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A lot of credit cards give cash back usually for a specific category such as gas, restaurants and the supermarket, while leaving every other purchase to receive only 1% back. However, for those odd purchases that don’t fall within a specific group, we are really hurting our savings potential when all the extra work required is to apply for a credit card.
Right now there are only two cards on the market that provide you with 2% cash back on all purchases without a cap. We must take not that this is for cash only. There are other great credit cards that offer 2x points on every $1 dollar spent, but they must be redeemed for travel or something else. For the purposes of this article, we are going to think in terms of cash only.
The two cards that give this benefit are the Fidelity Rewards American Express Card along with the Citi Double Cash Rewards Card. We’re going to do a side-by-side comparison of these two cards.
Both of these cards pay a cash back of 2% on all purchases in cash. This is important to note as there are credit cards that offer you 2x points per dollar spent, but these can only be redeemed for travel or other types of expenses.
With the Fidelity Rewards Card, 2% cash back is rewarded automatically as soon as you make your purchase. This means you don’t have to wait to get the extra cash. However, the downside lies in the fact that this cash back must be deposited into an eligible, Fidelity account. This includes IRAs, Cash Management Accounts, or 529 plans.
Fidelity doesn’t charge any maintenance fees for their accounts, but it is a hassle if you want to receive cash back in the form of cash. You have to first open a Fidelity account and decide which account you’d like to put your 2% cash back.
I find it easiest to use a cash management account, which essentially works like a bank account. You can even use this account to pay your bills or link it to your regular bank account to put the cash in another spot. Either way, you’re going to be receiving the 2% back in some form.
One other note to take note is that you have to have a minimum of 2,500 ($25 worth) points in order to cash out. These points can be used at their rewards mall called the WorldPoints Catalogue, but if you want to redeem for cash, you have to wait for a minimum of 5,000 points before you can claim it.
Citi triumphs over the Fidelity card by making your cash back redeemable without opening a new account. This means that as soon as you receive your cash back, you can deposit the money or use it to pay off your bill.
Unlike the Fidelity Rewards Card by American Express, there is one major downside:
- The entire 2% cash back will only be rewarded once you pay off your bill.
Looking at point number one, Citi only offers 1% upon purchase and 1% upon paying your bill. If for some reason you needed that extra cash back right away, you won’t be able to get to it until all of your credit bills are paid off.
If you don’t want to wait too long to receive your cash back, the Citi Double Cash Card might not be for you. You can only cash out your rewards once you’ve hit minimum of $25.00 in purchases (2,500 points). This is equivalent of making a total of $1,250 dollars in purchases, and they have to be paid off in full to receive the full 2%.
Fidelity also makes it so you have to have a minimum of of 2,500 points to redeem anything, but you’ll receive your cash back immediately. It really comes down to which situation you’re looking at. If you’re looking to receive cash back immediately, go with Fidelity. If you want ease of use, then Citi would be the best choice.
Given the fact that you need 5,000 points for your first redemption in cash, we’re going to side with the Citi card on this one.
Cash Advance and Other Fees
Both cards have their own cash advance fees, yet certain charges are counted as cash back while others are not.
The fees on the Fidelity Rewards card are nothing special. In fact, they’re basically on par with Citi in terms of how fees go.
If we look at the foreign transaction fees, they’re actually pretty reasonable. Any purchases made outside of the US will charge you a 1% fee, but you’re still getting that 2%. This means you’re still making a profit of 1%.
As for withdrawing from the ATM, there’s a standard fee of 3%.
Citi is on par with the American Express Card by Fidelity in terms of what appears to be their standard fees, but we have to be careful about what you want to purchase.
I wrote in another article that you may be accidentally using cash advance with your Citi Card Double Cash Card. As far as I know, Citi will charge you cash advance for depositing into your American Express Serve Account, purchasing American Express Gift Cards, or depositing money into a Forex account.
If you make these types of purchases I do not recommend using this card. Not only will you be charged a hefty 3% cash advance fee, but you won’t receive the 2% cash back bonus because it doesn’t count as a normal purchase. You’ll be taking a huge loss.
Another downside when comparing the Citi card to AMEX is that there’s a 3% foreign transaction fee. If you make any purchases abroad, you’re going to already at a downfall, losing a total of 1% on every purchase instead of gaining 1% like you would with its competitor.
There seems to only be positives with the Fidelity Rewards Card, so that’s our clear winner in regards to cash advance.
If you were to do a normal search on Google, you would find that neither of these cards offer a sign-up bonus. However, a little more digging showed me that there’s a way to get an extra $50 bucks by getting the Fidelity Card.
By simply searching for the Fidelity Rewards Card by AMEX, the first result that will be seen doesn’t offer a sign-up bonus. That’s why I recommend clicking this link to apply (I don’t receive commission). so that you can receive an extra 5,000 points after spending $500 in purchases from the first two months of opening an account.
This $50 dollars meets the minimum conclusion for the amount needed to cash out in cash, meaning that once you spend that $500 dollars to get the bonus, you’ll be eligible to redeem a total of $60.
Since Citi offers no form of a sign-up bonus, we’re obviously going to have to go with the Fidelity Card for the winner in this category.
There’s an entire slew of additional benefits that both credit card networks offer. However, when we look at the key points that we care most about, we’re going to have to say that the Fidelity Rewards Card by American Express is a clear winner, mainly because of the cash back and low foreign transaction fees. Just make sure to check out this link to get the sign-up bonus.
If you have any questions about these cards or disagree about which one is better, let us know in the comments below. Thanks for reading.