The Ultimate Guide: Unlocking Cash from Your American Express Points
Hello there, savvy cardholder! Are you sitting on a mountain of American Express Membership Rewards points, wondering how to transform them into cold, hard cash? You've come to the right place! While Amex points are renowned for their incredible value when redeemed for travel, sometimes, cash is king. This comprehensive guide will walk you through every legitimate method to convert your Amex points into usable funds, with step-by-step instructions and important considerations.
Let's dive in and turn those points into tangible value!
Step 1: Understand Your American Express Points' Value (and Why Cash Isn't Always King)
Before we jump into the "how-to," it's crucial to understand the inherent value of your Amex Membership Rewards points. Amex points are generally considered one of the most flexible and valuable points currencies out there, especially for travel.
What is a Point Worth?
Statement Credit / Pay with Points: Generally, you'll get a value of around 0.6 to 1 cent per point (CPP) when redeeming for statement credits or using "Pay with Points" at checkout with select merchants. This is often the lowest value redemption.
Gift Cards: Value can vary widely, from around 0.5 CPP to 1 CPP, depending on the merchant and any promotions.
Booking Travel via AmexTravel.com: Flights usually yield 1 CPP, while hotels, cruises, and vacation packages often come in at a lower value, around 0.7 CPP.
Transfer Partners (Airlines/Hotels): This is where Amex points truly shine. By transferring your points to airline or hotel loyalty programs (like Delta SkyMiles, Air Canada Aeroplan, Hilton Honors, or Marriott Bonvoy), you can often achieve values of 1.5 CPP to 3 CPP, or even higher, especially for premium cabin travel or luxury hotel stays.
Why Prioritize Travel (Usually)
While this guide is about getting cash, it's important to acknowledge that you will almost always get significantly less cash value for your points than you would by leveraging them for travel. If you have any upcoming travel plans, consider exploring those options first to maximize your rewards. However, if cash is your immediate priority, let's explore the best ways to get it.
Step 2: The Most Direct Way – Statement Credit
This is the simplest and most straightforward method, though it typically offers the lowest redemption value.
Sub-heading: Covering Your Card Charges
American Express allows you to use your Membership Rewards points to "Cover Your Card Charges." This effectively acts as a statement credit, reducing your outstanding balance.
How to Do It:
Log in to Your American Express Account: Head to the official American Express website (americanexpress.com) and log in using your User ID and Password.
Navigate to Membership Rewards: Once logged in, look for the "Membership Rewards" section. This is usually accessible from your account dashboard or through a dedicated "Rewards" tab.
Find "Cover Your Card Charges" or "Statement Credit": Within the Membership Rewards portal, you'll typically find an option labeled something like "Cover Your Card Charges" or "Redeem for Statement Credit."
Select Charges to Cover: Amex will often display a list of eligible recent charges you can cover with points. You'll see the equivalent number of points required for each charge.
Confirm Redemption: Choose the charges you wish to cover and confirm your redemption. The corresponding points will be deducted from your balance, and a credit will be applied to your statement.
Important Notes:
The redemption rate for statement credits is generally around 0.6 cents per point. This means 10,000 points will get you $60.
This is a quick and easy way to get "cash" in the sense that it reduces your spending, but it's not a direct bank transfer.
Step 3: Leveraging Specific Amex Cards for Higher Cash Value
For certain American Express cardholders, there are more lucrative ways to convert points to cash, often through specific co-branded cards. These typically offer a much better redemption rate than a standard statement credit.
Sub-heading: The Charles Schwab Platinum Card
If you hold The Platinum Card® from American Express Exclusively for Charles Schwab, you have a unique and highly advantageous option for cashing out your points.
How to Do It:
Open a Charles Schwab Account: First and foremost, you need to have an eligible brokerage account with Charles Schwab.
Apply for the Charles Schwab Platinum Card: You must be approved for and hold this specific version of the Platinum Card.
Transfer Points to Your Schwab Account: Once you have both, you can transfer your Membership Rewards points directly into your Charles Schwab brokerage account.
Redeem as Cash: Within your Schwab account, you can then redeem these transferred points as cash, which can be withdrawn or invested.
Value & Considerations:
This method typically offers a redemption rate of 1.1 cents per point (1.1 CPP). This is significantly better than the standard statement credit. For example, 10,000 points would yield $110.
Annual Fee: Keep in mind that the Charles Schwab Platinum Card has an annual fee, which should be factored into your overall strategy.
Account Balance: There might be minimum balance requirements for the Schwab account.
Sub-heading: The Morgan Stanley Platinum Card
Similar to the Charles Schwab variant, The Platinum Card® from American Express Exclusively for Morgan Stanley also provides a strong cash-out option.
How to Do It:
Open a Morgan Stanley Account: You'll need an eligible investment account with Morgan Stanley.
Apply for the Morgan Stanley Platinum Card: You must hold this specific version of the Platinum Card.
