If you’ve racked up a lot of AmEx points on your company credit card, but are changing jobs, it’s worth signing up for a personal card so you can keep your rewards points
Dear Cashing In,
I just left my company and have almost 200,000 American Express points that I was going to use. However, AmEx just changed its policy, and I can no longer use those points for items I wanted. They said I would need to open a new account and transfer the points to use them. My question is, since I have no need for a new card, what is the impact of opening a new AmEx (Blue or Optima) account, transferring and then using the points, and then closing the account once the points have been used? Is it better to make one small purchase, pay it off, and then close? Thanks for any information you can provide. — Brian
There’s a lot to like about bank-sponsored rewards programs such as American Express’ Membership Rewards. The points don’t expire, and they’re extremely flexible — you’re not locked into award redemptions with just one company.
However, unlike airline or hotel cards, the banks ask that you do one thing to hang onto those points: hold a credit card with them.
In this case, I would advise that you do that, because it would be a pity to let 200,000 Membership Rewards points disappear. Personally, I like using points for travel. American Express allows you to transfer points to one of 17 airlines, and for that many points, you have the equivalent of more than three round-trip coach tickets to Europe, or about eight domestic round trips. But you can also use the points to shop for all kinds of merchandise.
You’ll need to act fast to sign up for a new AmEx. If your old business card is canceled before you havesigned up for a new card, you could lose those points.
I checked with American Express spokeswoman Kimberly Litt, who told me that whether you can hang on to the points depends on how your former company set up its credit card accounts, as different companies have different policies. “If the reader’s company allows for his name to be on the Membership Rewards account, he can open another Consumer Card with Membership Rewards and have the two accounts linked,” she said by e-mail.
She also pointed me toward the program’s terms and conditions, which state that if your enrollment in Membership Rewards ends and you have no open American Express cards, “all points in your program account will be immediately forfeited.”
Also, you should look carefully at what kind of card to apply for. Not all of American Express’ cards include enrollment in Membership Rewards, and some have annual fees you’ll want to avoid if you’re not planning to use the card. The Optima card you mentioned is not accepting new applications. The Blue card (no annual fee) won’t work well for you if you’re interested in using the points for travel, because it is one of several American Express cards that does not allow you to transfer the points to travel partners, which is a big benefit. You can still purchase tickets through American Express with points, and you can still shop for merchandise.
A better alternative might be American Express’ new EveryDay card. It also has no annual fee, but it allows unfettered use of those valuable Membership Rewards points with the airline and hotel partners. I know you’re not really interested in using this card, but other features include double points at supermarkets, and a points bonus for using the card more than 20 times a month.
I’d consider opening one of those accounts, then using the points you’ve collected. Charge as much or as little on it as you want. If you’re uncomfortable holding the card after using the points and want to cancel it, go for it. But since it is not costing you anything, you might consider keeping it open, as it can help your credit score to have accounts open a while.
I hope you’re able to save those points! Good luck.