Right now, my primary card is a Fidelity Investment Rewards American Express that gives me 2% cash back on everything. The only problem is that they don’t have a way to pay the balance in full automatically — I have to go to the web site and type in the amount every month. I also have a Chase Freedom Mastercard that has rotating categories for 5% cash back (1% on everything else). I use that one if I’m making a purchase in a 5% category or at a place that doesn’t take American Express. You can get slightly better rewards on a card with an annual fee, but I would never pay a fee to use a credit card, although it may be worth it for people who spend a lot on credit cards.

Our focus for several years has been college funding. We’ve been using a MasterCard issued through Fidelity and linked to my son’s 529 college fund for more than 10 years. It offers 1% back up to, I think, $1,500 a year. Over the years, we’ve earned more than $10,000 for the 529 account.

I recently discovered that Fidelity also issues an AmEx that’s even better: 2% on everything, with no annual limit. That card’s been getting a lot of use since we got it.

Chase has a small-business card called Ink that rebates 5% on office supplies and telephone, and cellphone, and Internet providers; 2% on restaurants, and 1% on everything else. Rewards are redeemable for gift cards, as well as cash.

Discover allows you to redeem points for gift cards, many at a discount of 20% (e.g., $40 in rebate dollars gets you a $50 card). Chase Freedom also allows redemption for gift cards, but the discounts aren’t as routinely available.

And Chase also has an Amazon.com card that gets you 3% on Amazon purchases, 2% on gas and restaurants, and 1% on everything else. You used to have to get certificates, but, lately,your points balance has been linked to your Amazon account, and you can use the points just like cash at checkout, seemlessly.

I have a Visa card that gives 2% cash back on everything, all year long. I use it for nearly everything, except my garbage bill – I don’t want to burden my garbage guy with a transaction fee on my $16/month garbage bill. Again, it’s paid off each month.

I think this is OK as long as you have the discipline to pay off the balance each month. I don’t charge anything unless I have cash to pay for it outright.

One nit: I think getting 6-7% cash back is actually very hard. In fact I don’t think thats really obtainable with credit card rewards except for that 5% rate at Target which is limited to purchases at Target. 1-2% rewards is more typical and feasible. You could juggle a bunch of cards to maximize their rotating 5% bonus rewards and maybe get near 5% optimally but that requires a lot more work. Theres always promo deals and tricks to maximize your rewards but expecting 6-7% in general isn’t realistic.

Also, if you can find a card that credits your cash back right to your statement (rather than having to save it up and ask for it) that is preferable.