January 31,2007
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Not Too Many, Not Too Long
A recent review of many different rewards cards issued by all the big names (and some of the small ones) showed that, despite ad campaigns devised to seem otherwise, most rewards cards have at least a few things in common. How many points earned per dollar spent, relative quality of rewards, and thresholds for reward redemption tend to be pretty standard. What really divides the pack, however, are the subjects of expiration dates and caps on rewards.
The two don't always go together, but you see it often enough, buried in the fine italicized print of the card's terms and conditions: a annual limit on how many rewards points or rebate dollars your can accrue, and a cutoff date by which you can redeem them. The limits range from quite reasonable (75,000 points in a year) to the miserly (10,000), and the expirations range from 1 – 5 years. This is not at all a recommendation to avoid cards with earnings caps and expiries, but a warning to check what you are getting into before signing up. Make sure that the time you have to redeem your hard-earned rewards is realistic for you, and that you aren't signing up for a card where the earnings cap is lower than what you spend annually. The whole point of a rewards card, after all, if to make your card work for you – a little research goes a long way to this extent.