Some people have simple reward strategies. They only earn cash back, or they only earn URs. Cash back people know exactly what they are getting, and UR people may not know their future redemption values, but always know which card to use.
Others have a mix of rewards programs: cash back, transferable points, and hotel/airline-specific points. As such, if rewards are the only consideration in picking a card for a given transaction, they must make some estimate of point values and try to be fairly precise.
In making those estimates, I find myself facing a dilemma. My track record is pretty good in that I’ve gotten high cpp values on travel I would have paid for, anyway. My past redemptions would suggest that I can get 2 cpp for an MR or Hyatt point quite easily.
And yet I find myself a little reluctant to pass up cash back at times. I use Costco at the warehouse for 2% when I could use my Hyatt for a little more than 2%. I use Costco at all gas stations for 4% when I could probably beat 4% with my BBP. I even wonder if 5% cash cards are really worth it.
Now, convenience is a factor. If I had a Costco membership card, a separate credit card, and my DL for alcohol out, the odds are not insignificant that I’d somehow lose one. With BBP, recordkeeping is a little easier when the card doesn’t have a ton of small transactions. But these factors are fairly small.
How do other people handle anticipating point values? Pick high but reasonable values and stick to them? Pick more modest values and just consider it a nice surprise when your miles go further? Other thoughts?