Understanding the benefits of your credit card is crucial to maximizing your financial gains. Many credit cards offer enticing rewards programs, and among the most popular is the cash back system. This article delves into a specific cash back rewards program, breaking down how you can earn different percentages back on your spending and highlighting key aspects to consider.
The program we’re examining allows cardholders to earn varying cash back rates depending on where and how they spend. It’s structured around a tiered system with opportunities to earn 6%, 3%, and a base rate of 1.5% cash back. However, to unlock the higher reward tiers, enrollment is required each quarter.
To begin, cardmembers must actively enroll every quarter to participate in the enhanced rewards program. This enrollment process involves selecting two retailers where you can earn 6% cash back and one purchase category for 3% cash back. If enrollment is missed, or selections are not made, all net purchases will only earn the base rate of 1.5% cash back. It’s important to note that it can take up to 3 business days for registration to be effective, so plan ahead to ensure you’re earning at the desired rates from the start of each quarter.
The 6% cash back reward is offered on purchases made at your two chosen retailers. This elevated rate applies to the first $1,500 in combined net purchases at these retailers each quarter. Once this spending threshold is reached, any further purchases at these 6% retailers within the same quarter will earn the standard 1.5% cash back.
Similarly, the 3% cash back reward applies to your chosen purchase category. This rate is valid on the first $1,500 in net purchases within that category per quarter. Spending beyond this $1,500 limit in your 3% category will also revert to the 1.5% cash back rate for the remainder of the quarter.
For all other eligible net purchases that do not fall into the 6% or 3% categories, and for spending exceeding the quarterly limits in those categories, a base cash back rate of 1.5% is applied. Importantly, there are no limits on the cash back earnings at this 1.5% level, providing a consistent reward for all eligible spending.
It is critical to be aware of a significant upcoming change effective April 14, 2025. Purchases of gasoline and electric vehicle charging at discount stores, supercenters, wholesale clubs, and grocery stores/supermarkets will no longer qualify for the gas station and electric vehicle charging station everyday category. These purchases will then only earn the base 1.5% cash back rate. This change may impact cardholders who frequently use these locations for gas or EV charging and are relying on the higher cash back rates.
Transactions are categorized for the 6% and 3% rewards based on merchant codes. These codes are assigned to merchants by the merchant or their payment processor and indicate the type of business. While U.S. Bank endeavors to include all relevant merchant category codes in their listed retailer and purchase categories, they cannot guarantee that every transaction will qualify for the 3% or 6% rewards. This is because U.S. Bank does not control how merchants classify transactions. Purchases made at merchant subsidiaries and through third-party delivery services are also excluded from the additional cash back rewards and will earn the standard 1.5% rate.
Beyond the standard spending categories, cardmembers can earn an additional bonus. By using their Shopper Cash Rewards card to make prepaid car and hotel reservations within the Rewards Center, they can earn a bonus of 4% cash rewards. This is in addition to the base 1.5% cash rewards earned on all eligible net purchases, resulting in a total of 5.5% cash back on these specific travel bookings. Note that it may take 1-2 statement billing cycles for these bonus cash rewards to appear on your credit card statement.
In conclusion, this cash back rewards program offers tiered benefits with the potential for significant savings if utilized strategically. By understanding the enrollment requirements, retailer and category selections, spending limits, and upcoming changes, cardholders can effectively compare the benefits and maximize their cash back earnings. Always remember to review the terms and conditions and stay informed of any program updates to ensure you’re making the most of your credit card benefits.
