If you pay off your credit cards every month, I am a strong advocate of harnessing the power of rewards cards.

If you don’t pay off your cards every month, the interest rate generally destroys the value of using rewards cards.

Over the last several years, I’ve usually opened new credit cards when planning for a vacation, with a set goal in mind.

I’ve had some great success knocking a good amount of money off trips to:

• New Orleans
• Hawaii
• Iceland
• Eastern Europe

Clearly, I didn’t do much traveling in 2020, so for the first time, I had rewards just accumulating with no set goal to use them towards.

I was just quietly hoarding them for a while when I came across a post online that pointed out there’s no benefit to letting them sit in there. It’s money that’s not gaining any interest.

I realized I had never thought of it like that, so I’ve been applying the rewards to my credit card balance each time the number gets high enough to redeem.

I also decided to simplify my credit card life a little bit and cancelled the majority of my cards. I had been balancing quite a few and was holding off on cancelling any while I was house hunting last year.

Several cards had point balances just under the redemption thresholds and I wound up looking into what I could do with those cards as well.

Maybe it’s silly it took me all this time to really look into what you can do with these rewards points, I just always had a particular goal in mind before and just chase that.

For any cards just under the threshold, they became my primary card until I racked up enough points to make a redemption.

While travel generally had the best redemption option, I was also able to use some of my cards to get gift certificates – which was particularly useful for cards I just wanted to cancel. So I stocked up on some generally useful gift cards to places like JiffyLube, Groupon or Starbucks (in the hope that someday I will be out on tour again and need lots of caffeine).

So I was wondering how everyone else makes the most of their credit card rewards?

Do you also use your points towards a set goal?

Have you thought about how those rewards just sit there without collecting any interest?

And do you have any big travel plans now that the end of the pandemic is hopefully on the near horizon?