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Cash back alternatives that compete with top travel cards

You can potentially earn better rewards by switching from points to cash back

Summary

Though travel cards sometimes have a better point value, many cash back cards offer rewards rates that make them a better choice.

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The cash back vs. travel card decision is a tough one to make. On the one hand, cash rewards are much more flexible and can be used to purchase travel, merchandise or anything else you can imagine. But travel points often have a higher value or can be redeemed strategically to get more out of a smaller balance.

While Americans tend to prefer cash back, there are a couple reasons many travel enthusiasts still choose a travel card instead: They have larger introductory bonuses, and smart redemptions can stretch points a long way.

However, new competitive offers on cash back cards mean there are better sign-up bonuses, rewards rates and values in the category. If you choose strategically based on your spending, many cash back cards can compete with even the top travel cards for potential value.

Here’s a few of our most popular travel and cash back cards and how they compare.

Capital One Savor card vs. Chase Sapphire Preferred

The Capital One® Savor® Cash Rewards Credit Card and Chase Sapphire Preferred® Card are pretty similar – offering competitive rewards on dining and charging a $95 annual fee (although it’s waived the first year on the Savor).

Capital One Savor card

Capital One® Savor® Cash Rewards Credit Card

Chase Sapphire Preferred

Chase Sapphire Preferred® Card

Rewards rate
  • 4% cash back on dining and entertainment
  • 2% cash back at grocery stores
  • 1% cash back on other purchases
  • 2 points per dollar on travel and restaurant
    purchases
  • 1 point per dollar on general purchases
  • 2 points per dollar on travel and restaurant
    purchases
  • 1 point per dollar on general purchases
Introductory offer$500 if you spend $3,000 in first 3 months60,000 points if you spend $4,000 in first 3 months
Annual fee$95, $0 in first year$95

At first glance, the sign-up bonuses on these two cards look very similar. However, the Chase Sapphire Preferred card’s bonus is worth a bit more, as points are worth 1.25 cents when redeemed for travel in the Ultimate Rewards portal. That means 60,000 points can be worth up to $750 in travel purchases.

After the first year (and earning a sign-up bonus), the higher dining rewards rate on the Savor card actually outpaces the rewards potential of the Sapphire Preferred – even if you are redeeming all of your points for a 1.25 cent per point value.

If you spend $15,900 in a year, the average spender can earn more from the Savor card. We’ve calculated the average rewards rate of the Sapphire Preferred at 1.22 points for every dollar spent. The Savor card earns an average of 1.8 percent cash back.

Chase Sapphire Preferred average
rewards

$15,900 annual spend x 1.22 points/dollar = 19,398 points
19,398 points x 1.25 cent point value = $242.48 (when redeemed for travel through Ultimate Rewards)
$2442.48 – $95 annual fee = $147.48

Capital One Savor average rewards

$15,900 annual spend x 1.8% cash back = $286.20
$286.20 – $95 annual fee = $191.20

While you might be able to stretch Sapphire Preferred points a bit further with a good deal on a flight or hotel, the Savor card has more face value after the first year.

Citi Double Cash card vs. Capital One Venture

Both the Citi® Double Cash Card and the Capital One® Venture® Rewards Credit Card turn heads thanks to their high rewards rates on general purchases. The Venture offers 2 miles per dollar on all purchases, and the Citi Double Cash card offers 1 percent cash back on every purchase, plus another 1 percent cash back for paying your bill on time.

Citi Double Cash

Citi® Double Cash Card

Capital One Venture

Capital One® Venture® Rewards Credit Card

Rewards rate

  • 1% cash back on general purchases
  • 1% additional cash back when you pay your bill
    on time
  • 10 miles per dollar on hotel rooms booked and
    paid through hotels.com/venture
  • 2 miles per dollar on other purchases
  • 10 miles per dollar on hotel rooms booked and
    paid through hotels.com/venture
  • 2 miles per dollar on other purchases
Introductory offerNone50,000 miles when you spend $3,000 in first 3 months
Annual fee$0$95, $0 in first year

Unfortunately, the Citi Double Cash Card doesn’t offer a sign-up bonus, while the Venture card’s can be worth up to $500 when redeemed for travel. However, the Citi card doesn’t have an annual fee.

