topic Re: Balancing both Cash Back and Travel Rewards in Credit Cards

Balancing both Cash Back and Travel Rewards

mkhan1093 — Thu, 26 Jan 2017 00:47:53 GMT

Hi everyone! I've been a frequent user of the Chase Ultimate Rewards system to get points and miles. I have been using the Freedom, Freedom Unlimited and Sapphire Reserve to all feed into my Ultimate Rewards pool. Recently, however, I've needed to open a new card for BT purposes, and I had it narrowed down to the Chase Slate and Citi Double Cash Card, and I sprung for the latter because despite the BT fee which the Slate didn't have, it offered great cashback options for purchases. Now I'm having a hard time deciding whether or not I'd like my general purchases to pool into UR or get the cashback. Obviously, if it's travel/dining or one of the special rotating 5% categories, the CSR and CF offer the best. But when it's an ordinary purchase, I'm having a hard time whether to use the FU for 1.5 points for travel or the DC and get more money back in my account.

I know the obvious answer is to personally weigh for myself what I prioritize more but I was just wondering if anyone else has a dilemma like this and what they've done in the past. Thanks!

Re: Balancing both Cash Back and Travel Rewards

Anonymous — Thu, 26 Jan 2017 03:56:43 GMT

My understanding is that UR points can be redeemed for airfare (say) at better than their what you'd get for their cash equivalent. So is the extra value an improvement of > 33%? In other words, is 1.5 points worth more than 2 when redeemed for airfare? And do you think you'd be traveling even if you had to pay cash for it?

If the answer to both questions is yes, then UR points is right. If either is no, then getting 2% cashback is superior.

PS. Have you crunched the numbers and determined that the CSR is worth the expense in the long term? If not, the smart move may be to grab all the bonus points, grab the two complimentary $300 travel reimbursements, and then cancel before Day 364. It's hard for me to imagine that the reserve is worth $450 per year in the long term, even counting the $300 back on a flight.

Actually you don't even have to cancel it -- you can downgrade it to a regukar no-annual-fee Chase Sapphire.

Re: Balancing both Cash Back and Travel Rewards

Anonymous — Fri, 27 Jan 2017 17:31:37 GMT

@mkhan1093 wrote:
Hi everyone! I've been a frequent user of the Chase Ultimate Rewards system to get points and miles. I have been using the Freedom, Freedom Unlimited and Sapphire Reserve to all feed into my Ultimate Rewards pool. Recently, however, I've needed to open a new card for BT purposes, and I had it narrowed down to the Chase Slate and Citi Double Cash Card, and I sprung for the latter because despite the BT fee which the Slate didn't have, it offered great cashback options for purchases. Now I'm having a hard time deciding whether or not I'd like my general purchases to pool into UR or get the cashback. Obviously, if it's travel/dining or one of the special rotating 5% categories, the CSR and CF offer the best. But when it's an ordinary purchase, I'm having a hard time whether to use the FU for 1.5 points for travel or the DC and get more money back in my account.

I know the obvious answer is to personally weigh for myself what I prioritize more but I was just wondering if anyone else has a dilemma like this and what they've done in the past. Thanks!

If you have a lot of travelling to buy, then the FU points moved to CSR are worth 2.25% buying through Chase (and potentially much more if transferred). So that route provides more value than using the double cash. If you aren't buying travel then a) you may not need CSR long term! and b) using the double cash will give you a bit more

Re: Balancing both Cash Back and Travel Rewards

sillykitty1 — Fri, 27 Jan 2017 17:59:41 GMT

I think if you do a moderate level or traveling then 1.5 UR points are beter than 2% CB when paired w the CSR. If spent through the travel portal it is 2.25% automatically.

I'm having a similar debate though. For my non category spend do I put it on the FU, or on my JCB? I'm not quite sure if the additional UR points at 1.5/$, when I already have a 300K, and am consistingly earning w the CSR, vs. my JCB @ 3% CB.

