Even with only a few shopping days left until Christmas, you can still tap rewards credit card points and frequent flyer miles to squeeze in some great last-minute gifts.

It's a popular option, with slightly more than half of consumers using rewards points for holiday shopping, according to Maritz Motivation Solutions, a company that operates rewards programs for many major credit card issuers, airlines, and other companies.

And the savings can be pretty good. More than two-thirds of Americans who participate in rewards programs expect that their points redemptions will save them an average $149 this holiday shopping season, according to a study by Citi Retail Services.

The effective cash value of points can vary widely, depending on what you redeem them for. Here’s how to get the biggest bang for your gift-giving buck.


Visit 
Consumer Reports' 2017 Holiday Gift Guide for updates on deals, expert product reviews, insider tips on shopping, and much more. And be sure to check our Daily Gift Guide.
 

Get Best Value With Airline Tickets

Most frequent flyer programs and mileage rewards cards let you buy airline tickets as gifts for friends and family.

You’ll probably reserve this kind of gift for loved ones or special friends, and this is where you’ll usually get the best value for your points. Generally, domestic airline tickets provide a value of 1 to 2 cents per point, sometimes up to 3 cents, says Howie Rappaport, a rewards expert and blogger for AwardWallet, an app that helps a half million users track their 110 billion points from 700 loyalty programs all in one place.

Rappaport says that "hands down the best value" in the airline space is purchasing international business and first class airline tickets using the partner airlines of Alaska, American, Delta, and United. He says, "You can regularly receive 4 cents to more than 10 cents per mile in value.”

That’s not something you’d expect if you’re in the economy and coach class crowd. Last year, Rappaport says that he and his wife, plus five friends, flew roundtrip business class from New York to Johannesburg, South Africa, on Qatar Airways for 150,000 American AAdvantage miles each, instead of $6,500. That works out to 4.3 cents per frequent flyer mile.

To give the gift of air travel, all you need to do right now is give a Christmas card with your promise. Later, your recipient can tell you when he or she wants to fly, and at that point you can arrange to actually purchase the tickets in the recipient's name.

Consider Gift Cards

When you’re not sure what your gift recipient would like, a gift card is a convenient solution, and electronic gift cards are perfect for last-minute shoppers.

Most gift cards can be purchased for a value of 1 cent per point. So a $25 gift card would cost 2,500 points. However, some gift cards fetch values of less than a penny a point, so brush up on your point-value math (see below).

Apply Points to Purchases

Many rewards cards let you use your points to directly pay for purchases at participating retailers. For example, you can use your American Express Rewards points to pay for purchases at Amazon, Best Buy, Expedia, Ticketmaster, and several other retailers.

This option is especially valuable, because it lets you price shop for the best deal. Many rewards programs offer merchandise through their own proprietary online catalogs, where captive rewards program members might not get the best price. “The value you get [from these catalogs] is much lower than if you shopped around,” says Sam Dogen, who writes the Financial Samurai personal finance blog. 

But check right now if this option is available in your rewards program and shop pronto to meet Christmas shipping deadlines with retailers' expedited shipping, which may cost extra.

Know the Value of a Redeemed Point

You can’t maximize point value if you don’t know how to calculate the dollar value of a point. Here’s how to do it:

Start with calculating the point value of redemption. Divide the dollar value of whatever you’re buying by the number of points needed to purchase it. In one catalog, we found an Apple iPhone 7 32GB that could be purchased for 187,800 points. No retail price was listed, but Apple was selling it for $549, which means those points were worth only 3/10 of one cent apiece.

Many rewards redemption catalogs show a retail price and model numbers for merchandise. Copy and paste that model number to cross-check the price that other retailers are charging for the same item plus standard shipping (which is typically built into the price of reward merchandise).

When you use points to pay for a purchase at Amazon or elsewhere, the value you want to target should be one penny per point. Ditto for gift cards, but always check; divide the dollar value of the gift card by the number of points needed to buy it. Many airlines allow you to toggle airfares between dollars and points/miles.  

Point Value Can Be Higher

The value of your credit card spending could be higher, depending on how many points you're earning for each dollar you charge. Typically, you earn one point for every $1 you spend, which sets a baseline of value, wherein one point is worth one penny.

However, for certain categories of purchases, many reward cards give you two, three, five, or more points per dollar spent. That boosts the various values of your points on redemption. If you can calculate the average number of points you've earned per dollar spent–whether 1, 1.5, 2, or more–that's how much more your redemption value is worth.

To boost your rewards value even more, some experts recommend credit cards that earn a percentage cash-back–instead of points or miles–per dollar spent. "A 2 percent cash-back card would be better, because cash is more flexible than a gift card, which usually can be used in only one particular store," says Gary Leff, a rewards expert and author of ViewFromTheWing.com.

Many cash-back credit cards also offer percentage-point earning multipliers when you use them for certain categories of purchases, such as gas, groceries, and travel. Use our Credit Card Advisor comparison tool to find the best card for your spending patterns.