No. of Recommendations: 1
Amex Blue Cash... after you spend $6500 within the calendar year you earn 1.5% on anything and 5% on gas, grocery (not warehouse) and pharmacy purchases...

Before $6500 I think the earn level is something like 0.5% for everything and 1% for gas/grocery/pharmacy.

That's an attractive card for people who have very large budgets or wash a lot of business expense through their personal cards. I've never considered it seriously because of the tiers and the places that don't take Amex, but let's think about it. Since I keep detailed records in Quicken, it shouldn't be very hard to figure out whether this is a winner.

I do very little spending that the cards consider grocery or pharmacy, so most of the analysis is on the 1% spending. Breakeven as compared to a pure 1% cash back card is at $13,000 of spending in a card year.

If I kick out the places that I know don't take Amex, I only put $9,541 on credit cards in the last 12 months. The actual amount I could, in theory, put on Amex Blue might be lower. I'm only kicking out Sam's Club and my daughter's college, but there might be more places I charged that don't take Amex.

As compared to Citi MasterCard, most purchases work out to lose 0.5% before $6500, gain 0.5% after $6500. Gas/grocery/pharmacy works out to lose 1% before $6500, gain 3% after $6500. If I assume gas/grocery/pharmacy purchases distributed evenly through the card year, that's equivalent to those purchases being worth twice as much as undesignated purchases for purposes of breaking even. That brinks the amount of 1% equivalent purchase I might have put on Amex up to $11,486. I still do better with Citi MasterCard. The $300 per year limit on cash back is not a problem for my spending patterns.

Okay, I remember why I never seriously considered Amex Blue before. The numbers don't work out for me, and I'm not interested in increasing spending or shifting purchases to other (read: costlier) merchants in order to make the cash back more attractive.

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