Credit Card Reward Points: When Should You Use Them?

Carrying a rewards credit card is beneficial for a number of reasons, including the fact that you can earn points for almost every purchase you make.

However, this does lead you to a very important question: when is the right time to use these points?

Since everyone is in a different position, there is no right or wrong answer. There are consumers who never let their points accumulate for too long. And of course, there are those who hang onto these until they can cash them in for something more valuable.

Here are some basic tips to help you decide when to use your reward points:

•    Know the expiration schedule. This doesn’t come into play with every rewards credit card, but it could impact you. If your points expire, make sure you know when this will be happening. This way, you can cash them in before you lose them forever.
•    Know what you can get. It’s much easier to decide when to use and when to save your points when you have a clear idea of what you can use them for. Maybe you like to cash your points in every so often for cash, whereas the next person is saving for a hotel stay or airline ticket.
•    Set a goal. Just the same as a gift card, it can be a challenge to hold onto your credit card reward points for an extended period of time. At some point, these may begin to “burn a hole” in your pocket. However, if you set a goal, such as saving 50,000 points, you’ll find it much easier to stay on track.

Earning credit card reward points alone is exciting enough. Even so, the real fun begins when it’s time to cash these in for something you’ve had your eyes on.

Do you have any other tips for using credit card rewards? What have you been able to purchase in the past with these?