Deposit Points into Your Morgan Stanley Account: You can redeem your Membership Rewards points as a deposit directly into your Morgan Stanley brokerage account.
Access Your Cash: Once the funds are in your brokerage account, you can withdraw them as cash.
Value & Considerations:
This redemption offers a value of 1.0 cents per point (1.0 CPP). So, 10,000 points would give you $100.
Annual Fee: Like the Schwab version, this card also has an annual fee.
Account Requirements: Morgan Stanley accounts may have specific balance or asset requirements.
Step 4: The Less Common but Possible Methods
While less direct or potentially less advisable for maximizing value, these methods can still result in cash or cash-like equivalents.
Sub-heading: Gift Card Redemptions (and Reselling)
You can redeem your Amex points for various gift cards through the Membership Rewards portal. While not direct cash, some gift cards are almost as good as cash, and there are even ways to resell them.
How to Do It:
Access Gift Card Options: Log into your Amex account and navigate to the Membership Rewards section. Look for "Gift Cards" or "Redeem for Gift Cards."
Browse Available Gift Cards: You'll see a wide selection of gift cards from various retailers, restaurants, and online merchants.
Select and Redeem: Choose the gift cards you desire and complete the redemption process. The gift cards will typically be delivered electronically or by mail.
Considerations for Cash-Like Value:
Universal Gift Cards: Some gift cards, like those for major online retailers or general-purpose Visa/Mastercard gift cards (if available), are highly versatile and can be used for almost anything, making them close to cash.
Reselling Gift Cards: There are online platforms where you can sell unwanted gift cards for cash. However, you'll typically sell them for less than their face value, meaning you'll get an even lower return on your Amex points. This should only be considered if you have no use for the gift card yourself.
Redemption Value: Gift card redemption values can vary significantly. Always check the point-to-dollar ratio before redeeming.
Sub-heading: Pay with Points at Checkout (with a caveat)
American Express allows you to use your points directly at checkout with certain online merchants, like Amazon. While this isn't a cash deposit, it does reduce your out-of-pocket spending, which is a form of saving cash.
How to Do It:
Link Your Amex Account: On participating merchant websites (e.g., Amazon), you'll need to link your American Express card and Membership Rewards account.
Select "Pay with Points" at Checkout: When making a purchase, you'll often see an option to "Pay with Points" at the payment screen.
Adjust Points Used: You can typically choose how many points you want to apply to your purchase.
The Caveat:
Low Redemption Value: The redemption rate for "Pay with Points" at checkout is usually around 0.7 cents per point. This is generally a poor value for your Amex points, and it's almost always better to pay with your card and save your points for higher-value redemptions. Only use this if you have no other immediate use for the points and want to reduce a current bill.
Sub-heading: The "Book and Cancel" Travel Loophole (Use with Extreme Caution)
There's an often-discussed "loophole" involving booking refundable travel with points through Amex Travel and then canceling to receive a statement credit. This method is not officially sanctioned by American Express and carries risks.
How it Theoretically Works:
Book a Refundable Flight/Hotel: Use your Membership Rewards points to book a fully refundable flight or hotel stay through the American Express Travel portal.
Cancel the Booking: After the booking is confirmed, cancel it according to the refund policy.
Receive Statement Credit: In some reported cases, the refund might be issued as a statement credit to your Amex card, effectively converting your points to cash at a decent rate (sometimes 1 CPP).
Why Use Extreme Caution:
Not Guaranteed: Amex could choose to refund the points back to your Membership Rewards account instead of issuing a statement credit.
Account Red Flags: Repeatedly using this method might flag your account for suspicious activity, potentially leading to an account review or even closure.
Terms and Conditions: This goes against the spirit of how points are intended to be used and could violate the Membership Rewards program terms and conditions.
Given the risks, this method is generally not recommended for regular use. Stick to the official and sanctioned methods for point redemption.
Step 5: Selling Your Points to a Broker (Also with Caution)
This is perhaps the most direct way to get cash into your bank account, but it comes with its own set of risks and ethical considerations.
How it Works:
Several online "miles brokers" or "points buyers" exist that will purchase your Amex Membership Rewards points for cash. You provide them with access to your Amex account (or transfer points to their designated travel partner accounts), and they pay you for the points.
The Process (Generally):
Contact a Broker: Find a reputable miles broker online (e.g., MilesBuyer, Sell My Miles).
Get a Quote: Provide them with the number of points you have, and they will give you a cash offer.
Transfer/Provide Access: If you accept, you'll typically be instructed to transfer the points to a specific airline or hotel loyalty account they manage, or in some cases, provide them with limited access to your Amex account to book travel on your behalf.
Receive Payment: Once the transfer or booking is confirmed, they will send you the agreed-upon cash payment, usually via PayPal or bank transfer.
Risks and Considerations:
Against Amex Terms: Selling your Amex points to a third-party broker is expressly against American Express's Membership Rewards program terms and conditions.
