Should I get a cash-back or a travel rewards card?

Question

ClearValue Editorial Team · Accepted Answer

Cash back if you want simple, guaranteed value and won't learn a redemption system. Travel rewards if you'll actually transfer points to airline and hotel partners — that's where points beat a flat 2% cash-back rate. If you'd only redeem points for cash, a 2% cash-back card wins outright. The honest test is redemption behavior, not aspiration. A flat 2% cash-back card returns a known 2 cents per dollar with zero effort. A transferable-points card can beat that — Chase Ultimate Rewards to Hyatt or United can hit 1.5-2+ cents per point — but only if you do the work to find those redemptions. Most people who get a travel card and then redeem for statement credit or cash are earning roughly 1 cent per point, which loses to 2% cash back. Our methodology values points at conservative benchmarks (1.5 cpp Chase UR, 1.4 cpp Amex MR, 1.0 cpp Capital One Miles) precisely to avoid the issuer's inflated math. Pick cash back unless you're confident you'll use transfer partners; you can always add a travel card later once your spend and travel justify it.