These days, you're more likely to hear about credit cards scaling back rewards programs. But American Express is expanding the options its cardholders have for redeeming points through its Membership Rewards program.
Through the new Everyday Charges program, customers can use points to pay for groceries, cable and the electric bill online.
It's being touted as a way that the company is responding to consumers in this recession. Who can wait years and save a gazillion points for a luxury item when there are bills to pay now?
With this new program, points can be used to pay for charges greater than $6.
Nice idea. Here's the catch. Every 1,000 points offsets a $6 charge. And charges must be offset in full. So you still need a lot of points to be able to buy gas or cover your cell phone bill. The 1,970 points I currently have won't even cover my last trip to the post office. I earn 1 point for every $1 I spend.
And if you do the math, it turns out that using your points to offset these routine expenses does not maximize your points' value.
I typically use my points in 10,000 point increments to purchase $100 gift cards to the stores and restaurants my family frequents.
For example, 10,000 points earns me a $100 Banana Republic gift card.
