{"id":184291,"date":"2015-02-18T04:00:29","date_gmt":"2015-02-18T11:00:29","guid":{"rendered":"http:\/\/getrichslowly.org\/blog\/?p=184291"},"modified":"2018-11-21T13:53:49","modified_gmt":"2018-11-21T21:53:49","slug":"best-way-to-redeem-travel-points-why-hoarding-points-is-a-bad-investment","status":"publish","type":"post","link":"https:\/\/www.getrichslowly.org\/best-way-to-redeem-travel-points-why-hoarding-points-is-a-bad-investment\/","title":{"rendered":"Best way to redeem travel points: Why hoarding points is a bad investment"},"content":{"rendered":"
For most people, pursuing credit card rewards is a game of cat and mouse. You keep a watchful eye on your credit score, seek out the best offers, and strike when the iron is hot.<\/p>\n
But that is just one component of the hobby; the other part of the equation is that it can be extremely exciting to watch your point balances climb. Obviously, the more credit card rewards offers you sign up for, the more sign-up bonuses you earn, and the more spending you complete over time, the more points you accumulate.<\/p>\n
If you love to save like I do, it can be tempting to do the same with your points and miles and hoard them in the same fashion as you would your monthly paycheck. But there are a number of reasons why you shouldn’t treat your airline miles and hotel points like cash in the bank. Here are a few:<\/p>\n
If you’ve been collecting airline miles or hotel points for any length of time, you’ve probably lived through at least one major devaluation. If you haven’t, I’ll explain what that means.<\/p>\n
Basically, each frequent flyer and hotel loyalty program has a system that dictates how much each point is worth and, occasionally, they’ll deem that their points have become too valuable and decide to make them worth less. A few examples:<\/p>\n
Notice a pattern? If you follow the history of frequent flyer programs, you’ll notice that their currency becomes worth less and less with each passing year. And this phenomenon isn’t limited just to airlines; major hotel loyalty programs have gone through countless devaluations over the years, including big changes from Hilton, Marriott, and even Starwood Preferred Guest. Just remember, award chart changes are\u00a0never in your favor<\/em><\/strong>, and they always result in your points being worth less.<\/p>\n Beyond devaluations, it is important to understand that many credit card points expire if they remain inactive for a certain length of time, too. In some cases, they expire if you don’t earn or spend any miles within a span of 12 to 24 months and, in others, they will expire if you close your account.<\/p>\n Keep in mind that you generally just need to earn or burn some miles to keep your account active, and that earning just a handful of points can reset the clock and keep your account in good standing.<\/p>\n Here are some of the most popular programs’ expiration policies:<\/p>\n You get the picture, but can you imagine keeping track of multiple point balances over multiple programs? Imagine saving a hefty balance of points in one program for a year only to find out that your points expired and your effort was all for naught. Unfortunately, that happens all the time, and often to those who are saving their balances for a\u00a0special trip<\/a> or redemption.<\/p>\n In addition to worries over devaluations and expiration policies, another good reason to cash in your points frequently is plain ol’ inflation. The fact is, credit card rewards don’t collect interest, so no matter what, the value of your points will erode over time. And even if you are just collecting cash-back rewards, the money you accumulate will be worth less this time next year.<\/p>\n If you have been saving your points and miles for a while, you probably have a healthy stash. But it is a good idea to think of your account balances differently than your actual investments. Because unlike your retirement accounts, your point balances only stand to lose value over time. Think of it this way: Saving points and miles is kind of like keeping them in a savings account\u00a0that actually charges you<\/em> five to 10 percent interest each year.<\/p>\n So if you are sitting on a mountain of points, consider burning them before it’s too late. Take stock of what you have and see if you can use them for this year’s spring break or your summer vacation plans. Search around for the best redemptions and use your points in the way they were intended instead of letting your balances grow month after month. And after you book your dream trip, consider opening a\u00a0vacation savings account<\/a> to help pay for everything your points and miles won’t cover.<\/p>\n And have fun with it!\u00a0Because when it comes to points and miles, it never pays to save.<\/p>\n How often do you redeem your points and miles? <\/em><\/strong>If you tend to save your points and miles, are you saving up for a special trip or purchase?<\/em><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":" For most people, pursuing credit card rewards is a game of cat and mouse. You keep a watchful eye on your credit score, seek out the best offers, and strike when the iron is hot.<\/p>\n But that is just one component of the hobby; the other part of the equation is that it can be extremely exciting to watch your point balances climb. Obviously, the more credit card rewards offers you sign up for, the more sign-up bonuses you earn, and the more spending you complete over time, the more points you accumulate.<\/p>\n If you love to save like I do, it can be tempting to do the same with your points and miles and hoard them in the same fashion as you would your monthly paycheck. But there are a number of reasons why you shouldn’t treat your airline miles and hotel points like cash in the bank. Here are a few:<\/p>\n","protected":false},"author":3202,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[489],"acf":[],"_links":{"self":[{"href":"https:\/\/www.getrichslowly.org\/wp-json\/wp\/v2\/posts\/184291"}],"collection":[{"href":"https:\/\/www.getrichslowly.org\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.getrichslowly.org\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.getrichslowly.org\/wp-json\/wp\/v2\/users\/3202"}],"replies":[{"embeddable":true,"href":"https:\/\/www.getrichslowly.org\/wp-json\/wp\/v2\/comments?post=184291"}],"version-history":[{"count":0,"href":"https:\/\/www.getrichslowly.org\/wp-json\/wp\/v2\/posts\/184291\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.getrichslowly.org\/wp-json\/wp\/v2\/media?parent=184291"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.getrichslowly.org\/wp-json\/wp\/v2\/categories?post=184291"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}<\/span>Expiration dates<\/span><\/h2>\n
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<\/span>Points and miles — the perfect excuse to spend<\/span><\/h2>\n