Credit cards are almost required to function in this modern world. Since we are forced to be cogs in the capitalist machine, why not get a few benefits? Cashback credit cards can earn Generation X a significant amount of money back on purchases they would have already made anyway.

If the average Gen X member uses cashback credit cards for most or all spending, they can make anywhere from 1%–6% cash back. Not to mention sign-on bonuses and extra benefits. These rewards can be used to pay off debt, applied as statement credit, deposited straight into your bank account, and more. This is tax-free money just sitting on the table, waiting for you to earn it.

Gen X Age and Shopping Habits

People born from 1965–1980 are known as Generation X. They were the first generation of women who had access to bank accounts and credit cards without a man’s permission, the first generation to have more wealth than their children ever will, and the generation with the highest average annual expenditure by at least $20,000. Around 70% of this population own homes, and 92% own or lease at least one vehicle. The average income of a Gen X household is $126,892, with an average yearly expenditure of $91,382.

Gen X doesn’t believe that brands should engage with social issues, they shop in physical retail stores most often, but are omnishoppers, meaning that they are active online and in physical stores. Generation X is full of tech-savvy individuals, they are the generation that birthed the internet, after all. So many will research their purchases online but still prefer to purchase those items in-store. Gen X prefers to be a part of loyalty programs, and email marketing, and values personalized offers.

Types of Credit Cards

Generation X loves rewards, loyalty programs, and discounts, which is why cashback credit cards suit their shopping habits particularly well. No matter what kind of shopping you do, the good news is that there are three different types of Cashback credit cards that you can choose from.

The first type, and probably the most lucrative for Generation X shopping habits are Tiered, or Bonus Category cards. These cards offer different levels of cashback ranging from 1% to as high as 6% or even 8%. The highest bonus categories can be a specific category such as groceries, or a specific big box store, such as Amazon or Target. It could also earn you more cashback to purchase from specific restaurants, big-box stores, or airlines. It just depends on the card carrier and who they are partnered with. Store credit cards fall under this category.

One of the more labor-intensive cards but possible with the maximum amount of customized benefits is a Rotating Category Card. With this card, categories are sorted into different cashback reward amounts like the previous card, but the top earning categories change quarterly. You can activate or select the specific bonus categories with some cards, while others are assigned to you. Although this type of card requires some planning, the benefits can be quite good for those who put in the work.

These cards take a little strategy, as the categories can rotate quarterly. For example, in January, you could be earning 5% cashback Gym Memberships and United Airlines. By July, the 5% could switch to Target and gas stations. The goal of this type of card is to earn the highest amount of cashback possible on the categories you personally spend the most on. It is a great way to customize your rewards and is another way to maximize and customize your purchases.

One of the drawbacks of these cards, and what makes them tricky is that some require you to manually activate the bonus categories each quarter. They also typically have a spending cap that the highest rewards apply to. So usually, your top earning quarterly bonus category is capped at $1,500 per quarter (or $300 annually). Often, these types of cards can come with other cash benefits such as end-of-year matching up to a certain number, and generous sign-on bonuses. It’s essential to carefully read the terms and conditions to fully understand the bonuses and typical fees of these cards.

The most basic kind of cashback card is a flat rate card. No hassle, no fuss, this type of card typically offers 1%-3% cashback on every single purchase you make. For Generation Xers on the go, this could be the card for you. Another great bonus is that these cards typically don’t carry any annual fees, and have generous sign-on bonuses, sometimes up to $300.

What Card is Right for You?

The good thing about the different types of cashback cards is that you truly can customize them to fit your spending habits. Most economists suggest that for those with good credit, having a few different cards (usually less than 5), is a healthy way to build credit and maximize your rewards, as long as you are paying back your monthly minimums.

