Should I Redeem Points for Cash or Transfer to Airlines?

Mar 8, 2015

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TPG reader Michael sent me a message asking:

“I’ve accumulated 100,000 Membership Rewards points over the past year, but want to withdraw them for cash. I noticed American Express gives you gift cards at a rate of half a cent per point, which is highway robbery. My other credit cards give me 2% cash back, so I’d prefer to get at least two cents per point. What are my options?”

Here’s the deal with Amex and Chase points: don’t get them if you want cash back. They won’t be worth it for pure cash redemptions. Typically, statement credits offer half a cent per point, and gift cards don’t offer good value either.

Transfer partners are the best way to maximize these points. 125,000 Amex Membership Rewards points can get you a round-trip, upper-class flight on Virgin Atlantic. That ticket could easily cost $5,000, so you’re getting four cents per point in value.

We’ve written in great detail about the best ways to maximize Amex Membership Rewards points with transfer partners. Aeroplan is a great option, and so is British Airways. Your 100,000 points can easily get you thousands of dollars worth of airfare on British Airways if you know how to use them for short-haul redemptions.

British Airways
Transferring Amex points to an airline partner like British Airways will get you much more value than cash back or statement credits. Photo courtesy of Shutterstock.

I definitely recommend transferring to an airline partner instead of redeeming for cash back; you’ll get much better value that way.

If you have any other questions, please tweet me @thepointsguy, message me on Facebook, or send me an email at info@thepointsguy.com.

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