A customer smiling as he receives his food at a trendy burger restaurant.Updated: October 1, 2019

Some of today’s top credit cards offer rewards to turn your purchases into a pile of cash back, points or miles, and people interested in high cash back rates may want to check out rotating category credit cards. These cash back cards are able to offer you the highest rates available depending on how you distribute your spending over the year, so it’s important to plan ahead of time.

Rotating category cards offer a high 5% cash back rate on a spend category (or categories) that change each quarter. You’ll typically see categories like groceries, gas, dining, travel and others, but what you really need to know is where and when you should be spending to qualify for the highest rates.

Chase and Discover provide great options when it comes to rotating cash back category cards, so let’s look into the top cards, the features, and what you can do to maximize the value all year long.

Discover it Cash Back

The Discover it Cash Back provides a way for cardholders to earn significant cash back rewards, but that’s not where the value ends. For starters, you can earn 5% cash back on rotating quarterly categories (up to the quarterly maximum, currently $1,500) upon activation and 1% cash back on any other purchases throughout the year. Additionally, newly approved applicants will receive a 0% intro APR period on purchases and balance transfers for 14 months (after that, a variable rate of 13.74% – 24.74% applies, balance transfer fee of 3 percent of the amount transferred; up to 5 percent fee on future transfers (see terms)), giving you a window to flourish with cash back earnings while avoiding tacked on interest.

Here’s the kicker: No matter the amount, Discover will match the amount of cash back you earn in the first year, meaning that your 5% bonus categories are really rewarding you with 10% — all interest-free. Thanks to these perks, your first year as a Discover it Cash Back cardholder is an opportunity to earn serious cash back with some not-so-costly spending.

You should know that your earnings in the highest cash back category are limited. Once you’ve hit $1,500 of quarterly spending in your bonus category, your cash back rate will drop to the standard 1%.

Luckily, the Discover it Cash Back’s full 2019 bonus category schedule is available:

  • January – March: Grocery stores
  • April – June: Gas stations, Uber and Lyft
  • July – September: Restaurants and PayPal
  • October – December: Amazon.com, Target and Walmart.com

It’s extremely important that you activate your bonus each quarter, meaning you’ll have to sign up to receive the 5% cash back opportunity. Discover offers automated reminder emails, so you’ll want to keep an eye out for them to remember to register via your online account.

The Discover it Cash Back has several other associated benefits, such as no penalty APR, no annual fee, no foreign transaction fees, no fee for your first late payment and you can cash out at any time because there’s no minimum redemption. With these added features, significant bonuses and an alluring promotional offer, this card is a good fit for anyone interested in earning cash back.

Chase Freedom

With 5% cash back in rotating categories, $1,500 limits on bonus categories and a 15-month 0% introductory APR period on purchases and balance transfers, the Chase Freedom card is very similar in its rewards profile to the Discover it Cash Back. While you won’t be matched on your first year’s earnings, Chase will reward you with $150 back after spending $500 in your first 3 months.

The cash back earning works the same, with 5% earning in assigned categories and 1% earning on purchases elsewhere. Here’s the 2019 categories for the Chase Freedom:

  • January – March: Gas stations, tolls and drug stores
  • April – June: Grocery stores and home improvement stores.
  • July – September: Gas stations and select streaming services.
  • October – December: Department stores, Paypal and Chase Pay.

With the Chase Freedom card, you can still receive reminders of each category change and will need to activate your 5% cash back each quarter. You can do this online, via email, over the phone, or at a Chase branch or ATM.

The Chase Freedom card has a high variable APR after the promotional period is up, but there are several long-term benefits to combat the high interest rate. Featuring no annual fee, anytime redemption, rewards that don’t expire and access to Chase’s Ultimate Rewards portal, this card is a great option for anyone who wants cash back rewards or someone looking to maximize their Ultimate Rewards Points-haul by adding another card from the Chase family.

Making these cards work for you

With the nature of rotating category cards, you may be interested in another card to work alongside it. Your earnings are maximized in a few categories per quarter, so a card with complimentary rotating rewards or a high flat-rate cash back card could be a suitable partner to earn more. Thanks to the fact that a lot of cash back cards don’t charge annual fees, you’ll have plenty of options to earn extra rewards at no additional cost, if you can stay organized.

For example, say you have three cash back credit cards. Two of them have rotating bonus categories and one is a flat-rate cash back card. If you plan ahead of time to be sure the rotation schedules are different, you’ll have access to 5% cash back across a few categories each quarter. Additionally, a good flat-rate card – like the Citi Double Cash Card (a NextAdvisor advertiser) – will earn 2% on your leftover purchases (1% when you make a purchase, plus another 1% when you pay for the purchase), so by using the right card for the right purchases, you can maximize your cash back potential.

The Chase Freedom is a great card to be coupled with other Chase options. By pairing with the Chase Sapphire Preferred Card you can pool your points in the Chase Ultimate Rewards portal, where points receive a percentage boost – 25% for Chase Sapphire Preferred cardholders and 50% for Chase Sapphire Reserve cardholders – when redeemed for travel through the Chase Portal. You’ll have to be on top of things to be sure you’re using the right card at the right places, but with some discipline, you can boost your rewards rate and turn cash back bonus categories into a means to pay for other desired purchases.

The Discover it Cash Back can be used similarly, but you don’t have the option to earn bonus rewards by pairing with other Discover cards. A flat-rate cash back card like the Citi Double Cash Card or another rotational category card would still be a great pair, but the Discover it Cash Back card has standalone value regardless.

There are a couple of things to keep in mind when spending with a rotating category card. It may be tempting to take full advantage of the bonus category each quarter, but be careful not to overspend. As best you can, you should track your quarterly spending as well as restraining from making any over-the-top purchases. Additionally, carrying multiple cards and a changing schedule can make it tough to sort out the categories that are most lucrative with each, so it can be helpful to carry a reminder of this quarter’s bonus categories or keep the information readily available on your phone.

When are rotating categories not for you?

If you’re looking to earn cash back but keeping track of your payments on a strict schedule seems overwhelming, there are still options for you.

One great choice is the Blue Cash Preferred Card from American Express (a NextAdvisor advertiser), offering 6% cash back at U.S. supermarkets (up to $6,000 in purchases annually, then 1%) and 3% cash back at U.S. gas stations and on transit all year long. You’ll still be capped with how much you can earn from U.S. supermarkets at 6% ($6,000 limit), so you’re not off the hook when it comes to keeping an eye on how much you’re spending. The good news is there’s no need for remembering your category seasons.

2 things to remember to maximize rotating categories

Reaching your full potential with a rotating category card can be difficult, so let’s cover a few of the most important things to keep in mind:

  1. Remember to activate: If your card provider requires that you register/sign up every quarter to be given access to your bonus category, set a reminder. Some credit issuers will let you activate retroactively, but don’t bank on it. Taking advantage of the bonus category is vital when getting the most out of your card.
  2. Don’t overspend: The 5% cash back categories will be tempting to maximize but don’t feel as though you have to reach the limit every quarter if it forces you to overspend or spend on things you don’t need. That doesn’t mean you will never get to the limit, but don’t burn into some savings just to hit a category threshold.

A rotating category card will certainly take some self-control and organization, but with the right roadmap, you’ll find the fastest route to substantial cash back earnings.