Redeeming Cash back

[workinabroad]

When do you redeem your cash back rewards? I have a minimum of $25, but should I be using it at each $25 interval or what? I don't have any other kinds of rewards, but I'd hate to lose everything like I did with that ridiculous Hooters card. Their points only qualified for crappy items and couldn't be changed to money, then the whole program went away with the changing of companies.

[sblatner]

I cash in my rewards whenever I can. Every month if I reach the minimum level.

[Jerry91]

You can redeem your cash back reward any time you feel like. However, there are some places which may have a specific limitations on cash back. Like some places may not let you redeem the cash back rewards unless you have $50 or $100 in your account. So, you should check out the rules and regulations, read through the policy and check out the specifications.

[disneysteve]

It depends. Some programs are tiered so that the more points you accumulate, the more value each point has. For example, I have one program that needs 25 points for $25 but 45 points for $50 and only 80 points for $100. With a program like that, I wait until I get the biggest bang for my points. Cashing in at the $25 level doesn't make sense.

With other programs that have a flat structure, I cash out whenever I can. There is no benefit to waiting.

[SeanH]

This might be a different stab at the question. Assuming that I'm not penalizing myself by cashing out the rewards (ie. a tiered structure above) I usually cash in the rewards as they become available. Otherwise its like leaving money sitting in someone else's pocket. That said, when I was first earning rewards I let it build up to ~$400. My wife liked the idea of watching it build up to pay for something specific (ie. a replacement computer) or to say that the money was going towards one specific event. I had a my own Discover card for awhile and used the rewards from that to purchase clothes. No point living in regret, but I find I had a tendency to view reward money as personal free spend cash and not use it for any real purpose (ie. I blew it - it didn't seem real). This has sort of soured me to the rewards card game.

[disneysteve]

when I was first earning rewards I let it build up to ~$400. My wife liked the idea of watching it build up to pay for something specific

I have this problem with hotel reward points, which is what we earn with our main credit card. The program (Marriott Rewards) used to be structured so that the points were tiered: 7,500 for 1st night, 7,000 for 2nd night, 6,000 for 3rd night, etc. That way it made sense to save up your points and redeem them for a week's stay rather than a night here or there. Now the points are flat - 7,500 per night - except the 5th night is free so there is still a benefit to saving up points. It encourages you to not redeem your points as you earn them, which is sometimes a problem. Most of our trips are just a night or two so I'm never sure if I'm getting the best value by using my points for those stays.

Of course, the result is that at the moment, I've got 134,000 points on my account. I guess we need to use some.

[feh]

It depends. Some programs are tiered so that the more points you accumulate, the more value each point has. For example, I have one program that needs 25 points for $25 but 45 points for $50 and only 80 points for $100. With a program like that, I wait until I get the biggest bang for my points. Cashing in at the $25 level doesn't make sense.

With other programs that have a flat structure, I cash out whenever I can. There is no benefit to waiting.

Ditto. I've had cards that followed both these systems and handled rewards exactly as Steve describes here.

[workinabroad]

Duly noted.I'm just going to cash in then. It's a set $25 increment system.