How to split up credit card perks when splitting up with your spouse

Jan 25, 2020

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During the dissolution of a marriage, the process of divvying up points or miles is obviously less consequential than deciding on custody of the kids — more along the lines of figuring out who takes the good china. Still, whether you’ve accumulated them through air travel,  dining out or exclusively using one card for everyday spending, you’ve earned them. (And you can earn even more when you use a travel card to pay off the costs associated with your divorce.)

Here’s how to handle credit card travel perks when you decide to take a solo path.

Decide if points are really worth fighting over

If you signed a prenuptial agreement, it may well cover the distribution of points and miles. If not, you can list them in your settlement agreement, but is it a battle worth picking? Never, says Tawnya Yetter, a litigator and family law attorney in the Washington, D.C. area. “Since there are many more complex issues to deal with, especially when child custody is an issue, arguing over something like travel is not going to gain any Brownie points with a judge,” she says. “Divorces are expensive, emotionally and financially, and you never want to spend a dollar to get a quarter.” If points are a significant part of marital assets they could be worth a mention to your attorney, however.

Consider how, when and by whom the card has been used

If you opened the credit card while you were still single and earned all of the points before you got married, you may be entitled to keep them. Likewise, if the card has been used by one spouse for business expenses or trips, points might not be considered marital assets. The situation also depends on whether the state in which you reside follows the legal concept of community property or that of equitable distribution. In the former there is an equal split of all property acquired during the marriage; in the latter, assets may or may not be considered marital property and the split might not be 50/50. If there is outstanding card debt that one spouse will assume, it is fair for that spouse to take the rewards.

Find out what happens once the account is closed — before you close it

Depending on the card, once an account is terminated you may lose points immediately or there may be a grace period. When you cancel The Platinum Card® from American Express, for example, you immediately forfeit all the points unless you also hold another Amex card to which you transfer them; holders of the Chase Sapphire Reserve card have 30 days to redeem points. The takeaway: In the haste to separate finances, don’t cancel a credit card and then figure out what to do with the accumulated rewards. It might be too late.

Come up with a creative solution to divide travel benefits

Assuming spouses are relatively friendly and the divorce is proceeding without contention, there are creative ways to divide perks, like having exes take the children on separate vacations. If one parent has full custody, she or he can use points to fly the kids to see the other parent with visitation rights. High schoolers can use them to purchase flights for college visits or they can cover transatlantic flights for college students studying abroad. “Divide them in half and use them for a nice post-divorce adventure,” Yetter suggests. “A clean cut is best.”

Assign points a cash value even if they don’t officially have one

If your 100,000 points can be used to purchase two round-trip domestic tickets, research what that translates to if you were using cash for the fare. Spouses may decide that one keeps the points while the other one gets a comparable monetary value.

The points could also be used in other divorce-related situations. Chase Ultimate Rewards, for example, can be used for expenses like making home repairs or hiring stagers before putting a property on the market.

Some programs like United MileagePlus let you buy gift cards with miles, which can be easily divided. TPG posts monthly points valuations of the various travel rewards programs, which fluctuate regularly.

Apply for individual cards with the same rewards program and transfer points to the new accounts

The spouse who travels more frequently may decide to apply for an individual Chase Sapphire Reserve card, which comes with a hefty annual fee but a bevy of perks; the spouse that jets around less may opt for a Chase Sapphire Preferred, whose $95 annual fee is more manageable and still provides benefits like travel and purchase coverage and 2x points on travel and dining. Both cards allow users to accrue points through Chase Ultimate Rewards. Ditto for the American Express Platinum, American Express® Gold Card or American Express® Green Card, whose various benefits appeal to those with different incomes and travel habits but whose points can all be redeemed through the Amex Travel Program. If you are transferring points to either a new card or an airline frequent flyer program, however, your name may have to appear exactly the same way on your old card and the new one or the transfer may be invalid. And be aware that you may be charged a fee to transfer miles.

The information for the Amex Green Card has been collected independently by The Points Guy. The card details on this page have not been reviewed or provided by the card issuer.

If you and your soon-to-be-ex-spouse maintain a working relationship, you may keep the joint account after the divorce

This is an unconventional approach for sure, but credit card companies don’t often prohibit it. “The Additional Card Member isn’t limited to spouses, so the cardmembers can do as they please,” says Isabella Persico, an account executive with Day One Agency who works on the American Express Platinum team. But Yetter doesn’t recommend it. “Marriage in a sense is a business and owning things together not only creates issues in a legal dispute, but it opens the door to arguments and emotional stress,” she says. “You’re getting divorced because you do not want to continue your ‘business,’ so draw the line and move on.” JetBlue Plus Card’s pooling option lets points be shared among up to seven travelers, so if exes are still on good terms, this card lets them both still use their miles. 

Kelly Magyarics, is a travel, wine, spirits and lifestyle writer in the Washington, D.C. area. She can be reached through her website, or on Twitter and Instagram @kmagyarics.

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