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If a travel reward is earned but never spent, did it ever exist at all?
No, this isn't an existential crisis, but it could be a financial one if you're one of the many Americans who think travel rewards are important but doesn't actually redeem them. It's a widespread phenomenon according to a survey completed by the American Institute of CPAs.
The contrast is stark.
While 58 percent of Americans believe that accumulating travel rewards is important, only 15 percent actually report taking a trip they've paid for with those rewards. That means a significant portion of wishful travelers are either not accumulating the rewards they think are important, redeeming them for cashback offers that aren't as lucrative or letting them expire altogether.
It gets worse.
Compare that 15 percent of Americans who are wisely traveling on the cheap to the 14 percent of Americans who report their travel plans actually result in credit card balances that they can't immediately pay off. Smaller amounts even report missing payments or exceeding their credit limit because of travel.
That's the polar opposite end of the spectrum! That means that almost as many people are paying extra for their travel rather than utilizing relatively simple means to travel for less.
Financially, it's important to keep track of rewards and use them, and it's also important to refrain from chasing rewards that might end up not being worth the price you pay for them. Gregory Anton, chair of the AICPA'S Financial Literacy Commission said as much in a statement about the survey:
"When chasing after elite status with hotels and airlines, it's important to not lose sight of the fact that miles and points often have a dollar value associated with them. Spending extra money in hopes of earning free nights and flights has the very real potential to leave Americans feeling like they've been travel hacked when their credit card payments are due."
Overall, the report showcased a stunning lack of financial literacy with many respondents not being able to cite their own rates and fees though believing those were the most important facets of choosing a card.
The institute recommends never spending more than you were planning-even to earn covert travel rewards-as well as picking cards that fit your needs and looking for those cards with big sign-up bonuses.
Perhaps most important of all, use the rewards you earn!
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