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Valued Member

## Cash Back vs Points

So I'm contemplating adding another card from my bank (PNC). They have 2 cards that intrigue me, a CB card (4/3/2/1%) and a Points card (Flat 4 points per \$1). My question is wouldn't the points card equal out to a flat 4% CB on everything? My math is probably wrong but I'm assuming, at a .01 per point, if you spend \$100, that's 400 points, which is \$4. The CB card has different categories but I'll use the 4% category for the example. If you spend \$100, 4% would be \$4. It looks like the benefit of the Points card equals the 4% and beats the 3/2/1%. One last thing to add, since I have a checking account with them, I get a 50% bonus to points. Any information or opinions would be appreciated.

Message 1 of 10
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Mega Contributor

## Re: Cash Back vs Points

@firehawk73 wrote:

So I'm contemplating adding another card from my bank (PNC). They have 2 cards that intrigue me, a CB card (4/3/2/1%) and a Points card (Flat 4 points per \$1). My question is wouldn't the points card equal out to a flat 4% CB on everything? My math is probably wrong but I'm assuming, at a .01 per point, if you spend \$100, that's 400 points, which is \$4. The CB card has different categories but I'll use the 4% category for the example. If you spend \$100, 4% would be \$4. It looks like the benefit of the Points card equals the 4% and beats the 3/2/1%. One last thing to add, since I have a checking account with them, I get a 50% bonus to points. Any information or opinions would be appreciated.

It all depends on what your redemption options are.  Some points are worth less than a penny.  Some can be worth more.

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Message 2 of 10
Frequent Contributor

## Re: Cash Back vs Points

Suggest you try out the CardPointers app

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Amex(everyday, cash, Hilton)
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Message 3 of 10
Established Contributor

## Re: Cash Back vs Points

PNC point converted to direct cash is 0.2 cents. (also this) That is 1/5 of a cent.

If PNC point is 0.2 cents per point, that means "4 points" is equal to 0.8 cents, which is not even 1 cent.

Whereas a 1% reward means you get 1 cent, and 4% is 4 cents / per dollar.

\$100 spend will not get you \$4 back in cash. You get 80 cents (cash redeption).

Even suppose that you get 50% bonus points, that is still only 0.3 cents per point. 1.2 cents per dollar, which is worse than even Quicksilver's 1.5 cents per dollar.

if you are only redeeming for cashback, then go for cashback.

Cashback: no thinking required.

Points: can be worth more, or less. Definitely not for redemption to cash, in most cases.

If there is such a card (4% flat cash for all purchases), everyone in this forum would have it.

Message 4 of 10
Senior Contributor

## Re: Cash Back vs Points

@staticvoidmain wrote:

PNC point converted to direct cash is 0.2 cents. (also this) That is 1/5 of a cent.

If PNC point is 0.2 cents per point, that means "4 points" is equal to 0.8 cents, which is not even 1 cent.

Whereas a 1% reward means you get 1 cent, and 4% is 4 cents / per dollar.

\$100 spend will not get you \$4 back in cash. You get 80 cents (cash redeption).

Even suppose that you get 50% bonus points, that is still only 0.3 cents per point. 1.2 cents per dollar, which is worst than eveny Quicksilver's 1.5 cents per dollar.

if you are only redeeming for cashback, then go for cashback.

Cashback: no thinking required.

Points: can be worth more, or less. Definitely not for redemption to cash, in most cases.

If there is such a card (4% flat cash for all purchases), everyone in this forum would have it.

+1  ^ ^ ^  This.  I think it was the PNC "Points" card that many of our members were converted to in the BBVA Clear Points transfer in merger with PNC.  I had looked up their points system and it's pretty weak, even at "better" redemption options.

Points systems can be attractive on some cards but they always require a degree of skepticism because valuation can be misleading.  And unfortunately, it's very easy on a "points" card for the lender to devalue them without some cardholders really noticing.  But cash is cash is cash.

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Message 5 of 10
Epic Contributor

## Re: Cash Back vs Points

@staticvoidmain wrote:

If there is such a card (4% flat cash for all purchases), everyone in this forum would have it.

And it's doubtful that a bank offering a flat 4% cash back would also offer a 4/3/2/1% category card.  The customers wouldn't have to be all that math sophisticated to detect that one was much better.

(ETA: assuming other features such as AF are the same of course)

Message 6 of 10
New Contributor

## Re: Cash Back vs Points

It's possible this card has the worst redemption rate of any credit card.  There really is nothing exciting about this card.

Message 7 of 10
Super Contributor

## Re: Cash Back vs Points

@nccarguy1 wrote:

It's possible this card has the worst redemption rate of any credit card.  There really is nothing exciting about this card.

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Message 8 of 10
Valued Contributor

## Re: Cash Back vs Points

Still sounds better than a card that gives Scorecard points.

@firehawk73, others have covered how some points are worth less than other points, so I'll give some feedback on the other card: PNC's Cash Rewards card seems to be fairly well regarded. While there are a few cards that give 5% on gas, they're rotating or hard to come by, so that 4% plus the other useful categories makes it a decent general card, and one that you could keep using indefinitely (on gas, at least). It's the best PNC card.

Message 9 of 10
Valued Contributor

## Re: Cash Back vs Points

The advantage of cash back is that you don't have to select a predefined time to use it.

Also you can move the cash back into an IRA and yield gains on it.

Travel cards cause you to spend more to maximize points. Like if you take a free night you might end up spending more at the hotel. I'm going to have to kill a free night with my Hyatt card as I have no other use for it. They work better when you're solidly taking 3-4 vacations a year.

I think it makes sense to hold back a certain amount of points in reserve, say 200,000 if you need a flight or travel otherwise cash them out and put them somewhere they can be more useful.

Official travel point totals as of 1/5/23 (992,347 Total Points)
Chase Ultimate Rewards 365,510 | IHG One Rewards 182,845 | World of Hyatt 106,105 | AMEX Membership Rewards 101,663 | Marriott Bonvoy 84,039 | Citi Thank You 72,932 | Southwest Rapid Rewards 25,439 | United MileagePlus 13,316 | British Airways Avios 12,333 | Jet Blue TrueBlue 11,661 | Hilton Honors 2,779 | AA Advantage 2,360 | NASA Platinum Rewards 1883 | Navy Federal Rewards 792 | Expedia Points 529 | Delta Sky Miles 175 | Virgin Atlantic Virgin Points 100 | Hotels.com Rewards 6/10 (\$135.99) | Discover CB 5,384 (\$53.84) | Amazon Rewards 1,380 (\$13.80) | Lowe's Business Rewards 1,122 (\$11.22)
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