Common Categories

• Credit card companies offer rotating rewards on many common categories of consumer spending. Grocery stores, drugstores, gas, hotels, airfare, home improvement, charities, restaurants, department stores, movie theaters, health care, fitness and amusement parks have all appeared as bonus categories. Each merchant categorizes itself, so two similar stores could identify themselves as being in different categories for the purpose of the rotating categories.
  
  

Special Rewards

• When you make purchases in the rotating categories that are currently active, you get extra rewards on these purchases. For example, the Chase Freedom credit card offers 5 percent cash back on purchases in the active categories, as opposed to just 1 percent cash back on all other purchases. These rotating categories provide the opportunity to significantly increase your cash-back rewards.
  
  

Warning

• As of 2011, the Chase Freedom, Discover More and Citi Platinum Select credit cards all require card holders to sign up for the bonus in the rotating categories. If you do not sign up, you will not receive your extra cash back. You have to sign up through the credit card website each time the categories change. Some of the cards also enforce dollar limits on how much spending you can receive the high bonus on. For example, Chase Freedom only offers 5 percent cash back on the first $1,500 of purchases in the rotating categories each quarter.
  
  

Spending Strategy

• If you have a few different credit cards that have rotating categories for bonuses, you can spend strategically to maximize your rewards. For example, during the first quarter of 2011, Chase Freedom offered 5 percent cash back on grocery stores and drugstores; Discover More offered 5 percent cash back on travel and restaurants; and Citi Platinum Select offered 5 percent cash back on health care, drugstores and fitness. Someone with all three cards could use the card with the bonus on the applicable transactions to get 5 percent cash back in all of the categories. In addition, you could purchase groceries at the end of March on the Chase Freedom card to take advantage of the last chance to get cash back in that category.