How Citi's new Custom Cash Card stacks up to other 5% cash-back cards - CNBC

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Cash-back credit cards are a simple way to earn some extra cash on all of your purchases. You can get a generous 5% return on purchases with a number of rewards credit cards.

These cash-back cards typically use rotating categories for what you earn 5% back on. Credit card issuers will release a calendar with the spending categories for each quarter. The cardholder is required to activate each quarter's bonus categories, which is done online or through the card issuer's mobile app. 

Citi Custom Cash Card

The Citi Custom Cash℠ Card is unique in this respect 一 it automatically determines your top spending category for the billing cycle, applying 5% cash back for purchases in this category up to $500. Unlike most other 5% cash-back cards, which require you to manually activate the categories and alter your spending habits each quarter to maximize your cash back, you can spend like you normally would and 5% cash back will be applied to the category you spend the most in. 

After you hit the spending cap of $500 for the billing cycle, you'll earn 1% cash back on purchases in that category. You'll also get 1% cash back on all other spending. That means you can earn up to $25 cash back from your top spending category each month, in addition to 1% cash back on your other purchases.

The benefit of 5% cash-back cards is that they often come with no annual fee and a welcome offer. The Citi Custom Cash card comes with $200 cash back if you spend $750 on purchases within the first three months and has no annual fee. It also comes with a 15 month 0% APR introductory offer on balance transfers and purchases (after, variable APR 13.99% to 23.99%). 

Citi Custom Cash℠ Card

On Citi's secure site

• Rewards

  5% cash back on purchases in top eligible spend category each billing cycle, up to the first $500 spent (then 1%); unlimited 1% cash back on all other purchases

• Welcome bonus

  Earn $200 cash back after spending $750 on purchases in the first 3 months of account opening. The bonus offer will be fulfilled as 20,000 ThankYou^® Points, which can be redeemed for $200 cash back.

• Annual fee

• Intro APR

  0% APR on balance transfers and purchases for first 15 months

• Regular APR

  13.99% to 23.99% variable

• Balance transfer fee

  5% of each balance transfer ($5 minimum)

• Foreign transaction fee

• Credit needed

  Excellent, Good

Pros

• No annual fee
• 5% cash back in eligible spend categories like restaurants, gas stations, grocery stores, select travel, select transit, select streaming services, drugstores, home improvement stores, fitness clubs and live entertainment
• $200 cash back welcome bonus if meet spending threshold
• Introductory 0% APR offer for first 15 months

Cons

• 5% cash back is limited to top spend category, up to the first $500 spent
• 3% foreign transaction fee when traveling outside the U.S.

Citi Custom Cash Card vs. other 5% cash back cards

But how does the Custom Cash Card compare to other 5% cash-back cards on the market? Select compares three other popular 5% cash-back cards to the Citi Custom Cash Card to help you determine which card is the best fit for you: Discover it® Cash Back, Chase Freedom Flex℠ and U.S. Bank Cash+™ Visa Signature®.

The U.S. Bank Cash + Visa Signature Card is unique because it allows you to earn 5% cash back on two spending categories, of your choice, on up to $2,000 of spend in each quarter. There are many 5% categories you can choose from such as fast food, department stores, ground transportation and select clothing stores. Furthermore, you get to choose one of three categories 一 such as grocery stores, gas stations, and restaurants 一 where you'll receive 2% cash back with no spending cap. You'll receive 1% on all other purchases. 

You could earn up to $100 from two chosen 5% categories, each quarter, in addition to 2% on your everyday categories and 1% on other purchases. Additionally, this card comes with a solid welcome offer. If you spend $500 within the first 90 days, you'll get $200 back. If you're looking for a card with a similar welcome bonus, you might also consider the Chase Freedom Flex credit card.

U.S. Bank Cash+™ Visa Signature® Card

Information about the U.S. Bank Cash+™ Visa Signature® Card has been collected independently by Select and has not been reviewed or provided by the issuer of the card prior to publication.

