What is the value of your rewards?
Because your rewards are worth a specific amount of money, you’ll want to pay close attention to the card’s redemption rate. The typical value of rewards hovers around 1 cent per point/mile. Make sure you are receiving a 1:1 value when you cash in, otherwise you’re leaving cash on the table. To calculate the value, take the cost of the item you want to buy and divide it by how many points are needed.
Redemption Options
Some rates will be even higher when redeemed a certain way. For example, Premium Rewards cardholders can use the rewards portal and new Pay Yourself Back feature to receive 25% to 50% more value on their points, which is an increased value of 1.25 cents to 1.50 cents. Before the pandemic, Expert Bank only offered this premium value on travel redemptions.
And likewise, you could potentially devalue the amount of your points and miles, too. This is common with gift cards and paying with points at online checkouts. Be sure to check the dollar value of your points before you cash them in.
Expiration of Rewards
Finally, stay on the lookout for when your rewards both hit your account and expire; one big mistake rewards cardholders often make is waiting either too long or not long enough to redeem and missing out on their earnings.