topic Re: Rewards - Save or Redeem? in Credit Cards

Rewards - Save or Redeem?

Anonymous — Thu, 17 Mar 2016 18:13:58 GMT

Do you guys save your points on your account or do you usually redeem them after increments of say $50-$100? I am saving mine for a future item I want to buy or a trip somewhere.

Re: Rewards - Save or Redeem?

Anonymous — Thu, 17 Mar 2016 18:20:35 GMT

Cash rewards I do the same thing and wait until I get a larger value (just cashed out $1300 from discover it) since you can't really devalue cash but with points I try to use them whenever the redemption value meets a certain threshold since they could be devalued at anytime

Re: Rewards - Save or Redeem?

Anonymous — Thu, 17 Mar 2016 18:22:41 GMT

@Anonymous wrote:
Cash rewards I do the same thing and wait until I get a larger value (just cashed out $1300 from discover it) since you can't really devalue cash but with points I try to use them whenever the redemption value meets a certain threshold since they could be devalued at anytime

oh wow 1,300! That must have been great. How long did it take you to reach that? Was that with the double cash back promo?

Re: Rewards - Save or Redeem?

Mattopotamus — Thu, 17 Mar 2016 18:28:27 GMT

I save them for either A) vacation or B) christmas. I try to save my reward points for vacations and the cash back rewards for christmas. For example, my CSP UR points will pay for a trip to seattle later this year, and the citi DC will pay for Christmas gifts.

Re: Rewards - Save or Redeem?

pip3man — Thu, 17 Mar 2016 18:56:16 GMT

I'm wondering the same thing too, got about $900 on my Quicksilver and I been considering whether or not to cash out or keep accumulating. Hmm decisions!!

Re: Rewards - Save or Redeem?

Anonymous — Thu, 17 Mar 2016 19:09:34 GMT

haha this reminds me of my grandma's story for some reason. she used her BofA card for everything. she literally didn't even know it got rewards lol. she called them one day for something and they're like "hey did you know you had almost $5k in cash back?" she was so shocked lol. she went on vacation almost instantly (like a week later)

Re: Rewards - Save or Redeem?

Anonymous — Thu, 17 Mar 2016 20:41:44 GMT

It didn't take me very long to accumulate that $1300. Most of it was from the 10% Apple Pay promo (I spent almost $8k on Apple Pay during that time) it hasn't been doubled yet but I have another (at least) $1300 coming in July from the double cash back promo!!

Re: Rewards - Save or Redeem?

Anonymous — Thu, 17 Mar 2016 23:46:41 GMT

This is discussed here a lot and I never really understand the "other" side. My view for cashback.

Unless there are special offers (e.g. Discover when if you have enough you can buy a giftcard at a discount), cash out as soon as you can, and if you need discipline, put it in a savings account and then spend it at the end of the year or whatever.

Leaving it with an issuer causes a (slight) risk that you can lose it if the issuer decides to close your card, and you are not earning any interest on the saved rewards (so in effect you are paying them interest, which you probably know to avoid).

Real transferable miles are much more complex, as you have to consider potential devaluations by airline (so you don't want to guess and transfer them to the wrong one too early etc), but the cashback case seems pretty cut and dried to me!

Re: Rewards - Save or Redeem?

Open123 — Fri, 18 Mar 2016 00:27:14 GMT

@Anonymous wrote:
This is discussed here a lot and I never really understand the "other" side. My view for cashback.

Unless there are special offers (e.g. Discover when if you have enough you can buy a giftcard at a discount), cash out as soon as you can, and if you need discipline, put it in a savings account and then spend it at the end of the year or whatever.

Leaving it with an issuer causes a (slight) risk that you can lose it if the issuer decides to close your card, and you are not earning any interest on the saved rewards (so in effect you are paying them interest, which you probably know to avoid).

Real transferable miles are much more complex, as you have to consider potential devaluations by airline (so you don't want to guess and transfer them to the wrong one too early etc), but the cashback case seems pretty cut and dried to me!

Right, for cash, I'll cash out 0.25 cents. Except for Fid Amex (because of Serve), I don't use any cash rewards cards with a redemption threshold, since it literally takes me years to hit $25.

