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Tuesday, November 21, 2017

Membership Rewards Use Points for Purchases explained

In 2016 American Express took a major step in providing more flexible reward options for Cardmembers earning Membership Rewards points. They took their very popular TripFlex option, which allowed Cardmembers to redeem points against any travel charge that was paid for with a Membership Rewards earning card from American Express, and expanded it. The expanded program is now called Use Points for Purchases, which is fitting because you can literally use points for almost any purchase on your card.

The Use Points for Purchases still incorporates the old TripFlex rate and introduced a new redemption rate for non-travel purchases:
  • Use Points for Purchases (Travel): 1,000 points = $10 credit
  • Use Points for Purchases (Non-travel): 1,000 points = $7 credit
Essentially, what the program has become, is a cash back program for any and all purchases, rather than just for travel purchases.

The travel option of the Use Points for Purchases is great for those looking for the utmost flexibility in using points for travel. You get to book the flights that are best for you, from the carrier you want, right from the airline’s website, a travel agent or any online travel portal. It even covers non-air travel, such as car rentals.

Book your hotel via the hotel's website, a cruise via a travel agent or even an all-inclusive vacation, and you can redeem your Membership Rewards points for it all.  All you have to do is charge the travel to any Membership Rewards earning American Express Card and when the charge shows up, redeem your points against it at a rate of 1,000 points for a $10 statement credit.

The great thing with Membership Rewards is that you can continue to fund your trip with points even after it's over, since American Express allows you to redeem for a charge up to 12 months after it gets posted to your account. This is an awesome feature of Use Points for Purchases because most traditional loyalty programs, and even some proprietary credit card programs, require you to have some, or all of the points at the time of booking. Since American Express does not, and gives you up to 12 months, you can be in the middle of a month long European vacation when you decide you want to take a train trip into the majestic Swiss Alps. Simply pay for the train trip with your Amex card, then when you get home, redeem your points for it and voila – that  train trip is covered!

When purchasing flights and accommodations, remember you can also earn frequent flyer miles, frequent guest points or whatever reward program points may be associated with the service. Think about it, you are redeeming points to get something cheaper or free and are still gaining miles or points in other programs! You can't do that with traditional frequent flyer or guest programs with their awards.

Use Points for Purchases is not only great for booking travel, but non-travel purchases too. With
the holiday’s coming up, what better way to use your points to buy a gift for family, friends, or
even yourself! And while purchasing gifts through Use Points for Purchases, you’ll be gaining
rewards points back at the same time.

The newest addition to Use Points for Purchases allows American Express Cardmembers to redeem points for almost anything they charge to their cards. The rate for non-travel purchases is 1,000 points for a $7 credit. Depending on which American Express Card you carry, this means you are achieving a rate of return from 0.7%, all the way up to 3.5% with the eats & drinks accelerator category on the new American Express Cobalt Card. Not many cash back cards will afford you with an unlimited cash back amount of 3.5% on eats & drinks purchases.
What  return does 1,000 points for $7 actually represent for the three most popular Membership Rewards Cards?

American Express Cobalt Card:
5X Points on Eats & Drinks purchases: 3.5% (versus 5% for travel redemption, 5%+ when converting to frequent guest programs)

5X Points on Eats & Drinks purchases: 1.4% (versus 2% for travel redemption, 2.5%+ when converting to frequent guest programs)

1X Points on  all All other purchases: 0.7% (versus 1% for travel redemption, 1%+ when converting to frequent guest programs)

American Express Gold Rewards Card:
2X Points on Gas, Grocery, Drug Store & Travel purchases: 1.4% (versus 2% for travel redemption, 2%-5%+ when converting to frequent flyer/guest programs)

1X Points on all other purchases: 0.7% (versus 1% for travel redemption, 1%-2.5%+ when converting to frequent flyer/guest programs)

The Platinum Card from American Express:
1.25 Points on all purchases: 0.875% (versus 1.25% for travel redemption, 1.25%-3.13%+ when converting to frequent flyer/guest programs)

Membership Rewards make it easy to redeem for charges online by providing Cardmembers with a handy slider to decide how many points they want to redeem against a certain charge. Here are examples of the travel and non-travel redemption slider option:

A Travel Purchase where you can redeem at the 1000 points to $10 rate

A Non-Travel Purchase where you can redeem at the 1000 points to $7 rate
You can also redeem points on-the-go by using the Amex app. All you have to do is open the app, tap on the transaction you want to redeem points against and click Use Points. It can’t get any easier than that!
The app in action showing a non-travel purchase that is eligible for
Use Points for Purchases


If you're not an American Express Cardmember yet, we recommend you check out the American Express card listings to find the card that is right for you.

Personally, I have used the Use Points for Purchases and love it. I have used it pay for the taxes and fees on Aeroplan award tickets, hotel stays and more. It is just one of the many features and benefits from American Express that have led to our household making them the primary cards in our household and Membership Rewards our primary loyalty program.

Learn more about American Express Membership Rewards Use Points for Purchases here.

How about you? Have you used Use Points for Purchases? Tell us how and what for and feel free to ask us your questions about the program if you aren't a Cardmember yet.

This is part two of a three-part Membership Rewards series sponsored by American Express.

Part 1:  Membership Rewards - the loyalty currency every Canadian should be utilizing

This post was sponsored by Amex Bank of Canada.  The views and opinions expressed in this blog, however, are purely my own.

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