Stockpiling Credit Card Rewards: Strategies to Break the Habit
Over the weekend, me and my brother had a tiffsome discussion about who was gonna shell out the cash for our tab during our night out. Truth be told, it wasn't about our Dad-blessed generosity; we're both stingy, wanting those sweet, sweet rewards points instead.
Both of us own the slick American Express® Gold Card, a beauty I recommended to my brother because of his jet-setting lifestyle and food-loving heart. So, that bill was like a buffet for rewards points. I relented and let him pay since I ain't planning to use those rewards anytime soon. I've got a stash of 'em saved for my epic Iceland adventure next year.
My brother was proudly flaunting his towering points tally, nearly 200,000 points I think he said. I did the math, and voila! That's nearly $2,000 in travel just sitting there! I called him out on not using his points in two whole years. Wouldn't you know it, I wasn't alone. I realized I've only used my rewards points once since 2023, despite having nearly 180,000 points. I began to ponder, what's been keeping us both from cashing 'em in?
Why Redemption Remains Elusive
I've got this points-hoarding vibe goin' on, and it's all because of my obsessive points-earning strategy. I dote on my points like they were gold. It don't seem far-fetched to think of 'em like cash, right? Of course I don't wanna fumble it all with some random, low-value redemption! And let's not forget the bane of our existence—keeping track of point and mile values. It's a pain in the neck, to say the least.
I'd be way more confident cashing in my points if I didn't need to calculate their value every time. If they'd always have the same value, like 1 cent per point, I'd be good to go. But then again, that'd make 'em kinda lame compared to cashback cards.
Breaking the Redemption-Anxiety Cycle
My credit card wisdom ought to be enough to give me the gumption to redeem points regularly, but it seems to have done the opposite, making me all the more skittish. Enter my colleague, Ryan Flanigan, certified card whisperer and rewards guru. He uses over 50 cards from our website, always prepin' to grab the next great adventure. When I asked him for his insights on how he avoids redemption anxiety—that nagging fear of blowing your points on the wrong thing—his advice proved enlightening.
Go For It and Get Happier
"If points can save ya money, burn 'em!" Ryan said. It ain't always gonna be the ideal redemption value, but if it means keeping more moolah in the bank, it's a smart move. Using our website's point valuation guide as a starting point is the smart play. But you don't need to sweat getting every last drop of value from your points. Aim for a value you're comfortable with—say, 1 cent or better—and call it a day. If you have a good stash of points, there's rarely a reason to dip into your pocket when your redemption ain't delivering the goods.
"I don't treat points like money," Ryan reminded me, "I just earn and burn!"
Everyone's method of maximizing their rewards will vary, so instead of fretting about the ideal time to redeem rewards, I should come up with a redemption plan tailored to my travel needs.
I planned most of my trips well in advance, so even with a lower-end redemption value, I can get a sense of how many points I'll need to rack up. Once it's time to book that trip, I'll go ahead and redeem the points. If I'm gettin' my minimum redemption value, there's rarely any point in waiting, ya feel?
This new outlook should help my redemption anxiety ease up. I'll know how many points I'll need and when to use 'em. No more wandering whether I'm making the right move.
Evaluate Your Rewards Program
Besides adjusting my redemption mindset, Ryan suggested I take a long, hard look at whether I'm earning points in the right rewards program or milkin' the best out of my rewards. If I ain't earnin' 'em in the right program or unable to transfer 'em, that might be why I'm struggle-busching to find a decent redemption option. To conquer my redemption anxiety, I should assess whether my rewards program is working for me.
Your favorite airline or hotel is a crucial factor to consider when choosin' a rewards card. You can earn points or miles with your preferred travel providers through a co-branded airline or hotel rewards card, or you can choose a general travel card that lets you redeem rewards for bookings with them or transfer points to 'em. For instance, if you fly Delta Airlines often, a card like the Amex Gold or a co-branded Delta SkyMiles card might suit ya. If you travel with Southwest, Chase might be more your style. But if you're haulin' AAdvantage miles, neither's gonna help.
I can see how just knowin' I'm earnin' the right points could help ease my redemption anxiety. Either way, Ryan's "earn and burn" approach makes sense. Let those points work for ya, then keep on earning more. If they ain't workin' for ya, burn 'em and focus on a rewards program that suits your goals better.
Plan Ahead
When I got my travel card, I knew I could get a 2-cent-per-point redemption by transferring points to a travel partner, but I didn't anticipate struggle so hard to get that value. Instead of finding the best value, I fell into Prime Paralysis, spendin' cash instead of rewards—cash that could've been padlin' my savings and investments. I ain't got the best strategy if I aim to make my travel card worth its annual fee.
Ryan's solution starts with strategic planning.
I should align my rewards and redemption strategies with my future travel plans. The points I've got squirreled away should be more than enough to cover my travel next year when I transfer 'em to the Delta SkyMiles program. But once I've burned off a chunk of those points, I'll need to think about my next move.
What airline will I be travelin' with for the holidays? Or got any big trips planned in 2027? I'll know what rewards I should focus on earnin' then, and what redemption value I can expect. I'll mostly stick with the Amex Gold since I usually travel with Delta or Aer Lingus. But if I plan a trip to the west coast, I might open a Chase travel card, put most of my spendin' on that card, earn the welcome offer, and score a better redemption value with Southwest or via Chase Travel.
Plannin' like this has already made my redemption anxiety more manageable. I can easily see what rewards I'll need, their likely value, how many I'll need for my trip, and when to use 'em. When it's time to book, I'll burn those points with gusto!
Bottom Line
I've straight-up been missin' out on savings, all in my quest for the perfect redemption. Fear not, though. I'm gonna steal Ryan's "earn and burn" wisdom, while still preservin' some of my own philosophy.
I'll still aim for high-value redemptions, but I'll make 'em more realistic. Instead of holdin' out for 2 cents per point, I'll look for redemptions values of at least 1.5 cents per point—a valuation I've seen plenty in my travels—meaning 2025 and 2026 will be the best years to cash in on the points I stashed away over the last four years.
I implore anyone who's got a mountain of points to consider Ryan's advice. If you find yourself in the same boat as me, it might be worth reassessin' your strategy and adjustin' your rewards expectations. The right time to redeem is comin', whether you like it or not.
Ryan Flanigan contributed additional reporting to this piece.
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- Recognizing the value of my points from the American Express® Gold Card, I decided to use some of them for my personal-finance goals, like funding my epic Iceland adventure next year.
- Adopting the "earn and burn" approach suggested by Ryan Flanigan, I began to plan my redemption strategy according to my travel needs, ensuring I am using my rewards points effectively and not just hoarding them.
