Cash In Credit Card Points? Or Keep Accumulating?

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JJP
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Cash In Credit Card Points? Or Keep Accumulating?

Post by JJP »

I'm looking to get some opinions on this one. I've got about $300 worth of credit card points through Bank of America Travel Rewards that sit in my account doing nothing. After some thought, that is essentially $300 that is not accumulating any interest. I'm not saving for anything in particular either. It's just nice to watch the number grow each month. I make plenty of travel-related purchases so it isn't a matter of them expiring or me trying to figure out what to spend them on. If I used the points, I would receive a reimbursement on my next credit card bill.

Would you keep accumulating points to make a big (say $400) reimbursement? Or would you use them monthly for a $10-$20 reimbursement on the card? Thoughts?
BigPrince
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Re: Cash In Credit Card Points? Or Keep Accumulating?

Post by BigPrince »

I redeem points as soon as I can.

Two reasons
1. Point programs occasionally assign new values to points or increase redemptions. Tomorrow those points could be worth $150.

2. I would rather use that money to pay off any balances in full and use other monies to collect interest.


I only accrue points to ensure I get the max benefit. For example sometimes 10,000 points is worth $50 but at 25,000 it's worth $250. (Just an example)
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tennisplyr
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Re: Cash In Credit Card Points? Or Keep Accumulating?

Post by tennisplyr »

I usually cash them in when I reach around $100 šŸŽ‚ šŸ° no particular reason
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avalpert
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Re: Cash In Credit Card Points? Or Keep Accumulating?

Post by avalpert »

Redeem them as soon as you are able (unless there is some bonus for bunching them). No reason to wait to accrue the same dollar amount.
davebo
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Re: Cash In Credit Card Points? Or Keep Accumulating?

Post by davebo »

I have a discover card and it's very easy to just use it when I buy stuff on Amazon, but lately I've been acccumlating because we're planning a trip to disney. Just makes me feel like it's offsetting the purchase a bit more. But otherwise, I cash em in.
tonsofthorns
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Re: Cash In Credit Card Points? Or Keep Accumulating?

Post by tonsofthorns »

I also have the BofA Travel Rewards. Every month after my statement closes, I transfer the $$(points) to my Fidelity AMEX account via the BofA website. Then my Fidelity AMEX is on auto transfer. So all of my $$(points) get transfered to my Fidelity Brokerage Account. From the Brokerage Account, I can transfer to any bank account. I hope this helps. Sometimes you have to wait until you have accumulated a certain number of points to cash out. This method I can do any amount.
poker27
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Re: Cash In Credit Card Points? Or Keep Accumulating?

Post by poker27 »

Personally, I like to bank the $ and then spend it on something larger ish. Earlier this year I funded a 2k vacation between my discover cash and southwest points. Ya, it probably took me 5 years to add all that up, but it felt nice :)
investor1
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Re: Cash In Credit Card Points? Or Keep Accumulating?

Post by investor1 »

I used to use them ASAP, but I realized that was only causing me to spend more money on everyday things that I don't really need or even want all that much. I switched to using them once a year. That gives me a decent chunk of change that I can make a decision and do something useful with. This year it will likely end up in the vacation fund.
lululu
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Re: Cash In Credit Card Points? Or Keep Accumulating?

Post by lululu »

BigPrince wrote: 1. Point programs occasionally assign new values to points or increase redemptions. Tomorrow those points could be worth $150.
I ran into a point is not worth a penny for the first time just recently with a card run by First National Bank of Omaha. They were advertising 3% on gas and groceries, and then when I went to apply points as cash bank, $25 cost 3500 points. Am I the only person who thinks that's crooked? Their phone rep had never heard of it either.

I only use points as cash back or amazon gift cards generally. I did once get a Nook. So I'm not accumulating junk merchandise. I do tend to cash the points in when I think of it instead of letting them accumulate forever. The Nook became a possibility because I'd just forgotten for awhile and the points had piled up.
Laren
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Re: Cash In Credit Card Points? Or Keep Accumulating?

Post by Laren »

A friend of mine had someone hack her Fidelity Amex account and instead of making unauthorized charges, they cashed out all of her reward points for gift cards. Apparently this has happened with enough accounts that FIA was watching for this kind of activity and froze the account. She had only ever redeemed for cash, so the change to redeeming for gift cards is what got the account frozen. After she called, they did restore the points, but it was still unnerving. I used to let my credit card rewards accumulate until I had a specific use for them, but after hearing this I went through all of my credit cards and redeemed everything I could!
ddunca1944
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Re: Cash In Credit Card Points? Or Keep Accumulating?

