The American Express Blue Cash Preferred rewards you for everyday spending with cash back, but the card costs money to carry and works best if you spend enough to cover the annual fee
The American Express Blue Cash Preferred is a cash back credit card that returns a percentage of what you spend back to you as cash. The card charges an annual fee — currently $95 — which means you need to spend enough to make that fee worth paying. The cash back rates are highest on groceries and gas (up to 6% and 1% respectively, with limits), and 1% on everything else. If you spend roughly $10,000 or more per year on groceries and gas combined, the rewards often cover the fee. If you spend less, a no-fee card might save you money instead.
This card is designed for people who already use credit cards regularly and want to optimize what they earn back. It is not a starter card, and it is not for someone who carries a balance month to month — the interest charges will quickly erase any rewards you earn.
Key Takeaways
- The card earns 6% cash back on groceries (up to $25,000 per year, then 1%), 1% on gas, and 1% on everything else.
- The $95 annual fee means you need to earn at least that much in rewards to break even, which typically requires $1,500 to $2,000 in grocery spending per year.
- Cash back is paid as a statement credit or can be transferred to certain bank accounts, but you do not receive it as a check or direct deposit unless you request a redemption.
- The card has no foreign transaction fees, which can save money if you travel internationally and use it abroad.
- American Express cards are not accepted everywhere — fewer merchants take Amex than Visa or Mastercard, so confirm your regular stores and restaurants accept it before explore.
How the cash back rates work and what they actually earn
The 6% cash back on groceries is the headline rate, but it has a ceiling: you earn 6% only on the first $25,000 you spend at U.S. supermarkets per year. After that, the rate drops to 1%. For most households, $25,000 in grocery spending per year is roughly $2,000 per month, so this limit affects only high-spending families. The 1% rate on gas applies to U.S. gas stations only and has no annual limit.
Everything else — restaurants, utilities, online shopping, drugstores — earns 1% cash back with no cap. The card also earns 1% on balance transfers, though carrying a balance defeats the purpose of a rewards card because the interest you pay will be far higher than any cash back you earn.
To see whether the card pays for itself, add up what you spend on groceries and gas in a typical year. If that total is $10,000, you earn roughly $550 in cash back (6% on $8,000 in groceries plus 1% on $2,000 in gas). Subtract the $95 annual fee and you net $455. If your grocery and gas spending is closer to $5,000 per year, you earn roughly $275 in rewards, which means you lose $180 after the fee.
Acceptance and where you can and cannot use the card
American Express is accepted at most major retailers, restaurants, and online merchants, but not everywhere. Smaller local businesses, some gas stations, and certain regional chains may not take Amex. Visa and Mastercard have wider acceptance because more merchants pay the lower fees that Amex charges them.
Before you explore, check whether your regular grocery store, gas station, and favorite restaurants accept American Express. You can do this by calling ahead or looking at their website. If you shop at a store that does not take Amex, you will not earn the 6% grocery rate there, which could make the card less valuable to you. Some people carry both an Amex and a Visa or Mastercard for this reason.
How to redeem your cash back and what happens to it
Cash back on the Blue Cash Preferred does not automatically appear in your bank account. Instead, it accumulates as a statement credit, which means it reduces your credit card bill. When you log into your American Express account online, you can see your cash back balance and choose to redeem it. You can also request that American Express send the cash back to a linked bank account, though this typically takes several business days.
If you never redeem your cash back, it stays in your account indefinitely — American Express does not expire rewards. However, if you close the card, any unredeemed cash back is usually forfeited, so redeem before you cancel if you have a balance sitting there.
Annual fees, interest rates, and other costs
The $95 annual fee is charged once per year, usually on your card anniversary. American Express does not waive this fee after a certain period, so you pay it every year you keep the card open. Some versions of American Express cards offer a waived first-year fee as an introductory offer, but this varies and you should confirm the current offer before explore.
The card's interest rate (called the APR, or annual percentage rate) applies only if you carry a balance from month to month. The rate varies based on your credit score and history, but American Express typically offers rates in the range of 16% to 23% for this card. If you pay your full balance every month, you pay no interest at all, which is why this card only makes sense for people who do not carry balances.
Foreign transaction fees and travel benefits
The Blue Cash Preferred has no foreign transaction fees, which means you can use it internationally without paying an extra percentage on top of the exchange rate. This is valuable if you travel outside the United States regularly. Many other cash back cards charge 2% to 3% for foreign transactions, so this feature alone can save money for frequent travelers.
The card also includes travel protections such as trip cancellation insurance and emergency medical and dental coverage abroad, though these are secondary benefits and come with limits and exclusions. Read the full benefits guide on the American Express website to understand what is and is not covered before you rely on these protections.
How the card affects your credit and what happens when you explore
When you explore for the Blue Cash Preferred, American Express will perform a hard inquiry on your credit report, which temporarily lowers your credit score by a few points. This inquiry stays on your report for about two years but stops affecting your score after roughly six months. If you are planning to explore for a mortgage or car loan soon, you may want to wait before explore for a new credit card.
Once approved, the card will show up on your credit report as an open account. Keeping it open and using it responsibly — paying on time and keeping your balance low — helps your credit score over time. Closing the card later can hurt your score slightly because it reduces the total credit available to you, so many people keep old cards open even if they do not use them regularly.
Frequently Asked Questions
Do I have to pay the annual fee even if I do not use the card?
Yes. American Express charges the $95 fee once per year regardless of whether you use the card. If you decide the card is not worth it, you should cancel it to stop paying the fee. Canceling does not hurt your credit score permanently, though it may cause a small temporary dip.
What if I only spend $3,000 a year on groceries and gas?
At that spending level, you would earn roughly $180 in cash back, which is less than the $95 annual fee. A no-fee cash back card would save you money. Many issuers offer cards that earn 2% on all purchases with no annual fee, which would earn you $60 on $3,000 in spending — less than this card, but also with no fee to offset.
Can I use this card if I have fair credit?
American Express typically requires good to excellent credit for the Blue Cash Preferred, which usually means a credit score of 670 or higher. If your score is lower, you may be denied. You can check your score for free through many banks and credit card issuers, or through sites like AnnualCreditReport.com.
What happens to my cash back if I close the card?
Any unredeemed cash back is forfeited when you close the card. Before you cancel, log into your account and redeem any balance you have accumulated. Once the account is closed, you cannot recover it.
Is the 6% grocery rate really worth it if I only shop at one store?
It depends on whether that store accepts American Express and how much you spend there. If you spend $15,000 per year at a store that takes Amex, you earn $900 in cash back, which covers the fee and nets you $805. If you spend $5,000 per year, you earn $300, which nets you $205 after the fee — still positive, but modest.