Should we opt for cash back cards like me?
- Some credit cards offer cash back on purchases, while other cards offer travel rewards.
- I prefer cashback cards because of the flexibility they offer.
Credit cards can be broadly divided into a few different categories. Some are travel cards that offer bonus rewards for purchasing travel and often encourage you to use those rewards to pay for more travel. Others are cashback cards that reimburse you for all of your purchases.
Although I’ve had both travel cards and cash back cards, I much prefer the ones that offer cash back. Here’s why.
This is the big advantage of cashback cards over travel cards
The main reason I prefer cashback cards over travel credit cards is the increased flexibility these cards offer.
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In most cases, if you have a travel card, you get the best value for your rewards points or miles if you redeem them for a vacation. You usually need to book through a special portal set up by your credit card company in order to get the maximum value for your points. And you often need to use your rewards points or miles for specific types of travel-related expenses, such as flights or hotels.
Now, if you’re absolutely sure that by the time you earn enough rewards to redeem, you’ll want to use those rewards to pay for trips, you might not mind. But, as the past few years of COVID-related uncertainty have demonstrated, it can be hard to know what direction your life will take and whether you’ll still be able and willing to use your points for a vacation in a few months or a few years. when you have collected enough.
I have two small children so it can be particularly difficult to predict what types of trips we will be taking and when as it very much depends on how my children are developing at the time and their ability to take the plane without disturbing the other passengers too much. I don’t want to be forced to book trips just to get the most out of my credit card, so cashback cards work better for me.
With a cashback card, I can Choose use the money I get from my credit card company to pay for a vacation if I want to. But I can also choose to do other things with the funds (for example, most often I invest the money in a brokerage account to save for my future). I’m just not willing to give up the flexibility that a cashback card provides.
What kind of cards are right for you?
Figuring out which credit card is best for you can be tricky, as it depends on both the types of things you tend to spend money on and your preferences for how you want to redeem your card rewards. credit.
If you want to cover the cost of your trips by using credit card points to pay for them, a travel credit card might be the ideal choice. But if you’re like me and want more choice in how to use your rewards without feeling like you have to book trips to maximize their value, a cashback card may also be the best fit for you.
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