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Do I Earn Points if I Don't Pay My Credit Card Bill?

Aug. 20, 2019
5 min read
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Reader Questions are answered twice a week by TPG Senior Points & Miles Contributor Ethan Steinberg.

With credit cards serving as the fastest way to earn points and miles these days, award travelers are caught in a game of tug and war between spending more to earn more points while still trying to stay financially responsible. TPG reader Kayla wants to know if she needs to pay her credit card bill in order to earn points...

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[pullquote source="TPG READER KAYLA "]If I have a large balance on my credit card, I won't receive my points until I pay the balance in full, right?[/pullquote]

Before we address this question, it's important to reiterate that carrying a balance on your credit cards ignores one of the most important rules of travel rewards. The interest charges you'll pay from month to month will quickly erase the value of any points you're earning, especially since travel rewards cards tend to have higher interest rates. If you find yourself carrying a balance on your cards or are working on getting out of debt, it might be prudent to clean up your financial situation before you start pursuing travel rewards.

Now to get to Kayla's question. With a majority of credit cards, you earn your points based on the purchase and not when you pay your bill. If you look at my Chase Ultimate Rewards account for my Chase Sapphire Reserve, you'll see that I'm set to earn 4,565 points on my next statement. Chase will deposit these points into my account at the same time that my bill for this month becomes available, and I'll earn these points even if I haven't yet paid my bill.

This is how most credit cards operate, although there are a few exceptions to note. One that jumps to mind instantly is the Citi® Double Cash Card, which effectively offers 2% cash back on all purchases. You'll earn 1% at the time of purchase and another 1% when you pay your bill.

Another exception involves cards that earn American Express Membership Rewards points. Here's how this is described on the issuer's FAQ page:

When you earn Membership Rewards® points from spending with your Card, they initially appear on your billing statement as "pending." These are available for use a full monthly billing cycle after you pay the amount due on your billing statement, as long as your account remains current.

In essence, American Express delays the regular points you earn for a month, and you must pay the amount due before they're actually posted to your account.

Here's a snapshot from TPG Editor Nick Ewen's Amex account that shows this in action:

The 1,402 points designated as "Available on Payment" are from his statement that most recently closed. Once he makes his payment on that statement, the points will post to his account within 24-72 hours.

However, the 5,995 "Pending Points" will take a bit longer. Those correspond to purchases made since his last statement closed. Once that statement closes, they'll shift into the "Available on Payment" category and will then post when he submits a payment, and it's worth noting that even a minimum payment on an Amex account will result in the points posting.

When it comes to welcome bonuses, the terms typically state that it can take a month (or even three) for those points to post, but the terms typically don't require full payment to earn those bonuses. Again, though, not paying your balance in full and on time could result in interest charges that far outweigh the value of those points, so keep that in mind before you add a new travel rewards card to your wallet.

Bottom Line

Kayla should rest assured that the points she earns on her rewards cards will almost always be connected to the purchases she makes and not her payment activity, but that isn't a license to exercise poor financial judgement and start carrying a balance from month to month. There's a reason that "thou shalt pay thy balance in full" is the first commandment of travel rewards.

Thanks for the question, Kayla, and if you’re a TPG reader who’d like us to answer a question of your own, tweet us at @thepointsguy, message us on Facebook or email us at info@thepointsguy.com.

Featured image by Getty Images
Editorial disclaimer: Opinions expressed here are the author’s alone, not those of any bank, credit card issuer, airline or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

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Pros

  • Earns 3x points on restaurants, supermarkets, gas stations, air travel and hotels.
  • $100 annual hotel savings benefit (on single hotel stay bookings of $500 or more, excluding taxes and fees, booked through thankyou.com)
  • Points transfer to 16 airline programs, from JetBlue to Virgin Atlantic.
  • World Elite Mastercard benefits, extended warranty, damage and theft protection.

Cons

  • $95 annual fee
  • Lacks travel protections that other travel rewards cards come with
  • For a limited time, earn 80,000 bonus ThankYou® Points after you spend $4,000 in purchases within the first 3 months of account opening
  • Earn 3 Points per $1 spent at Restaurants and Supermarkets
  • Earn 3 Points per $1 spent at Gas Stations, Air Travel and Hotels
  • Earn 1 Point per $1 spent on all other purchases
  • Annual Hotel Savings Benefit
  • 80,000 Points are redeemable for $800 in gift cards when redeemed at thankyou.com
  • No expiration and no limit to the amount of points you can earn with this card
  • No Foreign Transaction Fees on purchases
Best starter travel card
TPG Editor‘s Rating
Card Rating is based on the opinion of TPG‘s editors and is not influenced by the card issuer.
4 / 5
Go to review

Rewards Rate

3XEarn 3 Points per $1 spent at Restaurants and Supermarkets
3XEarn 3 Points per $1 spent at Gas Stations, Air Travel and Hotels
1XEarn 1 Point per $1 spent on all other purchases
  • Intro Offer
    For a limited time, earn 80,000 bonus ThankYou® Points after you spend $4,000 in purchases within the first 3 months of account opening

    Earn 80,000 ThankYou® points
    60,000 points
  • Annual Fee

    $95
  • Recommended Credit
    Credit ranges are a variation of FICO© Score 8, one of many types of credit scores lenders may use when considering your credit card application.

    670-850
    Excellent, Good

Why We Chose It

The Citi Premier’s 3 points per dollar spent across a wide range of popular categories is one of the more lucrative offerings in the world of points and miles. The Citi Premier comes with a $95 annual fee and is currently offering a solid sign up bonus of 80,000 points after you spend $4,000 on purchases within the first three months. It also has some valuable transfer partners to make the most of your rewards. Add in access to Citi Entertainment plus a $100 hotel credit for any single-stay hotel booking that exceeds $500 or more, excluding taxes and fees, booked through the Citi travel website, there are few reasons why the Citi Premier should not be in every traveler’s wallet.

Pros

  • Earns 3x points on restaurants, supermarkets, gas stations, air travel and hotels.
  • $100 annual hotel savings benefit (on single hotel stay bookings of $500 or more, excluding taxes and fees, booked through thankyou.com)
  • Points transfer to 16 airline programs, from JetBlue to Virgin Atlantic.
  • World Elite Mastercard benefits, extended warranty, damage and theft protection.

Cons

  • $95 annual fee
  • Lacks travel protections that other travel rewards cards come with
  • For a limited time, earn 80,000 bonus ThankYou® Points after you spend $4,000 in purchases within the first 3 months of account opening
  • Earn 3 Points per $1 spent at Restaurants and Supermarkets
  • Earn 3 Points per $1 spent at Gas Stations, Air Travel and Hotels
  • Earn 1 Point per $1 spent on all other purchases
  • Annual Hotel Savings Benefit
  • 80,000 Points are redeemable for $800 in gift cards when redeemed at thankyou.com
  • No expiration and no limit to the amount of points you can earn with this card
  • No Foreign Transaction Fees on purchases