Stop Wasting Your Points: 6 Reward Redemption Mistakes to Avoid in 2026

Many travelers unknowingly sacrifice thousands of dollars in value by redeeming points for gift cards, booking inflexible awards, or missing transfer partner sweet spots.

This article will guide you through the six most costly reward redemption mistakes to help you maximize every point you've earned.

Key Takeaways

• Gift card and merchandise redemptions typically offer 0.5-0.7 cents per point versus 1.5-3+ cents for travel.

• Hoarding points risks devaluation that can instantly reduce redemption values by 20-40%.

• Transfer partner sweet spots can provide 2-3x better value than booking directly through credit card portals.

• Flexible travel dates and airports can unlock award availability that saves thousands of points.

"Credit card rewards offer hundreds of dollars worth of value annually if you can get the most out of them," says Jacqueline DeMarco, writer at Yahoo Finance.

"However, there's more to maximizing your credit card rewards than just earning and redeeming points or cash back over time. It's good to be aware of all the benefits your card offers, but also avoid habits that can end up costing you if you want to get the most from your rewards."

What are Reward Redemption Values?

Redemption value is how much each point is worth when you use it. If you redeem 10,000 points for a $200 flight, each point is worth 2 cents. If you redeem those same 10,000 points for a $100 gift card, each point is worth 1 cent.

This number determines whether you're getting good value or wasting your points. The same 50,000 points could be worth $300 in gift cards (0.6 cents per point) or $1,250 in travel (2.5 cents per point).

Knowing redemption values helps you choose the best way to use your points and avoid costly mistakes that cut your rewards value in half.

Mistake 1: Redeeming Points for Gift Cards and Merchandise

The biggest mistake reward earners make is redeeming points for gift cards, merchandise, or statement credits that provide terrible value compared to travel redemptions. Here’s why:

• Low redemption rates: Most programs offer 0.5-0.7 cents per point for gift cards or merch, versus 1.5-3+ cents for travel redemptions. A $100 Amazon gift card might cost 15,000-20,000 points when those same points could book $300-600 worth of flights.

• Limited selection and restrictions: Gift card options are often limited to specific retailers with restrictions on usage. Merchandise catalogs feature overpriced items that usually provide worse value than gift cards.

Better Alternatives for Non-Travel Redemptions

• Statement credits: Many programs offer 1 cent per point for statement credits, which beats most gift card rates while giving you cash flexibility.
• Travel-related purchases: Use points for car rentals, hotels, or dining through your card's portal. These often provide better value than merchandise while still covering practical expenses.
• Save for future travel: Even without specific plans, holding points for travel redemptions typically delivers better long-term value. Just don't wait too long – points can lose value through program devaluations, so use them within 12-18 months.

Pro tip: Before making any redemption, use free tools like The Points Guy's calculator to check your point values. If you're getting less than 1 cent per point, you're likely making a poor redemption choice.

Mistake 2: Hoarding Points and Missing Devaluation Risks

Saving points for the "perfect trip" can backfire when programs suddenly increase award prices. Airlines and hotels regularly devalue their programs, sometimes overnight and without warning.

A flight that costs 50,000 points today could require 70,000 points after the next devaluation. Delta moved to dynamic pricing that increased many popular routes by 30-40%. Other major airlines have made similar changes that instantly reduced point values.

Most programs devalue every 2-3 years. Some make changes multiple times per year. Your points lose purchasing power each time this happens.

How to Protect Your Points

• Book confirmed travel immediately: If you have travel plans within 12 months, book those flights now. This locks in current award prices and protects you from future devaluations.
• Use older points first: Many programs expire points after 18-24 months of inactivity. Check your account regularly and use the oldest points to avoid forfeitures.
• Stay informed: Subscribe to airline and hotel program emails. They sometimes announce devaluations in advance, giving you time to book before prices increase.

Mistake 3: Ignoring Transfer Partner Sweet Spots

Credit card portal redemptions often provide inferior value compared to transferring points to airline and hotel partners with better award charts and availability.

Transfer Partner Advantages

• Better redemption rates: Transfer partners offer 1.5-3+ cents per point, compared to 1-1.25 cents through credit card portals. Your 60,000 points might book a $900 flight through the portal or a $2,400 business class ticket through transfer partners.
• Access to premium cabins: Partner airlines offer business and first-class awards unavailable through credit card portals. You can book luxury experiences that would cost thousands in cash for a fraction of the points.

