To determine which cash back card offers the best return at restaurants, CNBC Make It vetted highly rated cash back cards based on their cash back offers, introductory and eventual APRs, annual fees, bonuses, recommended credit scores, late fees, balance transfer fees, foreign transaction fees, redemption options and customer reviews.
We then estimated how much money each card would save the typical American after one year, two years and five years. Our assessment heavily weighs the five-year return to avoid a large sign-up bonus skewing the results. We also assume that most people want a great card that they can stick with for years, especially since bouncing from card to card can be bad for your credit score.
To estimate the return, we used expenditure data from the Bureau of Labor Statistics to make a sample budget broken down by average annual spending in categories like gas ($1,909), groceries ($4,049), dining out ($3,154) and general purchases ($10,529). The general purchase category includes shopping, entertainment, public transit and vehicle expenses other than gas.
The estimate incorporates bonuses and assumes you have a high credit limit and that you use your card for 90 percent of the purchases you make in these categories, accounting for instances where you have to use cash or shop somewhere that doesn't accept your card.
Once we had our estimates, we then weighed cash returns against other factors including interest rates and fees, cash-back categories, practicality, bonuses and other perks.
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