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This seems to not apply to the first year you have the card, but will apply beginning 1/15/13 on your renewal date. Happy 6% for the first year! 😉
I saw some bad news today while reading InACents.com. It seems that grocery purchases with the Amex Blue Cash Preferred card are getting more restrictive beginning on January 15, 2013. Currently, when paying for groceries at stand alone grocery stores, you receive 6% cash back for all of your purchases. That is one of the best grocery discounts/rewards out there among all the credit cards that offer bonus points on grocery purchases.
Previously you could purchase as much as you wanted at stand alone grocery stores and get the 6% cash back bonus. As you may guess, many people were not only purchasing groceries at the grocery store, but they were purchasing gift cards as well. This enabled people to get not only 6% cash back on groceries, but also on the gift cards sold at the grocery stores (gas, food, clothing retailers, and even MasterCard/Visa/Amex gift cards). Now people are getting notices on their October statements that inform them as of 1/15/13, there will be a $6,000 yearly cap on the 6% cash back at stand alone grocery stores. After hitting the $6,000 limit, the cash back will drop to 1% at stand alone grocery stores. The $6,000 limit averages out to $500 per month on groceries. That is probably a reasonable limit for typical families that purchase just groceries at grocery stores (though many families spend more than that), but it will certainly put a serious limit on the gift card gig.
It is still up to $360 cash back on grocery purchases each year, so that more than off-sets the $75 annual fee, but I’m sad to see this new limit. I don’t have this card, but I have read that the new language also excludes prepaid cards. I’m not sure how they will know what is being purchased at the grocery stores, but be aware of that new language that is reportedly included.
One thing that can help with the new limit is to have two people in the family get the card. That increases your combined limit to $12,000 per year. Another idea is to supplement with cards like the Chase Freedom that had grocery stores as a quarterly 5x bonus category during 2012. That bonus is also capped, but when you start combining limits with different cards you can still do pretty well. Of course the Ink Bold and Ink Plus are very useful for gift cards at 5x Ultimate Reward points at office supply stores (which I prefer to 6% cash back). I haven’t read anything that indicated the Blue Cash Everyday card has a new limit. That card has no annual fee and offers 3% back at grocery stores – which of course is only half as generous as it’s cousin the Blue Cash Preferred Card.
I think many of us feel that this gift card gravy train is too good to go on forever. We are already starting to feel the pinch, and it won’t shock me to see further restrictions regarding the purchase of some of these gift cards with credit cards. Anything that seems to good to be true probably will be in the long run. However, I will keep on doing what I am doing in the short run.
Have you gotten a notice regarding your Blue Cash Preferred Card? How does this impact your “grocery” strategy at all?