Over the last two years, many Americans accumulated a stash of unused credit card points amid travel restrictions during the COVID-19 pandemic. Now, credit card users are ready to cash in on those rewards, according to a new Forbes Advisor survey.
Credit cardholders in a travel rewards program can earn points through their transactions and use them to cover expenses such as rental cars, airfare, baggage or other reservations and travel purchases. Some of these cards have annual fees but many waive foreign transaction fees. Credit card issuers usually give cardholders their travel perks in the form of a statement credit after the card is used for eligible purchases.
The survey said about 88% of Americans are planning a trip in 2022, and 50% are planning at least two trips this year. And many of these travelers expect to put their rewards miles to good use. Twenty-five percent of travelers said they expect to redeem their points to pay for their trip, and 36% said they will pay for two trips with the rewards. Another 12% said they will pay for three or more trips using their rewards.
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Americans reveal their stash of available miles
Most respondents said they have a stash of miles and points available to them. Fifteen percent said they have at least 20,000 points, which could be enough for a free round-trip flight or a hotel stay, according to the survey. And 46% of respondents said they have even more than that saved up.
The survey said this accumulation is in part due to the COVID-19 pandemic, with about 49% of respondents having said they hadn’t used their points because the pandemic affected their travel hopes or plans. But many other Americans said they hadn’t used their points because their value didn’t seem worth it.
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Many credit card users didn’t understand their points’ worth
The survey also said that many consumers don’t understand their credit card points' value. While most cash-back credit card programs value their points at around one to two cents each, only 12% of consumers estimated the correct value of their points. However, 18% said they thought their points were worth about three cents each and 42% of respondents thought their points were worth 20 cents or more, the survey said. And more than a quarter of credit card users (27%) said they didn’t know their points' value at all.
But users were more accurate when it came to estimating how much of a trip their airline miles would get them, according to the survey. Many recognized that airlines advertise 100,000 miles would likely pay for two round-trip domestic flights.
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