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How to Get Cash Back with a Credit Card

In addition to their other features and benefits — like quick access to credit when you need it, and fraud protection — many credit cards reward you by giving you back a certain percentage of your spending in rewards points, sometimes described as cash back. It's one of the credit card perks you might want to consider when shopping for a card.

To help you make the most of your cash back card, let's look at the mechanics of how to get cash back with a credit card, as well as some things to keep in mind when comparing cash rewards offers.

What is cash back on a credit card?

Credit cards offer a variety of features and benefits, such as balance transfer promotional offers and rewards like miles or points earned on eligible purchases that can be redeemed for travel and other options. One popular benefit is cash back.

You earn a certain percentage of the eligible purchase price, typically from 1% to 5% as rewards.

"Cash back" doesn't mean money in your pocket immediately. After the eligible purchase has been fully processed, the credit card issuer will show your cash back reward on next your monthly statement or online account within a certain number of weeks per the issuer's policy.

How to earn cash back rewards

Now, let's look at how these rewards are generated. Some cards offer a flat percentage of your purchase in every category, whether you're booking an airline ticket or putting gas in the car.

Some reward you with a higher percentage for specific types of purchases (gas, groceries, travel) or shopping at certain retailers. And some let you pick your favorite categories for cash back and give you rewards just on those.

Some cards offer rewards on a rotating basis, changing the top rewards categories every quarter. For example, you might earn 5% on gas and groceries from January to March, then 5% at restaurants and drug stores from April to June. You'll want to pay attention to this calendar of bonus cash back offers to maximize your benefits.

Cash back cards may limit how much you can receive back in awards. For example, you may receive 3% cash back at grocery stores for up to $5,000 in purchases annually — that's $150. But if you exceed that spending cap, the cash-back percentage might drop to a lower percentage. When shopping for a credit card, examine the terms and conditions to choose the card that can give you the most benefits.

When will you see your cash back?

As you earn cash back rewards, you can generally see them on your monthly credit card statement, where you can keep track of them and know how much you're accumulating.

Today, many credit card holders use online platforms to monitor credit cards in addition to reviewing their monthly statements. Besides checking your statement to make sure your purchases are being included accurately and that you're remaining well within your credit limit, you can typically check your rewards too on your issuer's rewards platform.

How to use your cash back rewards

When you're accumulating points or miles toward travel, it can be complicated to use them. Blackout dates and limited availability might restrict your use of rewards. Getting cash back can make things simpler.

The terms and conditions for your credit card should give you the options for using, or redeeming, your cash rewards. These are some of the possibilities.

  1. Cash. You may be able to deposit rewards directly
    into your bank’s checking account or savings account

  2. Statement credit. Use your credit card perks to offset your monthly purchases, so you have less to pay back on the card

  3. Purchases at online retailers. Your card may enable you to use your cash back when making online purchases at, for example, Amazon

  1. Merch and gift cards. Your bank or credit card company may direct you to a special website where you can order gift cards or use your rewards to buy merchandise

  2. Charitable donations. Some card issuers have charitable partnerships that allow you to support your favorite cause

How to decide on a cash back card

When you decide to apply for a cash back card, think about your spending habits and how you can best use the cash back feature of your card. Here are some questions to ask.

  1. Are there any introductory offers? Some credit cards will give you a more generous cash back percentage for as long as 12 months after you first set up your account. You might also receive bonus cash back if you spend a certain amount of money within a given time

  2. What are the purchasing limits? You may want to find a card that puts a very high ceiling on the purchasing limit for your most frequent purchases or has no limits at all

  3. Can I choose my spending categories? Some cash back cards let you specify where you want to earn your rewards

  1. Is it a flat-rate percentage, or does it vary? Some cards offer a flat percentage reward on all eligible purchases year-round, which can be easy to manage. On the other hand, there could be a rotating calendar of special, higher cashback offers. Will you be able to keep track of them to get the greatest rewards?

  2. What are the options for redeeming cash back rewards? Look for a card that provides a wide range of ways you can use your cash back

"Cash back" vs. "cash advance"

As we've seen, cash back cards reward you with cash back rewards on purchases. Your credit card might also give you immediate access to cash, which is called a cash advance. This is when you withdraw money against your credit limit. It's important not to confuse the two.

