7 tips when redeeming points for a rewards 'experience'
Go for the card issuer's pre-made experience? Or create your own?
Award-winning writer covering consumer and small-business credit cards.
Thinking of cashing in your points for a cool “experience” offered by a card rewards program? First learn the ins and outs to make sure you don’t squander your rewards.
Rewards experiences offer you the chance to cash in your points from credit card, airline and hotel rewards programs for special events or packages – from a VIP night at the Emmys to a private farm-to-table dinner with a famous chef to a weekend of shredding the slopes with celebs at a charity ski event.
In some cases, you can buy an experience for a flat number of points, while in others you must bid and win an online auction.
Travel blogger and journalist Lyn Mettler of Go to Travel Gal got a Starwood Preferred Guest Credit Card from American Express and used rewards from the sign-up bonus to take her husband and two boys to watch a Chicago Cubs game from a luxury suite at Wrigley Field. The experience included unlimited food and drinks, including a mouthwatering dessert cart. The experience fulfilled a “bucket list” dream for the family and lives on as a great memory.
“I’m definitely a fan of using points for experiences,” she says.
Tips to consider before you redeem those points:
The growth of rewards experiences
Rewards experiences are a way for consumers to leverage partnerships that credit card issuers and other companies have formed with celebrities, sports teams and other entities. “They allow you to get things you wouldn’t get on your own,” says Gary Leff, rewards expert and author of View from the Wing.
Through these partnerships, a rewards program might be able to offer lessons from a sports pro, dinner with a celebrity chef, the chance to sing the national anthem at a game, backstage access to your favorite rock band or some other unique experience.
And, like travel rewards, experiences allow card issuers to create an emotional connection with their customers. “Aspirational activities, opening doors to exclusive events and fulfilling dreams drive loyalty on an emotional level,” Leff says.
But other “experiences” don’t leverage partnerships and are more like commodities: for example, a dinner at a restaurant or tickets to a show. They might offer a few extras, such as valet parking, but it’s nothing you couldn’t just buy on your own.
“Experiences may or may not be good deals in terms of points per dollar,” Leff says. “It varies.”
Getting big value from rewards experiences
Before you click the “redeem” button, it pays to learn a little more about trading rewards points for experience packages. Here are seven tips from rewards experts on how to use your points wisely and when to pass and create your own experience:
Video: How your points can pay for memorable experiences
1. Keep up to date on offers.
New experiences get added relatively frequently “as new partnerships are inked,” says Nick Ewen, editor at large for The Points Guy. But you don’t have to check daily, he says. Just bookmark the site and check in every week or two.
And similar experiences tend to pop up regularly, Mettler says. So even if you don’t have enough points, checking offerings now can give you an idea of the amount of points you’ll have to redeem.
For her family’s Cubs game experience, Mettler checked out the “experience” packages in the spring, accrued the appropriate number of points, then redeemed them in the fall.
2. Evaluate the experience.
Did you spot an experience that looks tempting? Some offers do include a once-in-a-lifetime opportunity. For example, a few years ago, SPG auctioned off the chance to throw the first pitch in a World Series game. Blogger Dan Eleff bid over 1 million points for the win, which drew flack from some readers.
Spending a slew of points on a unique experience is a very personal decision. You need to look at the opportunity cost of using those points and consider how much you value the experience, Leff says. “Only you can determine if it’s worth it to you,” he says.
3. Do the math on experience value.
If the “experience” includes only tickets or dinner or travel, do some research on prices and check to see what it would cost you to book on your own. “Check the market value,” Leff says.
You might find that, especially if you’re willing to be flexible on days and times, you could get a better deal paying cash and saving your points for something else.
On The Points Guy, Ewen once noted that an “experience” package of ice skating in Central Park cost the same via Chase Ultimate Rewards no matter when you go. But the skating rink website showed prices that were much lower during the week. Do this type of legwork, then crunch numbers to find the value you get per point.
4. Read the fine print.
It’s especially important to check the terms and conditions before you click to redeem your rewards for an experience.
For example, for many Chase Ultimate Rewards “culinary experiences,” you must be 21 to attend.
“Using rewards for events requires pre-planning,” says Julie Pukas, head of U.S. bankcard and merchant services for TD Bank, noting that TD Bank experiences are nonrefundable and have an expiration date.
5. Consider how the experience will be sold.
Can you simply pay a flat number of points or do you have to bid in an auction? In general, experience auctions tend to provide less bang for your buck.
“That’s because you have people sitting on mountains of points who feel comfortable redeeming an insane amount for an experience,” Ewen says. However, it really depends how many packages are available and how many people are competing to get one.
“Unless there’s a lot of attention around an auction, it may go for less than you’d expect,” Leff says.
6. Avoid getting bid up in an auction.
A psychological phenomenon called “auction fever” can cause you to overpay, whether you’re bidding dollars or points. To avoid getting swept away in the heat of the moment, set your top bid before you start the auction and promise yourself you won’t go any higher.
Also, go in knowing what that number of points could get you otherwise, Ewen recommends. For example, if your top dollar in a Starwood auction is 90,000 points, it might help to know that those points could get you, say, three nights at a top-tier St. Regis property.
“Have an idea of what you’re giving up if you bid past that limit,” he says.
7. Act quickly to snag an experience.
Finally, if you see an experience you must have, don’t hesitate. Rewards programs tend to have a limited number of each type of experience available.
“These tend to go fast,” Mettler says. “So if you see something you want, grab it.”
- How to save on a holiday trip to New York City – It's tough to beat the Big Apple when it comes to holiday cheer. Here's how you can book a holiday trip to New York City without cutting into your gift-buying budget ...
- 5 cardholders share how they earn and redeem rewards around the holidays – From traveling to exotic destinations on points to upping their gift game using cash back, five cardholders share how they earn and redeem rewards around the holidays ...
- 5 great winter destinations, and how to get there with rewards – Credit card rewards can help you get some wintertime sunshine or enjoy snowy outdoor activities. Here's how ...