By Jesse Cook, clarkhoward.com
Considering the fact that Amazon corners the market on online retail, finding a credit card that provides reward points for shopping on the site should be of the utmost concern for a conscientious shopper.
More and more credit card companies are working hard to provide cardholders enticing benefits geared toward the online retailer, but knowing which card is right for you may become a bit overwhelming. That’s because there’s a wide range of reward options customers are now given access to.
Most credit cards provide some benefits, which come in the form of point systems that reward customers for shopping in certain stores, or on specific types of products (from groceries to entertainment products). These programs are tailored systems, which allow cardholders to choose a card that will yield the most points per their standard purchase.
In our case, we are looking specifically for cards that provide optimal kickbacks for customers shopping on Amazon. We’ve provided several options below with a breakdown of each cards strengths and weaknesses.
Our first recommendation for the Amazon shopper is, unsurprisingly, the Amazon Visa card. I placed this card at the top of the list because it offers the best deal for the frequent Amazon shopper.
The Amazon Visa card offers a 3% cashback reward for any purchases made in the Amazon marketplace; a 2% reward for purchases at gas stations, restaurants and drugstores; and a 1% reward for any other purchases.
Compared to the other cards on the list, the Amazon Visa stands out as the best card for consumers who do most of their entertainment shopping online. It provides a consistent 3% cashback, only beaten by the Discover it card’s quarterly 5% bonus, and still offers a nice reward for dining and gas (on equal measure with Citi’s ThankYou card). Additionally, the Amazon Visa has no annual fees and gives applicants a $70 gift card upon credit approval to be spent on Amazon.com.
On the downside, the Amazon Visa has the highest APR of the group with a 14.49% – 22.49% range on purchases and a 3% foreign transaction fee. (By comparison, the Citi ThankYou card has no foreign transaction fees). The Amazon Visa also provides no reward bonuses for shopping in physical stores like shopping centers and grocery stores aside from the basic 1% return, which means that a lot of necessary purchases are not going to net you a considerable return in reward points.
Overall, this card stands out as a very flexible entertainment card, with limited value for practical purchases. But, as I said before, this list is geared toward consumers interested in a great reward program for Amazon spending. It shouldn’t be surprising that Amazon delivers the best deal for its customers.
The Discover it card is appealing for a number of reasons including: Cashback match (for new card members); 5% cashback in bonus categories like gas, restaurants, Amazon and more (up to $1,500 every quarter); 1% cashback on all other purchases; any-time cashback redemption options; no expiration dates on cash rewards; a U.S.-based customer service team; free FICO credit scores with statements and online account; and no annual fees.
Additionally, the it card also has the lowest APR on the list, ranging between 11.24% – 23.24%. The cashback match provides customers reward matching for their first year’s purchases. The it card also provides 0% APR for the first year of service and has no foreign transaction fees. In addition, the it card offers the highest reward percentage on the list with a whopping 5% cashback for purchases that fall within the quarterly category, along with access to Discover Deals (an online bonus mall that provides access to specific shopping options with special bonus cashback percentages ranging from 5% – 20%).
But this strength is also the greatest weakness. While the hypothetical appeal of a credit card with a 5% cashback feature sounds incredible, the caveat that this bonus applies to a rotating list of categories means that there may be times when a bonus has very little value based on your spending habits. This is especially concerning when Amazon is listed as one of the specific bonus categories. Meaning that at certain times in the year, your purchases on Amazon may only net the standard 1% cashback reward for your purchases. Additionally, Discover cards are not accepted universally like Visa cards are, which can limit your purchasing options.
If this list was being compiled about four years ago, there would be little need for any other options next to Citibank’s Forward Visa. This card provided users a five-point return for each $1 spent on Amazon. Unfortunately, that card is no longer offered.
But Citi still has a very appealing card in the form of the ThankYou Preferred card, which provides two “ThankYou” points per dollar spent on dining and entertainment (which includes purchases on books, movies, music, etc.); one “ThankYou” point per dollar on any other purchases; no point expiration; and unlimited ThankYou point accumulation. This card also offers a 15-month 0% APR on both purchases and money transfers and no annual membership fees.
What makes the ThankYou card so appealing in the context of our shopping needs is its two-point conversion per dollar spent on entertainment and dining. This means that every purchase made at Amazon will guarantee a 2% reward. This is a fixed percentage, unlike the Discover card, which means there is no guessing when it comes to spending bonuses. Essentially, you are trading the gamble of bigger rewards for the security of consistent kickbacks. Also, the ThankYou card has no foreign transaction fees.
But, the ThankYou card has some cons as well. The APR for this card is slightly higher than Discover’s it card, ranging between 13.24% – 23.24%. And it requires an excellent credit score to be approved. The Citi card also lacks the bonus shopping options that the Discover card has, and serves a very specific purpose (in terms of rewards). This card is ideal for the consumer who frequently goes out. Beyond entertainment purposes, the card has no additional bonuses aside from the standard 1% cashback feature.
Lastly, I have selected a card that isn’t specifically geared toward Amazon purchases, but rather serves a more universal purpose. The Citibank Double Cash card works on a very simple, flat rate basis: Cardholders earn 1% cashback on purchases made, and an additional 1% cashback when the balance is paid off.
What this means is the card essentially becomes an across the board 2% reward card, assuming you stay on top of balance payments. Why I mention it in the context of this list is that it provides essentially the same service as the ThankYou card, with the added bonus of rewarding customers for any purchase they make.
While this card also lacks the larger bonuses of the Discover card, and carries the same burdens that the ThankYou card has, it also has a very promising reward system which may work far in your favor more often. A 2% reward bonus for any purchase is a pretty great offer. But, this perk is truly reliant upon your ability to consistently pay off previous balances.
The only additional negatives for the double cash card is that it does have a 3% foreign transaction fee and does not provide the 15-month 0% APR perk of the ThankYou card. But, it does offer free FICO credit scores for cardholders. This particular card is the most well rounded of the bunch and still nabs you 2% back on every purchase at Amazon.
So there you have it, a round-up of the best credit cards for Amazon fanatics that will quickly give meaningful returns for all those doodads and whatnots they love to buy.
Each card on this list contains a number of strengths that would make it valuable in the world of online retail, but it clearly depends on the type of cardholder you consider yourself to be.
Take the time to figure out what type of shopping you typically do, and evaluate each card based on your spending. A happy shopper is an informed shopper. Consider doing some homework at a site like CreditCardTuneUp.com to ensure that you have the right plastic in your wallet.
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