By JENNA LEE
Want to earn money for using your credit card? If you have good or excellent credit and don't usually carry a monthly balance, a cash-back credit card could be a great way to earn rewards on your everyday spending.
Even better, you can get one without having to pay an annual fee. Here are five great options to consider:
For those who pay (or want incentive to pay) off their balance in full each month: Citi® Double Cash Card
Features: The Citi® Double Cash Card offers 1 percent unlimited cash back on eligible purchases and another 1 percent as you pay for your purchases, whether you pay in full or over time, as long as you pay the minimum due. So if you pay your statement balance in full and on time, this card could be a great deal for people who don't carry a balance.
If you pay off your balance gradually, you'll still earn the extra 1 percent cash back, but keep in mind that the interest you pay to keep a balance could weigh against the rewards you earn.
Watch out for: The cash rewards expiration. If you don't earn cash back from purchases or payments in 12 months, you could lose the rewards you've earned. Be sure to read and understand the terms and conditions carefully to help maximize your rewards.
For those who don't spend a lot: Capital One® Quicksilver® Cash Rewards Credit Card
Features: The Capital One® Quicksilver® Cash Rewards Credit Card offers a simple rewards program: unlimited 1.5 percent cash back on every purchase. While 1.5 percent cash back is a solid rewards rate, what makes this card special is that there's no minimum redemption threshold, meaning you can redeem your cash back for any amount. This can be especially appealing if you aren't a big spender and want to be able to redeem rewards at any time.
Watch out for: The rewards rate. If you're willing to deal with more complicated rewards plans or enroll in bonus categories each quarter, a different card could earn you more.
For those planning on spending a lot over the next year: Discover it®
Features: The Discover it® offers 5 percent cash back on up to $1,500 spent per quarter in rotating categories. For example, from January to March 2016, you could earn 5 percent on qualifying gas and ground transportation purchases. To differentiate itself from other rotating-category rewards cards, it's currently matching the cash back new card members have earned at the end of their first year. If you're a new card member and use it to make a lot of purchases over the next year, the rewards could really add up.
Watch out for: The opt-in. You have to sign up to activate the rewards categories each quarter in order to earn 5 percent cash back on eligible purchases.
For small families: Bank of America(R) Cash Rewards Credit Card
Features: Want to earn cash back on everyday spending such as gas and groceries? You may want to consider the Bank of America(R) Cash Rewards credit card, which offers 3 percent cash back on gas and 2 percent cash back at grocery stores and wholesale clubs on up to $2,500 in combined eligible purchases each quarter. For everything else, you'll earn 1 percent cash back.
Bank of America® customers get also a 10 percent rewards bonus when they redeem cash-back bonuses into their checking or savings accounts, and Bank of America® Preferred Rewards clients could increase that bonus to up to 75 percent.
Watch out for: The cap on rewards. You'll only get the 2 and 3 percent cash-back rates on the first $2,500 you spend in combined purchases each quarter. As the U.S. Department of Agriculture reports that a moderate-cost plan to feed a family of four could range from $894 to $1,066.10 each month, if you have a large family or simply spend a lot on gas or groceries each month, you could max out the benefits quickly and may want to consider a card that doesn't impose a maximum instead.
For those who don't want to deal with bonus categories: Barclaycard CashForward™ World MasterCard®
Features: The Barclaycard CashForward™ World MasterCard® is a new card that offers unlimited 1.5 percent cash back on every purchase, with a 5 percent cash rewards redemption bonus to use on your next redemption. After factoring in the 5 percent redemption bonus, the rewards rate effectively comes out to a solid 1.575 percent cash back, which is a better flat rate than many cash-back cards on the market.
Watch out for: The minimum cash-back redemption: While some cash-back cards allow you to redeem rewards in any amount you'd like, the Barclaycard CashForward™ World MasterCard® doesn't allow cardholders to redeem until they've racked up at least $50 in rewards.
If you pay off your credit card balance in full each month, using a cash-back card to pay for your purchases can essentially earn you "free money." However, if you ever plan to keep a balance, this type of card may not be right for you, as cards in this category typically come with high interest rates to offset the rewards they offer. Before applying, compare cards, read reviews and check your credit.
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