How to Find the Best Transfer Partner Deals

• Research award charts: Each partner airline has different pricing for routes. Some programs charge fewer points for certain destinations than others, creating opportunities for exceptional value.
• Time your bookings: Many partners offer better availability and lower prices during off-peak travel periods. Shoulder seasons often provide the best combination of availability and point savings.
• Use airline alliances: Transfer partners in the same alliance (Star Alliance, OneWorld, SkyTeam) give you access to multiple airlines' award inventory with one point transfer. This expands your booking options significantly.

Mistake 4: Booking Inflexible Travel Without Exploring Options

Sticking to exact dates and airports often forces you into expensive redemptions. Small changes in your travel plans can save thousands of points and open up better availability.

Why Inflexible Travel Costs More:

Airlines charge more points for peak travel dates and popular flight times. A weekend flight might cost 30-40% more points than the same route on a Tuesday.

The most convenient flights also book up first, leaving you with worse options that cost more points or forcing you to pay cash when award availability runs out.

How to Save Points Through Flexibility

• Shift your dates: Moving your trip by 2-3 days often reduces point requirements by 20-40%. Use airline calendar tools to compare award pricing across different dates.
• Check nearby airports: Major metropolitan areas usually have multiple airports. Flying into Oakland instead of San Francisco or Newark instead of JFK can offer better award availability and lower point costs.
• Consider connections: Direct flights aren't always the best value. Connecting flights sometimes cost fewer points, and many programs let you add free stopovers in interesting cities along the way.

Mistake 6: Not Monitoring and Optimizing Existing Bookings

Booking your flight isn't the end of the process. Many travelers miss opportunities to upgrade cabins, improve routings, or get better flight times by ignoring their reservations until departure.

How to Improve Your Existing Bookings

Airlines frequently change flight schedules, and when they make significant time changes to your booking, you often gain free rebooking rights on any available flight.

This gives you the chance to secure better routes, more convenient departure times, or even different dates at no extra cost. Plus, premium cabin space often opens up closer to your departure date as airlines release additional inventory based on demand patterns.

This means your economy booking could potentially be upgraded to business class if you monitor availability and act quickly when space becomes available.

How to Monitor Your Award Bookings

• Check regularly: Set monthly calendar reminders to review bookings, especially for travel more than three months away. Award availability changes constantly.
• Use tracking tools: Services like ExpertFlyer or airline apps can alert you when better flight options become available for your specific routes.
• Learn the rules: Each program has different policies for changes, cancellations, and upgrades. Understanding these rules helps you act quickly when opportunities appear.

How to Get the Most Value From Your Points

You don't need to be a travel expert to squeeze extra value from your points. A few smart strategies can turn a basic redemption into an incredible deal. Here’s what you can do:

• Visit multiple cities for the same points: Many airlines let you add extra destinations to your trip without charging more points. Instead of flying round-trip to Paris, you could visit Paris, Rome, and London for the same 60,000 points.

• Add free stopovers: Programs like Aeroplan let you stop in another city for free on your way to your final destination. For example, if you're flying in Asia, you could stop in Vancouver or Toronto for a few days at no extra cost.

• Mix business and economy: You can often book business class for your long overnight flight and economy for your short daytime connection. This saves points while ensuring you're comfortable when it matters most.

• Choose the right airline partner: The same flight might cost 50,000 points through one program but 80,000 through another. A little research before transferring points can save you thousands of points.

Bottom Line

Avoiding these six common redemption mistakes can dramatically increase the value you receive from your hard-earned points and miles. Focus on travel redemptions over merchandise, use points promptly to avoid devaluations, and leverage transfer partners for maximum value.

The key is treating your points as valuable currency that deserves careful consideration before spending, rather than rushing into poor redemptions that waste months of earning effort.

Frequently Asked Questions

What's the worst way to redeem credit card points?

Gift cards and merchandise typically offer the worst value at 0.5-0.7 cents per point. A $100 gift card costing 15,000 points wastes potential value when those points could book $300+ in travel.

How long should I wait before using my points?

Use your points within 12-18 months of earning them. Book confirmed travel immediately and avoid hoarding points while waiting for perfect opportunities that may never come.