Account Closure: If Amex discovers you've sold your points, they have the right to close your Membership Rewards account, forfeit all your points, and potentially even close your credit card accounts.
Security Concerns: You are providing a third party with access to your sensitive financial information or loyalty program accounts, which carries inherent security risks.
Varying Rates: The rates offered by brokers can fluctuate based on market demand and the volume of points you're selling. They are rarely as high as the theoretical value you could get from optimal travel redemptions.
Tax Implications: While generally not income, large sums received from selling points could be subject to tax scrutiny. Consult a tax professional if you're dealing with significant amounts.
While this offers direct cash, the risks associated with violating Amex's terms and the potential security implications make it a less desirable option for most users. Proceed with extreme caution and at your own risk.
Step 6: Explore Amex Business Checking Account Redemptions (For Business Cardholders)
For American Express Business Platinum Card holders, there's a specific redemption option that allows for direct deposits into an Amex Business Checking account.
How to Do It:
Open an Amex Business Checking Account: You need to have an active American Express Business Checking account.
Link Accounts: Ensure your Business Platinum Card and Business Checking Account are linked to the same Membership Rewards account.
Redeem for Deposits: Log in to your Amex account and navigate to the Membership Rewards section. Look for an option to "Redeem for Deposits" into your Business Checking account.
Initiate Transfer: Select the number of points you wish to redeem.
Value & Considerations:
0.8 to 1.0 CPP: For Business Platinum Card Members, you can convert 10,000 points into $100 for the first 1 million points per calendar year (1.0 CPP). After that, the rate drops to 0.8 CPP.
Direct Deposit: This is a true direct deposit of cash into your business checking account.
Limited to Business Platinum: This benefit is specifically for Business Platinum cardholders with an Amex Business Checking account.
Final Thoughts: The "Best" Way to Get Cash
The "best" way to turn your American Express points into cash largely depends on your specific circumstances and your willingness to sacrifice potential value for liquidity.
For the average cardholder seeking simple cash-back: Statement Credit is the easiest, albeit lowest value, option.
For those with specific Amex Platinum co-branded cards (Charles Schwab or Morgan Stanley): These offer the best legitimate cash-out rates at 1.0-1.1 CPP.
For Business Platinum cardholders with an Amex Business Checking account: Redeeming for deposits provides a direct cash transfer at a good rate.
Methods like reselling gift cards or using "Pay with Points" at checkout offer less optimal value.
Methods like the "book and cancel" loophole or selling to brokers come with significant risks and are generally not recommended.
Always weigh the convenience and immediate liquidity against the potential loss of value you could achieve through other Amex redemption options, especially travel.
10 Related FAQ Questions: How to Turn American Express Points into Cash
How to calculate the cash value of my Amex points?
To calculate the cash value, multiply your total points by the redemption rate (e.g., 10,000 points * $0.006/point for statement credit = $60).
How to get the most cash value from my Amex points?
The highest legitimate cash value typically comes from transferring points to a Charles Schwab or Morgan Stanley brokerage account if you hold their respective Platinum Cards (1.0-1.1 cents per point).
How to redeem Amex points for a statement credit?
Log into your Amex account, go to the Membership Rewards section, and select "Cover Your Card Charges" or "Redeem for Statement Credit." Choose the charges you want to cover.
How to transfer Amex points to a bank account directly?
Generally, you cannot directly transfer Amex Membership Rewards points to a personal bank account unless you hold a specific card like the American Express Business Platinum Card with an Amex Business Checking Account, which allows "Redeem for Deposits."
How to use Amex points for online purchases for cash-like value?
You can use "Pay with Points" at checkout with certain online retailers (like Amazon), but this usually offers a low redemption value (around 0.7 cents per point).
How to sell Amex points for cash legally?
Selling Amex points to third-party brokers is against American Express's terms and conditions and can lead to account closure. There is no officially sanctioned "legal" way to sell them directly for cash to an external party.
How to avoid losing value when turning Amex points into cash?
To minimize value loss, aim for redemptions that offer at least 1 cent per point. The Charles Schwab and Morgan Stanley Platinum Card options are the best for this. Avoid standard statement credits or "Pay with Points" for everyday purchases if maximizing value is your goal.
How to determine if my Amex card is eligible for higher cash redemptions?
Check your specific card's benefits guide or log into your Membership Rewards account and explore the redemption options available to your card type. Look for options related to brokerage accounts if you have a co-branded Platinum Card.
How to know if selling Amex points is safe?
Selling points to third-party brokers is generally not considered safe due to the violation of terms and the need to share account access, which poses security risks. It's a high-risk option.
How to make sure I don't forfeit my Amex points when trying to get cash?
Always follow the official redemption methods offered directly by American Express. Attempting unofficial "loopholes" or selling to brokers can result in the forfeiture of your accumulated points.
