The silver lining of racking up insane credit card debt? The points, baby! 😎 We’re being sarcastic (sort of). Especially now that your points may not get you as far as they used to. 😤
A recent article covered what’s been happening to credit card points…and the things you can buy with them. Turns out rising costs and inflation hit those bonuses, too. 💸
Here’s Five Fast Facts on inflation and credit card points:
- 📈 Major Stacks - Americans continue to rely on credit cards and the amount of accumulated points is skyrocketing. In 2023, cardholders stacked up $34 billion worth of points. That’s a whopping 70% increase from what they accumulated in 2019.
- 🪙 A Pretty Penny - Each credit card point is worth about a penny. According to the Bureau of Labor Statistics, a penny has lost roughly 20% of its purchasing power since 2018. For example, say you racked up 50,000 points on your Chase card in 2020 and haven’t spent them. Today, if you redeemed them through your bank’s points portal, they’d only be worth about 41,300.
- 💰 More, More, More - To fight the effects of inflation (and to get more people to sign up), credit card companies are offering points on more purchases. Between 2017 and 2024, Capital One Venture and Chase Sapphire Preferred increased sign-up bonuses by roughly 50%.
- ✈️ Ch-Ch-Ch-Ch-Changes - If you like to buy flights with your points, you may have noticed some changes. Airlines used to set the price of flights at a flat points rate. Now, many companies are using more of a dynamic pricing model, just like they do for people buying flights with cash. This means the price can go up or down based on demand and timing.
- 💡 Point Guard - Can you stop big bad inflation from eating away at your points? Not really, but you can change your points strategy a bit. One way is to sign up for credit cards that allow you to transfer points between a bunch of different partners. That way, you can shop around to see who has the best deal.
🔥Bottom line: Credit card companies love to dangle drool-worthy points bonuses in front of you, hoping you’ll sign up. Don’t fall for that shiny offer syndrome! Unless you truly need a new credit card, move right along. You know what else you shouldn’t fall for? Credit card forgiveness scams. Check out this article for tips on how to steer clear.
Do you use credit card points to travel?
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