Is this the year I should use my points to travel?

The question of whether to save or spend miles takes on new urgency this year as lawmakers consider it Credit card competition law. The legislation targets transaction fees (typically 2 to 3 percent of a sale) that retailers pay to credit card companies such as Visa and Mastercard. The fees are used in part by the companies to run loyalty programs that award points to cardholders that can be redeemed for things like flights and hotels.

The law proposes that retailers can choose a cheaper system that would reduce fees. Critics, including banks and airlineswho make billions from selling co-branded credit cards, claim a cheaper system is backed by retail giants like Walmart and Target would turn rewards programs on their head.

Whether the legislation will pass is unknown.

“This has been one of the biggest lobbying battles of all time, pitting two huge industries, retail versus banking, against each other,” said Brian Kelly, the founder of the points mana travel site that helps users maximize reward points and is against the deed.

Does the legislation threaten your points? Not right away, says Leigh Rowan Savanti Travels, a personal travel management service. “Assuming the bill is passed, we still have a long way to go between then and the date the bill comes into effect,” he said. “There is no rush to do anything in 2024.”

Yet experts consistently recommend spending over earning points.

“Never hoard,” Mr. Kelly said, explaining that airlines and hotels have the leeway to change their redemption values ​​overnight, and to keep up with points growth, they tend increase the total amount needed to get a flight or hotel room. “Over time, the points you have today generally lose value.”

Mr. Rowan suggests diversifying your credit cards by, for example, switching from an airline card, where you can only redeem points with that airline, to a more robust card like the Chase Sapphire Preferred Card, which has redemption partnerships with multiple airlines , hotels and rental companies. car companies.

“Diversification will help anyway, but especially if this act goes through,” Mr Rowan said.