When a $95 Annual Fee Is Actually Worth It for Groceries

Groceries cost more than ever, and every supermarket run feels like sticker shock. That's exactly why using a cash back grocery card matters -- it can help you earn something back on what you're already spending.

Plenty of grocery cards don't charge an annual fee and still offer solid rewards. But the Blue Cash Preferred® Card from American Express is different. It's one of the few cards where an annual fee can actually earn you more than it costs, especially if you're feeding a family or stocking up weekly. The Blue Cash Preferred® Card from American Express has a $0 intro annual fee for the first year, then $95. (See rates and fees.)

Why it stands out

The Amex Blue Cash Preferred earns:

• 6% cash back at U.S. supermarkets (on up to $6,000 per year in eligible purchases) and select U.S. streaming subscriptions
• 3% cash back on U.S. gas stations and transit (including taxis/rideshare, parking, tolls, trains, buses and more)
• 1% cash back on other purchases

That U.S. supermarket multiplier -- 6% -- is among the highest you'll find on the best credit cards for groceries right now. For most households, the grocery category alone can easily cover the fee and still leave you ahead.

Here's when the math makes sense

Here's how your grocery spending translates into real rewards, and what you'll actually keep after the annual fee:

If you spend $500/month, you'd earn $360 in rewards and still net $265 after the fee.

At $1,000/month, you'd earn $420 total (6% for six months, 1% for six months) and take home $325 net.

Now compare that to one of the top flat-rate cards earning 2% on everything with no annual fee. That same spending would earn $120 at $500/month or $240 at $1,000/month -- less than half what the Amex Blue Cash Preferred delivers even after its fee.

If you spend less than $400/month, the advantage narrows.

• At $300/month, you'd net about $121 after the fee (vs. $72 from a 2% card).
• At $200/month, you'd barely break even.

That makes $400/month where this card really becomes powerful, and above that, the value stacks up quickly.

The rewards don't stop at groceries

The Amex Blue Cash Preferred also quietly adds value in other areas you're probably already spending on.

For example, you can earn up to $10 back per month as a statement credit when you pay for Disney+, Hulu, or ESPN+ with your enrolled card (terms apply). If you're already subscribed, that's another $120 in annual value -- more than enough to cancel out the fee before groceries even enter the equation.

Together with the 6% cash back on streaming and the 3% cash back on gas and transit, the rewards extend well beyond the supermarket aisle.

Who this card is made for (and when to skip it)

The Amex Blue Cash Preferred isn't for everyone, and that's by design.

It's best for:

• Families or households spending $400 or more per month on groceries.
• Anyone already paying for Disney+, Hulu, or ESPN+.
• Drivers, commuters, or city dwellers who spend regularly on gas or transit.
• People who prefer simple cash back over tracking point values or transfers.

If you're only spending a few hundred a month on groceries, a no-annual-fee option may be a better fit. But for heavy grocery shoppers, the Amex Blue Cash Preferred is one of the few cards that can pay for itself -- and then some.

The bottom line

With 6% cash back at U.S. supermarkets (on up to $6,000 per year in eligible purchases) and select U.S. streaming subscriptions, 3% cash back on U.S. gas stations and transit (including taxis/rideshare, parking, tolls, trains, buses and more), a Disney Streaming Credit worth up to $10 per month (terms apply), and 1% cash back on other purchases, the Blue Cash Preferred® Card from American Express turns everyday spending into meaningful rewards.

If your grocery bill keeps climbing, this is one card that can make it work in your favor.

Compare benefits and see how much you could earn in our full Amex Blue Cash Preferred review.