Cashback cards are notorious for offering attractive cashback percentages, but hidden in the fine print is an extremely low spending cap. For example, the DBS Live Fresh Card offers a 5% cashback on a S$600 minimum monthly spending. However, because it is capped at S$60 per month, any spending above S$1200 does not earn you this 5% rate. In fact, using our example of a S$5k expense, the cashback that you would obtain (if you charged the whole amount to DBS Live Fresh Card) would only be S$71.40.
So what is the best strategy for a S$5k expense?
Without any additional information about the type of spending and its merchant cateory code, in my experience, the best strategy is to go with a credit card that does not cap the cashback amount. These generally have a lower cashback percentage (1.5%) compared to higher cashback cards like DBS Live Fresh Card, but with a higher total spending, the cashback is much higher. For example, a 1.5% cashback on the entire S$5k expense is S$75, which is higher! But wait! If you do not currently have this credit, then you can apply and get much more rewards!
So what is this credit card?
It is none other than the American Express True Cashback Card!
In my opinion, this is the best cashback strategy for a S$5k expense, because there within the first 3 month of your successful application, you would get a bonus 1.5% cashback, for a total of 3% cashback. This doubles the cashback from Standard Chartered or HSBC to a whopping S$150. Moreover, if you sign up for this card through our affiliate link above, you would be eligible for an additional $60 Capitaland voucher from Amex, S$30-S$100 Grab voucher from Singsaver (both conditional upon S$500 spending on the first month of receipt of your credit card) and $20 of Capitaland vouchers by using MyInfo (a new service by the government to pre-fill your application).
This means that you can get up to S$330 of total rewards for a S$5k expense, which is 6.6% and the highest absolute cashback in terms of dollar amount.
Therefore, in my opinion, signing up for a new American Express True Cashback Card! is the best credit card spending strategy for an upcoming expense valued at S$5k or more.
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