How Inflation Affects Your Credit Card Rewards
The value of credit card points and miles is often nebulous, allowing card issuers to constantly tailor their offers to things that seem more appealing and competitive.
In practice, NerdWallet notes, this usually means that our credit card rewards lose value behind the scenes, as the number of points needed to redeem savings is steadily increased. And with rampant inflation squeezing our purchasing power everywhere else, it’s only natural to expect credit card rewards to experience the same.
But an analysis by NerdWallet says it “found something unexpected in a sea of bad inflation news: Mall rewards programs’ points have become more valuable this year compared to the previous year. »
For example, this year:
- American Airlines miles increased in value from 1.2 cents per mile to 1.5 cents (a 25% increase)
- United Airlines miles reduced from 1 cent per mile to 1.2 cents per mile (20%)
The analysis found that, overall, airline miles are worth an average of 8.7% more than they were in 2021. Rewards from “almost all domestic airlines” remained the same or have increased in value.
The catch is that it’s harder to redeem these rewards right now due to high demand, and the increased value could disappear as economic conditions change.
Want to compare current offers and start earning more of those very valuable points? Head to Money Talks News Solutions Center to find the best credit cards for travel rewards.
Comments are closed.