The AMEX cash back card gieves back up to %5 if you carry a balance. I spoke to CS and they told me that you can get the cash back even if you carry a balance of a dollar. If I were to buy $20,000 of savings bonds i would get back %3 1/2 which comes out to around $600. even if i were to use a Starwoods card for june and july, that would net me 50,000 miles. i think that it would probably be better to do the cashback especially since you get 6 months interes free on it. can anyone help me on this? thank you.

Check the small print. On most cards, if you carry any balance, you lose your "grace period" on new purchases, and start paying interest from day 1. If you pay it off in 30 days, that could total 1.5% or so, depending on the interest rate.

ok but if i dont want the 6 months free and i pay up the $20000 i spent and i leave over one dollar than i should get 3 and a half percent does this make sense?

You will get 2% on Savings Bonds and other purchases except gas station, home improvement, drugstores and grocery stores if you carry a balance. These other purchases will net you 5%. You will get the monthly carry-over payback on your balance(s) for 6 months interest free when you first have the card. Don't leave a balance after that; it will never equal the interest you pay (if it did, we could all quit our day jobs ) p.s. That's once you've past the $6k threshold for lower tiered cash back.

Edited to add the p.s.



[This message has been edited by rox59 (edited 06-10-2003).]

i called customer service and they said that i can even carry over a balance of $1 and be eligible for the extra one and a half percent which would net me three and a half percent. there will be barely any interest paid on a balance of $1.

You will not pay interest on $1. You will pay interest on your Average Daily Balance.

Say you charge $20K and then pay off $19999 on day 15. Your ADB is (($20K * 15) + ($1 * 15))/30 ~= $10K. Multiply that by your monthly interest rate and that's what you'll get charged in interest. You'll see this hidden in there if you read the fine print on how finance charges are calculated.

I was told that you need to carry a balance for only one month once in an annual cycle to qualify for the extra 1.5%. The small print is very confusing probably intentional by AMEX

tzish,
Unless there is a different cash back AMEX, you are mistaken. Most charges earn 1 1/2% cashback plus an extra .5 for a carryover for a total of 2%. The other categories I mentioned earlier will earn you 3% plus an extra 2 for a total of 5%. This is only after reaching the $6,000 threshold (before it is .25% or .5% repectively for the first $2k in charges in those 2 different purchase categories, and then .5% or 1% for the next $4k = $25 for the first $6,000 worth of your Savings Bond purchase or $50 for say groceries)
You won't earn carryover $ for the first month; you'll get it after the second month and each subsequent month of carryover. You would want to pay off the charge by the billing date of month 6 as you'll get whacked for interest as was explained by StSebastian. And, if you left only that $1, in the 7th month you'd get 2% of $1.
However, if you're still skeptical, why don't you get it in writing and then try it the way the CSR has explained it to you?

Because the first 6 mos are free of interest, I have been carrying a balance. In the small print of my T&C, it says
"You will receive an additional 2.0% rebate for Everyday Purchases and .5% rebate for Non-Everyday Purchases posted to your Account in any billing period provided your Account is not in default."
So far, the money accumulates and posts every month to the statement, so you see it grow based on monthly statement fluctuations not annual.
Are we all talking about the same AMEX?

this is taken from the AMEX BLUE t&c page it sounds to me like all purchases are eligible for %2 extra if you carry a balance:
"Your annual cash reward for everyday purchases at stand-alone U.S. supermarkets, gas stations, drugstores, and home improvement stores is up to 3%. Stand-alone locations do not include the departments of superstores or warehouse clubs where the standard rebate of up to 1.5% applies. Your annual cash reward for all other purchases is up to 1.5%. You will receive an additional rebate of up to 2% in months in which your account carries a balance. Your cash rewards are limited to $50,000 of annual eligible spending. Balance transfers, purchases of American Express� Travelers Cheques or American Express� Gift Cheques and Cash Advances do not earn a cash back reward."

"up to"

QL

it says "up to" by all the rebates even the supermarket rebates

Non-everyday(Bond purchases) will get you up to 1.5%. You get the full 1.5% after you hit 6k in charges. You will also get the 0.5% non-everyday bonus for those months in which you carry a balance of any amount.

In summary, the total max cashback ever possible on a bond purchase(once you hit 6k in spending) is 2.0% ?

AMEX CSRs have told me incorrect info before, you gotta read all the fine print in your terms and conditions no matter what they say over the phone.