When’s the best time to redeem cash back?

When’s the best time to redeem cash back? Image: When’s the best time to redeem cash back?

In a Nutshell

Some credit cards offer rewards that can be redeemed as cash back or used to purchase gift cards or merchandise. The best time to redeem for cash back may depend on your objectives.

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This offer is no longer available on our site: Capital One® Quicksilver® Cash Rewards Credit Card

If you found a dollar bill on the sidewalk, you’d most likely drop to a knee and scoop it up in a hurry.

But when it comes to redeeming cash back earned on your rewards credit card, it’s not quite so simple.

As their name implies, cash back credit cards offer cash back on purchases that you make with the card. The typical rate is around 1%, though some cash back cards offer a higher percentage for purchases like gas and groceries or preset quarterly categories.

Knowing the best time to redeem cash back can help you maximize the amount you receive. At the very least, it can help you avoid letting your hard-earned cash back expire with nothing to show for it.


When’s the best time to redeem cash back?

Simply put, there’s no “best time” to redeem cash back. You may wish to redeem small amounts of cash back on a rolling basis — assuming there’s no minimum amount required for redemption — or you may base your decision on a specific purchase you want to make with your rewards.

A key to redemption, if there is one, is to make sure that you do so before any reward expires (if they expire at all). For example, your cash rewards balance earned from your Citi® Double Cash Card will expire if you haven’t earned cash back from purchases or payments for 12 months.

Just as important as when to redeem is what to redeem for. Some cash back cards, like Chase Freedom Flex℠, track cash back rewards as points. These points can be redeemed for various types of rewards, which may include cash back, gift cards or merchandise.

From our partner

Chase Freedom Flex℠

From cardholders in the last year

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Redemption rates vary and don’t always offer the same value for each reward option. But when you use points to redeem for cash back, they’re often worth 1 cent.

One other notable item is a possible bonus when you redeem for certain things, such as the gift card bonus when you redeem your Cashback Bonus® with your Discover it® Cash Back card.

When you redeem your Cashback Bonus® rewards for featured gift cards (starting at $20), at least another $5 is added to each gift card.

Just be sure to read the terms and conditions of your rewards programs carefully and understand the various redemption rates before redeeming.

Is there a minimum cash back redemption?

Several cash back credit cards have minimum redemption amounts, which means you can only redeem your rewards once you’ve earned a certain designated amount.

The Citi® Double Cash Card, for example, requires your balance to total $25 or more before you can redeem your cash rewards.

Can I lose my cash back rewards?

If you return an item you purchased, rewards may be deducted from your account. It’s also possible to have a negative rewards account balance — for example, you can have a negative rewards balance with Capital One® Quicksilver® Cash Rewards Credit Card after your balance is decreased when you return a purchase.

Some other ways you can lose access to rewards, whether temporarily or permanently, include …

  • Closing your credit card before claiming or using the rewards
  • Allowing the rewards to expire
  • Breaking the rules of the rewards program
  • Missing a credit card payment
  • The card issuer changing the rewards offer

Generally, it’s a good idea to keep track of your rewards and redeem them shortly after you’ve reached the minimum redemption threshold. That way, you won’t forget about them. Some card issuers may enable email or text alerts to help you remember when your rewards are about to expire.

How can I redeem cash back?

Depending on the credit card issuer, you may be able to redeem cash back via check or direct deposit into your checking or savings account. You may also have the option to apply the cash back to your credit card statement as a statement credit.

With the Citi® Double Cash Card, for example, you can …

  • Request a check
  • Redeem for a statement credit to your card account
  • Redeem for a credit to your linked Citi® savings or checking account
  • Redeem for a credit to a checking account from which you’ve paid a Citi® credit card bill at least twice
From our partner

Citi® Double Cash Card

From cardholders in the last year

See Details, Rates & Fees

Bottom line

While there’s usually no one best time to redeem cash back for everyone, you’ll want to be aware of the specific restrictions of your card’s rewards program. Take time to review the terms and conditions so you don’t risk letting your rewards expire or otherwise disappear.

Remember: Rewards programs are designed to retain loyal customers by adding an incentive to continue using the credit card. As long as you pay off your balance in full and on time each month and avoid interest charges, a cash back card can be a lucrative addition to your wallet.


About the author: Rod Kelly has been a writer and editor for more than three decades, the last of which has been in the financial services industry. A native of Minnesota, Rod has made Chicago his home al… Read more.