Your credit card has a credit limit as well as a "cash advance limit," which may be lower than the credit limit. This means you can borrow up to that much, in cash, with your credit card.

This can be helpful at times, but there could be a cash advance fee, calculated as a percentage of the advance. Also, the annual percentage rate (APR) on cash advances tends to be higher than your APR for purchases and interest typically begins accruing immediately when you take out the cash.

Credit Cards offered at TD Bank

The right credit card account from TD Bank can help you achieve your financial goals and earn rewards.

This article is for general informational purposes only. It is not intended to provide specific financial, investment, tax, legal, accounting, or other advice and should not be acted or relied upon without the advice of a professional advisor. A professional advisor will recommend action based on your personal circumstances and the most recent information available.

TD Double Up Credit Card
*Read important Credit Card Terms and Conditions for details about rates, fees, eligible purchases, balance transfers and rewards program rules. If you take advantage of a 0% introductory or promotional Annual Percentage Rate (APR) balance transfer offer and then use your Account to make new purchases, you can avoid paying interest on those new Purchases if you pay each month by the payment due date the “Payment to Avoid Purchase Interest” amount shown within the ‘Payment Information’ box on your Account Statement.

TD Cash Credit Card
*Read important terms and conditions for details about rates, fees, eligible purchases, balance transfers and rewards program rules. If you take advantage of a 0% introductory or promotional Annual Percentage Rate (APR) balance transfer offer and then use your Account to make new purchases, you can avoid paying interest on those new Purchases if you pay each month by the payment due date the “Payment to Avoid Purchase Interest” amount shown within the ‘Payment Information’ box on your Account Statement.

TD FlexPay Credit Card
*Read important terms and conditions for details about rates, fees, balance transfer rules. If you take advantage of a 0% introductory or promotional Annual Percentage Rate (APR) balance transfer offer and then use your Account to make new purchases, you can avoid paying interest on those new Purchases if you pay each month by the payment due date the “Payment to Avoid Purchase Interest” amount shown within the ‘Payment Information’ box on your Account Statement.

TD Clear Visa Platinum Credit Card with a $1,000 Credit Limit
*Read important terms and conditions for account details. The Clear Platinum Visa Credit Card with $1,000 Credit Limit has a $10 monthly membership fee. The monthly membership fee will be added to your monthly billing statement each month as a charge, whether or not you use your account, and applied against your available credit like other charges.

TD Clear Visa Platinum Credit Card with a $2,000 Credit Limit
†Read important terms and conditions for account details. The Clear Platinum Visa Credit Card with $2,000 credit limit has a $20 monthly membership fee. The monthly membership fee will be added to your monthly billing statement each month as a charge, whether or not you use your account, and applied against your available credit like other charges.

TD First Class Visa Signature Credit Card
*Read important Credit Card Terms and Conditions for details about rates, fees, eligible purchases, balance transfers and rewards program rules. If you take advantage of a 0% introductory or promotional Annual Percentage Rate (APR) balance transfer offer and then use your Account to make new purchases, you can avoid paying interest on those new Purchases if you pay each month by the payment due date the “Payment to Avoid Purchase Interest” amount shown within the ‘Payment Information’ box on your Account Statement.

1Bonus miles will be reflected on your credit card statement 6 to 8 weeks after a qualified first purchase and/or 6 to 8 weeks after $3,000 in total net eligible purchases made within the first 6 billing cycles of your credit card account opening date. This offer is non-transferable. This One-Time Bonus Offer is not available if you open an account in response to a different offer that you may receive from us or if you previously received a One-Time Bonus Offer on this account or any other account with us. Eligible purchases do not include purchases of any cash equivalents, money orders, and/or gift cards or reloading of gift cards. Groceries purchased from superstores and/or warehouse clubs may only earn 1 mile for each dollar spent.

TD Cash Secured Credit Card
*Read important Credit Card Terms and Conditions for details about rates, fees, eligible purchases, balance transfer and rewards program rules. Eligible purchases do not include purchases of any cash equivalents, money orders, and/or gift cards or reloading of gift cards.

TD Business Solutions Credit Card
*Read important terms and conditions for details about rates, fees, eligible purchases, balance transfer and rewards program rules. The person applying for the account is individually liable for the payment of all balances on the account and all cards issued pursuant to this application.

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