Have I Gone Crazy? Why I Just Cashed Out All My Points
A week or so ago I shared an article in around the web about a guy that regretted paying off his mortgage early. I figured it would be something about mortgage interest rates being so low and that he could have used that money elsewhere. But it was more about his loss of motivation to continue to earn at a high level because that large payment wasn’t required any longer. They also had some lifestyle creep, which Benjy likes to caution about. The article came off kind of tone deaf but it did get me thinking about my miles and points situation. I, along with many of you, am sitting on larger balances of miles and points then I have ever had. I also find myself unmotivated and bored with the hobby overall. That got me to thinking, should I spark my hunger for points by burning my balances to the ground?
How I Got To This Point
Most of us are not traveling much these days, if at all. And if you are cash prices are pretty insane which has made points less valuable / useful overall. I am personally sitting on larger stashes of points than usual for a few reasons:
- Cancellations from 2020 travel.
- I usually plan about a year out so I had a ton of cancellations and points coming back to my accounts.
- No future bookings.
- I usually plan a year out but I have nothing on the books right now which means I haven’t been using many points either.
- I am home all the time
- Over this past year I have spent more time at home than I have since the kids were really young. That isn’t a bad thing per se but it has allowed me to increase my points earning since I have had more time on my hands to do it.
Because of those three things I have balances that are 2-3 times larger than I ever had in the past. In all honestly, I am usually on the just in time method of accruing. I am always earning points focused on a specific future trip. My balances are usually pretty small since I am truly burning them as I am earning them. So having stockpiles of points is a new sensation that I am not used to and it doesn’t necessarily agree with me.
My Reasoning For Cashing Out My Points
Here are the reasons that I decided to cash out my points.
Airline & Hotel Balances
When I talk about cashing out my points I am talking about the transferrable currencies (Ultimate Rewards, Membership Rewards and ThankYou Points). The rest of my airline and hotel point balances remain untouched. That plays a role in this as well. I have enough points in those programs, and free nights, to cover my travel for a year or more. If I am set on points for future travel why should I let these other points collect dust and potentially lose value (we know the value is never going up).
Future Travel Is Still Hazy
I do plan on travel to pick up this year but it still won’t be to the levels of years past, at least for me. Throw in the fact that I don’t plan to travel much, if at all, over the summer. We will be spending a lot of time this summer getting the cottage set up for rentals and using it ourselves so I just won’t have the time to get away much, or the desire to really. That means I have a good 6 or 7 months of earning before my points would really be needed. A lot of damage can be done in that time frame.
My Desire Is Waning
I have fallen into the desire, or motivation, trap the mortgage writer spoke of. Because I had larger balances than ever before I found myself unmotivated to chase things down. I found myself coming up with reasons not to chase deals instead of knocking them out quickly. This could be bank bonuses, Amex Offers or anything in-between. I had lost my fire to rack up these easy wins. If I burn my balances to the ground then I will have that built in motivation to build it back up. After cashing out, there will be a reason for doing what I am doing once again. I won’t simply be going through the motions just because I can anymore.
I Have A Use For The Money
Lastly, I have an actual use for the money I would be earning. This isn’t to say there are not other good reasons like investing. If you chased out your points last year and invested them then I think you are doing pretty well right now 😉.
For my situation we have outgrown our house but our area has also lost any value it had with the recent housing price boom. That leaves us with the choice of leaving an area we love or doing an addition to the house to get the space we need. Either one will take money so this will help that endeavor. We have some larger repairs we need to do as well so this money will go to good use. I think knowing it is going into something we will use on a daily basis lessons the blow some, for me at least.
A Counter Point
We discussed this very thing in a livestream in our Diamond Lounge and Shawn brought up a counter point. Isn’t getting to a large balance the point? Then you can relax and take it easier. That is a fair question, no doubt.
My response to that would be, we have no idea how long this opportunity will last so I want to get as much of it while I can. And if I am unmotivated then I never will push it as far as I can. Plus I actually do enjoy going through the motions when I have a reason to do so. I have already felt the desire come back and my motivation has been restored. That alone made it worth it for me.
Why I Cashed Out All Of My Points – Final Thoughts
As I type this, the combined balances in my transferrable points programs is under 50,000 points total. You read that right, between Ultimate Rewards, Membership Rewards and ThankYou Points I have a total that is less than 50,000 points between mine and my wife’s account. We are already on the mend though with 60,000 ThankYou point and 60,000 Membership Reward bonus offers we are currently working on. For Ultimate Rewards I will focus somewhat on Hyatt point earning since that is where most of them go anyway. We should be getting an easy 10K coming in the next few weeks from their recent promo and I will have my wife grab a 50K welcome offer when they return.
I will say this isn’t for everyone, or most people. Many of you may think I am crazy and that is okay. I am the type of person that needs a goal in front of them to be their best work, not everyone is like that. Don’t do something similar just because I did it or because it worked for me. It may not work for you or you may regret it in the long run. A lot will depend how easily you can replace the miles and points and your current situation etc.
I am simply offering you a different view point from the norm to get you to think outside your box. Use that thought process to decide what is best for you. Only you can answer that question.