I’ve mentioned before that U.S. Bank’s Cash+ card may just be the best cash back card there is. U.S. Bank allows cardholders to choose two 5% cash back categories from a long list, and one 2% cash back category among gas stations, grocery stores, and drug stores. All other purchases earn 1%.
Where things get really interesting is that there are multiple ways to easily increase your earnings with this card. First, by opening a Platinum checking account, you get an extra half percent cash back for all purchases. So earnings go from 1%/2%/5% to 1.5%/2.5%/5.5% just by opening this account. If you have a credit limit of $25,000 or more across all of your U.S. Bank cards, the Platinum checking package is free. Even better, each time you withdraw cash rewards of $100 or more, U.S. Bank throws in a $25 Visa gift card bonus. So, by simply redeeming your rewards $100 at a time, you can increase your earnings by 25%. By stacking these two opportunities, the earnings go to 1.875%/3.125%/6.875%. Those are pretty spectacular cash back earnings, especially for a no-annual fee card!
Time to Choose for Jan-March 2013
Each quarter, it is necessary to pick your 2% and 5% categories. Here are my thoughts about each…
2% Categories (effectively 3.125%)
Gas/Grocery/Drugs: I can only pick one of these in order to get an effective rebate of 3.125%. I don’t tend to spend much on gas (I work from home!), so the real debate is between groceries and drug stores. For reasons that will be apparent to frequent readers of this blog, I’m leaning towards drug stores.
5% Categories (effectively 6.875%)
I can pick two of the following. Which should I pick?
Department Stores: I used this option this past quarter and regretted it. I found that neither Sears online, nor Kmart in-person counted as department stores. I simply don’t often shop at regular department stores, nor do I know of any that have really good gift card racks.
Restaurants: I do eat out a lot, so this could be a good choice, but I already get 5X from my Citi Forward card at restaurants. When paired with a ThankYou Premier card, 5X is worth 6.65% towards airfare. That’s good enough, so I think I’ll pass on this option.
Home Improvement Stores: I do have some real home improvement purchases on the horizon, so this one is very tempting. The main argument against this category is that it is easy to buy Lowes and Home Depot gift cards at office supply stores with my Ink Bold card for 5X Ultimate Rewards points. On the other hand, I noticed that OpenSky showed up on my credit card bill as a home improvement store. Maybe they’ll bring back the 150X MyPoints promotion…
Electronic Stores: This is another tempting category. I may buy a new computer sometime soon and it would be great to get 6.875% cash back for the purchase! Also, there would be some interesting lab experiment opportunities such as checking out at Target via the electronics counter…
Airlines: Thanks to having so many miles & points, I hardly ever pay for airfare anymore. I don’t see a good opportunity here for me.
Hotels: I’m a little tempted here because I may go for the Hyatt Diamond Challenge beginning in February. If so, I’ll need a number of paid nights to qualify. That being said, my American Express business credit cards give me 5% cash back for Hyatt transactions thanks to the OPEN Savings program. So, this wouldn’t save me much money over what I could do already.
Bill Payment: This option covers telephone charges, cable, internet, and insurance. Through my Ink Bold card, I get 5X on all of those except for insurance. I’m not sure that my quarterly insurance payments are high enough to justify selecting this category. However, I’m tempted to pick this category for just one quarter and prepay my insurance for the whole year…
Fast Food: See restaurants, above.
Furniture Stores: Know any furniture stores with good gift card racks? I didn’t think so.
Car Rental: I still have a bunch of Hertz points from last Spring’s Daily Getaways. I don’t see myself spending much in this category unless there’s a great mile earning opportunity.
Charity: I picked this last quarter and I’m tempted to do so again. It’s a great way to get something back while doing good.
Movie Theaters: My Citi Forward card has this one covered at 5X already.
Help me choose
So, what do you think? Among the 5% categories, I can only pick two, but I’m torn between Home Improvement, Electronics, Charity, and (to a lesser extent) Bill Payment. What do you think I should do?
