Point Me To First Class 5. Rewards Vs Cash-Back Credit Cards (Part 2)
Apr 3, 2023
Conversation digs into whether to keep store-specific cash-back cards or use broader rewards cards for the same purchases. A clear three-step framework is laid out to compare cashback rates versus point value. Practical tactics include using cards that earn elevated non-category points and buying store gift cards through bonus categories to multiply earnings.
AI Snips
Chapters
Transcript
Episode notes
Audit Your Store Specific Cards
- Do inventory all store-specific credit cards you still use.
- Pull them out and note the exact cashback rate and any non-rewards perks like free tailoring or early sale access that matter to you.
Calculate Cashback Versus Points For Exact Spend
- Do the math: compare cashback earned at a store versus points you'd earn using a rewards card.
- Calculate annual spend, cashback dollar amount, and points earned to make an objective comparison.
Find The Points Break Even Rate
- Determine the break-even points-per-dollar needed to beat cashback.
- Example: $10,000 at 2% cashback needs 10,000 points worth ≥ $200, so you need ≥ $0.02 per point to break even.