Lesson 7.3 – Redeeming Rewards Effectively

Introduction

Earning points is only half the equation—the real value comes from redeeming them wisely. Many people waste their rewards by redeeming them for low-value options like gift cards or statement credits, missing out on much better uses. In this lesson, we’ll cover how to maximize your redemptions so you get the most out of every point or dollar earned.

1. Understanding the Value of Points & Cashback

Not all rewards are created equal! The value of a point depends on how you redeem it.

Typical Point Values:

💡 Tip: If a program lets you use points for travel, you should almost always redeem them this way for the best value!

2. How to Redeem Points for Maximum Value

A. Travel Redemptions: The Golden Standard

For most rewards programs, booking flights and hotels gives you the highest value per point.

Aeroplan Example (Good vs. Bad Redemption):

🔹 Good: A Business Class ticket to Europe (70,000 Aeroplan points) → Worth $3,500 (~5 cents per point).
🔹 Bad: A $700 iPad from Aeroplan’s merchandise store (100,000 points) → Worth only 0.7 cents per point.

💡 Tip: Some programs have sweet spots, where flights cost fewer points than they should—these redemptions can double or triple your points’ value.

B. Cashback & Fixed-Value Redemptions

If your credit card earns cashback, there’s no strategy required—just redeem for a statement credit or direct deposit into your bank account.

However, for programs like Amex Membership Rewards or RBC Avion, you might get a bad deal if you redeem for cashback instead of travel.

💡 Tip: If you have a points-earning credit card but don’t want to book travel, consider transferring points to a travel partner instead of cashing out at a lower rate.

C. Transferring Points to Airline & Hotel Partners

Many premium rewards programs let you transfer points to airline or hotel partners—this often unlocks the highest value redemptions.

Best Transfer Options (as of 2025):

• Amex Membership Rewards → Transfer to Aeroplan, British Airways Avios, Marriott Bonvoy.
• RBC Avion → Transfer to WestJet, British Airways Avios, American Airlines AAdvantage.
• CIBC Aventura → Transfer to Aeroplan.
• HSBC Rewards → Transfer to British Airways Avios or Singapore Airlines KrisFlyer.

💡 Tip: Transferring during a bonus promotion (like 30% extra points) can make your points even more valuable!

3. Avoiding Common Redemption Mistakes

Even experienced rewards users sometimes redeem poorly. Here’s what NOT to do:

🚫 Redeeming for Gift Cards or Merchandise – The worst value, usually 0.5-1 cent per point.
🚫 Booking Through a Bad Travel Portal – Some card issuers mark up flights, making redemptions cost more points than necessary.
🚫 Letting Points Expire – Many programs expire your points if you don’t earn/redeem regularly (e.g., Aeroplan expires after 18 months of inactivity).

💡 Tip: If you have expiring points, book ANY travel, buy a small amount of gas, or transfer points to keep your account active!

4. Maximizing Redemptions with Everyday Hacks

To get the most out of your points, try these simple strategies:

🔹 Book Flights in Advance – Award flights get more expensive the closer you get to departure.
🔹 Check for Sweet Spots – Some airlines charge less points for specific routes (e.g., Air Canada to Hawaii with Aeroplan).
🔹 Use Points to Cover Taxes & Fees – Some cards (like the Amex Platinum) let you cover airline fees and taxes with points.
🔹 Combine Points with Other Perks – Stack your points with companion fares, status benefits, and credit card travel credits.

Key Takeaways

✅ Travel redemptions usually offer the best value—especially business class flights.
✅ Cashback is simple but not always the highest value unless you have a pure cashback card.
✅ Transferring points to airline & hotel partners can unlock huge value if done correctly.
✅ Avoid low-value redemptions like gift cards, merchandise, or bad travel portals.
✅ Keep an eye on expiration policies so you don’t lose your hard-earned points.