Travel And Other Rewards Cards Are Great, But Stated Plainly Cash Back Makes More Sense

When deciding which type of credit card you should use today, there is a good chance you’ll hear a cash back card as everyone’s favorite choice. Travel card lovers are out there in force, but there is a bigger audience of those who love the idea of putting money back in their pocket than any other card perk. 

Whether you choose a flat-rate, tiered, or choice category cashback card, and yes, there are multiple option types, you will receive the most straightforward and flexible reward type. This differs dramatically from travel cards, which require you to jump through hoops to cash in, all while changing point value without warning. 

Cash Back Flexibility 

When you consider why cash-back credit cards are so popular, the most obvious reason is that they are truly versatile. Cash-back rewards can be used anywhere, for anything, or you can continue to let them accrue indefinitely. 

Now, compare this to travel points or store-specific credit cards, which are often restricted to one hotel or airline brand or require you to use the credit card’s travel portal. Instead, you can earn rewards on a credit card by doing everyday shopping, such as buying groceries, paying bills, buying new clothes, making emergency purchases, and more. 

You also don’t have to worry about devaluation concerns, which can happen if a travel credit card determines that your rewards value should be different. Marriott cardholders have gone through this recently, where their points were worth one value on a Monday and another value on a Tuesday. 

Redemption Is Easy

Sticking with why cash back cards are so straightforward, the argument goes beyond how easy it is to earn rewards. Redeeming your rewards is just as straightforward as you can decide to receive a statement credit, direct deposit, purchase gift cards, or get a check in the mail. 

This contrasts against travel cards, which can involve blackout dates, limited or no availability at a hotel, and tiered redemption levels, which can be frustrating for the end user. The bottom line is that redemption is entirely up to the user, and there are no strict rules on what you need to do, saving a lot of frustration. 

Broad Appeal for Everyday Spending

The biggest reason to choose a cashback credit card over store-branded and travel cards is that they are ideal for everyday spending. Cashback cards are the most rewarding when you consider where you spend the most, likely at the grocery store, on gas, dining, or general daily spending.

This is especially true if you look at cards that have 2% cash back, where you earn $20 for every $1,000 you spend. This can add up quickly, something I know all too well, having earned close to $1,800 last year in rewards on a 2% Fidelity card. 

Better yet, if you get a card with rotating categories from Chase or Discover, you can earn as much as 5% on rotating categories like groceries, gas, home improvement stores, and drug stores. Smartly using a card like this can help you earn even more alongside a 2% cashback card. Best of all, you don’t have to change your lifestyle to make this work. 

Choosing the Best Cash Back Card

The good news is that you have many options for a cash-back credit card. Among the best are the 2% Fidelity or Wells Fargo Active cards, which offer a 2% flat rate on all purchases plus purchase protection, extended warranties, auto rental coverage, etc. However, if you love dining out, you might want to consider the Chase Freedom Unlimited card, which offers 3% dining rewards for eating in and taking out. The honest answer is to look at wherever you spend the most and see what card provides the best benefit in that category. 

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