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You’re going to spend a small fortune on gifts for others this holiday season, so why not take advantage of a cash back credit card to turn some of the money going out the door around and right back into your pocket. Some of the best cash back credit cards give 5 and 6 per cent cash back on popular holiday purchases. Here are some of our favourites: Best Card for Online Shopping: Discover More Card
This is the only card we’ve found that gives you extra cash back on any online shopping you do during the holidays. You can get 5 per cent cash back on up to $1,500 in purchases on ALL online shopping, as well as offline department stores, through December. The 5% cash back categories rotate quarterly so they’ll be new seasonal categories come January. This card may not be the best choice for all your purchases, though, since you only get .25 per cent cash back on other purchases until you spend $3,000, and then it only goes up to 1 per cent.
Best Card for Thanksgiving and Christmas Dinner Shopping: Blue Cash Preferred Card from American Express.
This card gives you a whopping 6 per cent cash back on any purchases from stand-alone supermarkets (for the first $6,000 spent in a calendar year), plus a new cardholder bonus of $150 cash back after spending $1,000 anywhere in the first 3 months. Note that there is a $75 annual fee, so this card makes the most sense if you’re going to use it for your purchases year round (it also offers 3% cash back on gas and almost all major department store purchases, and 1% on everything else).
Best Card for Electronics and Toy Shopping: Citi Dividend Platinum Select Visa
With this card, you get 5 per cent cash back on both electronics store and toy store purchases (and anything you buy from Macy’s) through the end of December. The 5% cash back categories change each quarter and you get 1% back on all other purchases. Big spenders beware, the card maxes out at $300 cash back in a calendar year, but that doesn’t include the $100 cash back you get after spending $500 in the first 3 months.
Best Card for Travel Shopping: Chase Freedom Visa
This card gives you 5 per cent cash back on all hotel and airline purchases through the end of December. It also gives you $100 cash back after spending $500 in the first 3 months, which can be helpful in paying off all those holiday travel bills. Like some of the other cards mentioned, the 5% cash back categories rotate each quarter and you get 1% cash back on all other purchases.
Best Card for Overall Shopping: Capital One Cash Rewards
If you don’t want to worry about specific categories and just want the highest cash back you can get for all your purchases, this card is a great choice. It has a 1.5 per cent effective cash-back rate on all purchases. You also get $100 cash back after spending $500 in the first three months.
If you’re looking for the card that will maximise your cash back throughout the year, the maths gets complicated, so you can just plug your average monthly spend on different categories into NextAdvisor.com’s cash back calculator and let it do the work for you, to see which card will earn you the most based on your spending habits.
This guest post was written by Erik Larson, CEO and President of NextAdvisor.com.