Credit card reward points are accumulated over a period of time by spending your hard-earned money on your purchases. You cannot afford to lose your credit card reward points because it takes months and years to achieve your target of reward points. Your credit card rewards may lose for multiple reasons.
Here we discuss the various reasons why you might have lost your credit card reward points.
- Missed credit card payment
- Did not use credit card actively
- Financial problems
- Violated credit card reward rules
- Expiry of reward points
- Unforeseen event
- Change in the reward program
1. Missed credit card payment
If you have missed your credit card payment it will not only affect you with a high-interest rate but also has a huge effect on your reward points. Credit card issuing companies want you to keep your account in good marketable condition.
Credit card issuers take reward points away if you have missed monthly payments and your account becomes delinquent.
If you miss your monthly payments, some credit card issuers temporarily put a hold on your reward points and you cannot redeem your points until you have cleared your payments. Once you have made your payments, the system will automatically allow you to redeem credit card reward points.
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2. Did not use credit card actively
If you are not using a credit card for a long time your reward points lapse. Some credit card issuers remove credit card reward points immediately. You have to read the terms and conditions carefully before accepting the credit card offers. Your reward points get forfeited if your account is closed.
Card issuers follow a concept that if you do not make purchases with a credit card they do not offer you reward points. It is a give and take technique where both cardholders and card issuers get mutual benefit.
Some card issuers offer a grace period during which you are allowed to redeem your points. After closing inactive credit cards a grace period of 60 or 90 days is offered and you can redeem them accordingly. This is possible only if the company lists them in terms and conditions of credit card.
Also, check: Is it a good idea to close unused Credit Cards
3. Financial problems
Financial problems are the main concern for the repayment of any debt. If you are in any financial problems and could not pay your monthly payments, then your credit card rewards get affected.
Some companies take away reward points or miles once you apply for bankruptcy whereas some companies put a hold on your reward points or miles if you’re not paying monthly deposits regularly.
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4. Violated Credit Card Rewards Rules
The terms and conditions of credit card rewards will give an understanding as to do’s and don’ts of credit card rewards redemption. It is always advised to read the instructions and understand the warnings issued by the card issuers. If you try to earn rewards in a fraudulent way credit card issuers take away your points and close your credit card.
It is always advised not to misuse your credit cards and the rewards program. Do not sign up for a credit card just for the sake of bonus points or rewards and then close the credit card. This will not only affect your credit score but you will also lose your future benefits from card issuers.
5. Expiry of reward points
Many major credit card rewards do not have an expiry of reward points. Reward points remain active till the card is not closed. But airline rewards have an expiry duration. However, it is advised to the customers to find out regarding reward points expiry with the credit card issuer.
Some credit card issuing companies offer rewards that do not have expiry whereas some card issuers have an expiry of reward points after 60 months from the date of the issue of reward points. The oldest reward points are used first so you need not worry about the date of the issue of reward points.
6. Unforeseen event
The terms and conditions of the credit card issuer list out what happens to rewards during the event of death. Once the information is notified to the card issuer credit card rewards are redeemed if it meets redemption conditions.
Reward Policies vary from card issuers to card issuers some card issuers state if the cardholder dies then credit card rewards lapse. Since credit card rewards have monetary value and beneficiaries may or may not be account holders, the transfer of reward points may not be possible.
However it depends on the terms and conditions of the credit card issuer, it is advised to fully understand the terminology before accepting.
7. Change in the reward program
The credit card issuer may change the reward program or may cancel the reward program. In these cases, sufficient time is provided by the card issuers to the cardholder to redeem the points and get benefited.
Generally, a 30 days period is needed to redeem the points. Some credit card issuers may allow 90 days to redeem reward points. Some credit card issuers simply terminate without any prior notice.
Conclusion
Reward points are your earnings accumulated over a period of time. Do not ignore your reward points. Whenever you make purchases first lookout if you can spend from reward points and then use your card money. Keep your account in good standing conditions, monitor your account closely and abide by the rules. Monitor your rewards points and redeem them periodically and enjoy the benefits of cashless spending.
About the author
Vinay Kumar Goguru is a finance professional with more than 8 years of diverse experience as a researcher, instructor and Industry work experience with both public and private entities. Prior to MyMoneySouq, he spent 6 years in Berkadia, It's a commercial mortgage banking company. He has a "Doctoral Degree in Commerce" and two master's degrees with a specialization in Finance, one as Master of Commerce and other as Master of Business Administration. He has written several articles on personal finance, published by different International journals. He loves traveling, reading and writing is his passion. He has a dream of writing a book on his favorite finance topics.
