Keep Chase Ultimate Rewards Points, Citi Thank-You Points and Amex Membership Rewards Points With the Card Issuer Until You Are Ready to Redeem

Cardholders who accrue points in these programs should try to keep them there until they know exactly how they will redeem them.

Smart credit card users are generating some of the most valuable travel rewards through the flexible travel rewards programs on Chase, Citibank and Amex. Each of these programs allow their points to be transferred into the programs of several leading airline hotel partners, usually in 1,000 point increments. (Note that Barclays and Bank of America also have flexible travel rewards programs and those cards are ranked among our top 10 travel rewards for 2015, but the programs operate differently in that points can be applied directly against travel expenses).

When you earn points in the Chase, Citibank or Amex programs, there is an inclination to want to move them as quickly as your earn them to your favorite frequent flier program or hotel program. For several reasons, you are better off leaving them in the flexible program in which they are accrued until such time as you need them for booking / redemption.

Here are the main reasons why it makes sense to hold your points at Chase, Citibank or Amex.

  1. Airline miles and hotel programs frequently devalue their program as a whole (Delta and United, in particular), or change the number of miles or points required for an airline or hotel stay. Once you move your points into a given airline or hotel program, your points are with that program and for as long as they remain unused they become less valuable with each devaluation. You protect yourself from these devaluation by holding the option where to transfer your points as long as possible.
  2. Airlines and hotels have a constant incentive to devalue their points, and the card issuers have a constant incentive to keep their points being worth as much as possible. Between the two, your interests are better aligned with the card issuer so you want to keep your stash with them until you need them.
  3. Because card issuers have an incentive to keep points worth as much as possible, they are constantly adding new partners …. Both Citibank and Amex recently became partners with the Singapore Airlines Krisflyer program which gives holders of their points a very valuable option that wasn’t present just a few months ago (Chase has long had Krisflyer as a partner). This article outlines the Krisflyer program and explains why it is extremely valuable on Singapore Airlines as well as on United and Virgin America (but, it is also not a good place to store points). Had you transferred your points to one of the US airlines before Krisflyer was added, you would have missed out on some great redemption opportunities.
  4. Card issuers are sometimes even giving transfer bonuses that make your points more valuable. American Express is the program that often runs promotions allowing you to transfer your points to British Airways and Delta at better than a 1:1 transfer ratio (they have offered transfers as high as 1:1.40).
  5. There is an optionality value to the points that is lost as soon as they are transferred. For example, 100,000 Chase Ultimate Rewards points earned through a Chase Sapphire card or the Chase Ink card can get you three nights at the Park Hyatt Place Vendome in Paris (90,000 points on Hyatt), or six roundtrips from New York to Chicago on American (90,000 points booking through British Airways), or a Business Class round trip ticket from JFK to Frankfurt on Singapore Airlines (you’ll need 98,800 points on Singapore). They can also be redeemed for flights on United, Korean or Virgin Atlantic, for hotel stays at Intercontinental or Marriott / Ritz, or even for travel on Amtrak. But, once transferred, your options are gone.

There is one disadvantage to not transferring your points until you need them, and that is that you’ll need to keep your card active (i.e., pay the annual renewal fee each year) in order to keep your points.

We rank these three cards as the best flexible travel and rewards cards for individuals and these three as the best for business.

Ari Socolow
Ari Socolow: Ari Socolow is the Chief Economist and Editor-in-Chief at BestCashCow. He is particularly interested in issues relating to bank transparency and the climate crisis. Since co-founding BestCashCow in 2005, Ari has been frequently cited in the media as an expert on local and national savings accounts, CD products, mortgage and loan products and credit card rewards products.

Editorial Disclosure: Opinions, reviews, analyses & recommendations are the author's alone, and have not been reviewed, endorsed or approved by any of these entities.

User Generated Content Disclosure: Responses are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser's responsibility to ensure all posts and/or questions are answered.

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