The simplest way to maximize cash back is using two cards. One card with high rewards in your biggest spending categories — typically 3-5% on groceries, gas, or dining. And one flat-rate card that earns 2% on everything else. This covers every purchase at the highest possible rate without juggling a dozen cards.
Average household spending breaks down roughly as follows: groceries at $6,000 per year, gas at $2,400, dining at $3,600, and everything else at $48,000. A 5% grocery card earns $300. A 3% gas and dining card earns $180. A 2% flat-rate card on the rest earns $960. Total: $1,440 per year in pure cash back.
Never carry a balance. Cash back is worthless if you're paying 22% APR in interest. A $1,440 reward means nothing if you're paying $3,000 in interest. Pay your statement balance in full every month, or cash back cards are working against you, not for you.