Should You Cash Out Your Points? My Thoughts Have Recently Pivoted
I have been a points cashing out machine these past few months. I made my case on why it makes sense early on in the pandemic. With the overall lack of travel, points balances stocked from cancellations, and my continued earning abilities, it didn’t make sense to let my points collect dust (and most likely devalue). I ran my Ultimate Rewards balance down to zero and shared recently how I planned on to earn it back. American Express Membership Rewards have been pared down as well, with the help of my Charles Schwab Platinum card. My plan was to continue down this path once I locked in my safety net balances. Anything above those figures was fair game. I have recently pivoted, and put a kibosh to this thinking. I am sure it is a question many are wrestling with right now too, should you cash out your points?
What Has Changed?
So what has changed over the last few months that has me going full stop on my money printing machine that is cashing out points? Well, a lot really. It hasn’t been one thing, but a combination of things that had me do a 180 on my line of thinking.
Avenues Being Shut Down
The news over the past few weeks has not been great. PayPal Key shut down Plastiq, and then Amex cards as a whole. Walmart also blocked Metabank Visa gift cards, which are a favorite of many, and now has a memo going around that doesn’t look great for us either. Throw in the fact that Best Buy gift card reselling is on a pause right now and you get the picture. Earning has become harder and the trend hasn’t looked very good overall. I feel like I am always waiting for the next shoe to drop.
One of my main avenues was caught up in the Metabank Visa card mess even though I don’t go to Walmart. I have found a quasi workaround but there is no telling how long that will last. And if that goes down it cuts my normal avenues for earning in half. That has me proceeding with caution.
Travel Is On The Horizon
As we turn the page into 2021 I am expecting a travel boom in the second half of the year. I think having a vaccine will open many doors, whether a person wants to take it or not. That means my balances are gonna take a substantial hit with all of my pent up travel desires. I expect to do longer, and more expensive, trips versus my normal travel patterns to try to make up for lost time. That will put a dent in my stash of miles and points for sure.
Changes In Applications
While offers are hitting all time highs, which is awesome, I think new rules and restrictions will continue to roll out to safeguard these increased offers. We have seen the Citi Premier roll out with new restrictions, does that transfer to other Citi cards?
Will the new American Express pay over time rules make getting cards more difficult? Only time will tell. This, along with the ever increasing shutdowns for everything in the gray area, makes points accumulation more difficult and something we need to keep an eye on.
Counter Point, I Am Being A Worrywart
Things come and things go. Sure, PayPal Key became a lot less interesting but it wasn’t even a thing a few months back. That was a win and a loss all rolled into one. Those things are always coming and going and as long as we continue to be creative options will be available to us.
And sure, Walmart has cut us off at the knees but we don’t know for sure how bad it will be post memo. It could just limit the velocity but not shut it down completely. More work for a smaller payoff is never great, but it is better than nothing.
This game has a lot of ebbs and flows and the end has been predicted for a decade now, but we are still here. There is some comfort in that for sure. Maybe I am just overthinking it here. I would rather be safe than sorry though. Plus, time is on my side!
How Is Time On Your Side?
Doors, and windows for that matter, are closing right and left, so how is time on our side? Good point, but I mean that from a cash out standpoint. We still have several months on the Pay Yourself Back clock, and that is if it doesn’t get extended. Add in the fact that there is no reason to think the Charles Schwab cash out option is going away and I have time on my side. There is no need to rush into this, I want to take the wait and see approach. Or the stockpile and see approach I should say 😁.
While I plan on pausing my cash outs for the time being it doesn’t mean I am done with them forever. There is no harm in sitting it out for a few months and see how the landscape looks down the road a bit.
Are opportunities still closing right and left? Or were my fears overblown?
Is travel really back? Or are we still sitting on the sidelines for the foreseeable future?
These are questions that will have much clearer answers 3-4 months from now. At that point I can reevaluate my thinking. The miles and points hobby is ever changing, ever evolving and no one should rest on their laurels. You need to be open to change and to pivoting as it makes sense.
Always be closing? Nah, always be evaluating is the way of miles and points.
So, should you cash out your points? Only you can answer that for yourself. For me, I am taking the wait and see approach. While I am not opposed to cashing them out again in the near future I plan on taking advantage of the entire runway in front of me. Once I get to the point of no return I can make a more informed decision on cashing out my points.
If things continue to trend downward then I will sit on them. If things show some improvement I will cash out my surplus before the options disappear. There have been enough land mines detonated recently that I think a pause is in order, for me at least.
What do you think? Have you recently changed your plans because of recent news? Let me know in the comments.