It is also wise to consider if you will need to make any large purchases such as appliances, vehicles, furniture, or vacations in the near future. Opting for a card that will give you the highest percentage of cashback possible for your largest purchases can help you decide where your focus should be. Not planning on making any large purchases? A flat-rate cashback card might be the everyday card you are looking for. Looking to rack up travel points? There are several cards on the market that can help you do that. Concerned about grocery prices? Cards exist that can earn you as high as 3%-6% on your grocery needs. The wonderful thing about rewards programs, especially cashback, is that they are truly customizable. Not sure where to start? Sometimes consulting with an accountant can take out the guesswork and make logical decisions based on our actual spending habits, not just our idealized ones.

Average annual spending for Gen-X per household in 2022:

• Housing: $26,722
• Healthcare: $6,372
• Personal Insurance and Pensions: $13,001
• Groceries: $6,837
• Dining Out: $4,798
• Alcohol: $645
• Pets: $886
• Utilities: $3,685
• Transportation: $12,235
• Gasoline: $4,001
• Cell Phone: $1683
• Entertainment: $4,330
• Apparel: $2,604
• Personal Care Products and Services: $1,052
• Housekeeping Supplies: $924
• Furniture: $3,355
• Miscellaneous: $6,921
• Travel: $3,009
• Total Besides Housing, Healthcare, Personal Insurance, and Pension: $47,661

For simplicity, we are removing Housing, Utilities, Insurance, and Pension from these calculations because many providers of these services may not accept credit card payments. So, using our Sample Gen X budget, we will illustrate how much money cash-back credit cards can earn Gen X individuals.

Amazon Prime Visa

• Good For: Amazon and Whole Foods Brand Loyalists
• Type: Tiered
• Annual Fee: $0
• Cashback Rate: 1%-5%
• Intro Offer: $100 Amazon Gift Card (for Prime Members)
• Intro APR: 0% for 6 months
• Regular APR: 19.74%-28.49% Variable APR
• Sample Budget Cashback: $1,386.82

If you enjoy brand loyalty, and you are especially loyal to Amazon and Whole Foods, this might be a great card for you! This card has two versions: The Prime Membership Visa and the Amazon Visa. We will discuss the benefits of the Prime Membership Visa. The latter doesn’t require a Prime Membership, and the cashback isn’t quite as beneficial, but still good. A benefit of this card is that you can receive the benefits in the form of Amazon points ($1=100 points), deposited into a Chase checking or savings account, travel, gift cards, and statement credit.

Some other benefits to this card include shopping protections such as extended warranty, purchase protection, travel accident insurance, baggage delay insurance, roadside dispatch, auto rental collision damage waiver, travel and emergency assistance, and access to the Visa Signature Luxury Hotel Collection. A bonus for frequent travelers is that there is no foreign transaction fee. Prime memberships cost $139 annually or $69 annually for students.

The cashback tiers go as follows:

10% on select rotating items and categories on Amazon.com

5% back at Amazon.com, Amazon Fresh, Whole Foods Market, and Chase Travel

2% back at gas stations, restaurants, local transit, and rideshare apps

1% back on every other purchase

Sample Budget:

5%

• Groceries (Whole Foods Market only): $6,837
• Alcohol: $645
• Travel: $3,009
• Pets: $886
• Furniture: $3,355
• Housekeeping Supplies: $924
• Apparel: $2,604
• Personal Care Products: $1,052
• Total: $19,312 x 0.05=$965.60

2%

• Dining Out: $4,798
• Gasoline: $4,001
• Total: $8,799 x .02= $175.98

1%

• Cell Phone: $1,683
• Transportation: $12,235
• Utilities: $3,685
• Miscellaneous: $6,921
• Total: $24,524 x .01=$245.24
• Total Cash Back: $1,386.82

U.S. Bank Shopper Cash Rewards Visa Signature Card

• Good For: Big Box Shopping
• Type: Bonus Category
• Annual Fee Intro: $0
• Regular Annual Fee: $95
• Cashback Rate: 1.5%-6%
• Sign-on Bonus: $250
• Intro APR: N/A
• Regular APR: 18.74%-28.74% Variable
• Sample Budget Cashback: $1,471.58

This card is wonderful for Generation Xers who have brand loyalty and prefer the reliability of major retailers. It has a generous sign-on bonus of $250, and $0 annual fee for the first year, and then $95 per year after that. For shoppers that like the following 24 brands such as Apple, Disney, Home Depot, Target, Amazon, Best Buy, Ikea, Lululemon, Macy’s, Williams Sonoma, Anthropologie, Kohl’s, Pottery Barn QVC, and more, this card is wonderful.

