While it seems as if the benefits of using a credit card that gives you rewards is one of the best ideas around, some individuals still think otherwise. Alternatively, some roll their eyes at the idea of cashback rewards in favor of travel points or miles.
One Redditor asks this question directly to the audience in r/CreditCards: Why would someone ever cash a non-cashback credit card? Unfortunately, it’s unclear if they mean a credit card without any rewards or using a travel card over cash-back rewards.
To be fair, I’m not sure which one the original poster refers to matters, but there is no question that the comment section gets heavy as cash-back and travel fans battle it out.
Why Cashback Is Great
It stands to reason that cashback continues to be the most popular credit card benefit for all the right reasons. For one, cashback rewards are more straightforward, offering an easy-to-understand way to earn rewards just for doing the shopping you would likely already be doing.
There are no hoops to jump through, no blackout dates to worry about, and nothing else you have to factor in regarding the timelines on which you spend your money. Just about every cashback credit card these days offers you unlimited earning potential and a limitless timeframe with which to use these rewards. If you want to let them accrue for three years before cashing them in, you can absolutely do that.
Best of all, when you are ready to cash in your rewards, you can earn actual cash back by having your money directly deposited or sent via check. You can also have the rewards amount applied to your statement balance, meaning you have to pay less toward whatever you owe, putting the same amount of money right back into your wallet. No matter how you decide to use cashback rewards, they are as easy as it gets.
Why Travel Rewards Are Good
If you love the idea of frequently traveling, there is little question that a travel card can be good for you. Whether with an airline, hotel, or general travel card, the opportunity to earn points or miles can help you with the cost of a future trip.
The biggest argument here is that travel rewards are generally worth more than cashback rewards when you cash them in. There is also some truth that the equivalent amount of points might be worth more than what you spend to earn cashback.
However, where this argument becomes a little more questionable is how much these points are worth toward a trip. If you still owe a considerable amount of money on a hotel or flight, even with points, it goes right back to the idea of why cashback rewards have a big audience.
Still, if you love to travel for work or pleasure, getting status for things like priority security and free hotel upgrades is a hard perk to ignore.
Reddit Responds
In the comment section of this post, the debate between travel and cashback really heats up, and the original poster has plenty of support for why cashback rewards are better. Travel fans’ biggest argument echoes a point above in that redemption for points is often at a higher dollar value than if you just redeemed points for cashback rewards.
However, one Redditor says that based on their spending habits and travel cadence, they get 4x in cash equivalence with their shopping habits versus the 2x return on investment they would with travel. One overlooked consideration is that one Redditor here says that a 0% interest card with cashback rewards is how they renovated their house. Over time, they spent $45,000 and earned 1.5% cash back, which gave them $675, which they hopefully spent on a nice dinner after all the work.
This debate will undoubtedly continue, and while the original poster loves the idea of cashback rewards, there are plenty of supporters on Reddit for travel cards. Ultimately, the bottom line is that you should use any credit card that gives you any kind of reward instead of a debit card with no purchase protection or perks.
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