The Great Debate: Points vs. Cashback
Hey friends, what's up? Phillip here with Points of Phillip, and it's been a couple of days since some pretty wild news dropped in the credit card world, and I just had to talk about it: the Mesa Card is done.
If you weren't following the breaking news, late on a Friday, just hours after their customer service desks closed, Mesa announced they were shutting down every single card member account. This left a lot of us in the lurch, especially regarding our hard-earned points. What's happening with those? It's still up in the air for many.
This sudden shutdown brought up two major questions in our community:
How is this going to change my credit card strategy?
Do points even still make sense, or should we all just switch to cashback?
Let's dive into that second question first, then we can talk about how this impacts my own setup.
The Mesa incident has certainly fueled the "cashback is king" argument, and there are some valid points for it.
The Case for Cashback
One of the biggest appeals of cashback is its simplicity and perceived security. You're getting a direct percentage back on your spending, and you don't have to worry about points devaluation or a "fly-by-night fintech" suddenly disappearing. You just plot along, earning 3% or even 5% in high-spending categories with cards like the Citi Custom Cash or Chase Freedom Flex.
Cashback also allows for incredible flexibility. You can spread your earnings across multiple cards – 5% on Amazon with your Amazon Prime card, 5% at Target with your RedCard, and so on.
However, there's a catch: Cashback isn't truly "never losing" money. Inflation eats away at its value, roughly 2% per year. To truly maximize cashback, you need to make sure your money is working for you. For example, if you have the Apple Card, you can set your daily cashback to go directly into a high-yield savings account (HYSA) with Goldman Sachs. Similarly, if you have the Robinhood Gold card, transfer your rewards to your brokerage account where it can earn interest. Simply letting it sit dormant means you're missing out.
The Case for Points (Why I'm Still a Believer)
Despite the sting of the Mesa shutdown, the value I've been able to extract from points has been far above and beyond what cashback could offer. And it's not just the value of the points themselves, but the ancillary benefits and statuses that come with these cards.
Let's look at some real-world redemptions:
Flight Redemptions:
Air France Business Class (Charles de Gaulle to JFK): For 100,000 points (50,000 per person), my wife and I flew business class, saving us an incredible $8,000 on tickets that would have cost $4,000 each. That's an 8-cent per point valuation!
Virgin Atlantic Premium Economy: We've snagged premium economy seats for around 18,000-24,000 points, saving us anywhere from $2,000 to $2,400. While not the 8-cent valuation of business class, getting 3-4 cents per point is still phenomenal.
Virgin Atlantic Business Class (Manchester to Orlando): Another redemption saved us about $5,000.
British Airways Business Class (using Mesa points via Cath Pacific): My now-defunct Mesa card gave me nearly 150,000 points. I transferred 126,000 of those to Cath Pacific to book two British Airways business class tickets, which would have cost around $2,500 per person. That's another $5,000 in savings for 126,000 points, yielding a very strong 3-4 cents per point.
Hotel Redemptions:
Park Hyatt New York: We purchased 45,000 Hyatt points for $750. The base room was $1,500, but because it was our anniversary, we were upgraded to a room valued at $2,500! Paying $750 for a $2,500 experience is insane value.
Waldorf Astoria Orlando, Conrad Orlando, Conrad Fort Lauderdale: I've used points for stays at these luxurious properties, often leveraging my Hilton Diamond status (a benefit from other points-earning cards) for upgrades and perks.
The signup bonuses for points cards are also significantly higher than most cashback offers, providing a massive initial boost to your travel dreams. For me, the ability to make these extensive, often luxurious, travel experiences happen for a fraction of the cash cost makes points invaluable.
My Strategy Post-Mesa: Adapting, Not Abandoning
While the Mesa card's demise stung (I had to convert 20,000 points to a statement credit at a reduced 0.6 cents per point, and I'm still fighting for 5,000 pending points), it hasn't deterred me from the points game.
The Mesa card was a workhorse for me. It provided 2,800 points per month for my mortgage and 3x back on high-dollar purchases like utilities, totaling about 5,000-6,000 points monthly.
Moving forward, many of these purchases will now go on my Venture X card, earning a solid 2x points. Yes, I'm losing the 3x on those specific categories, but there isn't another card currently offering that same earning structure for those expenses. Plus, I'm still working towards that juicy 100,000-point signup bonus on the Venture X, so I'm not mad about continuing to rack up transferable currency.
The Mesa card shutdown was definitely a tough lesson, reminding us of the risks of smaller fintechs and the importance of diversifying. But the sheer value and experiences that points and miles continue to unlock far outweigh that one bad experience.
If you're someone who was impacted by the Mesa card shutdown, let me know. I'm still trying to navigate their non-responsive emails and uncertain customer service situation. Keep fighting for the value of your points!
Anyway, thanks again for joining me! Stay tuned this week for more insights, including a "what's in my wallet" ahead of 2026. Have a great day!