Should You Liquidate Your Points for Cash?

There’s no denying we’re in a tumultuous period at the moment, with airlines suspending operations left and right and traveller numbers clocking in at less than 5% compared to a year ago. Those of us in the Miles & Points community are cancelling and rebooking trips, trying to gauge when we can travel again, and reconsidering our earning and burning strategies going forward.

Previously, we discussed diversifying into some of the best cash-back cards on the market as one potential alternative strategy. In addition, given that we can’t travel for the foreseeable future, it’s certainly possible that the thought of liquidating your existing points balances for cash may have crossed your mind. 

In this article, we’ll take a look at what types of people should be considering cashing out their points, as well as some of the options at your disposal for doing so.

Who Should Consider Cashing Out Their Points?

The simplest answer to this question is that individuals who have points to spare, and who might place a greater value on having cash in the bank rather than extraneous points balances, should consider liquidating their points for cash.

Many points collectors out there find themselves with limited vacation time every year compared to the number of points they earn, so if you already have a decent stockpile to fund a couple years’ worth of trips once this is all over, then it could definitely make sense to looking into liquidating the rest. 

Others may have had their financial situation affected by the the pandemic, either through job loss, reduced hours at work, or missed job opportunities.

(My assistant Rachel, for example, has recently received some large points refunds because she had to cancel her trips, at the same time that her university has revoked most of their summer research positions. Thus, she finds herself in a “points rich, cash poor” situation and consequently has chosen to liquidate some of her points.)

Still others might choose to liquidate excess points balances as a means to invest in the stock market at a time when prices are lower across the board, and I know a few people who have recently secured some tax-sheltered cashflow by redeeming their RBC Avion points at a rate of 0.83 cents per point (cpp) directly into their RBC TFSA accounts for this very purpose. 

And finally, if you’re not planning to go anywhere for the next little while because of the aftereffects of the pandemic, then liquidating your points can be a way to neutralize any extra expenses you may have incurred in recent weeks, such as your food delivery bills or Netflix subscriptions. 

If one of the above situations apply to you, I would still always recommend keeping an “emergency fund” of points on hand, which is a practice that I encourage even in ordinary times. If nothing else, a stash of points can always come in handy in any situations where last-minute travel is required and cash fares are sky-high.

The Opportunity Cost of Cashing Out

Of course, the obvious downside to cashing out points is the fact that they could be redeemed for much better value towards travel, especially for flights in business class or First Class. 

Here, I’d say that it’s important to factor in the price elasticity of airline seats in your thinking. Previously, the demand for travel in premium cabins was primarily composed of business travellers, who’d pay the high cost of tickets no matter what, and those high prices are what allowed us to redeem our points at an extremely high cent-per-point value.

Right now, analysts are predicting that the market will take years to return to pre-pandemic levels, so it isn’t unreasonable to assume that we’ll see a drop in cash fares as well for the next few years, which will result in lower redemption values across the board. 

I’ve already noticed a significant uptick in mistake fares and “good deals” on business class and First Class cash fares recently, many of which represent even better deals than travelling on points – indeed, you could even use some of the methods in this article to liquidate your points, before using that cash to book those cheap cash fares to come out even further ahead than if you were redeeming points directly! 


What Are the Best Ways to Liquidate Points?

Let’s cover some of the best ways for liquidating points that are available to you, which I’d group into two distinct categories: those that are risk-free and by the books, and those that are more of a grey area in terms of what the loyalty programs like and do not like to see. 

The risk-free options for liquidating your points may sound pretty boring, and they may even be methods I’ve advised against in the past, but I think we can all agree that we’re facing an unprecedented situation in which new strategies should be given due consideration. 

Arguably the easiest way to liquidate any type of points is to redeem them directly towards purchases charged to the card. American Express Membership Rewards points (as well as its lower-tier cousin, Membership Rewards Select points), for example, can be redeemed at a rate of 1cpp against any statement charge.

(In the past, most American Express cards were limited to 0.7cpp redemptions against any statement charge, and 1cpp redemptions against travel purchases only; however, this seems to have been relaxed in response to the fact that very few cardholders would be making any travel purchases at the moment.)

If we look across the landscape at other banks’ points currencies: 

  • RBC Avion points can be redeemed at 0.58cpp for statement credit, although a better move may be to cash out the points via a transfer to an RBC TFSA at 0.83cpp or via gift cards (see below). 

  • Scotia Rewards points can be redeemed at a rate between 0.67cpp and 0.8cpp for statement credit, depending on how many points you’re redeeming at once (3000 points = $20 and 62,500 points = $500). The refundable hotel trick works well with Scotia Rewards to cash out your points at a higher rate of 1cpp.

