🌊 Time to get some cash back

Finny: The Gist

Jan 12

Happy Tuesday everyone! In today's Gist, we'll cover three money topics you've asked about:

Ka-ching! What cards and services offer the best cash back opportunities?

What should you do when your favorite banking service gets shut down?

What funds and ETFs are Finny members checking out?

CASH BACK "KA-CHING"

What are some of the best cash back cards out there?

Cash back is one of those things that's always nice to get, especially now that some other perks (such as travel or hotel credit cards) have limited use!

There is no shortage of cash back recommendations online. Going through all of them could take you a few hours.

So we leaned on the Finny community to find out their cash back recommendations. Here's what they said:

Citi Double Cash card pays you 2% back: 1% when you make a purchase and 1% when you pay it off. Fidelity's Visa Rewards Signature card also offers 2% cash back, but you need to have a linked Fidelity account. For both cards, your chances of getting approved are better if you have excellent credit (credit score above 720), and there's no annual fee.

Chase Freedom Flex offers rewards as high as 5% in specific categories (which could change on a quarterly basis), plus a $200 bonus if you spend $500 in the first three months. No annual fee.

US Bank Cash+ lets you pick two categories for 5% cash back (e.g., cable TV or utilities) for spend up to $2,000 a month. After that amount, you'll earn 2% cash back on one category you choose. Outside of those selected categories, you'll earn a flat 1% cash back. No annual fee.

AMEX Blue Cash Preferred has a $95 annual fee but offers 6% cash back on spend at U.S. supermarkets (up to $6,000 per year, then 1%). You also get 3% cash back at U.S. gas stations and 1% on other purchases.

Cash back as a perk is particularly rewarding in times like now. It's one of the most flexible and useful rewards you can get!

Consider using tiered cash back cards (like US Bank Cash+) if you spend more on a specific category like groceries. If your spending is even or inconsistent across categories, a flat-rate cash back card will probably give you the most bang for your buck.

BANKING

How should you go about replacing a banking service?

You might have heard that Simple banking is shutting down. For those who've enjoyed this highly rated service, it's time to find an alternative. But how? Here are a few thoughts from our community.

Look for feature parity. Simple was known for its built-in budgeting, no-fees, high-interest checking, and a super simple user experience. Good news is that you don't need to look too hard to find others providing similar services! One Finance and Empower are good alternatives.

If you didn't particularly like the budgeting tool offered in Simple but liked everything else (or the other way around), then look for equivalent service components. For example, consider pairing Aspiration—an eco-friendly, no-fee bank service offering up to 1% APY and up to 10% cash back on debit purchases—with a nifty budgeting tool like Tiller Money. You can replace Simple with two complementary services and wind up in a nice spot.

Beware of bait-and-switch. Some online banking services provide incredibly high-interest rates to start, only to substantially downgrade them shortly thereafter. If you're signing up for a newly launched service, you may want to wait until there's critical mass. Also, check consumer reports and reviews online at places like Trustpilot, Google, and your mobile App store.

Follow the discussion on Finny:

INVESTING

What funds are trending on Finny?

It's always fun to see what funds are most searched on Finnyvest, our stock & fund research tool. So far this week, the most popular funds being researched are thematic exchange-traded funds (ETFs) that yielded triple-digit returns in the last year!

The top trending is the suite of ETFs issued by ARK Invest. ARK's actively-managed ETFs invest in "disruptive innovations" to seek long-term growth of capital. These funds are concentrated, with anywhere between 30-55 holdings, and come with higher than average expense ratios (0.75 - 0.79%) because they are actively managed. In other words, the fund manager has full discretion over which stocks make their way into and out of the fund (versus simply tracking an index).

Here are the snapshots of the top three trending ARK ETFs researched by our members—ARKK, ARKW, and ARKG—and here's a handy dandy comparison of all three.

Next are clean energy and solar funds. With an ever-growing emphasis on clean energy, alt-energy ETFs such as ICLN and TAN (and the comparison) are becoming a mainstream theme. Unlike ARK funds, they are passively managed. And like the ARK funds, they have high expense ratios and are concentrated with only 30 holdings apiece.

Please remember this though: past performance is not indicative of future returns. So do lots of research and understand your risks before diving into any one of these funds. And...diversify, diversify, diversify!