It really depends on how you plan on using them, if cash back is your ultimate goal then a cash back card will pretty much always yeild you a higher net result than getting points and converting them. Most issuers will convert their points to cash at under 1 cent per point (usually around .005), which is well below the 1-2% cash back you can find.
Those 300 points are likely worth less than $3.
However, if you are planning on using the points for things like travel, they can be worth WAY more than the 1-2% cash back. Esepcially if you get the hang of trasnfering the points to partner airlines/hotels.
@coldfusion wrote:
@longtimelurker wrote:I think there is a card that is/was semi-popular here that gives FOUR points per $, but it turns out each point is worth very little and the earning is worse than many cards.
That would be the PNC Points card, which is the card that many BBVA Clearpoints cardholders ended up with as part of the BBVA assimilation by PNC. The standard payout is 4 points per dollar, but the value of 1 point = 0.25% i.e. by default it's a 1% cashback card. There are however ways to earn bonus points based upon type and value of PNC accounts and/or amount of monthly direct deposits made that in theory could make the card as much as a 1.75% cashback card, not that I see that as much of a wow factor.
That was my first ever credit card, around 2006 or something. Back then, I thought the 4x points was awesome. I'd cash them in for Best Buy gift cards. But over the years, I noticed the amount of points for the gift cards was ever increasing. It wasn't until 2018 when I actually decided to start learning about credit card points/cashback. I did some math, and I realized the PNC cashback card would likely net me a greater return. PNC wouldn't PC it, so I ended up with Chase's Freedom card, thus beginning my journey to maximize rewards.
Overall, I prefer cashback to points. In PNC's case, they kept increasing the point cost for items, which effectively devalues the points. A point would need to be worth at least 1 cent to match cashback. That being said, I do like URs, since I can get more than 1 cent worth out of them.
I have a couple of travel cards in my siggy as my goal card. One of them is points based, but as much as I research, I can't wrap my mind around using a points system.
I'm really new to using credit cards and I love seeing the cash back that I get on my purchases. However, I do want a travel card because I want to travel more. I'm worried that I won't get the full benefit of the cards because I haven't really grasped points vs. cashback and all of the conversions, partners, etc.