Post by ddunca1944 »

I save our rewards to use towards an annual international trip. I recently redeemed them to pay the fees associated with redeeming miles for a round trip flight to Europe next year.
ieee488
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Re: Cash In Credit Card Points? Or Keep Accumulating?

Post by ieee488 »

lululu wrote: I ran into a point is not worth a penny for the first time just recently with a card run by First National Bank of Omaha. They were advertising 3% on gas and groceries, and then when I went to apply points as cash bank, $25 cost 3500 points. Am I the only person who thinks that's crooked? Their phone rep had never heard of it either.
Crooked?
It is not required that 1 point = $1 at redemption.

I have a Citibank credit card where I get 2% for entertainment and restaurants.
It is only 2 points = $1 if I want a statement credit.
Fortunately, I get one-to-one on gift cards. I used my last points for a $25 Walmart gift card which will come in handy for the upcoming holiday season.
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midareff
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Re: Cash In Credit Card Points? Or Keep Accumulating?

Post by midareff »

I turn them to cash and move the cash to an Ally MM as soon as I can. Better in my hands than theirs and points have an expiration date.
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N1CKV
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Re: Cash In Credit Card Points? Or Keep Accumulating?

Post by N1CKV »

I only use Cash back rewards cards. I have all of them set to auto redeem at the minimum amount allowed as a statement credit.
lululu
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Re: Cash In Credit Card Points? Or Keep Accumulating?

Post by lululu »

ieee488 wrote:
lululu wrote: I ran into a point is not worth a penny for the first time just recently with a card run by First National Bank of Omaha. They were advertising 3% on gas and groceries, and then when I went to apply points as cash bank, $25 cost 3500 points. Am I the only person who thinks that's crooked? Their phone rep had never heard of it either.
Crooked?
It is not required that 1 point = $1 at redemption.

I have a Citibank credit card where I get 2% for entertainment and restaurants.
It is only 2 points = $1 if I want a statement credit.
Fortunately, I get one-to-one on gift cards. I used my last points for a $25 Walmart gift card which will come in handy for the upcoming holiday season.
You seem to be in some other point universe than I am. If 2 points = $1, I'd be rolling in money. In fact, the more money I charged, the more money I'd have.
ieee488
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Re: Cash In Credit Card Points? Or Keep Accumulating?

Post by ieee488 »

lululu wrote:
ieee488 wrote:
lululu wrote: I ran into a point is not worth a penny for the first time just recently with a card run by First National Bank of Omaha. They were advertising 3% on gas and groceries, and then when I went to apply points as cash bank, $25 cost 3500 points. Am I the only person who thinks that's crooked? Their phone rep had never heard of it either.
Crooked?
It is not required that 1 point = $1 at redemption.

I have a Citibank credit card where I get 2% for entertainment and restaurants.
It is only 2 points = $1 if I want a statement credit.
Fortunately, I get one-to-one on gift cards. I used my last points for a $25 Walmart gift card which will come in handy for the upcoming holiday season.
You seem to be in some other point universe than I am. If 2 points = $1, I'd be rolling in money. In fact, the more money I charged, the more money I'd have.
200 points = $1
Is that better?

The point is that what you call "crooked" is not crooked. It is probably in the fine print somewhere.

What is eye-opening is the CSR was equally as clueless.

As I stated above, to get the 100 to 1 correspondence that you are insisting, I redeem for Walmart gift cards with my Citibank card.
I knew this going in. No surprise to me.
Last edited by ieee488 on Mon Oct 06, 2014 11:00 am, edited 1 time in total.
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Topic Author
JJP
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Re: Cash In Credit Card Points? Or Keep Accumulating?

Post by JJP »

Thanks for the thoughts! To add to what lululu said, I put EVERYTHING I can on the credit card for the points (and pay it off each month, of course). Granted I don't accumulate as much as some, seeing as I only spend $1k-2k a month, but it is even more beneficial if you have business expenses that are reimbursed to you.

I do find it interesting that BoA charges 4,200 points for a $25 gift card, but 2,500 points for $25 of travel reimbursement. THAT, I will agree, is crooked. But hey, if you don't read and understand what you're getting yourself into, that's on you. I'll take the travel reimbursement....thanks! :moneybag :beer
ieee488
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Re: Cash In Credit Card Points? Or Keep Accumulating?

Post by ieee488 »

JJP wrote:I do find it interesting that BoA charges 4,200 points for a $25 gift card, but 2,500 points for $25 of travel reimbursement. THAT, I will agree, is crooked. But hey, if you don't read and understand what you're getting yourself into, that's on you. I'll take the travel reimbursement....thanks! :moneybag :beer
I have a BoA Cash Rewards credit card. I have no problem with redeeming 2500 points for $25 statement credit.
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Phika
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Re: Cash In Credit Card Points? Or Keep Accumulating?

