Certain rewards credit cards feature rewards that rotate quarterly or change depending on your spending habits.
These cards tend to provide a return on a variety of different purchase types, from popular stores and vendors like Target and Amazon, or things like gym memberships and streaming services. Some of them require manual activation of the categories each quarter, while others offer automatic activation.
What is a rotating rewards card?
A card that changes rewards every quarter or every few months is considered a rotating rewards card. Some examples of popular rotating rewards cards include the Chase Freedom Flex℠*, the Discover it® Cash Back*, the Bank of America® Customized Cash Rewards credit card and the Citi Custom Cash℠ Card.
Who should use a rotating rewards card?
Anyone who spends across a variety of purchase categories would benefit from a rotating rewards card. Some of them offer rewards for some less-common categories such as home improvement stores, online shopping or fitness memberships.
The best rotating rewards cards
Chase Freedom Flex
The Chase Freedom Flex has more earning potential than most credit cards. In addition to rotating rewards, it offers static cash-back categories for travel through Chase Ultimate Rewards, drug stores and dining.
Its 5% cash-back rotating categories are limited to the first $1,500 spent each quarter, then reward rates fall to 1%. The current 5% categories for January through March are grocery stores (excluding Walmart), Target, fitness clubs and gym memberships.
With the Freedom Flex, you must manually activate the categories to earn the higher rewards rate. As long as you activate by the date specified by Chase -- for example, for this quarter cardholders need to activate by March 14, 2023 -- any qualifying rewards for previous purchases in that quarter will retroactively apply to your account.
Discover it Cash Back
The Discover it Cash Back offers 5% cash back (limited to the first $1,500 spent each quarter, then it reverts to 1%) on rotating categories, but doesn’t have any static categories. The categories for January through March are grocery stores, drug stores and select streaming services. One of the biggest draws to Discover cards are their welcome bonuses. Called Cashback Match, Discover will essentially double the rewards you earn during your first year with the card at the end of your first year.
You’ll need to activate your rewards each quarter, and if you activate later in the quarter, you won’t earn retroactive rewards.
Bank of America Customized Cash Rewards card
The Bank of America Customized Cash Rewards card works a bit differently than other rotating rewards cards. Each month you can choose one 3% cash-back category in addition to earning 2% cash back for grocery stores and wholesale clubs. 3% and 2% rewards are limited to the first $2,500 spent in combined purchases each quarter, then the rate falls to 1%.
Your 3% category choices include gas, online shopping, dining, travel, drug stores or home improvement and furnishings. Cardholders can change their 3% category once per month. So while the rewards don’t technically rotate, you can still choose to change them depending on your expected spending.
Citi Custom Cash Card
Another card with changing rewards, the Citi Custom Cash offers 5% cash back (on the first $500 of each billing cycle, then 1%) for your eligible top-spend category. There’s no need to manually activate categories with this card -- instead, you’ll receive the higher tier reward rate for whichever category you spend the most on during that billing cycle.
Eligible categories include restaurants, gas stations, grocery stores, select travel, select transit, select streaming services, drugstores, home improvement stores, fitness clubs and live entertainment.
How to use rotating rewards
There are three things to keep in mind when utilizing a rewards card with rotating categories:
- Always remember to activate your bonus categories. Avoid missing out on rewards by remembering to activate your categories (if required) at the start of a new quarter.
- Make sure you’re using your card for the correct purchases. You’ll need to keep track of which purchases your card earns the most rewards for.
- Be aware of the card’s higher rewards rate limit. Once you hit that mark, consider switching to a flat-rate cash-back card to maximize your return.
When using a card like the Custom Cash, it’s also important to track your spending. You’ll want to make sure you’re doing the majority of your spending in the category that you’d like to earn the most rewards for -- but you shouldn’t overspend to earn higher rewards.
The Bank of America Customized Cash Rewards card offers a bit more flexibility, as you can decide which category you’d like to earn the most rewards for each month. If you plan to spend more on online shopping or dining one month, simply change your category.
Considering most cards that feature flexible or rotating rewards have lower spending limits before their higher cash-back rates fall significantly, it’s a good idea to pair them with another rewards card, like a flat-rate card, which may help you earn higher rewards once you reach this threshold.
Cards that work well with rotating rewards cards
Here are a few suggestions for general rewards cards that would work well with rotating rewards cards. Using them in tandem to cover purchases your rotating rewards don’t can help you maximize your rewards.
Wells Fargo Active Cash® Card
The Active Cash is one of the best flat-rate cash-rewards cards on the market. Its 2% cash-rewards rate will cover the purchases that your rotating rewards card won’t. There’s no annual fee to worry about either, making it an easy choice to pair with another card. In addition to its strong rewards, it offers some useful Visa Signature benefits and an introductory APR offer on purchases and qualifying balance transfers.
You can learn more in our Wells Fargo Active Cash Card review.
Citi® Double Cash Card
The Double Cash offers 2% cash back on every purchase. You’ll get 1% when you use the card, and the other 1% when you pay the purchase off. It’s a good general card to use for any spending your rotating rewards card doesn’t earn higher rates on, and once you hit higher rewards rate limits for the quarter. It doesn’t charge an annual fee and there’s a long introductory balance transfer offer should you need to eliminate some existing credit card debt. However, using the card to earn rewards while working to pay down a transferred balance isn’t a great strategy.
Check out all the details in our Citi Double Cash Card review.
Blue Cash Everyday® Card from American Express
The Blue Cash Everyday offers rewards for everyday expenses including purchases made at U.S. gas stations, U.S. supermarkets and with select U.S. online retailers. Its 3% cash-back rate (on the first $6,000 spent annually on each category, then 1%) is hard to beat for a card without an annual fee, making it a solid pick to use in conjunction with a rotating rewards card. Cash back is received in the form of Reward Dollars that can be redeemed as a statement credit.
Terms apply to American Express benefits and offers. Enrollment may be required for select American Express benefits and offers. Visit americanexpress.com to learn more.
You can read more about it in our Blue Cash Everyday from American Express review.
The bottom line
Rotating rewards cards can be great tools to earn a higher return on a wide variety of purchase types. They work best when paired with general rewards cards, however, to ensure you’re still earning decent rewards rates on most of your purchases.
Just be sure to activate your bonus categories each quarter, keep an eye on spending limits, and use them for the correct purchases.
*All information about the Chase Freedom Flex and the Discover it Cash Back has been collected independently by CNET and has not been reviewed by the issuer.
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