Best Cash Back Credit Cards [August 2025]

It depends on what categories you spend in the most. A card that offers a 5% cashback rewards rate on dining and entertainment won't be as valuable to a family who doesn't go out to eat very much. However, a card that offers 3% back at select U.S. grocery stores may be very valuable to the same family, even though the rewards percentage is lower.

You should decide what matters most to you and examine what your spending habits look like. Then you can look for cards that offer high cashback rates for the purchases you make most.

High percentages are generally 2% or more, as most cash back cards offer 1% or 1.5% on select purchases. And don't forget to pay attention to spending caps for certain categories, which limit how much of your annual spending on the card is eligible to earn rewards. 

In general, here are some excellent cards for earning rewards in different categories:

• U.S. Supermarkets: Blue Cash Preferred^® Card from American Express
• Gas Stations: Wells Fargo Autograph^® Card
• Restaurants: American Express^® Gold Card
• Travel: Chase Sapphire Reserve^®
• Rotating categories: Chase Freedom Flex^®

When you use a cash back credit card, the issuer gives you back rewards as a percentage of what you spend on qualifying purchases. You can usually redeem these rewards for statement credits, and sometimes for other things, like gift cards.

There are different types of cash back credit cards. For example, if you have a flat-rate cash back card that offers 1.5% back on all purchases and you buy a $10 birthday cake, the card issuer will give you 15 cents back. Certain cash back cards also offer rotating bonus categories, which typically vary from quarter to quarter.

One quarter, bonus cashback categories might include eligible online shopping purchases on sites like Amazon, Target, or Walmart. The next quarter, you might earn bonus cash at a wholesale club or home improvement store, or on a streaming subscription. As an added bonus, some issuers will even match the cash back you earn at the end of your first year, up to a certain amount.

The exact rewards structure will vary from card to card, though redemption options may be similar across credit cards. Some typical cashback redemption options include statement credits, direct deposits to your checking account, mailed checks, or credits you can use to purchase gift cards. Some issuers even let you donate your cash back to a charity.

Because issuers want to give you a reason to apply for their credit cards over others. Competition among credit card issuers is fierce and any kind of incentive program, such as rewards or cash back, can make one card more appealing than another.

The rewards you get back typically come from transaction fees that merchants pay every time they process a charge. The issuer takes a percentage of those fees and passes some of them on to customers as rewards for using cash back cards.

Getting a percentage of money back encourages consumers to swipe more, which results in more transaction fees that the issuer can collect from merchants. You may also find that cash back cards have higher interest rates than credit cards that don't offer rewards. That's because these cards are so popular that issuers can set their APRs higher and still gain new customers.

Whether cash back or points/miles are better depends on what you value most. Big travel spenders might appreciate rewards that can be traded in for airline tickets, statement credits, and hotel stays. These points may be worth more than cash back depending on how you earn and redeem them.

However, some credit cards offer cashback rewards that can save customers a lot of money annually, which may be more important for you. In the end, it's up to you to decide which is better for your lifestyle.

If you'd prefer more flexibility, certain cashback rewards cards allow you to use your cash back to book travel. This can give you the best of both worlds if you're on the fence about which type of card to choose. For instance, if you have the Chase Freedom Unlimited^®, you can convert your cashback earnings into travel rewards and use them to book travel through the Chase Travel program.

Every issuer will likely consider your creditworthiness when you apply for a new cash back card — but exact credit requirements vary. Some issuers require excellent credit for approval, while others may approve your application even if you have a credit score on the low side, or a more limited credit history.

Issuers are in charge of approval/rejection, and it's at their discretion. To increase your options when it comes to credit cards, it's a good idea to learn more about how FICO Scores work and how to improve your credit score.