I have too many credit cards. I know I do. I applied for more than few to earn a particular bonus. Some I have because of balance transfer offers that have long been paid off. But I only have a few that I use week in and week out. Now that I’m pretty much done with balance transfers, and have no desire to jump on the next credit card deal offered, I want to maximize my rewards. I’m somewhat saddened but I believe I will be retiring my trusty old Amex Blue with Membership rewards. The membership reward program just can’t compete with other reward programs. I’ve been delaying this switch  for a long time as I’ve always enjoyed watching my membership reward points accumulate week in and week out. However at some point sentimentality has to put aside, and cold hard reasoning has to take over.

Year to date, I’ve spent a little over $20,000 on my credit cards. That’s average of about $2,500 a month. Extrapolate that over a whole year, I should spend close to $26,000 on my credit cards. That’s a lot of money, and reflective of the fact that I try to pass as many expenses as I can through my credit card. If I’m going to put that much through my credit card, I better be maximizing the benefit I get. Ideally, I would already have the right credit card for me in my wallet, but that doesn’t seem to be the case. Below is table of my current reward cards and rewards cards I’m thinking about adding.

The top table is rewards card I currently have, and the bottom table is cards I’m considering.

There are many different reward credit cards, but based on my research the best reward credit cards are: American Express Blue Cash, Chase Freedom, Starwoods Preferred, Discover More, and Citibank Dividend Platinum Select. However because each card has a slightly different reward structure, there isn’t a clear cut “best” card. The values I placed on the “cash back” reward put there are based on the my spending numbers and optimization of the use rewards.

Amex Blue Cash
Amex Blue Cash is the most generous of the pure cash reward cards. It pays 5% on everyday spending (groceries and gas), and 1.5% on everything else. The only problem is that those rates only apply after spending 6500 dollars. The lower 1% and .5% rates applies to spending below that threshold. I easily spend over 6,500 on credit card, and suspect this is likely the best card for me.

Citibank Dividend Platinum Select
I wouldn’t put this card on the list at all except Citibank runs a promotion offering 5% on everyday spending for the first 6 months. As result, I could get this card put $5,000 of everyday spending, and be $250 better off. The standard 1% and 2% rates on this card are not competitive making this card a poor long term solution.

Discover More Promotion Code FGML
The biggest problem I have with the Discover More card is the fact it’s a Discover card. I find that Discover is not as universally accepted as Visa, Mastercard, and American Express. I use my credit card for dining quite a bit, and do not often see Discover as accepted card. That said it rewards 5% for “special” category purchases. Unlike most of the other reward cards where “special” purchases are everyday purchases, Discover rotates it’s bonus 4 times a year in different categories. I imagine this makes it more difficult to users to maximize rewards as it takes active monitoring for the categories. For me it would hardly make a difference since I try to pass as many dollars as I can through my credit card. The problem is because it’s a Discover card, I probably wouldn’t be able to do so. What makes this card especially lucrative is the ability to exchange cash rewards for gift certificates at select retailers at double the value of the cash reward. As a result the optimal reward value could be a whopping 10%. 5% for the special purchases X 2 for the gift certificates.

Starwoods Preferred
This is the only card I’ve listed that has an annual fee. The annual fee of $30 is waived for the 1st year. This card intrigues me because one of the irrational reasons I’ve continued to use my Amex Blue w/ Memebership Rewards is because I like the idea of using rewards for actual rewards. An indulgence of mine is traveling, and this card would probably result in me staying nicer hotels than I would normally stay. Unlike many other travel reward cards, Starwoods has no blackout dates and few other restrictions. I could actually use the points accumulated for exactly the stays I want to. That’s extremely valuable. When using miles, I tend to plan my vacation around the miles rather than using the miles for the vacation I have planned. I would enjoy the flexibility of travel reward program that would allow me have a roome when I want to have a room.

Chase Freedom
I already have this card, and it’s one of the better reward cards out there. Chase at 3% for everyday purchases is generous right off the bat. Citibank offers 5% but that’s promotional. Amex offers 5% as well but only after 6500. Discover has 5% but for odd categories. There are almost no “buts” with Chase. The one drawback of the Chase card is that it only allows $600 worth of everyday purchases a month to quality for the superior 3% rate. $600 worth of everyday purchases is plenty for most people. It’s plenty for me. For someone who doesn’t put as much on the credit card as I, the Chase card would fit the bill. Plus it’s Visa which is more widely accepted than American Express.

All these reward programs are solid, but I think at the end of the day I have to go with American Express Blue Cash. Despite the potentially greater value of the rewards with both Discover and Starwoods, cash inherently is more valuable. Also because I do spend so much on my credit card, I should have no problem with getting over the 6,500 spending floor for the increased reward rate. At the same time I plan on continuing using the Chase Freedom Card which I already have for everyday purchases until I get my spending on the Amex above $6500 to qualify for the higher rate.

The Chase and Amex Blue Cash have very different and opposite behaviors when it comes to rewarding spending. Chase rewards lower spending while Amex is the complete opposite. Below is chart describing the reward behavior as a function of everyday spending and regular spending.

While I’ve linked applications for each the cards, I would advise anyone who is thinking about applying to do some research to see if there are any other deals being offered on these cards or any other cards. I didn’t spend too much time researching specific promotions. For example on the Chase Freedom, they periodically have run $250 cash back promotion instead of the $50 currently available. I signed up under the $250 promotion. Also when signing up for cards, often times the business version of the card will have better rewards or benefits. It’s my understanding that you do not actually need to have a business to sign up for business credit cards.