Re: Balancing both Cash Back and Travel Rewards

DeeBee78 — Fri, 27 Jan 2017 22:12:35 GMT

@mkhan1093 wrote:
Hi everyone! I've been a frequent user of the Chase Ultimate Rewards system to get points and miles. I have been using the Freedom, Freedom Unlimited and Sapphire Reserve to all feed into my Ultimate Rewards pool. Recently, however, I've needed to open a new card for BT purposes, and I had it narrowed down to the Chase Slate and Citi Double Cash Card, and I sprung for the latter because despite the BT fee which the Slate didn't have, it offered great cashback options for purchases. Now I'm having a hard time deciding whether or not I'd like my general purchases to pool into UR or get the cashback. Obviously, if it's travel/dining or one of the special rotating 5% categories, the CSR and CF offer the best. But when it's an ordinary purchase, I'm having a hard time whether to use the FU for 1.5 points for travel or the DC and get more money back in my account.

I know the obvious answer is to personally weigh for myself what I prioritize more but I was just wondering if anyone else has a dilemma like this and what they've done in the past. Thanks!

With a balance transfer in the mix, you're overthinking this.

If you actively use the Citi card while a BT is active on it, your payments will go towards the lowest-interest debt - the balance transfer. This means all that cashback you're dreaming about earning is going to be eaten up by the interest on your purchases.

Whatever card you choose, don't use it until the BT is paid off.

Re: Balancing both Cash Back and Travel Rewards

mkhan1093 — Sun, 29 Jan 2017 22:37:39 GMT

@DeeBee78 yeah I know I wasn't going to use the Double Cash while the BT was still on it. I was asking for the future!

Re: Balancing both Cash Back and Travel Rewards

Revelate — Mon, 30 Jan 2017 00:28:26 GMT

@sillykitty1 wrote:
I think if you do a moderate level or traveling then 1.5 UR points are beter than 2% CB when paired w the CSR. If spent through the travel portal it is 2.25% automatically.

@I'm having a similar debate though. For my non category spend do I put it on the FU, or on my JCB? I'm not quite sure if the additional UR points at 1.5/$, when I already have a 300K, and am consistingly earning w the CSR, vs. my JCB @ 3% CB.

I've recently come down on the side of the FU with the same FU+CSR vs. JCB debate; pretty certain unless I utterly suck at redemptions I can make up the difference and unless I somehow wind up with kids in my life at this point, moderate travelling is going to become a thing even without the current gig (where I'm looking at 1.5 months straight in Asia).

Re: Balancing both Cash Back and Travel Rewards

yfan — Mon, 30 Jan 2017 00:51:46 GMT

@sillykitty1 wrote:
I think if you do a moderate level or traveling then 1.5 UR points are beter than 2% CB when paired w the CSR. If spent through the travel portal it is 2.25% automatically.

Only assuming that Chase's travel portal gives you the best pricing though. I have heard that to often not be the case. Earning an extra 0.25% is meaningless if you are overpaying for travel.

Re: Balancing both Cash Back and Travel Rewards

sillykitty1 — Mon, 30 Jan 2017 03:55:11 GMT

@yfan wrote:
@sillykitty1 wrote:
I think if you do a moderate level or traveling then 1.5 UR points are beter than 2% CB when paired w the CSR. If spent through the travel portal it is 2.25% automatically.
Only assuming that Chase's travel portal gives you the best pricing though. I have heard that to often not be the case. Earning an extra 0.25% is meaningless if you are overpaying for travel.

I have read that as well, but I have booked on and searched the site extensively. I'm personally convinced that pricing descripencies from other sites are glitches. When I have seen flights available on other sites, I've been able to call in and the agents found the flights for the exact same cost. Additionally, they can book Southwest flights which don't show up on any travel portal, but can be booked via phone.

Re: Balancing both Cash Back and Travel Rewards

sillykitty1 — Mon, 30 Jan 2017 04:20:04 GMT

@Revelate wrote:
@sillykitty1 wrote:
I think if you do a moderate level or traveling then 1.5 UR points are beter than 2% CB when paired w the CSR. If spent through the travel portal it is 2.25% automatically.

