Here's What Happens When You Transfer Credit Card Rewards

In the travel rewards community, cards with transferable points are typically heralded as the best travel cards. And it makes perfect sense when you think about it. Transferable rewards offer great flexibility, as well as lots of opportunities to get outsized per-point value.

To give you a look at how it all works, we'll talk about how to transfer your points and what happens when you do so. Let's get started.

Preparing for the transfer

The first step is to decide where you want your points to go. Each rewards program has its own transfer partners. Take a look at the partners for the four most popular programs to get an idea of your options:

• American Express Membership Rewards
• Capital One Venture Miles
• Chase Ultimate Rewards
• Citi ThankYou Points

Before you start transfering points, it's vital that you have a specific use in mind. Once you transfer your rewards, there's no going back -- you can't transfer them back. This is a one-way road.

For example, if you transfer Chase points to your World of Hyatt account, they become Hyatt points. You can't turn them into Chase points again.

The only time you may want to transfer points without a specific redemption already planned is if there is a transfer bonus. Most transfers are 1:1, meaning you'll get one point or mile for every point you transfer.

With a transfer bonus, you get extra points when you transfer to the specific travel partner. These bonuses can give you an extra 30% (or sometimes more).

As an example, say Amex has a 30% transfer bonus to Virgin Atlantic. In this case, if you transferred 1,000 Amex points to Virgin Atlantic, you would end up with 1,300 Virgin miles (instead of the 1,000 miles you'd normally get).

As great as these bonuses can be, however, make sure you only transfer to programs you're likely to use relatively soon. It doesn't matter how great the bonus is if your points or miles will expire before you use them.

Transferring your points

If you're ready to put your points to use, it's time to transfer. The actual process will vary depending on the rewards program. The general steps are fairly universal, however:

1. Log into your credit card account (online or in the mobile app).
2. Head to the rewards portal. (There is usually a link for this on your main credit card account screen where your current points balance is displayed.)
3. Choose the "transfer points" option. (See note below.)
4. Select the airline or hotel partner to which you want to transfer your rewards.
5. Input the number of points you want to transfer.
6. Complete the transfer.

Note: You specifically want to look for a "transfer points" option, not the travel portal. Many rewards programs let you redeem your points directly for travel through their own internal travel portals. However, you'll usually get a flat rate for your points that isn't as good as what you could earn by transferring those points to a travel partner.

After the transfer

The time it takes for a points transfer to complete can vary based on the program and partners involved. Most transfers should be nearly instantaneous, but it could take up to a few days. (I haven't, personally, had to wait more than half an hour, but your mileage will vary.)

Once the transfer is completed, you should see your new hotel points or airline miles in your loyalty account. From there, you can redeem them for hotel rooms or flights just as if you'd earned those rewards directly.

Transferring points is by far the best way to not only get great value from your rewards, but also to score amazing free travel opportunities. While transfers can take more effort (and research) than other redemption options, the benefits are often well worth it.