Why Don't Credit Card Cashback Rates Stay High?

[codeberg]

This is something people notice quickly.

You might see offers like 1% or even 5% cashback at the start, but over time they drop to something like 0.25%.

This happens for a few reasons.

First, introductory offers are used to attract new customers. Once you are signed up, the provider no longer needs to incentivise you as heavily.

Second, profit margins on card spending are not huge. Banks make money from fees charged to retailers and from interest on customers who do not pay in full. They cannot afford to give away high percentages long term.

Third, competition keeps rates in a narrow range. Most standard cashback cards settle around 0.25% to 1% because anything higher long term would not be sustainable.

That is why the real strategy is to take advantage of intro bonuses and combine them with other methods rather than relying on one card forever.

[QuantumKnight]

OP Thanks for posting. Interesting post.

[codeberg]

I wish it was higher

[QuantumDay]

Ditch and switch as martin lewis would say/do

[Quanta]

Definitely mate. Need a better one before i book Egypt in September

[codeberg]

Solid point, that matches what I ran into. Let us know how it goes.

The best savings rates are usually not advertised, you have to look.

[VB]

This is something people notice quickly. You might see offers like 1% or even 5% cashback at the start, but over time they drop to something

I don't know, I had a different experience. Definitely worth picking up.

[Totally]

That is one way of looking at it. Legend.

[QuantumDay]

That is one way of looking at it. Ha, yeah that is about right.

Proper useful that.

[VB]

Kind of depends I think. Might go back to it.

[QuantumKnight]

Feels like the right read on it. There is usually a quieter more important story sitting just behind the obvious headline.

Worth watching closely.

A cashback card you pay off every month is one of the easiest wins.

[VB]

That is one way of looking at it. Legend.

Yeah that sounds about right. Would recommend giving it a go.

[codeberg]

That checks out from what I have seen. I always start with the free and non-destructive fixes before considering anything drastic.

Let us know how it goes.

[QuantumDay]

That is one way of looking at it. Good stuff.

[KnotKnull]

I would only bother if the saving is real and not just headline nonsense. Cheers for sharing that.

Automating your savings so you never see the money is the most effective method for most people.

[MiniElliot]

I thought that at first but it changed after a few hours. Definitely worth picking up.

[VidiTechnica]

Cheers for that. Every time without fail.

Cheers.

Most people have at least one subscription they forgot about that could go.

[QuantumDay]

Yep, agree with that. Classic.

Ha, fair enough.

[Q]

Interesting, I had the opposite experience. Good stuff.

[GlassKnight89]

Same here really. Makes sense from what I have seen.

Cheers.

[KnotKnull]

That works if you are disciplined about it, most people are not. The switching bonuses are usually the best bang for almost zero effort.

I will keep an eye on it.

Automating your savings so you never see the money is the most effective method for most people.

[Seb51]

I wonder if that is the whole story or just the most obvious part of it. This is exactly the kind of conversation I come here for.

The ISA allowance is the easiest tax-efficient move most people ignore.

[Cobra69]

I would push back on that slightly. I have fixed more machines by doing less than by doing the obvious dramatic thing.

Should sort it if the basics are fine.

[Lazy Sentinel]

Same here really. Makes sense from what I have seen. Cheers.

Yeah I can see that now. Good to know, thanks.

[Sinead_47]

That works if you are disciplined about it, most people are not. The switching bonuses are usually the best bang for almost zero effort. I w

I would push back on that hard. Statistics tell part of the story but they never capture the full picture.

We will know soon enough.

Most people have at least one subscription they forgot about that could go.

[EventHorizon25]

I would push back on that slightly. I have fixed more machines by doing less than by doing the obvious dramatic thing. Should sort it if the

There is a bit more to it than that I think. Happy to help further if you get stuck.