Post by Phika »

For any cash back rewards cards, I redeem pretty often for cash since that's money that's otherwise just sitting around. For any points rewards credit cards, I tend to accumulate and spend them for vacations and travel for weddings (since I'm at that age).
Luke Duke
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Re: Cash In Credit Card Points? Or Keep Accumulating?

Post by Luke Duke »

I let them accumulate and I usually buy something stupid on Amazon that I couldn't really justify to myself if it weren't "free" money. Next on the list is a pellet gun.
PatrickA5
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Re: Cash In Credit Card Points? Or Keep Accumulating?

Post by PatrickA5 »

I'm a points/miles hound and currently have 2 million points in various hotel/airline/travel cards. Most of the points were from various bonus awards from signing up for umpteen credit cards.

It's always best to use the points if you can. I've seen so many devaluations over the years, that you're really taking a chance just hanging on to them. Having said that, I tend to do the opposite because I like to save up for family trips. This last summer we save around $4,000 in air fare, hotels and rental cars for our family vacation. There's a fair amount of work involved in playing the rewards card game. I'd say if you're not interested in a certain flight, etc you should go ahead and cash them in. If I have a small amount of points in a certain rewards programs, I usually just try to get a gift card.
takeshi
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Re: Cash In Credit Card Points? Or Keep Accumulating?

Post by takeshi »

JJP wrote:Cash In Credit Card Points? Or Keep Accumulating?
Cash in. As others have pointed out points can be devalued at any time.
lululu wrote:They were advertising 3% on gas and groceries, and then when I went to apply points as cash bank, $25 cost 3500 points. Am I the only person who thinks that's crooked?
If they were advertising 3% it would be crooked. However, it sounds like they're actually advertising 3 points/$1 and you were assuming that 1 point = 1 cent. That's not necessarily the case with all point systems. Points can even vary in value based on how they're redeemed in some cases. What card is this?
Caduceus
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Re: Cash In Credit Card Points? Or Keep Accumulating?

Post by Caduceus »

Unless you get some kind of bonus for hitting a certain level of points, why would you not redeem them as soon as you are allowed to?
nordlead
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Re: Cash In Credit Card Points? Or Keep Accumulating?

Post by nordlead »

The only reason I know of to hoard points is to redeem them for discount airfare or hotels. You can sometimes increase the value of the points by up to 50%.

I personally cash them, as I rarely travel by airplane and don't stay in hotels often.
Easy Rhino
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Re: Cash In Credit Card Points? Or Keep Accumulating?

Post by Easy Rhino »

as others have said, unless you need to save them for something "big" where the redemption is more efficient (maybe it's just a $100 reward with a better conversion, or maybe it's something like expensive plane tickets), then spend them as soon as you can, reduces the risk of getting them devalued or lost if the card is closed.
auggiedoggies
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Re: Cash In Credit Card Points? Or Keep Accumulating?

Post by auggiedoggies »

If it's a cash back card, you may as well cash it in now.

For cards where you can transfer your points to airline or hotel programs, it can make sense to hold onto them and save up for something. BTW, I greatly recommend one of these cards as opposed to a pure cash back card. You can get significantly more value than 1 cent per point.
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celia
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Re: Cash In Credit Card Points? Or Keep Accumulating?

Post by celia »

My Capital One "No Hassle Rewards" Visa lets you spend points like cash (100 pts=$1) unless you use them for travel (air, hotel) in which huge balances are worth more than a dollar, something like 80,000pts =$1,000 of travel, instead of $800 of non-travel purchase/redemption.
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forkhorn
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Re: Cash In Credit Card Points? Or Keep Accumulating?

Post by forkhorn »

I think of them as free money that might be arbitrarily taken away or devalued at any time. That's why they call them "points" and not "dollars". Therefore, I cash them as soon as they reach the full value (sometimes you have to build up $100 or something and then you get slightly more $/point for them) and I think about it. I don't use miles rewards cards, only cash back cards. If you get miles, then I suppose you might need to save up a lot to get the ticket or hotel you want.
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Re: Cash In Credit Card Points? Or Keep Accumulating?

Post by JDDS »

My brother wanted to have a wedding outside the country. I was saving my Chase Amazon points towards an airplane ticket. My brother decided with short notice to get married elsewhere in the country the same weekend as a long time friend. I had already committed to being in my friend's wedding--at least no one else in my family was able to make the brother's wedding either! Anyways, shortly thereafter I decided to just take the rewards as they accumulate. As others have mentioned, points can be devaluated any time. Also, I'd hate to find my account closed for some crazy reason and points forfeit.
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