Points Principles: What Happens to Your Points When You Close a Card?
Editor’s Note: Welcome to our Points Principles series, an ongoing series dedicated to explaining the basics behind the confusing world of frequent flyer miles and travel rewards points. Follow along as we lay out some of the building blocks to travel for nearly free. And check back to the Points Principles page to see what ground we’ve already covered.
It’s a question that comes up for everybody who has ever opened a travel rewards credit card: “What happens to my points and miles after I close a credit card?”
The answer? It depends. Exactly what happens to your points and miles depends on the specific credit card, and which hotel or points program it’s associated with.
If you’re closing a co-branded card – a partnership between an airline or hotel and a bank like Delta, American Airlines or Hilton – your points should be safe. But if the card in question is issued directly from a bank like Chase, American Express or Citi, you will need to have a plan for your points before you cancel.
Let’s dive in.
The Basics of Canceling a Co-Branded Credit Card
If you are canceling a co-branded card like the Barclays American Airlines Aviator card, or the Chase Marriott Bonvoy Boundless card, your points should be safe and sound in your account after you choose to close the account, generally speaking.
Once the card-issuing bank – in this case, Chase or Barclays – deposit the points into either your American Airlines AAdvantage account or your Marriott Bonvoy account, they cannot claw the points back after you decide to close the credit card. They are yours to keep until you use them or they expire.
And while we only used an American Airlines and Marriott Bonvoy credit card in our example above, this same principle will hold true no matter the hotel or airline credit card you are referring to. Once they’re in your hotel or airline account, they are safe.
The Basics of Canceling a Flexible Points Credit Card
While there is no risk of losing your points when canceling a co-branded credit card, that’s not the case when referring to a flexible points credit card issued directly from a bank. This includes but isn’t limited to cards like the Chase Sapphire Preferred, Chase Sapphire Reserve, Capital One Venture, Amex Platinum, and Amex Gold cards.
If you have points in your account and you decide to cancel flexible points cards like the ones listed above, you will forfeit any and all remaining points in your account. The exception is that as long as you still have a card open that earns the same points, your points balance should be safe.
For example, if you hold both the American Express Platinum and American Express Gold cards and decide to cancel the Gold card, you will not forfeit any points because you still have a card open that earns Amex Membership Rewards points in the Amex Platinum card.
Co-Branded Card Cancelation Considerations
Because losing your points should not be a deciding factor in whether or not to close a co-branded credit card, we always recommend weighing the annual fee vs. the benefits it provides you when deciding whether or not to keep the card open. That’s why we tell readers to think twice before canceling a card.
For example, I often fly with Delta, and having an almost 2-year-old daughter at home means we typically check a bag when we travel with her.
I carry the Delta Gold Card from American Express simply because it provides a free checked bag every time we travel. Considering that Delta now charges $30 each way to check a bag, we only have to take two round trips each year to come out ahead on our $95 investment in the card’s annual fee. For that reason alone, we keep the card open.
The same can be said for the many hotel credit cards in my wallet – especially the World of Hyatt Credit Card. While I could cancel the card and my World of Hyatt points would be safe and sound, I keep it open for the annual free night it provides at hundreds of Hyatt properties around the world. Again, I have no problem getting three to four times more value than the annual fee costs ($95) out of this benefit.
Flexible Points Card Cancelation Considerations
Because you will lose any points left in your account upon canceling a flexible currency credit card, it’s important to have a gameplan before deciding to cancel.
If you absolutely need to cancel the card, transfer the points into one of the many partner airline or hotel programs associated with each points program. Once these points reach the loyalty account of the airline or hotel program, they will be safe and sound upon canceling your credit card.
But remember that all of these points transfers are one way. This means that once you send them from Chase Ultimate Rewards to World of Hyatt for example, there is no going back. You can’t turn those Hyatt points back into Chase Ultimate Rewards points.
For this reason, it’s always a good idea to transfer the points to programs where you know you will use the points.
Whether or not you will lose your points depends on the type of travel rewards credit card you are considering canceling. And if the card in question is a flexible points credit card issued directly from a bank, think twice. Any points left in your account upon cancelation will be forfeited.
Editorial Note: Any opinions, analyses, reviews, or recommendations expressed in this article are those of the author’s alone, and have not been reviewed, approved, or otherwise endorsed by any card.