Should you use credit card rewards for shopping or travel?

Maximizing a great rewards credit card isn’t only about earning the most points — you should also know the most valuable ways to redeem them.

With most rewards cards, you’ll have options when it’s time to redeem: cash-back or statement credits, travel, shopping online, gift cards, and more. Not all of these redemptions are equal, though. Your specific credit card and rewards program can play a part in which redemption is best for you.

If you’re sitting on a stack of credit card rewards, compare whether it’s best to use your points for cash back on new purchases or for travel.

Read more: The best rewards credit cards

The value of your credit card rewards varies depending on the redemption you choose. Because most cards that earn points are travel rewards cards, you’ll often get the most for each point when you redeem for travel — either through your issuer’s travel portal or by transferring points directly to partner airlines or hotels.

Here’s a look at shopping vs. travel redemptions under popular credit card rewards programs:

American Express travel credit cards earn points within the issuer’s Membership Rewards program. Unlike Amex cash-back credit cards or co-branded cards with hotel and airline partners, these cards offer several different redemption options.

Here are popular Amex Membership Rewards cards and a rundown of redemptions:

Read more: The best American Express credit cards

With Amex cards, you can get the most value from a specific travel option: airfare. When you use your points to book flights through Amex Travel, they’re worth 1 cent each. In other words, you can get $100 in value from 10,000 Membership Rewards points.

The other way to maximize your points is by transferring them to Amex’s airline and hotel partners. Most partners have a 1:1 transfer ratio, meaning your 10,000 Amex points would translate to 10,000 points or miles with the partner program. The ultimate redemption value then depends on your travel and when you book.

Other forms of travel, including booking hotels, cruises, rental cars, and more through Amex Travel is worth a lesser 0.7 cents per point, or $70 per 10,000 points. That’s about the same as you’ll get for shopping redemptions.

Read more: Amex Platinum vs. Amex Gold — Which card should you bring on your next trip?

Most Amex shopping redemptions are worth less than 1 cent per point.

When you use your points to pay at checkout with the following retailers, you’ll get 0.7 cents per point redeemed: Amazon, Best Buy, Grubhub, PayPal, RiteAid, Seamless, Staples, and more. Statement credit redemptions get even less; you can redeem points at a value of just 0.6 cents each for statement credits, or $60 per 10,000 points.

Read our full reviews of The Platinum Card from American Express and the American Express Gold Card.

Capital One travel credit cards earn miles, not points, but we can compare redemption rates in the same way. Here are a few cards you can use to earn Capital One miles, and a look at the range of redemption options:

When you redeem Capital One miles for travel, you can count on a standard value of 1 cent per mile. This includes booking travel through Capital One Travel or covering past travel purchases charged to your card.

When you transfer miles to one of Capital One’s 15+ airline and hotel travel partners, most have a 1:1 transfer ratio (though there are a few exceptions depending on the program). The total value of your points, once they’re transferred, will depend on your travel plans and the program itself, but it’s possible to get the same 1 cent per point value with many travel programs.

Capital One miles can be worth much less when you choose a non-travel redemption. You can choose to redeem miles for cash-back and statement credits, but if you’re not using miles to cover a previous travel purchase, you’ll generally get just 0.5 cents per mile. In other words, you’ll get $50 back with 10,000 miles.

Gift cards may be slightly better, but still much less valuable than travel redemptions. Gift cards available through Capital One generally cost around 12,500 miles for $100, or about 0.8 cents per mile.

Read our full reviews of the Capital One Venture, Venture X, and VentureOne credit cards.

Chase cards are unique among rewards credit cards, because the value of your points can depend on the card you use to earn and redeem them. Here’s a look at some Chase rewards cards and the redemption options you can choose from:

Read more: The best Chase credit cards

Like other programs, Chase Ultimate Rewards points are generally most valuable when you redeem them for travel. If you have a Chase Freedom Unlimited or Freedom Flex card, you’ll get 1 cent per point that you redeem for travel through Chase Travel℠.