Thanks to a generous introductory offer and a waived annual fee in the first year, the Venture card can earn you more in your first 12 months. But over time, the Citi Double Cash is competitive due to its lack of an annual fee.

We calculate the Venture’s overall rewards rate at around 2.16 miles per dollar and the Citi Double Cash card at 2 percent back on all purchases (as long as you pay your bill on time). Once you start paying the annual fee on the Venture card, the Citi Double Cash can beat it in rewards.

Capital One Venture average rewards

$15,900 annual spend x 2.16 miles/dollar = $343.44
$343.44 – $95 annual fee = $248.44 (when redeemed for travel purchases)

Citi Double Cash card average rewards

$15,900 annual spend x 2% cash back (1% when you buy, 1%
when you pay on time) =
$318

Capital One miles are also far less flexible than cash back – losing half of their value when redeemed for a statement credit instead of travel.

Amex Blue Cash Preferred vs. Citi Premier

The Blue Cash Preferred® Card from American Express and Citi Premier℠ Card are both lauded for their gas rewards, though their rewards rates differ from there. The Blue Cash Preferred offers one of the best cash back rates available on U.S. supermarket purchases, while the Citi Premier focuses on entertainment and dining out.

Blue Cash Preferred Amex

Blue Cash Preferred® Card from American Express

Citi Prestige

Citi Premier℠ Card

Rewards rate
  • 6% cash back at U.S. supermarkets (up to
    $6,000 in purchases per year, then 1%)
  • 3% cash back at U.S. gas stations
  • 1% cash back on general purchases
  • Terms apply
  • 3 points per dollar on travel, including gas
  • 2 points per dollar on restaurants and
    entertainment
  • 1 point per dollar on other purchases
Introductory offer
  • $200 if you spend $1,000 in first 3 months
  • Terms apply
50,000 ThankYou® points if you spend $4,000 in first 3 months
Annual fee$95$95, $0 in first year

Both of these cards have a $95 annual fee, but only the Premier card’s is waived in the first year. The Citi Premier card also includes a larger introductory bonus, though the spend threshold is much harder to reach. This means that the Citi Premier has no trouble out-earning the Blue Cash Preferred in the first year.

In following years, however, the Blue Cash Preferred easily catches up with its eye-catching rewards rate. Because grocery shopping makes up such a big portion of most budgets, the 6 percent cash back at U.S. supermarkets is extremely valuable – even with the $6,000 per year purchase limit.

We estimate the average rewards rate on the Blue Cash Preferred card at around 2.45 percent cash back and the Citi Premier at 1.65 points per dollar.

Citi Premier average rewards

$15,900 annual spend x 1.65 points/dollar = $262.35
$262.35 – $95 annual fee = $167.35 (when redeemed for travel purchases)

Amex Blue Cash Preferred average rewards

$15,900 annual spend x 2.45% cash back = $389.55
$389.55 – $95 annual fee = $294.55

While ThankYou points are fairly flexible as far as rewards go, you’ll still lose value if you redeem for something other than travel or gift cards – further boosting the appeal of earning cash back instead.

Should you sign up for a cash back card now?

For some spenders, a travel card still might be your best bet – especially if you don’t mind hunting for great deals on flights and hotels. However, be sure not to discount the potential value of cash back cards. Even though they typically come with smaller introductory offers, you might actually earn more in later years of card membership.

The biggest benefit of cash back is that rewards are very flexible. You can apply it toward paying off a large statement balance, a gift for yourself or toward your next trip.

See related: The best flat-rate cash back credit cards, The best cash back credit cards for parents

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Credit Card Rate Report Updated: March 13th, 2019
Business
15.24%
Airline
17.50%
Reward
17.52%
Cash Back
17.58%
Student
17.79%

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