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6 tips for gaining the most value when redeeming reward points

These guidelines can help you maximize your reward points.

It feels great to cash in all of those reward points on a new video game console or a flight to Hawaii. But it’s not always easy to know the best way to use credit card points – or if you’ve been missing out on even more ways to earn.

Here are six things you can do to make the most of your credit card points.

Use the credit card that will earn you the most points

While it sounds obvious, this doesn’t necessarily mean use a credit card that earns the most points per dollar on a purchase. Instead, you want a credit card that fits your everyday spending. For example, a rewards card with 3x points on dining purchases won’t help much if you don’t dine out often.

A great strategy for reliably earning points is to double up on your rewards cards. Pick one for everyday purchases, such as gas and groceries, and another for less common purchases such as travel.

Pick a rewards card that suits your rewards preferences

Rewards credit cards come in a few flavors: airline cards, hotel cards and general rewards cards. Hotel and airline cards generally earn and redeem points through their respective category purchases. For example, the Delta SkyMiles® Reserve American Express Card only earns Delta SkyMiles on eligible purchases.

These niche rewards cards are great if you value a certain hotel or airline brand and don’t mind catering to them specifically. The drawback is you’re locked in to redeeming with that brand, with some exceptions.

If you prefer flexibility with how you earn and redeem your credit card points, a general credit card rewards program, such as Chase Ultimate Rewards or American Express Membership Rewards, might offer you a better value. Several of these rewards cards also allow you to transfer your points to other rewards programs – an even greater opportunity for value.

Compare rewards credit cards

Name Product Welcome offer Rewards Annual fee Filter values
Blue Cash Preferred® Card from American Express
Up to $350: 20% back on purchases in the first 6 months for up to $200 back, plus $150 statement credit after you spend $3,000 in the first 6 months
6% on select US streaming services, 3% on transit and US gas stations, 6% at US supermarkets on up to $6,000 annually, then 1% after that and on all other purchases (redeem as statement credit)
$0 intro annual fee for the first year ($95 thereafter)
Earn up to $350. In your first 6 months, you can earn a $150 statement credit when you spend $3,000, and earn 20% back on Amazon purchases made with your card, up to $200 total. Having 6 months to earn a welcome offer is a rare benefit as most cards give you only 3. Terms apply, see rates & fees
Blue Cash Everyday® Card from American Express
Up to $250: 20% back on purchases in the first 6 months for up to $150 back, plus $100 statement credit after spending $2,000 within the first 6 months
3% at US supermarkets on up to $6,000 per year (then 1%), 2% at US gas stations and select US department stores and 1% on all other purchases (redeem as statement credit)
Earn up to $250. You'll get 20% back on purchases in the first six months for up to $150 back, and $100 after you spend $2,000 in the first six months. This is a higher-than-average welcome offer for a card with no annual fee. Terms apply, see rates & fees
Chase Sapphire Preferred® Card
100,000 points after spending $4,000 in the first 3 months. That's $1,250 when you redeem through Chase Ultimate Rewards®
5x points on Lyft, 2x points on travel and dining and 1x points on all other purchases

Up to $1,250 signup bonus

Earn a massive signup bonus of 100,000 points with this popular travel card. That's worth up to $1,250!

Compare up to 4 providers

Review your transfer options

Perhaps the best way to redeem credit card points is to transfer them to a travel loyalty program.

For many of the premier credit cards rewards programs, you can transfer your credit card rewards points to a partnered airline or hotel loyalty program at a 1:1 ratio. However, point values are much more variable on many travel loyalty programs. In fact, it’s not uncommon for points to be worth 2 cents each or more, depending on how you redeem them.

Do a little research and you’ll be able to double or even triple the value of your credit card points. Compare airline loyalty programs to look at our current point values. Or if you prefer spending your points on hotels, check out the top hotel loyalty programs.

Make your redemptions through a single card

If you’re committed to getting the most value out of a rewards program, it pays to pick up a card that maximizes your redemption value. Many credit card rewards program points are worth a different value depending on which credit card you use to redeem them.

For example, flights booked with Membership Rewards points through the Amex travel portal are worth 0.5 cents each when you use Blue from American Express® Card. But they’re worth 1 cent each when you book using your The Platinum Card® from American Express.

These point values can vary greatly. For example, the Chase Sapphire Reserve® card boosts point values to 1.50 cents each when you use it to book travel through the Chase travel portal.

Transfer your points to this premium card as you earn points on your other cards to ensure you’re making the most of your points when you spend them. Just take care when managing multiple cards to not get overwhelmed.

Stay away from merchandise

Merchandise and gift cards offer some of the lowest value for your points on average. You can count on this fact across almost every credit card rewards program available.

Most point values are worth around 0.3 cents each when redeemed on merchandise, a far cry from the 1 cent or more they’re worth when redeemed on travel options. If you want to convert your points into merchandise purchases, consider a cashback credit card instead.

Take advantage of your welcome offer

Most rewards credit cards provide large welcome offer bonuses if you can meet the requirements. These bonuses range from simple cash back to enormous point bonuses depending on the card.

In many cases, a big chunk of your total credit card value is tied up in this welcome offer. If you don’t think you can meet the requirements of a card’s welcome offer, consider holding off until you can. You might also want to consider another rewards card with more forgiving requirements.

Spend within your means

Take care not to overspend in pursuit of a card’s bonuses. It’s better to play it safe and avoid carrying a balance if you can’t reach the spending threshold for a welcome offer or other credit card bonus. Choose a rewards credit card that best suits your financial situation.

Bottom line

Provided you do a little research, you have plenty of opportunities to turn your credit card rewards points into big value. Follow these guidelines to help make your choices even easier.

Compare rewards credit cards to find one that offers the rewards and earning potential that best fit your needs.

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