Frequent flyer miles and credit card points are worthless

By | September 1, 2015

I applied for and was approved for an American Express Platinum Card last week.  Today I received the “Membership Rewards Terms and Conditions” (which are about as exciting a read as any legal document).  But after reading through them I was reminded that frequent flyer miles and credit card points are worthless UNTIL you redeem them.

The very first point under the T&C is as follows (bolding is mine):

We may add to and/or change the Membership Rewards program Terms & Conditions at any time. For example, we could:

  • Change the number of points you can earn for spending
  • Change the number of points required to get rewards
  • Impose caps and/or fees on earning and/or using points
  • Increase annual and/or other program fees
  • Cancel rewards

We also may cancel the program at any time, as long as we give you three months notice. During this three-month period, we may change or cancel some or all of the rewards that are current at that time. Once the three months have passed, you’ll no longer be able to earn or use points.

Our merchants and rewards may change at any time. Card Members can only use points for rewards that are currently available. Certain rewards are only available for specific time periods.

Some rewards may have additional terms and conditions, including those from our merchants. To see detailed terms and conditions for a specific reward, find your reward on membershiprewards.com and then click the “Terms and Conditions” link on the reward detail page.

When you use points to get rewards, you release American Express and all of its affiliates from liability for your use of points, for the reward and how you use it, and for your participation in the program.

American Express and our merchants are not responsible for replacing lost, stolen or damaged certificates, tickets or gift cards.

We may refuse your request to use points if any of your Linked Card Accounts are not in good standing.

These Terms & Conditions apply to your participation in the Membership Rewards program. Your Card Member Agreement applies to your Linked Card Account.

While Amex reserves the right to cancel their Membership Rewards program at any time, they do say that they will give consumers 3 months notice.  However, they also say that during that time they may cancel all of the rewards if they so chose!  Meaning that even though you have points, you can’t spend them.

So legally Amex could decide tomorrow that all Membership Rewards are worth exactly $0 and the consumer can do nothing about it.

Alaska Airlines Mileage Plan (my favorite program) has similar legal language in their Terms and Conditions:

Alaska Airlines may terminate the Mileage Plan program 180 days after publishing notice of program termination on www.alaskaair.com.

Alaska Airlines may, in its sole discretion, amend the Mileage Plan Conditions of Membership, including terminating any member’s ability to redeem Miles already accrued, at any time.

Any and all changes in the Conditions of Membership, including rules regarding the number of Miles needed for a Mileage Plan award, are retroactive and apply to all previously accumulated mileage.

The accumulation of mileage in a member’s account does not entitle the member to any vested rights with respect to any specific awards or specific Mileage Plan benefits. In accumulating mileage, members may not rely upon the continued availability of any award or award level, and members may not be able to obtain awards for all destinations or flights. Alaska Airlines may, among other things:

  • Change Mileage Plan benefits, participant affiliations, or cities served
  • Limit the number of seats available for award travel or otherwise restrict the continued availability of travel awards or special offers
  • Increase or decrease the mileage required for an award
  • Modify transferability of miles and awards

Alaska Airlines’ Mileage Plan Partners may on occasion implement changes affecting Mileage Plan benefits without prior notice to members.

I am guessing most all loyalty programs have similar terms.

It is a cold hard truth that frequent flyer miles and credit card points are worthless.  They literally have no value.  Luckily most of the companies that offer these programs are big enough that they will not want to make the general public angry by unilaterally canceling their accounts; fearing that the public will lose trust in them.  However, if one of these companies decides, for whatever reason, to take away all of your miles or points, they can do so and you have no recourse.

Just something to remember in this miles/points game that many of us play.

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