TULSA, Okla. — Do you have a rewards credit card sitting in your wallet? If so, there's a good chance you're not making the most of it — that oversight could be costing you money.
A new LendingTree study reveals a staggering reality: nearly three out of four credit cardholders have unused cash back, points or miles rewards.
Many are sitting on $100 or more in unused cash back that's potentially losing value every day.
"The truth is that credit card rewards and other types of rewards tend to do nothing but lose value over time. So the longer you hold on to them, the more value you can lose," said Matt Schulz, LendingTree's chief consumer analyst.
Why rewards go unused
The study found 45% of cardholders are waiting to grow their points to a certain threshold before using them. Another 21% are saving for a trip, while 18% simply don't know how to use their rewards.
The problem with waiting? Your points may be losing value — or worse, expiring — while you delay.
"When in doubt, as long as you're getting a reasonable amount of value from these rewards, the best thing that you can do is use them sooner rather than later," Schulz said.
Nearly one-third of rewards cardholders have already experienced this frustration, having had rewards, points or miles expire before they could redeem them.
Holiday timing could be perfect
With the holidays approaching, now might be an ideal time to cash in those accumulated rewards.
"Credit card rewards can really help extend your holiday budget," Schulz said.
You can use rewards in several ways:
- Apply them as credits to pay down credit card balances
- Make travel cheaper for holiday trips
- Purchase gifts at a discount
The flip side: redemption regret
However, there's a cautionary tale here. The study found nearly one-third of those who redeemed points ended up with buyer's regret because they used them so quickly they missed leveraging them for better deals.
The biggest reasons for regret include:
- redeeming too soon and missing a better deal (35%)
- opting for cash or gift cards when another option may have been more valuable (33%).
Simple strategies work best
For most people, Schulz recommends keeping it simple rather than getting bogged down in complex reward calculations.
"Most people don't want to have to do spreadsheets, they don't want to have to use apps to think about all these things," he said. "For a lot of people, the best thing that they can do is just get a simple cash back card that gives you 1.5% to 2% back on everything you buy."
The bottom line
Don't forget to use your points, but put some thought into what you use them for. The key is finding the balance between using rewards before they lose value and making sure you're getting the best possible return on your redemption.
As Schulz puts it: "You don't want to just use it for anything because there are definitely things that are more valuable in terms of redeeming points, but don't just sit on those points because you'll end up losing value."
This story was reported on-air by a journalist and has been converted to this platform with the assistance of AI. Our editorial team verifies all reporting on all platforms for fairness and accuracy.
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