@I'm having a similar debate though. For my non category spend do I put it on the FU, or on my JCB? I'm not quite sure if the additional UR points at 1.5/$, when I already have a 300K, and am consistingly earning w the CSR, vs. my JCB @ 3% CB.
I've recently come down on the side of the FU with the same FU+CSR vs. JCB debate; pretty certain unless I utterly suck at redemptions I can make up the difference and unless I somehow wind up with kids in my life at this point, moderate travelling is going to become a thing even without the current gig (where I'm looking at 1.5 months straight in Asia).

Thanks Revelate, good to know someone has gone through the internal debate. Do you think it is possible to over invest in a program? The CSR aligns very well with my spend (reimbursable business travel and entertainment), so I'll be piling up the UR points. All my personal travel for 2017 is already booked, so I'll just be stock piling. I'm always leery of devaluations.

Re: Balancing both Cash Back and Travel Rewards

yfan — Mon, 30 Jan 2017 05:33:02 GMT

@sillykitty1 wrote:
@yfan wrote:
@sillykitty1 wrote:
I think if you do a moderate level or traveling then 1.5 UR points are beter than 2% CB when paired w the CSR. If spent through the travel portal it is 2.25% automatically.
Only assuming that Chase's travel portal gives you the best pricing though. I have heard that to often not be the case. Earning an extra 0.25% is meaningless if you are overpaying for travel.
I have read that as well, but I have booked on and searched the site extensively. I'm personally convinced that pricing descripencies from other sites are glitches. When I have seen flights available on other sites, I've been able to call in and the agents found the flights for the exact same cost. Additionally, they can book Southwest flights which don't show up on any travel portal, but can be booked via phone.

In that case, the opportunity cost and time spent calling in has to be considered. Some travel booking sites like Obritz not only will match prices elsewhere but give you an extra $50 if prices turn out lower elsewhere - so each time those "glitches" happen, using Chase may actually be losing you $50 that has to now enter the calculation.

I agree it's an advantage being able to book Southwest using UR points at the same rate as others on the portal though.

Re: Balancing both Cash Back and Travel Rewards

sillykitty1 — Mon, 30 Jan 2017 09:04:46 GMT

@yfan wrote:
@sillykitty1 wrote:
@yfan wrote:
@sillykitty1 wrote:
I think if you do a moderate level or traveling then 1.5 UR points are beter than 2% CB when paired w the CSR. If spent through the travel portal it is 2.25% automatically.
Only assuming that Chase's travel portal gives you the best pricing though. I have heard that to often not be the case. Earning an extra 0.25% is meaningless if you are overpaying for travel.
I have read that as well, but I have booked on and searched the site extensively. I'm personally convinced that pricing descripencies from other sites are glitches. When I have seen flights available on other sites, I've been able to call in and the agents found the flights for the exact same cost. Additionally, they can book Southwest flights which don't show up on any travel portal, but can be booked via phone.
In that case, the opportunity cost and time spent calling in has to be considered. Some travel booking sites like Obritz not only will match prices elsewhere but give you an extra $50 if prices turn out lower elsewhere - so each time those "glitches" happen, using Chase may actually be losing you $50 that has to now enter the calculation.

I agree it's an advantage being able to book Southwest using UR points at the same rate as others on the portal though.

Completely agree about opportunity costs. But award travel redemption in general takes a significant amount of work, and has an opportunity cost already built in IMO.

Re: Balancing both Cash Back and Travel Rewards

Anonymous — Mon, 30 Jan 2017 15:16:21 GMT

So far for me the easiest way to balance this is by giving points a cent value, then looking at cash back options.

In general I don't want cash back unless it will give more value than I could get in points on that purchase, so in effect I use CB cards only for at least 5%

Re: Balancing both Cash Back and Travel Rewards

yfan — Mon, 30 Jan 2017 15:45:13 GMT

@Anonymous wrote:
So far for me the easiest way to balance this is by giving points a cent value, then looking at cash back options.

In general I don't want cash back unless it will give more value than I could get in points on that purchase, so in effect I use CB cards only for at least 5%

Then why is the Double Cash in your sig line?

