Credit card points are likely pretty far down the list of assets you and your spouse are negotiating over as you divorce. However, as you’re deciding which cards to keep and which to close, you may find that the points you’ve earned on these are substantial.
These points could help as you furnish your new home, take a much-needed getaway or buy a new exercise bike to replace the one your spouse is keeping in the divorce. That’s why it’s worth taking some time and care as you consider these along with your other assets.
Are the points marital property?
Likely they are. As one financial professional says, “If the rewards were earned during the marriage, regardless of who earned them, they’re going to be considered marital property.” This can even be the case if a spouse earned points on a credit card that was only under their name. An exception might be a business credit card.
If you’re going to factor the points into the sum of your marital property as you divide it, you’ll need to assign a value to them. Every card’s points are different, but you should be able to determine what each card’s points are worth in spending power.
What are your options?
Transferring points between cards, even if your cards are with the same company, can be tricky. Some companies will let you, while others won’t. Beware of possible fees that may be charged for these transfers.
The easiest thing may be to let the points stay with the card. If you each have your own credit cards, you would just keep the points you have on your card. If you have a joint card that you keep and put in your name only, you might keep the points and give your spouse something of value in return.
Before you spend a good deal of time negotiating over credit card points (as well as airline miles, hotel loyalty program rewards and so on), determine just how much they’re worth compared to how much time, energy and legal fees you might spend dividing them up. If they’ll make a substantial difference to your life and you’re not just trying to keep them so that your spouse can’t enjoy them (or vice versa), then with some legal guidance, you should be able to reach an agreement that’s fair to both of you.