Forbes - Cash or miles? You don’t have to decide

Your Weekly Advisor Update

A note from Becky:

The past month sucker-punched my personal budget. Some costs were planned for—a vacation, for starters—but inflation, vet bills and other expenses piled on. Thankfully, credit card rewards shouldered some of the burden. My husband and I exclusively earn “flexible points” and typically transfer them to airlines for award travel—but this month, we’ll redeem them for cash rewards instead. This week, I’m sharing exactly why that flexibility can be a huge advantage.

Very best,

Becky

Becky Pokora 

Staff Writer, Credit Cards

Editorial Note: We earn a commission from partner links on Forbes Advisor. Commissions do not affect our editors' opinions or evaluations.

 How Flexible Points Work

As the name suggests, flexible points don’t silo you into a specific type of redemption. Their versatility allows you to choose the best type of reward at the time you actually need (or want) it.

Generally speaking, flexible points can be redeemed for various forms of cash back, gift cards, merchandise, travel booked through your credit card or transfers to partnering frequent flyer and hotel loyalty programs.

That versatility is clutch when life is unpredictable (isn’t it always?).

It takes a little work to learn your redemption options, especially since points usually aren’t worth the same value for all types of rewards.

For example, you might get 1 cent per point toward cash back or gift cards but 1.25 cents per point when paying yourself back for a certain type of purchase…or even 3 cents per point when transferring to an airline to book a first class flight. If you need cash, it’s fantastic to have that option on hand—even if the conversion is worth less than using your points for a business-class plane ticket.

Not all credit cards earn flexible points, but many do. You’ll find options with several big-name card issuers, including Chase, Capital One and American Express.

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Here’s what else you should know
this week:

Credit Card Points Vs. Cash Back: How To Decide?

Deciding whether to pursue cash back or flexible rewards depends on your spending habits, the rewards you value and your willingness to put in effort toward redemptions.

7 High Value Trips You Can Take With Chase Ultimate Rewards^® Points

Travel transfers can be a spectacular way to use flexible points. Get some inspiration on what you can do with points and start saving today.

3 Reasons You Shouldn’t Speculatively Transfer Your Miles (And 1 Time You Should)

You have more options with flexible rewards if you keep them in their original form until you need them. Here’s why you shouldn’t speculatively convert them to miles, even if you’re tempted.

Best Travel Credit Cards Of 2023

It’s easier than you think to leverage your credit card rewards to snag award flights and upgrades. That said, be sure to have your credit house in order before you start earning rewards because the interest rates and fees will outweigh what you earn in rewards on a monthly balance.

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