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I’m often asked if you lose your points when you cancel your credit card. I can understand the confusion, since the rules do vary based on the type of card.
Furthermore, I’ve heard of some credit card issuers incorrectly threatening that cardmembers will lose their points, even when it isn’t true.
Generally speaking the rules vary based on the type of card you’re earning points with. It depends on whether it’s a program specific card or a bank rewards card (a card accruing points with Membership Rewards, Ultimate Rewards, Citi ThankYou, etc.).
Program specific card — no
As a general rule of thumb you don’t lose your points when you cancel a card which accrues airline or hotel points. These are cases where the card issuer themselves doesn’t issue the points currency, but rather one of their partners does.
For example, if you earn AAdvantage miles with the Citi® / AAdvantage® Platinum Select® World Elite™ Mastercard® or Starpoints with the Starwood Preferred Guest® Credit Card from American Express, your points wouldn’t be forfeited when you cancel the cards. That’s because the points are issued directly in the partner currency.
To clarify, this doesn’t mean they can’t claw the points back. For example, if you make a purchase to get over the minimum spend threshold and then later refund it, they can take back the points they issued you.
But the point is that canceling the card in and of itself doesn’t cause the points to be forfeited, since keeping the points isn’t at all contingent upon having the card.
Bank rewards cards — yes
If you accrue a points currency specifically linked to your card — like accruing Membership Rewards points with the The Amex EveryDay® Credit Card from American Express, Ultimate Rewards points with the Chase Sapphire Preferred® Card, ThankYou points with the Citi ThankYou® Premier Card, etc. — you do typically lose the points associated with the account when you cancel the card.
The exception is if you have another card which accrues the same points currency, in which case you can typically transfer points to that card. For example, if you have the Chase Sapphire Preferred and want to cancel it, you can transfer those Ultimate Rewards points to the Ink Plus® Business Credit Card, or if you have the Amex EveryDay you can transfer those Membership Rewards points to the The Platinum Card® from American Express.
So you’ll always want to transfer or redeem your bank rewards points before canceling the card, or else you’ll be in for an unpleasant surprise.
If you accrue points with a credit card in a specific partner program, your points balance will typically be safe, even if you cancel a credit card. However, if accruing bank rewards points, you’ll want to be much more careful before canceling your card.