Your 5% card quietly becomes a 1% card. Here’s exactly where it happens.
If you picked your rewards card because of one big number, 5% on gas, 6% on groceries, 3% on dining, that number is real. But almost every one of those rates comes with an expiration point buried in the terms and conditions: spend past a certain amount, and the rate quietly drops, usually all the way to 1%. We read the fine print on more than 200 U.S. credit cards to find out where each headline rate actually ends, and what that means for a normal family’s spending.
Here’s what the terms and conditions say that the ads don’t.
Finding 1: Every general-purpose 5–6% cash-back card is capped. Zero exceptions.
We track more than 200 cards. Every single general-purpose card advertising a 5% or 6% cash-back rate limits how much you can earn at that rate: Chase Freedom Flex, Discover it, Citi Custom Cash, U.S. Bank Cash+, Shopper Cash Rewards, Blue Cash Preferred. All capped.
The only uncapped cards paying 4% or better are single-retailer cards, which only earn that rate at one store.
Finding 2: The ceiling is about $300 a year, and it’s nearly identical across cards.
The famous 5% cards all max out at close to the same number:
- Chase Freedom Flex: $1,500 per quarter × 5% = $300/yr
- Discover it: $1,500 per quarter × 5% = $300/yr
- Citi Custom Cash: $500 per billing cycle × 5% = $300/yr
- U.S. Bank Cash+: $400/yr
- Shopper Cash Rewards: $360/yr
The “5% card” category has a roughly $300–400/yr bonus ceiling that nobody advertises.
Finding 3: Past the cap, the rate doesn’t just degrade. It completely collapses.
Across the 34 capped cards in our database, the median post-cap fallback rate is 1.0%. So the choice isn’t between 5% and 4%. It’s between 5% and 1%, and it flips the moment you cross a threshold most people never look up.
Finding 4: What that means for an ordinary grocery bill
A completely ordinary grocery bill turns the advertised 6% into an effective 2.7%. Less than half the number on the ad.
Blue Cash Preferred advertises 6% at U.S. supermarkets. That 6% caps at $6,000 per year, which is $500 a month.
A family spending $1,000 a month on groceries earns:
- First $6,000 at 6% → $360
- Next $6,000 at 1% → $60
- Total: $420 on $12,000 of groceries, an effective 3.5%
- After the $95 annual fee: $325, or about 2.7%
About half the advertised number, for a completely ordinary grocery bill.
We run this same math store by store, with caps and annual fees already subtracted: see the best card at Amazon, Costco, Target, or Walmart.
Finding 5: Premium cards quietly added ceilings too.
Caps used to be a budget-card feature. Not anymore. The Amex Gold Card, a $325-annual-fee product, caps its 4x dining at $50,000/year and its 4x U.S. supermarket earning at $25,000/year. Business cards cap as well: Chase Ink Business Cash limits its 5% categories to $25,000/year, and Delta’s business cards cap bonus categories at $100,000/year.
Overall, 29% of the highest-advertising cards we track (top rate of 4%/4x or better) carry a spending cap.
What does this mean for you?
Capped cards are not bad cards. They are mislabeled ones. A card paying 5% on the first $1,500 each quarter is a genuinely great deal for exactly $6,000 of spending a year. The problem starts when you make it your primary card and push $20,000 through it, because most of that spending earns 1% while you believe you are earning 5%.
As a second card, capped cards shine. Route the right category to it, stay under the cap, and the effective rate really is the advertised rate.
As a primary card, they quietly underperform. Once your spending clears the cap, a flat 2% card with no cap beats most of the cards in this study on total dollars, with none of the tracking.
Which side of that line you are on depends entirely on your actual spending, not on any ranking, including this one.
That math is what Kiwii Match does: it models every card’s rates, caps, and fallback rates against your actual spending and tells you what you’d really earn. It’s free, there’s no account required, and we never rank a card higher because it pays us.
Methodology
Earning rates, spending caps, cap periods, and post-cap rates were compiled from issuer terms and conditions and rate documents for 200+ U.S. consumer and business credit cards, maintained as the live database behind Kiwii Match (last audit: July 2026). “General-purpose” excludes cards whose bonus rate applies only at a single retailer. Effective-rate examples assume the stated spending patterns; point-based cards are valued at Kiwii’s program-level point valuations. Questions about the data: hello@addkiwii.com.