• Rewards

  5% cash back on two categories you choose quarterly (on your first $2,000 in combined eligible net purchases each quarter, then 1%); 2% cash back on one everyday category; 1% cash back on everything else

• Welcome bonus

  $200 after you spend $500 within the first 90 days of account opening

• Annual fee

• Intro APR

  0% APR for the first 12 billing cycles on balance transfers

• Regular APR

  13.99% to 23.99% variable*

• Balance transfer fee

  3%, minimum $5

• Foreign transaction fee

• Credit needed

  Excellent/Good

Pros

• No annual fee
• High 5% cash back on select entertainment purchases, when you activate bonus categories
• Low spending required to earn a good welcome bonus

Cons

• 5% cash back is limited to $2,000 in combined purchases each quarter
• Activation is required to earn 5% cash back
• 2% to 3% foreign transaction fee

• Estimated rewards earned after 1 year: $478
• Estimated rewards earned after 5 years: $1,790

Rewards totals incorporate the points earned from the welcome bonus

The Chase Freedom Flex offers cardholders $200 cash back if they spend $500 on purchases within the first three months. The card gives 5% cash back on purchases up to $1,500 (after 1%), within certain categories, each quarter. The categories rotate every quarter and require activation. Some of the recent categories from 2021 include gas stations and home improvement stores and grocery stores (excluding Target and Walmart) and select streaming services.

The card also gives 3% cash back on dining and drug stores and 1% cash back on other purchases. You could earn up to $75 on the 5% cash back categories each quarter, in addition to the 3% and 1% cash back on other purchases. This card also comes with perks like 5% cash back on all Lyft rides through March 2022 and a complimentary 3 month DoorDash subscription.

Chase Freedom Flex℠

On Chase's secure site

• Rewards

  Earn 5% cash back on up to $1,500 in combined purchases in bonus categories each quarter you activate (then 1%), 5% cash back on travel booked through the Chase Ultimate Rewards®, 3% cash back on dining and at drug stores, 1% cash back on all other purchases

• Welcome bonus

  $200 cash back after you spend $500 on purchases in your first three months from account opening

• Annual fee

• Intro APR

  0% for the first 15 months on purchases

• Regular APR

  14.99% to 23.74% variable

• Balance transfer fee

  Either $5 or 5% of the amount of each transfer, whichever is greater

• Foreign transaction fee

• Credit needed

  Excellent/Good

Pros

• No annual fee
• Generous welcome bonus
• Opportunity to earn up to 5% cash back in select categories upon activation
• Rewards can be transferred to a Chase Ultimate Rewards card

Cons

• Bonus categories must be activated each quarter
• 3% fee charged on foreign transactions

• Estimated rewards earned after 1 year: $814
• Estimated rewards earned after 5 years: $2,647

Rewards totals incorporate the cash back earned from the welcome bonus

There are four Discover cards that offer 5% cash back in rotating categories: Discover it® Cash Back, NHL® Discover it®, Discover it® Balance Transfer and Discover it® Student Cash Back. The Discover it Cash Back requires cardholders to activate the categories every quarter. The card offers 5% cash back on purchases in these categories up to $1500 (after 1%) each quarter, and 1% cash back on other purchases. This means you can earn up to $75 each quarter in addition to 1% cash back on your other purchases. The rotating categories for 2021 are Grocery Stores, Walgreens and CVS; Gas Stations, Wholesale Clubs and Select Streaming Services; Restaurants and PayPal; and Amazon.com, Walmart.com and Target.com.

The card has no annual fee and also comes with a unique welcome bonus — Discover matches the amount of cash back that cardholders earn in the first year. So if you earned $350 in cash back at the end of your first year with the card, Discover would match that and add another $350 to your rewards account.

Bottom line

The Citi Custom Cash card takes a lot of the effort and time out of managing a 5% cash-back card with rotating categories. With the Custom Cash card, you won't have to worry about activating the categories every quarter or changing your spending habits to get the most out of your cash-back card. However, the Custom Cash Card does only offer 5% cash back on purchases up to $500 for each billing cycle. The U.S. Bank Cash + Visa Signature might be a better option for you if you're willing to activate the categories each quarter since it offers 5% cash back on up to $2000 of purchases.

Information about the NHL® Discover it® has been collected independently by Select and has not been reviewed or provided by the issuer of the cards prior to publication.

Editorial Note: Opinions, analyses, reviews or recommendations expressed in this article are those of the Select editorial staff’s alone, and have not been reviewed, approved or otherwise endorsed by any third party.

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