# How much cash back will I earn?

Works out the cash back a credit card pays a month and a year on your spending in each category, the net after the annual fee, the first year with a bonus, and your effective cash back rate.

- Page: https://www.acalculator.org/finance/cash-back-calculator
- JSON spec: https://www.acalculator.org/finance/cash-back-calculator.json
- Version: 55ff259949b3

## Default answer

Example with the default inputs (Spending by category [Spent a month $600.00, Cash back rate 3%; Spent a month $200.00, Cash back rate 2%; Spent a month $1,500.00, Cash back rate 1%], Annual fee $0.00, Sign-up bonus $200.00): Spending $27,600.00 a year earns $444.00 of cash back, $444.00 after the annual fee.

## Inputs

| Key | Label | Description |
| --- | --- | --- |
| categories | Spending by category | What you spend on the card each month in each category, and the cash back rate for it. |
| fee | Annual fee | Optional: the card’s yearly fee. |
| bonus | Sign-up bonus | Optional: a one-time bonus you expect to earn in the first year. |

## Outputs

| Key | Label | Description |
| --- | --- | --- |
| yearly | Cash back a year | 12 × the monthly cash back. |
| monthly | Cash back a month | Σ(spent a month × rate) over the categories. |
| net | Net a year after the fee | Cash back a year minus the annual fee. |
| first | First year with the bonus | Net a year plus the sign-up bonus. |
| spend | Spent a year | 12 × all the monthly spending. |
| effective | Effective cash back rate | Cash back a year ÷ spent a year. |
| breakEven | Spending a year to cover the fee | The annual fee ÷ the effective rate: what you must spend in the same mix to earn the fee back. |

## Method

monthly = Σ(spend × rate ÷ 100); yearly = 12 × monthly; net = yearly − annual fee; first year = net + bonus; effective = yearly ÷ (12 × Σ spend); break-even spending = fee ÷ effective.

## Assumptions

- You pay the balance in full every month. Interest on a carried balance is not included.
- Rates apply to all the spending in each category. Spending caps, rotating categories and rewards that are worth less when redeemed are not modelled.

## Worked examples

1. categories = {"spend":600,"rate":3} or {"spend":200,"rate":2}, fee = $0.00, bonus = $200.00 gives monthly = $37.00, yearly = $444.00, net = $444.00, first = $644.00, spend = $27,600.00, effective = 1.608696%. Source: Consumer Financial Protection Bureau, CFPB Report Highlights Consumer Frustrations with Credit Card Rewards Programs (hidden conditions, devaluation; nearly 1 in 10 reward dollars come from sign-up bonuses), https://www.consumerfinance.gov/archive/newsroom/cfpb-report-highlights-consumer-frustrations-with-credit-card-rewards-programs/ (retrieved 2026-10-03).
2. categories = {"spend":2000,"rate":1.5} or undefined, fee = $95.00 gives yearly = $360.00, net = $265.00, effective = 1.5%, breakEven = $6,333.33.
3. categories = {"spend":333.33,"rate":5} or {"spend":0.1,"rate":2}, fee = $550.00, bonus = $0.00 gives monthly = $16.67, yearly = $200.02, net = -$349.98.

## FAQ

### How is cash back calculated?

Multiply each category’s spending by its rate and add them up. $600 of groceries at 3%, $200 of gas at 2% and $1,500 of other spending at 1% earn $18 + $4 + $15 = $37 a month, or $444 a year.

### Is a card with an annual fee worth it?

Compare the net after the fee. A flat 1.5% card on $2,000 a month earns $360 a year; with a $95 fee that is $265. You would need to spend $6,333 a year in the same mix just to earn the fee back.

### What is the effective cash back rate?

Your yearly cash back divided by your yearly spending. The default mix earns $444 on $27,600, an effective 1.61%, even though one category pays 3%.

### Does the sign-up bonus count?

Only in the first year, so the page shows it separately. The CFPB found that nearly 1 in 10 reward dollars come from sign-up bonuses, and that rewards can come with hidden conditions or lose value.

### What if I carry a balance?

The calculator assumes you pay in full each month. Interest on a carried balance is not included and can cost more than the cash back you earn; see the credit card interest calculator.

### What does the calculator leave out?

Spending caps on bonus categories, rotating categories, and points that are worth less than face value when redeemed. Read the card’s terms for these.

## Sources

- Consumer Financial Protection Bureau, CFPB Report Highlights Consumer Frustrations with Credit Card Rewards Programs (2024). https://www.consumerfinance.gov/archive/newsroom/cfpb-report-highlights-consumer-frustrations-with-credit-card-rewards-programs/ (retrieved 2026-10-03)