Cash back credit cards are becoming popular alternatives to travel credit cards. With easy to understand rewards that you’re able to use on any purchase you like, it’s easy to understand why.
But, when it comes to getting your cash back, most credit cards have multiple ways you can make use of your hard-earned rewards.
Let’s talk about the various ways cash back can be redeemed, with a few that might surprise you.
Redeem your cash back rewards ‒ the choice is yours
Depending on the credit card you have in your wallet, there are a variety of redemption options available to you.
In fact, among the major credit card issuers, there are 6 ways you can get your cash back:
- Statement credits,
- Direct deposit,
- Mortgage payments, and
- Deposit into investment accounts.
Statement credits are the basic option for redeeming your cash back. With this redemption, your rewards will be applied against your credit card bill – reducing the amount you have to pay the following month.
For most cards, you’ll need to have between $20 to $25 in cash back earned in order to redeem. It’s as easy as making a request on your online banking, and your cash back will be applied as a statement credit against your current balance.
Although most cards give you a few other ways to get your cash back, a statement credit is your only option if you have an American Express cash back card.
But what if you don’t want to wait until you’ve earned $20 before redeeming your rewards? You’re in luck. All of Discover‘s credit cards will let you redeem your cash back with no minimum requirement. Even if you only have a few pennies worth, Discover will let you redeem it.
Another popular way to redeem your cash back is to have it deposited straight into your bank account – allowing you to use your cash for whatever you like.
Like with statement credits, when you have $20-25 worth of cash back earned, you can put in a request and have your cash deposited – you just need to provide your account information.
Although, many credit card companies will only deposit cash back into their own financial products.
Nearly all of the big banks offer this as a redemption option, with the exception of American Express and Citi.
If you’d rather get a good old-fashioned check that you can deposit yourself, Bank of America and Citi cash back cards will send you a check once you have earned at least $25 worth of rewards.
Bonus tip: If you have the
Pull cash from an ATM
For this option, you’ll need to have a bank account with Wells Fargo. Simply use your Wells Fargo debit or ATM Card at any Wells Fargo ATM, and can get your cash back paid out in $20 increments.
Sticking with the (innovative) Wells Fargo, the
Not only can you use your rewards for statement credits and cash back, but you can use it to pay off the principle of your Wells Fargo mortgage. That’s right – your mortgage.
Being able to turn your rewards into something that will help your future and quality of life is a great option.
Deposit into investment accounts
Keeping in the theme of saving for the future, if you have a Bank of America cash back card, you can deposit your cash back earnings into either a Merrill Lynch or Merrill Edge account.
You can even set up automatic deposits so that once you have $25 in cash back earned, Bank of America can automatically make a deposit into your account.
The following cards offer this cool feature:
If you’re not sure which card to get, consider the
Redeem your travel points for cash back
Typically, travel cards that have their own rewards program will offer you the ability to get a statement credit for your points. If you collect airline miles or hotel points, however, you won’t be able to redeem for cash back.
While this option does come with a loss of value compared to redeeming for travel, it does offer a way for you to use your points if you have no travel plans for the foreseeable future.
Or, if you’re looking to cancel your travel credit card, it offers a quick way to use your points.
Note: In most cases, when canceling an account, you’ll have no more than 60 days to use your remaining points.
We’d love to hear from you
Cash back cards have a wide variety of redemption options available, and depending on what you want to do with your rewards, there’s likely a card to suit you.
Do you have a cash back card? How do you prefer to have your rewards paid out?
Let us know in the comments below.