Re: Balancing both Cash Back and Travel Rewards

Anonymous — Mon, 30 Jan 2017 17:20:35 GMT

@yfan wrote:
@Anonymous wrote:
So far for me the easiest way to balance this is by giving points a cent value, then looking at cash back options.

In general I don't want cash back unless it will give more value than I could get in points on that purchase, so in effect I use CB cards only for at least 5%
Then why is the Double Cash in your sig line?

Because not all cards in a sig are used? Because the strategy changed after getting the card?

Re: Balancing both Cash Back and Travel Rewards

sillykitty1 — Mon, 30 Jan 2017 18:00:34 GMT

@Anonymous wrote:
So far for me the easiest way to balance this is by giving points a cent value, then looking at cash back options.

In general I don't want cash back unless it will give more value than I could get in points on that purchase, so in effect I use CB cards only for at least 5%

But determining the cash value of points is exactly the challenge. It is easy for fixed redemption rations like using the UR portal with a CSP or CSR. But transferring to travel partners can vary widely. Even travel programs that have generally high valuation like SW, have limitation like not having business class or many international destinations. And sometimes low valued points like Marriott can have fantastic redemption's, like I've reserved in Munich for Oktoberfest. There is also the time and patience it takes to search for good redemption's, the opportunity cost of not earning miles/points that contribute to status when redeeming awards, and finally the selection of less than ideal flights, like the current 9 hr layover I have on an award flight I've booked. Finally there is a risk of building points and then having a program nerfed. For instance I will be hung with a lot of points in the UR program if United is removed as a partner.

Re: Balancing both Cash Back and Travel Rewards

yfan — Mon, 30 Jan 2017 18:08:01 GMT

@Anonymous wrote:
@yfan wrote:
@Anonymous wrote:
So far for me the easiest way to balance this is by giving points a cent value, then looking at cash back options.

In general I don't want cash back unless it will give more value than I could get in points on that purchase, so in effect I use CB cards only for at least 5%
Then why is the Double Cash in your sig line?
Because not all cards in a sig are used? Because the strategy changed after getting the card?

That's certainly possible, as much as I don't get the point of hanging onto a card one doesn't ever plan on using. But there are also other possibilities, like a 0% promo period, specific promos, etc. It's also possible long term non use would get the card closed by Citi. That's why I asked - to hear the specific answer in this case, not for guesses.

Re: Balancing both Cash Back and Travel Rewards

Anonymous — Mon, 30 Jan 2017 18:38:18 GMT

@yfan wrote:
@Anonymous wrote:
@yfan wrote:
@Anonymous wrote:
So far for me the easiest way to balance this is by giving points a cent value, then looking at cash back options.

In general I don't want cash back unless it will give more value than I could get in points on that purchase, so in effect I use CB cards only for at least 5%
Then why is the Double Cash in your sig line?
Because not all cards in a sig are used? Because the strategy changed after getting the card?
That's certainly possible, as much as I don't get the point of hanging onto a card one doesn't ever plan on using. But there are also other possibilities, like a 0% promo period, specific promos, etc. It's also possible long term non use would get the card closed by Citi. That's why I asked - to hear the specific answer in this case, not for guesses.

Oh, I didn't realize it was a serious request for knowledge (if I had asked such a thing it would have been an attempt to pointscore, so maybe I am projecting). But then why not ask the same question about the Cap One Quicksilver and the Marvel card, neither of which ever earn 5%

Re: Balancing both Cash Back and Travel Rewards

yfan — Mon, 30 Jan 2017 18:47:18 GMT

@Anonymous wrote:
Oh, I didn't realize it was a serious request for knowledge (if I had asked such a thing it would have been an attempt to pointscore, so maybe I am projecting). But then why not ask the same question about the Cap One Quicksilver and the Marvel card, neither of which ever earn 5%

I don't have a Marvel card, and I don't know anything about it. The reason I didn't ask about the QS is because it has a publicly available bonus, and for that period/spend amount at least, it earns more than 5%.