When looking for a credit card rewards, it makes sense to review your spending habits and choose one that offers a high cash back rate or points in the categories in which you spend the most. But if your top spending categories tend to vary, a new card from peer-to-peer payment service Venmo is a compelling option: it automatically rewards you in the categories with the highest spending each month.
The Venmo Visa Credit Card pays you 3% cash back in the category in which you spend the most during a statement cycle (categories include groceries, gas, restaurants and nightlife, travel, bills and utilities, health and beauty, entertainment and transport). You get 2% back in the category in which you spend the second highest amount and 1% on other expenses.
No spending limit applies the first year you have the card. Each year thereafter, combined spending in the 2% and 3% categories is capped at $10,000, with purchases earning 1% after reaching the limit. The card was recently offered to select Venmo app users and will be available to all US users in Q1 2021.
Cash back is automatically added to your Venmo account and you can transfer it to your linked bank account or debit card. You can also use it to pay your credit card bill, other Venmo users or merchants who accept Venmo at checkout.
More rewards from Chase. Chase closed applications for its Chase Freedom card and introduced the Chase Freedom Flex Mastercard. Like the previous card, Flex offers 5% cash back on up to $1,500 spent in a category that changes quarterly (2021 categories not available at time of publication; fourth quarter 2020 category included Walmart and PayPal purchases). But year-round, Flex is also offering 5% back on travel bookings made through Chase, 3% back at restaurants, and 3% back at pharmacies. Other expenses recover 1%. The card recently offered 5% cash back on up to $12,000 in grocery purchases in the first year as well. Rewards are earned in the form of points, which you can redeem for a penny each for cash, gift cards, or travel.