The Cost of Unused Credit Card Rewards

All credit cards give you the power to purchase with plastic instead of paper. But a rewards card can also save you money each time you use it. Credit card rewards offer real monetary value, yet 31% of people still fail to redeem any rewards annually*.

As a business owner, you already have enough on your plate without worrying about reward balances and expiration dates. Don't let common redemption pitfalls keep you from getting the maximum value from your business credit card. If you find managing credit card rewards too time consuming, the simplest solution is to consider switching to a card that offers exclusively cash-back.

Out of Sight, Out of Mind
Forgetting to redeem rewards before they expire is a common reason for rewards going unused. It's easy to forget what you can't see. This is especially true if you have multiple employees accruing rewards under your business account. Yet redeeming rewards is the only way to reap the value they provide. When was the last time you checked your reward balance? You may have more rewards accrued than you think. 

Tip: Check your balance and that of your employees regularly. Make it easy by monitoring your balance online and/or downloading a mobile app. Or switch to a rewards card where your benefits are automatically credited. For example, the BECU Business Cash Back Credit Card credit card automatically deposits your accrued rewards as a statement credit each month.

Too Much Fine Print
Each credit card manages its rewards program differently and rewards are subject to change at any time.  Some cards offer rewards only for purchases made at selected partner companies or locations. Others reward specific categories of products purchased at retailers such as gas or groceries. Many cards also run seasonal promotions with “bonus” rewards on select purchases for a limited time. This makes it challenging to keep track of which retailers and products earn you the most rewards at any given time, leading to missed reward opportunities and less money for you to invest back into your business. 

Tip: When researching card options, read the fine print. Take the time to learn the details of your rewards program to know exactly when and how much you can earn. Generally speaking, reward programs that are simple and easy to understand, like a flat percentage cash-back program, outweigh the competition. But ask yourself what makes the most business sense for you so you can make buying decisions that best maximize your profits. 

Not Enough Flexibility
Redeeming credit card rewards can be just as complicated as accruing them. Rewards are often subject to blackout dates and other usage restrictions. Some cards allow rewards to be redeemed on broad categories of purchases, such as plane tickets or hotel stays. Other cards require rewards to be redeemed only with specific companies. This is especially true for co-branded credit cards. If you require more flexibility for your purchases, like needing an earlier flight time than the partner airline provides, you won't be able to use your rewards to offset the cost. You also lose any unused rewards when you cancel your card. 

Tip: Credit card miles aren't the only way to get travel discounts for your business. If travel benefits are what you seek, consider a card that doesn't charge any foreign transaction fees on international purchases and provides worldwide travel insurance. If you value flexibility for your travel plans, consider switching rewards from miles to cash back instead.  

Don't Sweat the Small Stuff
As a business owner, you already have enough on your plate without worrying about reward balances and expiration dates. Do your best to maximize the value of your credit card rewards by redeeming rewards sooner rather than later. If you find managing reward points too time consuming, the simplest solution is to consider switching to a card that offers exclusively cash back rewards – and it's an added bonus if they are automatically applied as a statement credit each month. 

To learn more about the BECU Business Cash Back Credit Card visit www.becu.org/cashrewards.