With a Chase Sapphire card, you’ll boost your travel redemptions. Chase Sapphire Reserve points are worth 1.5 cents each and Chase Sapphire Preferred Card points are worth 1.25 cents each when you redeem them for travel through Chase Travel. That means the same 10,000 points that would typically get you $100 toward a future trip could instead be worth $150 or $125, respectively.

Another valuable travel redemption option with Chase cards is transferring points to travel partners. Only the Chase Sapphire cards are eligible for transfers at a 1:1 ratio. After transferring, the value of your points will depend on the airline or hotel program you choose and your specific booking.

Cash back and shopping rewards vary, but they generally range lower than travel redemptions. If you want to use your points for cash back or statement credits, you’ll get a value of 1 cent per point, or 10,000 points for $100 cash back.

For a lower rate, you can pay with points at checkout with specific online retailers. Redeeming for Amazon and PayPal purchases, for example, will get you a value of 0.8 cents per point. Gift cards have more variability. They’re generally worth 1 cent per point as well, but may go on sale with offers like 2,250 points for a $25 gift card (instead of 2,500) or 900 points for a $10 gift card (instead of 100).

Read our full Chase Sapphire Reserve and Chase Sapphire Preferred card reviews.

Under many additional credit card rewards programs (Wells Fargo Rewards Points, Citi ThankYou Points, U.S. Bank Altitude Rewards Points, etc.), you can count on earning the standard 1 cent per point when you redeem for travel through the issuer’s portal.

Cash or shopping redemptions vary, but don’t be surprised if your travel rewards are worth less when you use them for shopping, no matter which issuer you choose.

Remember to check the fine print of your specific credit card for any additional value you might get for certain redemptions. Here are just a couple examples of credit cards (like the ones above) that offer inherently more value when you use points for travel:

• Bank of America points are generally worth 1 cent each, however you decide to redeem them. But Bank of America® Travel Rewards credit card points are worth 1 cent each when you redeem them for eligible travel or dining purchases, and just 0.6 cents each when you redeem them for cash.

• U.S. Bank Altitude Rewards cards typically get 1 cent per point whether you choose travel, statement credits, gift cards, or another redemption. But if you have a U.S. Bank Altitude® Reserve Visa Infinite® Card, you can get a boosted 1.5 cents per point when you redeem them for travel instead of cash or shopping.

No matter what type of points your rewards credit card earns, take time to log into your online account and review your redemption options. You’ll get the best view of exactly what your points are worth and how to best use them by seeing the different available options for yourself and reviewing the fine print in your card’s rewards program summary.

• Use your points. No matter how you redeem rewards, your points won’t gain value over time. While most credit card points don’t expire as long as your account is open, some redemptions can get devalued or you may feel the effects of inflation. Unless you’re saving for a big redemption, use the points you earn.

• Read the fine print. You can find all the details about your card’s points within your card agreement and rewards program document. This is where you’ll get specific information about redemptions that earn a boosted value or those that earn much less than 1 cent per point. The more informed you are about all your card has to offer, the better you can make sure you’re maximizing your rewards.

• Use transfer partners. Many credit card issuers partner with specific airline and hotel brands, allowing you to transfer your credit card points to the travel loyalty program. Points typically transfer at a 1:1 ratio, though this can vary. Airline and hotel loyalty programs often use dynamic pricing, meaning the value of your points or credit card miles can change depending on when you book, your specific travel plans, availability, and more. If you have flexible plans and you like flying with a certain airline or staying at a specific hotel chain, this can be a great way to make the most of your points (though it may take some extra strategizing).

• Consider a cash-back card. If you consistently prefer cash, statement credits, or shopping redemptions, you may want to reconsider whether a rewards card that earns travel points is right for you. Instead, compare cash-back credit cards with bonus rewards on your regular spending so you can continue to earn great rewards and more easily redeem them for maximum cash value.

Read more: The best cash-back credit cards

This article was edited by Alicia Hahn

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