How can I get the most value out of my credit card rewards?

From getting free airline tickets to paying for a new TV, credit card reward programs offer many ways to save you money on everyday items and big-ticket purchases. With so many ways to redeem points and rewards, how do you decide what’s right for you? Here are some tips to help you make the most of your credit card rewards.

1. Pay with rewards or points

If you are searching for a discount on your next purchase, or simply trying to save cash during the holidays, look no further than your rewards card. As an added perk to cardholders, some credit card issuers offer the ability to shop online at select retailers and pay for your purchase with all or part of your reward points or cash. For example, Discover cardmembers can pay with Cashback Bonus at

“Cardholders should keep in mind how rewards can help you pay at checkout,” says Maureen Powers, Vice President of Rewards for Discover. “You may not realize it, but your card may enable you to pay for part or all of your online purchase with your rewards, helping you save money and make the most of your rewards where you frequently shop.”

2. Buy a gift card

Gift cards are one of the most popular ways to redeem credit card rewards because of their flexibility and point-to-dollar value. Some cards even offer extra rewards when you purchase a gift card through a retail partner. For example, redeeming $20 worth of rewards or points could get you a $25 gift card.

Typically, issuers offer many options to redeem at lower price points such as $25 gift cards, so you don’t have to stockpile rewards to reap their benefits. Plus, you can usually redeem rewards online or with the swipe of your finger on a mobile device. For example, Discover cardmembers have the ability to redeem Cashback Bonus instantly for eCertificates at a variety of retailers ranging from major department stores to restaurants and travel sites.

3. Apply towards travel

Redeeming your credit card rewards for travel can save you hundreds of dollars on airfare or hotels. However, the need to accrue lots of miles or points, blackout dates and other travel restrictions often make travel redemption frustrating. Because mileage conversion rates change frequently, a good rule of thumb to avoid missing out on travel rewards is to redeem your miles or rewards points early and often. Check to see what travel sites partner with your issuer. Redeeming your rewards for a gift card at a travel or car rental company also can stretch your travel budget. You can also earn additional cash back on your travel plans by booking through your credit card’s online shopping portal.

“Discover is removing the confusion from miles rewards with our Discover it® Miles card,” says Powers. “The Discover it® Miles card is simple to understand, giving you rewards on every purchase, every day. And we try to make the redemption options simple and intuitive, which makes using your rewards even easier.”

4. Donate to charity

Whether your points or miles are about to expire or you’re switching credit cards, consider donating your points instead of spending them on something you don’t need. During the holidays and in times of crises or natural disasters, using your rewards points to donate to charity is an extra way to help without having to spend more out-of-pocket. If you plan on making a charitable donation, check to see if your issuer requires a minimum number of rewards points to donate.

5. Redeem for cash or statement credit

Getting an electronic deposit to your bank account or a statement credit is a practical and straightforward way to make your reward points work for you by paying your bills and improving your overall bottom line. You could use your rewards to pay down existing debt or transfer the money into an interest-bearing savings account, retirement account or college savings fund.

Tips to Maximize Your Credit Card Rewards

Pay off your balance

Avoid the temptation to spend more than you are able to pay back immediately simply to accumulate more rewards. The more you pay in interest each month, the less valuable your rewards become.

Focus your spending

It’s easy to become impulsive when it comes to earning rewards. The more credit cards you are using, the fewer rewards you will be able to accumulate on each. Concentrate your spending on a card that offers the best value in categories where you spend the most, rather than spacing out your purchases across several cards and making it more difficult to earn enough rewards on one card to truly help you.

“Consumers looking for a card offering the benefit of rotating categories should consider the Discover it® card,” says Powers. “Not only do the rotating categories offer consumers the chance to earn at places that appeal to them, but Discover it cardmembers earn 5% Cashback Bonus® on all purchases made in that category up to the quarterly maximum when they activate.”

Look for bonus offers

If you are earning one point for every $1 spent, you could be missing out on rewards. For example, some issuers offer an increased rate in special categories, up to a specified dollar amount. Several credit card issuers offer bonus offers through their website, such as earning double or triple cash back by shopping through their online rewards mall.

Estimate your rewards cash value

If your card gives you points, you’ll want to calculate the cash value of those so you can determine the best possible return. You can do this by dividing the cash reward you are trading in for by the number of points it takes to trade in for it. On the other hand, some cards, such as the Discover it card, offer cash back, which needs no point-to-cash conversion.

With any credit card program, it’s important to always read the fine print. Check to see if your rewards program has a spending cap, redemption restrictions or an expiration date. With careful thought and some extra planning, you can find the best credit card rewards which can quickly add up to substantial savings.

Legal Disclaimer: This site is for educational purposes and is not a substitute for professional advice. The material on this site is not intended to provide legal, investment, or financial advice and does not indicate the availability of any Discover product or service. It does not guarantee that Discover offers or endorses a product or service. For specific advice about your unique circumstances, you may wish to consult a qualified professional.