Should I Save or Redeem My Reward Points?

By: Cheryl Maguire

I love reward programs. I always sign up for a program any time it’s offered at a restaurant, grocery, or retail store. Most of the time the rewards programs are free and separate from credit card reward programs. If you also have credit card rewards, you can often earn points simultaneously from the rewards program and the credit card rewards.

In most reward programs. you earn points for purchasing specific items. You can then trade your points in for many different things like cash, discounts, gift cards, and other options. Here are some questions to help you consider whether you should save or redeem your rewards points.

Can you Increase Your Rewards? Sometimes you can increase your points by redeeming certain prizes. For example, some credit card rewards offer an extra $5 or more when you use your points for gift cards instead of cash. Increasing the value of your reward points may be time limited, which would make cashing out more valuable. Another way to increase your rewards would be to use a coupon with the gift card. For example, you could use a “$5 off $20 purchase” CVS coupon with a CVS gift card that you earned through a rewards program. If the coupon expires, you would want to trade in your points in time to use the gift card with the coupon. I used my Discover Card points to get a TGIF gift card and I earned an additional $5. I then used the gift card with a Buy 1 Get 1 Free entrée coupon which saved $7.  I also earned TGIF rewards points.

Is the Reward You Want Popular? If an item you are interested in obtaining is popular, available, and you have enough points, you should exchange your points for the item. Some programs even have a category called, “most popular” to help you figure out which prizes are sought after. Often there is a limited number of prizes and it may take weeks to restock the item or it may never be restocked. When I used my points for a gift card, that card was often not available for very long and then sometimes the card might not be available anymore in the future.

Will You Ever Earn Enough? If it takes a long time (over a year) to earn enough points to obtain the reward you want, the reward may no longer be available or you may never earn enough points. Before you save your points, consider if your goal of obtaining the reward is realistic and obtainable. I realize I will never earn enough points to get an expensive item so I aim for the prizes I know I can attain, and I will use such as gift cards or cash.

Are Your Points Expiring? Most reward points expire within a given time frame. Some programs like airline miles or credit card rewards require you to maintain activity in your account which is defined as either earning or redeeming your points. It is important to keep track of the program rules regarding expiration of points so you do not lose your points. Also, if you know when your points are going to expire, you can plan to redeem the points for a prize you want instead of one you get only to avoid losing your points. 

Does the Program Appear to Be In Trouble? Often there are signs a rewards program may be ending or being discontinued. Unfortunately, sometimes a program could end without any warning. Some signs to look out for are fewer valuable prizes offered, decreased opportunity to earn points, or increased restrictions regarding earning or redeeming points. When I noticed a program no longer offers any opportunity to earn points, I redeemed mine. Within a month after I redeemed my points, the website shut down. Also look for signs that the business might be in trouble like store closures.

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