What You Need to Know About Your Travel Rewards
Losing someone is always difficult, and it can be confusing to determine what happens to the deceased’s accumulated credit card points and airline loyalty miles. Who has ownership of these loyalty currencies when a person passes away?
As a general rule, points and miles are not considered your personal property. The terms and conditions of most loyalty programs include statements clarifying that the loyalty currency does not belong to you. This language can be confusing, reminding you that you have limited control over loyalty programs, their rules, and your rewards. Fortunately, many programs make it possible to transfer or use points and miles after a person’s death, though the process and options vary.
What Your Heirs Need to Do with Your Reward Points
If you’re an heir dealing with a loved one’s loyalty accounts, there are practical steps you can take. One of the simplest approaches is to ensure you have access to the deceased’s accounts by knowing their login information. This allows you to log in and potentially use the points or miles, provided you’re someone the deceased trusted completely. In most cases, especially for flights, points and miles can be used to book travel for someone else, meaning heirs could book travel for themselves or others using the deceased’s account. However, be aware that some points and miles have expiration dates, so timing may matter.
When it comes to credit card points, closing an account might risk forfeiting unused rewards. It’s worth understanding the specific program’s rules before taking action. Hotel points, on the other hand, often offer more flexibility and may allow transfers to another member’s account with certain limitations.
To take action, heirs may need to provide documentation, such as a death certificate, to the loyalty program. Keeping electronic copies of this document can streamline the process. Depending on the program, you might be able to transfer the points or miles, use them directly, or redeem them in a limited way.
How to Ensure Points or Miles Aren’t Forfeited
Few things are worse than seeing hard-earned points go to waste. To prevent this, heirs should act quickly and strategically. Beyond having account login details (including security questions), there are a few ways points and miles can typically be handled after someone’s death, depending on the program:
1. Transfer the points or miles: Whenever possible, transferring the points or miles to yourself is ideal. This gives you full control to use them as you see fit.
2. Use the points or miles: If transfer isn’t an option, keeping the account open and booking travel or other rewards directly from it might work, assuming the program doesn’t close the account upon notification of death.
3. Redeem at a fixed rate: In some cases, points or miles can only be converted to cash or a statement credit, often at a lower value than other redemption options.
The best approach depends on the program’s rules. Transferring points is typically the most valuable option, while fixed-rate redemptions tend to offer the least value.
Should You Include Points and Miles in Your Estate Plan or Will?
Given their potential value, you might wonder whether points and miles should be part of your estate plan or will. While they aren’t treated as traditional assets like cash or property—since loyalty programs often state they aren’t your property—explicitly addressing them in your estate planning can still be worthwhile. Including a clause in your will that designates who should receive your points and miles can provide clarity for your heirs. For example, you could specify that they go to a spouse, child, or other loved one, along with instructions on how to access or transfer them.
However, there are limitations to consider. Loyalty programs have their own rules, and some may not honor a will’s instructions if their terms don’t allow transfers after death. In such cases, the points could be forfeited unless your heirs act proactively (e.g., by using them before notifying the program). An estate plan that includes sharing login details with a trusted person might offer a practical workaround, allowing them to use the rewards without formal transfer hassles.
Ultimately, whether to include points and miles in your estate plan or will depends on their value to you and the effort you want your heirs to expend. If they represent significant worth, documenting your wishes and ensuring access can help maximize their utility after you’re gone. Consulting an estate planning professional could also clarify how to align this with your broader financial strategy.
Planning Ahead for Your Own Points and Miles
If you’re thinking about your own loyalty accounts, consider these steps to help your heirs:
– Track your rewards on a third-party site and share access with a trusted loved one, giving them the information they need to manage your accounts.
– Include a clause in your will directing that your points and miles pass to a specific person. Remember to not include your login information for the accounts in your will.
– Share your login details with someone you trust, like a spouse, so they can use your rewards after you’re gone without notifying the program. Programs, most notably credit card companies, typically only close accounts or forfeit points if they’re informed of a death.
The Bottom Line
Points and miles can represent significant value, often worth thousands of dollars. When someone dies, their heirs may need to act quickly—either by accessing the account directly or providing documentation like a death certificate—to preserve that value. While loyalty program rules vary, options like transferring, using, or redeeming points are often available. Including them in your estate plan or will can provide direction, but their fate may still hinge on program policies. Preparing ahead of time and understanding the general process can ensure these rewards don’t go to waste.
The information provided is for general knowledge and informational purposes only, and does not constitute legal or tax advice. It is essential to consult with a qualified professional for any legal or tax-related questions or concerns.