Cash vs Points: What’s The Best Strategy?

Given the extraordinary circumstances caused by COVID-19, we’ve seen the conversation about credit cards change.

Over the past few weeks, we’ve seen several credit cards issuers offer AMAZING welcomes bonuses (LIKE THIS). However, more recently, the conversation has shifted to “Are my points ok or should I convert them into cold hard cash?” So let’s start from the beginning…


Not all points/miles are created equal. The value of 50,000 points in one program can be worth more than the value of 100,000 points in another program and before you decide to convert any points into cash, here are a some factors you need to consider.


If you hold certain airline miles, you don’t even have that option to convert them to cash. However, in many programs it is possible to convert them to hotel points. I would not recommend doing this because 99% of the time, it’s a terrible conversion ratio.

With transferable currencies (i.e. Chase UR, Amex MR, etc.), it’s slightly different. Generally, you can get 1 cent per point when you convert your points to cash. So, 100,000 Chase UR = $1000.

Note: Please do NOT consider redeeming for a gift card. Trust me on this.


Most of the major US airlines have recently made changes so their miles never expire. However, if your miles do expire because of account inactivity, don’t feel pressured to fly or book a hotel. Simply, go to the dollar store and buy a bag of chips with your co-branded credit card and it will reset the clock. Another alternative is purchasing miles or points and it will also reset the clock.


If you really really need the cash right now, by all means…cash out!

Personally, I have quite a few points and although I could extract excellent value by redeeming them for more flights, my strategy is more long-term. I have tapped into some of my point reserves, and “cashed out” to invest in the stock market. Many stocks are at the lowest point they’ve EVER been. If the prices go up, I win. If they go down, the world has a much bigger problem on their hands (at least in my opinion).

Additionally, I’ve also asked myself “when things return to ‘normal,’ will I be the first one on the plane?” Probably not. I take a lot less risks these days than I did when I was younger and I’d rather invest in my future.


If you don’t need the cash right now, you still have a few options.

First, if you have more than one premium credit card (annual fee of >$400/yr), then keep just one.

Travel in 2020 has been disastrous and with airports closing lounges and operating at bare minimums, it may be several months before you can begin to take advantage of the benefits (if at all). Until then, you’re just paying hefty annual fees and not obtaining any of the benefits.

Second, if you carry many cards that have annual fees, call your bank to ask for a statement credit or a fee waiver. Trust me…many banks are offering extremely generous statement credits to retain your business.

Additionally, if you intend to outright cancel a card, definitely explain why why you’re going this route to the credit card company. I’ve had some great success in getting lucrative retention bonuses on many of my cards, particularly with Amex.

And don’t forget that you can always ‘product change’ your credit card to a no annual fee (or a lower annual fee) credit card. For example, you can downgrade your Chase Sapphire Reserve to a Chase Sapphire Preferred or product change from the Amex Gold (READ MORE) to the Amex Green (READ MORE).

Caveat: Do keep in mind welcome bonus restrictions for each bank. For example, if you downgrade your Amex Gold (READ MORE) to the Amex Green (READ MORE), Amex will deny you a welcome bonus on the green card.


Personally, I’m focusing on earning miles and points through welcome bonuses and category bonuses. I’ve decided to cut the meat from my portfolio. I’m vegan anyway so it makes sense. 🤣

But truth be told, I’m trying to minimize how much is coming out of my pocket this year in annual fees. I have a few cards that I use more for their benefits (e.g. lounge access, airline fee credits, Global Entry/TSA Pre-check, etc.) than for their point earning capabilities. But those benefits aren’t worth much considering I haven’t been in an airport in nearly a year (and counting).

I say all of that to say…unless you really need the cash right now, I’d suggest going lean and waiting this out would be a better option.

I’ve been in the miles and points game for a minute and miles & points aren’t going anywhere. I always advocate that you play a long-term game. In other words, plan how and where you want to travel and then sign up for credit cards that help you achieve that goal.

Are you planning to convert any of your miles & points into cash?

Let’s get straight to the point…some of the links on this site pay 1TattedPassport a referral bonus for anyone that is approved. For our complete advertising policy and details about our partners, please click HERE. Although using the links are completely optional, we are eternally grateful when you do.

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