How Minimum Redemptions Can Devalue Credit Card Rewards

Depending on a card's rules, you may have to spend hundreds or thousands of dollars before you can redeem earned cash back, points or miles.
Claire TsosieJul 23, 2021
How Minimum Redemptions Can Devalue Credit Card Rewards

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Rewards credit cards offer lucrative perks and benefits that can be worth a good amount of money for cardholders. But if you’re not able to cash in on the rewards you’ve earned, it can be tough to get the full value out of a card.

A minimum redemption — a requirement that you have a certain amount of rewards on your credit card before cashing in — can make it difficult to get your money's worth on earned points, miles or cash back. Depending on a card's rewards rate and minimum redemption, you may have to spend thousands of dollars before you can redeem any rewards.

Nerdy tip: Minimum redemption terms can be hard to find when you're looking to apply for a card. While credit card issuers are required by law to prominently disclose APRs and fees in what's called a Schumer box, they aren’t obligated to disclose minimum redemptions the same way. Sometimes, you need to contact the issuer directly to find out.

Why minimum redemptions matter

Minimum redemptions on credit cards aren't necessarily deal-breakers, but in some cases, they can lower the effective rewards rate on your credit card.

Take the Blue Cash Preferred® Card from American Express, for example, which has a minimum redemption of $25. If you had a rewards balance of $10, you couldn't cash in until you earned $15 more. Assuming you're earning the card's highest possible rewards rate of 6% (or 0.06 points per dollar spent), you would need to spend at least $250 more just to close that $15 gap ($250 in purchases x 6% back on every purchase = $15 in rewards).

For big spenders or people who use a particular card regularly, such a restriction might not be an issue. But for people who spend more slowly, restrictions on redemptions can make the card less valuable.

Popular cards with redemption minimums

Minimum redemptions typically vary widely across credit cards and issuers. For example, Discover and Capital One have no minimum redemptions for cash-back rewards and travel statement credits, while other major issuers require cardholders to spend a minimum of $1,000 before they can redeem rewards.

For NerdWallet’s most popular cash back and travel credit cards, here are the minimum redemption requirements and how much you would have to spend to cash in on your rewards.

Credit Card

Minimum redemption

Amount of spending required to meet minimum redemption*

5,000 points.

$1,250.

Direct deposit into an eligible 529 account or a contribution to an eligible Merrill account; check redemptions or electronic deposits into a Bank of America checking or savings account; credit into a qualifying Cash Management Account® with Merrill: $25.

*There’s no minimum redemption requirement when redeeming cash rewards as a deposit into your Bank of America® account or for statement credit.

$833.

2,500 points.

$833.

$25.

$833.

$25.

$417.

$25.

$1,250.

100 points.

$33.

5,000 miles.

$2,500.

5,000 points.

$1,000.

5,000 points.

$1,000.

2,500 points.

$625.

Withdrawal from a Wells Fargo ATM or direct deposit into an eligible Wells Fargo account: $20 Cash redemption options by phone or online: $25.

*Purchase redemptions must be for $1 or more, and cardholders are required to have enough rewards to redeem for the entire amount of the transaction.

Withdrawal from a Wells Fargo ATM or direct deposit into an eligible Wells Fargo account: $1,000.

Cash redemption options by phone or online: $1,250.

2,500 points.

$625.

*Rounded to nearest dollar. Does not include sign-up bonuses or limited time offers. Calculated using the highest possible rewards rate on each credit card.


To view rates and fees of the Blue Cash Preferred® Card from American Express, see this page.

To view rates and fees of the Blue Cash Everyday® Card from American Express, see this page.

To view rates and fees of the American Express® Gold Card, see this page.

To view rates and fees of The Platinum Card® from American Express, see this page.

To view rates and fees of The Business Platinum Card® from American Express, see this page.

All information about the Amex EveryDay® Credit Card has been collected independently by NerdWallet. The Amex EveryDay® Credit Card is no longer available through NerdWallet.

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