The biggest benefit of this card is that you can choose two retailers from the list of 24 as your 6% bonus and one retailer for your 3% “every day,” category up to $1,500 (then reverts to 1.5% back after that). These choices are bills, gas stations, and wholesale clubs like Costco and Sam’s Club. If you are looking for cash-back benefits from paying home bills like utilities, internet, cell phone bills, and even streaming services, this is potentially one of the only cards that allows that option.

The cashback rewards tiers are as follows:

6%: Chosen two retailers

6%: Rental cars and hotel reservations booked through Visa Rewards Center

3%: Choose one category

1.5%: Everything else

Sample budget (If we choose a grocery and apparel for our two categories each quarter):

6%

• Travel: $3,009 X 0.06= $180.54
• Groceries: $396 X 0.06= $23.76
• Apparel: $2,604 X 0.06= $156.24

3%

• Groceries: $6,441 X 0.03= $193.23

1.5%

• Dining Out: $4,798 X 0.015= $71.97
• Alcohol: $645 X 0.015= $9.81
• Pets: $886 X 0.015= $13.29
• Utilities: $3,685 X 0.015= $55.27
• Transportation: $12,235 X 0.015= $183.52
• Gasoline: $4,001 X 0.015= $60
• Cell Phone: $1683 X 0.015= $25.24
• Entertainment: $4,330 X 0.015= $64.95
• Personal Care Products and Services: $1,052 X 0.015= $15.78
• Housekeeping Supplies: $924 X 0.015= $13.86
• Furniture: $3,355 X 0.015= $50.32
• Miscellaneous: $6,921 X 0.015= $103.80

Wells Fargo Active Cash Card

• Good For: Families, Travelers
• Type: Flat Rate
• Annual Fee: $0
• Cashback Rate: 2%
• Sign-on Bonus: $200
• Intro APR: 0%
• Regular APR: 19.24%–29.24% Variable
• Sample Budget Cashback: $1,153.22

For this Wells Fargo flat-rate card, the user gets 2% back on every purchase. In addition to that, there is a low balance fee and foreign transaction fee of 3%. It is easy to use, and pairs really well with other cards. If you are planning on only getting a single cash back card, you might want to opt for a bonus category or rotating bonus category.

Cash back can be redeemed via debit card, direct deposit into a Wells Fargo account, ATM withdrawal, statement credits, and a mailed check. Some other benefits include Access to the Visa Signature Luxury Hotel Collection, the Visa Concierge, and cell phone protection.

This card is technically issued by Visa, which gives the cardholder access to some of Visa’s signature benefits. The Visa Concierge Service offers free access to help with travel planning, finding entertainment tickets, making reservations, and even purchasing gifts. The assistance is complimentary, but you still have to pay for anything you buy.

You are also entitled to the Visa Signature Luxury Hotel Collection. This gives you access to over 900 luxury hotels and resorts from around the world, with many priced at under $299 per night. Cardholders are entitled to 7 premium benefits such as complimentary breakfast, Wi-Fi, VIP guest status, late checkout, automatic room upgrade, $25 food and beverage credit, and of course, the best available rate possible guarantee. It doesn’t stop there! There are often discounts and special deals on the Visa Luxury Hotel Collections website such as every 4th night free and other limited time offer hotels. Simply enter your destination information and Visa will do the rest.

