isn’t impossible to maintain, but it does create a very fragile financial situation. If you fail to carry the balance for even a single month, you could suddenly find yourself in a freefall of fees and other headaches. We aren’t trying to discourage you from getting the card, but we still think this is a very important aspect of the card that should be kept in mind.
For those who have excellent credit, this is one of the best cashback cards on the market. Even with the issues we mentioned above, anyone who doesn’t have to worry about being able to carry the balance will find themselves enjoying the rewards. Not only do the limited-time-only perks have a longer-than-average lifespan, but the potential for savings over the first year or so is exceptional. However, if you are someone who doesn’t like to be told how you can get your cashback rewards, the American Express Blue Cash card is going to be a little frustrating at times. For some, this may not be a disqualifying factor. For other, however, it can make the difference between whether or not the card is worth their time.
David is a financial expert who graduated from the University of Fordham (Master in Finance) in 2001. He has 10+ years of experience in private equity and wealth management. With strong expertise in senior-level financial planning, personal financial analysis, and mortgages, David knows his way around personal finance. Before working at CCR he used to be a financial analyst at McKinsey.
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