Dealing With Expiring Bank Points in a Pandemic

Long-winded story time, or jump to the end for the too long; didn’t read guide to dealing with expiring points.

Seems like just a while ago that I started on hoarding miles, but the fact that some of my OCBC$ were expiring reminded me that it’s been a little more than 2 years since I started clocking miles like crazy (on top of getting my monthly cashback too, of course).

I consider myself a Team Value person, using a cashback or miles card depending on whichever gave me the most value (rule of thumb: go with the greater number, since 1% cashback is approximately 1 mile per dollar). Even then, I managed to clock a healthy amount of miles, and this was supposed to be year I cash in! 2020, with no fewer than 4 trips planned, was an ambitious year only a global pandemic could derail.

Instead, reality has me sitting in front of the glow of my computer screen, scrolling through OCBC’s rewards site (oh yeah go redeem your free $10 voucher while it lasts; I don’t know how they can spend so much money on that) for something to redeem with my expiring points. Certainly not as exciting as flying on business class and posting a photo of my boarding pass tucked in my passport on Instagram.

I had an almost round 200,960 OCBC$, and some 5,400 of them were going to expire at the end of September. Naturally, as a responsible, prudent working adult, I procrastinated until the literal last hour to redeem these points, and boy was I in a dilemma at the eleventh hour.

There were really two options I could take at this point:

A. Redeem for miles anyway

Singapore Air is unlikely to collapse, and they have even been extending the expiry of members’ miles. As much as this inspires a little confidence in the KrisFlyer programme, I find it a little worrisome to convert my OCBC$ into KrisFyler miles.

Firstly, I already have more than 100,000 or so miles languishing from when my DBS Points were starting to expire. 200,000 OCBC$ is 80,000 miles – not a large portion of my bank points, but it’s a significant enough number I get concerned about putting more eggs into a rather precarious basket.

I look at this number like I look at my CPF

Secondly, it seems likely that it’d take perhaps a year (… two? 🤐) or so before flights resume, and I can only imagine the amount of mile redemption that would happen from the pent-up demand then, as well as how difficult it would be to redeem flights with miles given the competition. It would also mean my points would celebrate a birthday (… or two? 🤐) in my account, and I’m not confident I can reasonably use up my miles before they expire.

Finally, and perhaps much to the chagrin of mile chasers, my valuation of a mile is closer to 1 cent versus the rather high 1.8 to 2 cents business class enthusiasts. If I can liquidate my miles at something around or higher than that, I certainly would, especially given how uncertain everything is now.

B. Redeem for other stuff

While most people use point cards to redeem miles, and that tends to be the most efficient way of using your points, the good thing about points cards is their versatility. While this versatility is often not appreciated because redeeming for vouchers or cash rebates usually gives you a pathetic value for your points, it is not always the case.

While OCBC used to offer cash rebates and vouchers at a rate of about 0.67 cents per mile, their new rewards portal STACK is decidedly more generous. 1,351 OCBC$ (or 540 miles) can get you something that is $5. That works out to about 0.925 cents per mile, which isn’t too shabby! That makes OCBC Titanium Rewards’ 4 mpd rate a 3.7% cashback card… not exactly cash, but with groceries vouchers as one of the options, it is not too far off.

There are also promotional items every now and then: I got myself two $10 Swensen’s voucher for half off – 1,351 OCBC$. That makes my miles worth 1.85 cents* each! With a rather big asterisk that it only applies to spending at Swensen’s. I eat at Toast Box too, but unfortunately other people have the same idea and it’s sold out now.

I then spent another few thousand on a couple of GV movie tickets. I already went below the nice round 200,000 figure to convert all into 80,000 miles (the next would be 175,000 OCBC$ for 70,000 miles), so I might as well. Given that these are things I would spend on anyway and the exchange rate is close to my valuation of 1 cent per mile, I don’t feel too bad about it.

A, then B

This doesn’t really apply to OCBC points because their rate is now pretty good at 0.925 cents per mile, but it sure does make sense for banks like DBS which gives you a low rate for your points.

If you want to buy the newest $600 Apple Watch using your DBS points, it’ll cost you 60,000 DBS points. That’s the equivalent of 120,000 miles, making your miles worth a pathetic 0.5 cents each. Yikes.

Here’s an alternative: pay $25 to convert your DBS points to KrisFlyer miles, then redeem it at a rate of roughly 0.8 cents per mile on KrisShop, which means around 37,500 DBS Points. That’s 12,500 DBS points less representing more than 20% savings, which is $112.50 even at DBS’s poor exchange rate. A worthy $25 spent.

The kink in this plan? KrisShop doesn’t currently offer the newest Apple Watch, so you have to wait for a bit… if they do decide to add that. Troublesome? The miles game was always a hassle even before the pandemic.

Tl;dr

If you have expiring bank points like me, you have to ask yourself this:

  1. Are you okay with converting your points into miles when airlines are bleeding?
  2. Do you have flexible enough travel plans to compete with other people when flights resume and there is mass redemptions?
  3. Do you have any good deals to redeem for with your bank points?
  4. Do you have any thing good to redeem for with miles?

Yes to 1 and 2 → Option A
Yes to 3 → Option B
Yes to 4 → Option A, then B

No to everything? Aiya should have gone cashback.

Any other options (or do you want to tell me I’m foolish for giving up miles for ice cream)? Let me know in the comments or my Telegram group!

Keep up to date on the best cashback/mile cards, savings accounts, attractive deals, and more tips to maximise your financial wellbeing by subscribing to my Telegram channel. You can also ask questions in the chat!

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