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Zz: people on FatWallet, SlickDeals, and a reader email to me all said the same. I’m working on verifying through US Bank before I publish. I’m not sure how to confirm that the bonus categories are active.
Rumors, where? Just got the card, would be disappointing.
It says that it takes up to 3 days until the bonus categories have been activated. Is there a way to confirm that they are active?
In case anyone is curious, I decided to go with Electronics and Home Improvement this quarter. In other news, there are rumors that US Bank is going to devalue this card’s benefits in May by capping 5% spend at $2K per quarter, limiting to 1 $25 bonus card per year, and changing some of the 5% categories.
Any further update on whether the extra .5% from the platinum checking package also applies to the first 1% of a bonus category purchase? I, too, was told by a US Bank representative on the phone–who said he had this very credit card himself–that the extra .5% was provided only on non-category bonus purchases, i.e., purchases that did not qualify for a bonus. Has anyone seen hard evidence of this either way on their credit card statement? Thanks much.
Sharon Simon: Yes, I can absolutely confirm that you always get the extra .5%. Here’s an example. I made a $1000 donation to charity after having picked charity as my 5% category. Then when I look under “reward history” I see three cash rebates. The first is for $10. This is the base, 1% rebate. The next is $40. This is the extra 4% you get within 5% cashback categories. And, the final one is $5 with the words “US Bank Platinum Package Bonus”. This is the .5% bonus from the Platinum checking.
Hsin: I can’t wait to hear your results!
Is the http://www.simon.com considered as department store? I know we can buy the AMEX or visa gift card from it with around 1% purchased fee if buying $500.
Hsin: Great question. I don’t know. That would be a nice trick if it worked! I didn’t pick department stores this quarter, but I’m willing to test anyway to see what mcc code shows up (unless someone else out there has tried it?). Have you ever bought from them before? If so, can you check your credit card statements to see how it is classified?
I didn’t buy anything from it before. In fact, I am going to apply for the US Bank Cash+ this week and I will try it out for you guys!!
I loaded my Target prepaid card with my cash plus at the electronics counter and it came up as groceries per US bank CSR. Has anyone got a 5% back from buying electronics at target?
I just tried a test purchase in Target electronics dept. and it did not earn 5% electronics either w/Cash+. I think the electronics register actually sends the same MCC code as the rest of the store and not an ‘electronics store’ code. What is interesting is I did an MCC supplier search beforehand and this Target store came up with an extra MCC entry for electronic store, but the description mentioned it as a ‘kiosk’ inside target that I wonder if it could be related to those mobile phone kiosks… which I’m not sure are even operated by Target (and probably can’t load a Target AMEX)… though I haven’t looked into it further yet. Curious to hear more comments on this.
Ham: Oh well! Thanks for doing that test. Of course, you can sign up for the grocery 2% option and load up at Target. That would be pretty good.
Cam: Interesting info. I don’t know anything about Target kiosks. Anyone else?
Hsin: probably not since Kmart in person isn’t counted as a department store. However, I haven’t explicitly tested it.
Is Kmart online counted as department store in US bank Cash+?
I chose grocery because I do my actual (food) grocery shopping at SuperWalmart, which AMEX does not count as a grocery store, but Cash+ does. And I have a 5% drugstore card (old AMEX BC) anyway.
Preacher: If I remember right, I think this card does have foreign transaction fees. So, not a card for international use.
Does this card have foreign transaction fees? I could use it to donate to a Charity in Canada.
Corky Putt Putt: good point. Unfortunately I often don’t plan ahead!
I have my categories set for home improvement, bill payment and drug store. The home improvement covers upcoming home remodeling and gas gift cards at my local Lowes. The rest is self-explanatory.
I don’t understand why you would buy Lowe’s gift cards for 5x when you can do TopCashback to Plastic Jungle and get the same gift cards for 10.5% off with a little advance planning. Which is a fascinating little trick I learned from you.