Should you get a flat-rate or bonus category cash back card?

Cash back credit cards appeal to so many cardholders for one simple reason: The value is easy to understand. Get clear, predictable discounts on every purchase, eliminating the guesswork that often comes with travel rewards cards.

That said, choosing the right cash back card isn’t always simple. At a high level, cards fall into two camps: flat-rate cards, which earn the same percentage on nearly all purchases, and bonus category cards, which offer higher rewards in specific spending categories.

Neither option is inherently better or worse. The best option depends on your spending habits and how much effort you’re willing to put in to maximize your returns.

So which option is right for you? Below, we’ll break down the key factors to consider when deciding whether a flat-rate or bonus category cash back card makes the most sense.

Related: Cash Back vs. Travel Rewards: How to Choose a Credit Card

A look at our picks of the best cashback cards

Best Flat Rate Cash Back Cards

Best Bonus Category Cash Back Cards

• American Express Blue Cash Preferred® Card: A top choice for households with high grocery bills, Earn 6% cash back at U.S. supermarkets (up to $6,000 per year) and have higher rates on select streaming subscriptions, U.S. gas stations and transportation.
• Chase Freedom Flex® (See Rates & Fees): Great for earning higher rewards with quarterly rotating bonus categories (activation required).
• Bank of America® Customized Cash Rewards Credit Card: Best for cardholders who want to choose their own rewards categories, earning 6% cash back on select categories (first year, then 3%) and 2% cash back at grocery stores and wholesale clubs.
• Citi Custom Cash® Card: Earn 5% cash back on your highest qualifying purchase category (up to $500) each billing cycle, then 1% cash back on everything else.

Citi Custom Cash Card information is independently collected by The Points Guy. The card details on this page have not been reviewed or provided by the card issuer.

Related: The Best Cash Back Credit Cards to Add to Your Wallet

What type of cash back card should you get?

Do you want to consider which card to use for every purchase?

If you’re looking for something simple and don’t want to spend time deciding which card to swipe every time you make a purchase, a flat-rate cash back card might be a better fit. These cards earn the same cash back rate on nearly all purchases, which means you can use a card anywhere without worrying about category, activation, or earnings caps.

If you don’t mind tracking your spending and are willing to use different cards for different purchases, it’s worth continuing through the decision-making process to see if a more specialized card could earn you more.

Related: How do cash back credit cards work?

Do you spend a lot of money on 1 or 2 major categories, such as groceries, meals, or gas?

If a large portion of your monthly spending consistently falls into one or two purchase categories, a bonus category cash back card may earn you more than a flat-rate option. These cards offer higher rewards in specific areas, allowing you to get the most cash back on the purchases you make most often, even if the interest rates on other expenses are lower.

If your spending is spread fairly evenly across multiple categories, a flat-rate cash back card may be a better choice. Many common expenses, such as utilities, insurance, clothing, or home improvements, do not qualify for bonus categories and are therefore ideal candidates for flat-rate incentives.

When there’s no clear spending pattern to optimize for, getting the same rate on every purchase can provide more consistent overall value.

Related: Pros and Cons of Cash Back Credit Cards

Would you like to activate rotating categories or track spending caps?

If you’re willing to activate bonus categories each quarter and keep an eye on your spending limits, a cash back card with rotating bonus categories might be a good choice. These cards typically offer some of the highest cash back rates, but require consistent attention to ensure you get the maximum rewards.

If you want to avoid activation requirements or tracking caps, consider a card with fixed or customizable bonus categories. These cards offer higher rewards in specific areas without requiring additional steps, making them a more convenient alternative to rotating category cards.

If addressing these issues already feels like more effort than you’d like, that’s a strong sign that a flat-rate cash back card is the right choice.

Related: Are Cash Back Credit Cards Worth It?

bottom line

No one cash back card is right for everyone, but the variety of options makes it easier to find a card that fits your spending style. For those who want to take a “set it and forget it” approach, a flat rate cash back card may be best for you. However, those willing to manage a maximizing strategy may prefer bonus category credit cards.

If you want the best of both worlds, pairing a rewards category card with a flat-rate card can help you earn more cash back throughout your budget—with relatively little extra effort.

Related: How to Choose a Cash Back Credit Card