Travel rewards points is much more complex. It really depends on so may factors.

Re: Rewards - Save or Redeem?

kdm31091 — Fri, 18 Mar 2016 00:39:40 GMT

@Anonymous wrote:
This is discussed here a lot and I never really understand the "other" side. My view for cashback.

Unless there are special offers (e.g. Discover when if you have enough you can buy a giftcard at a discount), cash out as soon as you can, and if you need discipline, put it in a savings account and then spend it at the end of the year or whatever.

Leaving it with an issuer causes a (slight) risk that you can lose it if the issuer decides to close your card, and you are not earning any interest on the saved rewards (so in effect you are paying them interest, which you probably know to avoid).

Real transferable miles are much more complex, as you have to consider potential devaluations by airline (so you don't want to guess and transfer them to the wrong one too early etc), but the cashback case seems pretty cut and dried to me!

I would agree, not sure what the downside is to redeeming your cash back as often as you can and putting it into a savings account. There's no advantage to leaving it sit in the rewards account other than specific circumstances (gift card discount from Discover, US Bank $25 bonus if redeem $100+, etc).

Re: Rewards - Save or Redeem?

Anonymous — Fri, 18 Mar 2016 03:25:57 GMT

I definitely agree when it's just cash back – no real point letting it pile up unless you really can't control your spending, but a saving account could fix that problem. I struggle with my travel rewards points, which can be redeemed for statement credits. I have a few hundred dollars worth of them and some small travel expenses that I could offset, but it's remarkably difficult not to continue saving these points for a future trip. It always feels irrational not to use them as soon as possible, but I find there can be some emotional value to watching the points amass and imagining the fun that could come from them in the future.

Re: Rewards - Save or Redeem?

Anonymous — Fri, 18 Mar 2016 06:09:48 GMT

I'm saving my rewards (mostly cash) so I can cash out anytime without having to meet a minimum (already have a little above minimum on multiple cards)

Re: Rewards - Save or Redeem?

takeshi74 — Fri, 18 Mar 2016 13:19:15 GMT

@Anonymous wrote:
Do you guys save your points on your account or do you usually redeem them after increments of say $50-$100? I am saving mine for a future item I want to buy or a trip somewhere.

Generally ASAP. The rewards don't earn interest sitting there and there's no telling when nerfing (not as relevant to cash back) might come along. I'll let UR points sit a bit in case I have other uses for them but generally they end up in my MileagePlus account.

Re: Rewards - Save or Redeem?

galahad15 — Fri, 18 Mar 2016 17:14:10 GMT

I redeem at the earliest available opportunity and/or once the minimum rewards threshold is reached (no min. for my Cap1 and Discover cards and $25 for my 3 FNBO and 2 BoA rewards cards, if I am remembering correctly).

Re: Rewards - Save or Redeem?

Ghoshida — Fri, 18 Mar 2016 23:14:46 GMT

@Anonymous wrote:
This is discussed here a lot and I never really understand the "other" side. My view for cashback.

Unless there are special offers (e.g. Discover when if you have enough you can buy a giftcard at a discount), cash out as soon as you can, and if you need discipline, put it in a savings account and then spend it at the end of the year or whatever.

Leaving it with an issuer causes a (slight) risk that you can lose it if the issuer decides to close your card, and you are not earning any interest on the saved rewards (so in effect you are paying them interest, which you probably know to avoid).

Real transferable miles are much more complex, as you have to consider potential devaluations by airline (so you don't want to guess and transfer them to the wrong one too early etc), but the cashback case seems pretty cut and dried to me!

Wholeheartedly agree.

This is what I do:

(1) Chase Freedom / CSP : Combine and leave them on CSP UR till I find a good opportunity to transfer. So far I've mostly done Singapore and Southwest. I've got about 92k UR sitting there.

(2) AMEX PRG: New card, but the rule is similar to CSP. I'll mostly pull the points in Singapore.

(3) AMEX BCE, Citi Dividend: Can't wait for the cashback to reach the minimum thresholds, then immediate withdraw (statement credit / direct deposit).

(4) Cap One Quicksilver: Withdraw once every statement as statement credit.

(5) US Bank Cash+: Waited the first time for that $25 bonus on $100 statement credit, after that I withdraw as soon as the statement posts, as statement credit.

