by Lyle Daly | Jan. 20, 2020
Cash back and travel rewards aren't mutually exclusive anymore.
You might think that it's impossible to earn travel points with a cash back credit card. After all, you earn travel rewards with travel cards and cash back with cash back cards. Simple, right?
Although that seems logical, it isn't always the case. Some credit card companies are now blurring the line between their cash back and travel cards, effectively allowing you to convert cash back to travel points. And that's great news for travel enthusiasts, because once you understand how this works, it can help you earn hundreds and even thousands more points every month.
Chase and Citi are the two biggest credit card companies that currently allow you to convert cash back rewards into travel points. To do this, you must have at least one of each type of card with that card issuer.
When you have both travel and cash back cards, you can transfer any cash back you accumulate over to your travel card. The standard rate is one point per $0.01 of cash back you transfer.
Let's say you have two Chase credit cards, a travel card and a cash back card. You have $500 in cash back available. Instead of redeeming that cash, you could transfer it to your Chase travel card, where it will become 50,000 points. It will then have all the same redemption options as any rewards you earned with your travel card, such as transfers to any of Chase's travel partners.
By the way, Chase and Citi only let you transfer cash back to travel cards in their own respective travel rewards programs, which are Chase Ultimate Rewards and Citi ThankYou® Rewards. You can't transfer cash back to one of their co-branded airline or hotel credit cards. If you have a Chase cash back card, you wouldn't be able to turn your cash back into miles on a Chase credit card with United Airlines.
When you're able to convert cash back to travel points, you can take advantage of spending categories where cash back cards earn better rewards. This gives you the opportunity to earn significantly more points on your everyday spending.
For example, imagine you have a travel credit card that earns three points per $1 spent on travel and dining, and one point per $1 on everything else. If you also have a cash back card that earns 5% on internet, cable, and phone spending with the same company, you can transfer that cash back to your travel card.
If you had used your travel card to pay those bills, you'd be earning one point per $1. Instead, you can pay with the cash back card, earn 5%, and send the cash back to your travel card -- effectively earning five points per $1.
Here's what makes this even better -- many of the best cash back credit cards don't have annual fees, so you'll be boosting your travel rewards without needing to pay anything extra.
If you already have a travel credit card with Chase or Citi, there aren't any drawbacks to adding one or more of their cash back cards to your wallet. It's a smart way to earn more travel points on your typical expenses, and it won't cost you a thing. You will have more credit card bills to pay each month, but that's easy enough to manage with automatic payments or by setting yourself reminders.
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