For those who do not understand the basics of how a credit card works, it’s simple – imagine the next time you are out making a purchase at a grocery store or out shopping for new clothes, and you can pay the bill without having to pay using cash or your savings! Sounds like a compelling proposition, right?

Many believe that using cash or debit cards to pay when you could be earning rewards points with a credit card means throwing money away – money that adds up over the long term. Many realize the opportunity that they are presented with and some are so good at the credit card game they’re able to finance international vacations almost entirely on points alone.

Sadly, many never actually use the points for them to do you any good. According to a new survey from, a surprising number of people never redeem their credit card rewards & while 38% of people regularly redeem for freebies like cash back and airline tickets, the report found that 31% of cardholders have never redeemed rewards at all – not even once. Recent research by UBS suggests that in most cases, one can expect about 20% of rewards to go unused.

Of course, credit card companies count on this to happen & this is part of the reason they can offer such lush sign-up bonuses and still turn a profit. Elite travel cards like the American Express Platinum offer some of the industry’s most generous sign-up bonuses, and their profitability projections depend on cardholders not taking full advantage of the perks.

So what is it that keeps people from not redeeming their lucrative rewards? It’s a number of reasons – many cardholders are just not aware of how many points they have, according to Additionally, around 32 million cardholders haven’t changed their primary card in over a decade and so the rewards might not match their lifestyle anymore.

Most card companies make your rewards easily accessible and redeemable online, so keeping tabs on your rewards shouldn’t be a tall order. There are even websites dedicated to tracking rewards and helping you book travel with them, making it all the easier to cash in and avoid letting them go to waste.

Holding on to your reward points for a massive cashout is also not advisable as Credit card rewards don’t usually gain value over time and are in fact more likely to lose value as companies require more points or miles for the same perks. It is best to cash them in regularly.

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