I'm Happy to Pay an Annual Fee for This Amex Card -- Here's Why
KEY POINTS
- The Blue Cash Preferred® Card from American Express earns the highest cash back rate on groceries I've ever seen.
- This American Express card also comes with high bonus rates on gas, tolls, and transit costs.
- If your spending looks like mine, this card is absolutely worth considering.
I'll be honest -- the prospect of paying an annual fee for a credit card hasn't always filled me with joy. In fact, I canceled my oldest credit card not too long ago because I wasn't using the card enough to justify the fee. But I still pay the annual fee on two cards in my wallet and I think they both pay for themselves.
One of those cards is the Blue Cash Preferred® Card from American Express. I whip it out every time I visit a grocery store, whether it's the big local chain or the independent market.
On American Express' Secure Website.
Terms apply
On American Express' Secure Website.
Terms apply
Good/Excellent (670-850)
Intro APR
Purchases: 0%, 12 months
Balance Transfers: 0%, 12 months
APR
19.24%-29.99% Variable
Rewards 6% Cash Back at U.S. supermarkets on up to $6,000 per year in purchases (then 1%). 6% Cash Back on select U.S. streaming subscriptions. 3% Cash Back at U.S. gas stations. 3% Cash Back on transit (including taxis/rideshare, parking, tolls, trains, buses and more). 1% Cash Back on other purchases. Cash Back is received in the form of Reward Dollars that can be redeemed as a statement credit or at Amazon.com checkout.
1%-6% Cash Back
Annual Fee
$0 intro annual fee for the first year, then $95.
Welcome Offer Earn a $250 statement credit after you spend $3,000 in eligible purchases on your new Card within the first 6 months.
$250
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This card offers market-leading cash back at U.S. supermarkets. The welcome bonus and intro APR offer sweeten the deal. Terms apply. If you spend a lot on groceries (excluding wholesale clubs and superstores like Costco and Walmart), this card is worth considering.
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- Big welcome offer
- U.S. supermarkets rewards
- U.S. gas stations rewards
- Streaming subscription rewards
- Travel and purchase protections
- Annual fee
- Foreign transaction fee
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- Earn a $250 statement credit after you spend $3,000 in eligible purchases on your new Card within the first 6 months.
- $0 intro annual fee for the first year, then $95.
- Buy Now, Pay Later: Enjoy $0 intro plan fees when you use Plan It® to split up large purchases into monthly installments. Pay $0 intro plan fees on plans created during the first 12 months from the date of account opening. Plans created after that will have a monthly plan fee up to 1.33% of each eligible purchase amount moved into a plan based on the plan duration, the APR that would otherwise apply to the purchase, and other factors.
- Low Intro APR: 0% on purchases and balance transfers for 12 months from the date of account opening. After that, your APR will be a variable APR of 19.24% - 29.99%.
- 6% Cash Back at U.S. supermarkets on up to $6,000 per year in purchases (then 1%).
- 6% Cash Back on select U.S. streaming subscriptions.
- 3% Cash Back at U.S. gas stations.
- 3% Cash Back on transit (including taxis/rideshare, parking, tolls, trains, buses and more).
- 1% Cash Back on other purchases.
- Cash Back is received in the form of Reward Dollars that can be redeemed as a statement credit or at Amazon.com checkout.
- $84 Disney Bundle Credit: With your enrolled Blue Cash Preferred Card, spend $9.99 or more each month on an auto-renewing Disney Bundle subscription, to receive a monthly statement credit of $7. Valid only at Disney Plus.com, Hulu.com or Plus.espn.com in the U.S.
- Terms Apply.
This card comes with a $0 intro annual fee for the first year, then $95. (See rates and fees.) But despite the extra little hit to my budget, I'm OK with this annual fee. Here's why.
It's easy to outearn the annual fee on one of my biggest expenses
You might wonder why I opted to apply for this American Express card in the first place, given that I'm a bit annual fee–averse. Well, I am an unabashed foodie and avid home cook. The Blue Cash Preferred® Card from American Express offers a whopping 6% cash back on U.S. supermarkets (up to $6,000 per year) and select U.S. streaming subscriptions (terms apply). Groceries are a huge part of my monthly budget, so getting this card specifically was an easy call.
As I write this, we are nearly halfway through 2024 (I can't believe it either). I just took a peek at my cash back earnings with this American Express card. Since Jan. 1, I've earned a little over $200 back on my spending. That puts me on track to earn around $400 this year, which is about as much as I did in 2023. It's also more than four times the annual fee. I feel pretty comfortable continuing to pay to get such a high rate of cash back on one of my biggest expenses.
The other perks are worth it
Of course, 6% cash back on groceries isn't the only benefit offered by this credit card. I also get 3% cash back on gas, tolls, and other transit costs (see rates and fees). Admittedly, I work from home and don't drive a ton, so I don't use this as much as other people could.
I also get 6% cash back on select streaming services and 1% cash back on everything else. I do, however, tend to use a different rewards credit card for non-bonus purchases, as it earns at least 1.5% back on everything instead of this card's 1%.
Beyond the cash back rates, the Blue Cash Preferred® Card from American Express also comes with American Express's legendary customer service, Amex Offers, and purchase and return protection. Plus, I use it to pay for The Disney Bundle of streaming services and get a $7 monthly statement credit back (terms apply, enrollment required). In short, this card's benefits are just more reasons why the annual fee is worth paying.
Is this American Express card right for you?
I can't answer that for you! But if your credit card spending looks like mine (heavy on the groceries, specifically), it could be a great fit. If you have a long commute by car, it's worth considering because of the cash back on gas purchases. Heck, even if you commute by train or other public transit, you'll still get that same 3% cash back.
Crunch the numbers on your own spending. If you can outearn the annual fee, I highly recommend the Blue Cash Preferred® Card from American Express.
Our Research Expert
We're firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers. The Ascent, a Motley Fool service, does not cover all offers on the market. The Ascent has a dedicated team of editors and analysts focused on personal finance, and they follow the same set of publishing standards and editorial integrity while maintaining professional separation from the analysts and editors on other Motley Fool brands.
Eligibility and Benefit level varies by Card. Terms, Conditions and Limitations Apply.
Please visit americanexpress.com/benefitsguide for more details.
Purchase protection underwritten by AMEX Assurance Company.
For rates and fees for the Blue Cash Preferred® Card from American Express, click here
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