Consumers leave rewards on the table when they don't use credit card points

SAN FRANCISCO (KGO) -- Martijn Nijensteen was waiting for a flight at SFO when 7 On Your Side's Michael Finney asked him about using credit card points to travel. Turns out he is not from around here.

"Back home, in the Netherlands," he told Finney, "they do not have credit card points."

And oh, is that too bad because they are missing out. Just listen to creditcards.com industry analyst Ted Rossman.

"The last three years really represent the golden age of credit card rewards," Rossman says.

Credit card companies are throwing rewards around. Capital One is offering 50,000 bonus miles on one of its cards, Chase is offering 60,000 bonus points on a couple of its credit cards. American Express matches that, so does American Airline's Aadvantage card. The deals are plentiful.

And yet a new study by creditrcards.com finds 53 million Americans have never switched their favorite credit card. About 16 million more switched more than ten years ago.

Rossman says travel points offer the best value, but there are other ways to cash in.

"We found cash back is king. About two-thirds of people who told us they liked rewards from their ongoing spending, told us it was cash back," he says. "Only 5 percent said airline miles, and only 2 percent said hotel points."

Consumer Action's Joe Ridout is the first person Finney ever heard call this the golden age of credit card rewards. He says what matters most is not which points you chose, but that you are in the game.

"If you have a good credit score," Ridout says, "who is making money off of that good credit score? Equifax, Experian, all the credit bureaus, the banks you do business with; what about you? Why not use a good credit score to help yourself?"

Rideout says don't worry about a huge impact on your credit score: "It changes your credit score to a very, very small amount. It is over-rated, frankly, the degree to which your credit score suffers if you open a couple of different credit cards a year -- it is a trivial drop."

And that takes us back to Martijn Nijensteen and his new bride, Robyn, who is from around here. She tells Finney, "For big expenses, we use my card so we get rewards."

To profit from rewards, it is best to be credit card debt-free, otherwise you are paying more in interest than you are getting in rewards.

Take a look at more stories and videos by Michael Finney and 7 On Your Side.