(6) Sallie Mae: Wait till I reach $25. Then transfer to UPromise and get 10% annual match in my Sallie Mae HYSA.

(7) UFCU: Involuntary wait. CU credits cashback once a year. Anyway I changed the product to a low interest product and don't use it much.

(8) Discover Debit card: Once a month transfer to Discover credit card, regardless of amount.

(9) Discover It: Piling on cashback. Redeem for Gift cards especially Enterprise, get 2x value.

In general, I keep an excel sheet of monthly rewards. I simply value everything as 1x cashback there (so no high valuation of UR because every better valuation is opportunistic). Then I sum up the monthly rewards and transfer an equivalent amount from my checking account to a HYSA.

Mostly been on track except for big value bonuses. That savings pile recently reached $5k. There's a certain feel good factor once I see it

Re: Rewards - Save or Redeem?

Broke_Triathlete — Sat, 19 Mar 2016 01:31:44 GMT

@kdm31091 wrote:
@Anonymous wrote:
This is discussed here a lot and I never really understand the "other" side. My view for cashback.

Unless there are special offers (e.g. Discover when if you have enough you can buy a giftcard at a discount), cash out as soon as you can, and if you need discipline, put it in a savings account and then spend it at the end of the year or whatever.

Leaving it with an issuer causes a (slight) risk that you can lose it if the issuer decides to close your card, and you are not earning any interest on the saved rewards (so in effect you are paying them interest, which you probably know to avoid).

Real transferable miles are much more complex, as you have to consider potential devaluations by airline (so you don't want to guess and transfer them to the wrong one too early etc), but the cashback case seems pretty cut and dried to me!
I would agree, not sure what the downside is to redeeming your cash back as often as you can and putting it into a savings account. There's no advantage to leaving it sit in the rewards account other than specific circumstances (gift card discount from Discover, US Bank $25 bonus if redeem $100+, etc).

I was reading each reply to see if anyone was going to mention the possibility of losing it. I agree with LTL and KDM and cash out asap and put it in a savings account if you must. What I usually do is say I have $25 in cash back. I'll apply it as a statement credit, and then transfer $25 from my checking to my savings. That way I don't have to wait for a check/gift card, etc.

Re: Rewards - Save or Redeem?

redpat — Sat, 19 Mar 2016 01:57:21 GMT

@takeshi74 wrote:
@Anonymous wrote:
Do you guys save your points on your account or do you usually redeem them after increments of say $50-$100? I am saving mine for a future item I want to buy or a trip somewhere.
Generally ASAP. The rewards don't earn interest sitting there and there's no telling when nerfing (not as relevant to cash back) might come along. I'll let UR points sit a bit in case I have other uses for them but generally they end up in my MileagePlus account.

Lol, interest, what interest! .10% woohoo!

Re: Rewards - Save or Redeem?

Anonymous — Sat, 19 Mar 2016 01:58:53 GMT

discover's savings has ok interest. my CU is .25%. not much but i always get dividends. heck the checking is .1%

Re: Rewards - Save or Redeem?

Anonymous — Sat, 19 Mar 2016 02:02:02 GMT

I usually cash out once a year. With all the closures/AA that seem to be coming up from different lenders, I suppose I should jump on the band wagon and cash out more often.

I will cash out at the threshold now and just throw it into a savings account for just rewards earned from cards.

With the wife's Disney card, I can cash out at $10 increments and put it onto the redemption card now that they have no expiration.

Re: Rewards - Save or Redeem?

Anonymous — Sat, 19 Mar 2016 02:03:11 GMT

@redpat wrote:
@takeshi74 wrote:
@Anonymous wrote:
Do you guys save your points on your account or do you usually redeem them after increments of say $50-$100? I am saving mine for a future item I want to buy or a trip somewhere.
Generally ASAP. The rewards don't earn interest sitting there and there's no telling when nerfing (not as relevant to cash back) might come along. I'll let UR points sit a bit in case I have other uses for them but generally they end up in my MileagePlus account.
Lol, interest, what interest! .10% woohoo!

haha..interest is the last of my worries...this is fun money and gets pulled out once/twice a year.