Crowning a New Best Credit Card

theInterest: Issue #1

Adios, Starwood

Nearly 10 years (and 2 startups) ago I wrote a blog post comparing reward cards and declaring the Starwood Amex the winner. It’s been in my wallet ever since and the points have covered 2 free trips to Hawaii and several other hotel nights along the way. But Marriott bought Starwood and the almighty SPG point is no longer.

The new best card

After a bunch of research, I decided to replace it with the Citi Double Cash Card. It’s nice and simple: 2% cash back for all purchases, with no annual fee. We’ll use a $50k annual spending budget to make comparisons. That’d be a cool $1,000 cash back with the Citi Double Cash Card.

Why it’s better than other cash back cards

There’s no other card as high as 2% on all purchases, so it comes down to the math around cards that give 1% for everyday purchases and a higher percent for certain spending categories. I found 3 of them to be tempting:

  • Blue Cash Preferred Amex: 6% cash back on groceries (on up to $6k of spend), 3% on gas stations and select department stores, 1% everything else. Within that $50k budget, let’s assume you spend at least that $6k at the grocery store, $1,800 on gas (15k miles; 25mpg car; $3/gallon), and, $200 at “select department stores.” That’s cash back of $360 at the 6% level, $60 at the 3% level, and $420 at the 1% level, for a total of $840. Not good enough.

  • Amazon Prime Rewards Visa Signature5% cash back at Amazon and Whole Foods, 2% at restaurants, gas stations, and drug stores, 1% everything else. If you committed to Whole Foods for your groceries, and you do a bunch of your shopping on Amazon, it’s possible that you’d spend 25% of your overall budget (or, $12,500 of our example budget) at the 5% tier, and, if you go out to eat a lot and drive a decent amount, another $8k at the 2% level. That shakes out to $1,080 total cash back. But that comes with being locked into Whole Foods (which I’m not doing) and, those assumptions are perhaps a little aggressive.

  • Uber Visa Card: 4% back on dining (including takeout), 3% on hotel/airfare, 2% on online shopping and streaming services, 1% everything else. I’ll assume $6k/year on dining, $2k/year on hotel/air, $2.5k/year on online shopping. That works out to $240 + $60 + $50, in cash back respectively, + $395 in cash back on everything else, for a total of $745. If you never grocery shop and always go out to eat, maybe this is the card for you, but not having groceries as a premium category doesn’t give it a chance for me.

Another option is to get 2 cards. It compromises simplicity, but, it wouldn’t be too bad to get the Amazon card, hook it up to your Amazon account (and try to remember to use it for the occassional Whole Foods trip), and carry around the Citi Double Cash for everything else. We (embarrassingly?) spent $4k at Amazon last year and on pace for at least that this year. Increasing that spending from 2% to 5% cash back would mean a difference of $120+. I’m still considering it, but, think I might apply for this card too.

Why it’s better than a travel rewards card

The great thing about a travel rewards card is, with a little bit of luck, you can save big bucks on a flight or hotel stay by using points. 

Typically a miles card pays 1 mile per $1 spent and charges 25k miles for a domestic roundtrip flight — if the flight is over $500, you’re getting more than 2% cash back there. However, more likely those expensive flights will be higher miles to redeem and/or the $500 you could’ve got in cash back on that $25k spend would pay for most domestic flights with room to spare, plus you’re not locked to a single airline. 

With the Starwood card, “luck” with high quality hotel redemptions was more frequent. And, you could even trade 20k SPG points for 25k miles at an array of airlines — instantly making it better than any miles card, and points for gift cards at a 1% “cash” back rate, which was a nice fallback option. But it’s gone; oh well. Programs from Marriott, and Hilton just don’t live up — the value’s not there.

That leaves general purpose travel programs. The best of these is Chase Ultimate Rewards. With their best card (Chase Sapphire Reserve), you get 3x points on dining and travel and 1x points elsewhere. It has a $150 net annual fee (annual fee is $450 but first $300 of travel is reimbursed). If you book travel through their portal (kind of like their own version of Kayak), you get a 50% bonus on your points, making 1 point worth $1.50. You also get access to super fancy lounges at airports across the world (meh), and it comes with a great signup bonus, worth $750 in travel. That is nice, but, I think of a credit card as a decade long decision and don’t like to play the signup bonus game.

Overall, the rewards are good, but they still dont stack up to the boring old 2% card. The best you’re doing is 1.5% “cash back equivalent” on everyday purchases and 4.5% on dining and travel, and even if that didn’t come with the restriction of having to use their travel booking portal, we know from our analysis above that it isn’t likely to beat out “2% everywhere.” If you do travel a ton, and would enjoy fancy airport lounge access, this is a card to consider. But not for most of us.

Price protection, purchase protect, and extended warranty

Credit cards also have 3 under appreciated features. Some will refund price drops within 60 days of your purchase, some will repair or replace damaged items within 90 days of purchase, and some extend warranty coverage on certain purchases. Honestly, I don’t trust that I’d be diligent enough to take advantage of these, so they don’t factor into my decision. American Express by far does the best here, having all 3 features. Visa Signature cards do well too. The Citi Double Cash does have price protection (but not the other 2 features), and, apparently it’s automatic if they detect a price drop.


So long, Starwood Amex, hello Citi Double Cash. And I think Amazon Prime Visa Signature, as well. It has been nice to not have to dip into cash for big travel purchases — if I can avoid eyerolling at my own suggestion, I think we might funnel this cash back money into a separate account, and use that as our primary travel budget.