Sample budget:

• Spending total: $47,661 x .02= $953.22

Discover it Cash Back

• Good For: Cashback Match
• Type: Rotating Categories
• Annual Fee: $0
• Cashback Rate: 1%–5%
• Sign-on Bonus: Unlimited Cashback Match
• Intro APR: 0%
• Sample Budget Cashback: $1,433.22

This Discover card is one that you can get the most out of if you are someone who can remember to activate bonus categories. The bonus categories on this card tend to be one broad category, such as restaurants, paired with a specific retailer such as Target. The downside is that you can’t pick your own 5% category, each one is already chosen for you. This could be seen as a challenge to some and a drawback for others. The major benefit to this card is the cashback match, with a caveat being that you must keep your account open and enrolled in the reward program at the time your cashback is calculated at the end of 12 billing cycles. So, this card requires a full-year commitment to reach its full benefit. 

The bonus categories cap out at $1,500 purchases a quarter for a total of $75 per quarter totaling $300 annually. After that, everything returns to a flat rate of 1%, which is not the highest flat rate in existence. If you use this card strategically with a higher flat-rate card or other type of card, you will get the most out of it. Let’s say that our sample Gen Xer only uses this card. The math goes as follows:

• 5% tier: $6,000 X .05= $300
• 1% tier: $41,661 X .01= $416.61
• Cashback Match: $1,433.22

Chase Freedom Unlimited

• Good For: Travelers, Dining Out
• Type: Bonus Category
• Annual Fee: $0
• Cashback Rate: 1.5%–5%
• Sign-on Bonus: $300
• Intro APR: 0%
• Regular APR: 19.74%–28.49% Variable APR
• Sample Budget Cashback Total: $1,187

The Chase Freedom Unlimited has an excellent bonus offer of an additional 1.5% cashback flat rate on all purchases up to $20,000 spent. This is equivalent to up to $300 cashback. It is also an attractive option for the extended 0% APR rate for up to 15 billing cycles. An additional offer through March 31, 2025, is 5% back on Lyft services. The other category cashback rewards are as follows:

5% Back on Travel

3% back at restaurants, takeout, and drugstore purchases

1.5% on everything else

There is a 3% foreign transaction fee, which is pretty standard. Another added bonus is that you will receive a free DashPass from DoorDash for three months, and then a discount for the following 9 months. You will also receive a $10 credit for one DoorDash order per quarter. This is a great everyday card.

Cashback redemption comes in the form of Chase Ultimate Rewards Points. For Chase Ultimate Rewards Points, one point equals one penny when redeemed for cashback. You can also redeem your points through Chase travel, and Amazon purchases (at .8 cents per point). These points can also be transferred to other Chase cards, such as the Chase Sapphire Preferred Card and the Ink Business Preferred Card which converts each point into 1.25 cents when redeemed for travel. Or even transferred to the Chase Sapphire Reserve Card, where points can be redeemed for 1.5 cents a piece when booking travel. This card could be the first step to maximizing your Chase Trifecta!

If you’ve never heard of the Chase Trifecta, you aren’t alone. Some might call it the secret to getting the most value for travel. With the Chase Freedom Flex, Chase Freedom Unlimited, and the Chase Sapphire Reserve, you can get 5% back on bonus categories, tiered rewards of the Sapphire Reserve for dining and travel, and then use the 1.5% flat rate for everything else. This trifecta is only for those who want a points-collecting hobby and isn’t that straightforward. You also would need to exclusively book travel through Chase, which might not give you the best deals. But still, for serious travelers, this trifecta might really push you places.

Sample budget:

5%

• Travel: $3,009 X .05= $150

3%

• Dining Out: $4,798
• Alcohol: $645
• Personal Care Products: $1,052
• Housekeeping Supplies: $924
• Total: $7,419 X .03= $222.57

1.5%

• Groceries: $6,837
• Pets: $886
• Utilities: $3,685
• Gasoline: $4,001
• Cell Phone: $1683
• Entertainment: $4,330
• Furniture: $3,355
• Apparel: $2,604
• Miscellaneous: $6,921
• Total: $34,302 X 0.015= $514.53
• Sample budget cashback with bonus: $1,187

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