  • HSBC Rewards can be redeemed at 0.3cpp for statement credit. The refundable hotel trick works well with HSBC Rewards to cash out your points at a higher rate of 0.5cpp.

  • TD Rewards points can be redeemed at 0.25cpp for statement credit or 0.4cpp towards any travel purchase, although the refundable hotel trick doesn’t appear to work.

  • CIBC Aventura points can be redeemed at 0.63cpp for statement credit or 1cpp towards any travel purchase, although the refundable hotel trick doesn’t appear to work.

  • BMO Rewards points can be redeemed at 0.33cpp for statement credit or 0.7cpp towards any travel purchase. An equivalent “refundable car rental trick” seems to work for the purpose of cashing out BMO Rewards points at the higher rate. 

As you can see, the standard rates for statement credits are rather abysmal, and should be pursued as a last resort only. 

In addition to statement credits and travel purchases, another option is to redeem your points for gift cards at retailers that you’d be likely to shop at. I won’t go into detail on the exact gift card redemption rates for each program, but in general, you can expect to achieve a value around 0.7cpp or 0.8cpp (scaled appropriately depending on the baseline value of your specific currency) when redeeming points for gift cards.

Meanwhile, when it comes to frequent flyer miles or hotel points like Aeroplan, Air Miles, or Marriott Bonvoy, your options for liquidating points are, in most cases, limited to redeeming them for gift cards only, as there’s no ability to redeem for statement credits or straight-up cash.  

To take the example of Aeroplan, you can redeem miles for gift cards at major Canadian retailers at a rate of between 0.7cpp and 1cpp. Marriott Bonvoy’s selection of gift card redemptions is more restrictive, allowing you only to redeem for US retailers at a rate of 0.33cpp (USD). 

Finally, there are of course other methods of liquidating points that fall into more of a grey area: I’ve written about buying and selling points in the past, so there’s no need to rehash it here. These channels obviously involve some degree of risk and are not recommended for that reason, but that doesn’t mean we can’t have an honest discussion about them so that you know of all the options at your disposal. 

Should You Slow Down on Earning Points?

A semi-related question that I’ve been hearing recently is whether you should be slowing down your credit card applications in light of this leaner period. 

In my view, the only reason to do so would be if you’re struggling to meet the minimum spending requirements in light of the reduced economic activity. If that’s the situation you find yourself in, you can refer back to this video where I provide a few ideas for meeting minimum spends. 

If you’re still comfortable with the minimum spends, then the ability to liquidate your points for cash means that you’re still coming out ahead even if you can’t redeem points for travel and even if you must pay annual fees. 

After all, the American Express Business Platinum Card gives a welcome bonus of 75,000 Membership Rewards points, which amounts to a total of 83,750 Membership Rewards points after reaching the minimum spend requirement.

Even if you were to use these points in the simplest manner, which is as statement credit, you can achieve a minimum value of $837.50, which still results in a handsome profit after subtracting the annual fee of $499.

As mentioned above, the refundable hotel trick allows you to liquidate points at the higher rate for travel purchases with select issuers, and there may be methods to achieve strong returns through other mercurially-minded methods as well. 


The current standstill in global travel has given rise to quite a few alternative Miles & Points strategies that would be inadvisable in ordinary times. One of these is to diversify your earnings between cash and points to a greater extent than before, whether through incorporating a few cash-back cards into your portfolio or liquidating the rewards points in favour of cash. 

After all, financially stricken households may find more value in dollars than points at this moment, and even when it comes time to travel again, the value in redeeming points may be slightly reduced when there’s an abundance of cheap cash fares on the market.

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  1. Josh Beckett

    I’ve read that for TD Rewards points, the refundable hotel trick does not work through Expedia4TD but does work for "Any Way Travel" bookings (albeit at a slightly lower redemption rate). Do you have any DP’s on if it doesn’t work on Any Way Travel either?

  2. Brian Douglas

    Hi Ricky! I’m a wee bit perplexed about your idea of moving points to cash, as the devaluation of the points would be drastic. If one thinks that a specific plan (say Aeroplan…I can’t imagine Aeroplan going away as it’s owners have very deep pockets) may go bankrupt, taking the cash and running would make sense. Can you see any of the major players (airlines and hotels) going bankrupt?

  3. Charlotte

    For Expedia4TD and CIBC Aventura, could we not just liquidate our points for airline travel credit, as in book a WestJet flight, cancel it and receive a voucher good for 2 years with no blackout dates?

    1. Ricky YVR

      You could – but that would be airline credit, rather than cash. The article is meant for those who would at the moment favour cold hard cash more than "travel currencies", whether that be points, airline credit, etc.

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