donating credit card rewards points

Credit card reward points are redeemable for such things as gift cards, airline miles or hotel stays, but here's another thought: What about giving away your points to help someone in need?

Giving is good for the soul, and also adds up to big dollars. The Red Cross noted that the $479 million dollars donated for Haiti, while it may seem like a lot, is third for most money collected for one disaster--9/11 and the Indian Ocean Tsunami are first and second, respectively. In all, 9/11 charities received $1.4 billion in the first year after the disaster, according to New York Magazine.

Most of the top reward credit cards have dedicated ways to donate your points to charitable organizations, and many credit cards responded to the 2010 earthquake in Haiti by making the donation of rewards points easier than ever. American Express, Citi Cards, Chase, Capital One and Discover allow members to donate reward points to such charities as the American Red Cross. And, if you had other charities in mind, check around. Make-A-Wish Foundation and World Wildlife Fund are examples of other charities that can receive rewards donations.

Donating reward points: a few tips

The first step in donating your points is to check with your credit card company to see what kind of program is set up for giving your reward points to charity. Three key things to consider:

  1. Determine what fees, if any, your credit card charges you or the charity for your donation. Some cards waive transaction fees for certain charities. It would be a shame to have your charity gobbled up before it reached the intended recipient.
  2. If your donation of reward points is sizable (more than $25-$50 for example), check with an accountant to see whether it is tax deductible.
  3. Verify your charity is doing what you think it is before you give. A site like charitynavigator.org can be used to research what a charity has been up to, according to the New York Times.

As with any charitable donation, the key to successful giving is to be smart. Most organizations are reputable, but when disaster strikes any number of get-rich-quick schemes unfold. Before you donate any of your hard-earned credit card rewards, make sure they will get to the people and places you want to help.

About the Author:

Megg Mueller is a journalist with almost two decades of experience. She has worked as a reporter and editor for the Reno Gazette-Journal, as editor of health care and education manuals for Aspen Publishers, a subsidiary of Wolters Kluwer and wrote a weekly column on the hotel industry during her tenure as assistant travel editor for USA TODAY.com. Mueller is the editor of a tourism-based Web site and also serves as a reporter for a weekly business newspaper.