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Donate your credit card rewards this holiday season

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There are plenty of ways to support others in and outside of your community, be it volunteering your time or resources, using your voice or platform to stand up for and educate others or donating monetarily.

And with the holidays quickly approaching, it’s a great time to do something for someone who might not have the means. Keep in mind that there are many families who can’t afford to buy gifts or even put a hot meal on the table. Consider giving to those in need in the true spirit of the holidays.

Here are some charities to consider for holiday giving:

Though unconventional, donating your credit card rewards is a great way to give back. Whether you have a stockpile of rewards you’re willing to part with or are looking to prevent account closure due to inactivity, it’s better your earnings are put to good use.

How to donate your credit card rewards

Most major credit card issuers let you donate your rewards, but the process (and restrictions) can vary. You’ll typically have a list of partner charities to choose from, including point-donation tiers and dollar amount equivalents.

American Express

American Express gives cardholders the option to donate Membership Rewards® points through its JustGiving program. American Express converts your points to a monetary donation to your choice of thousands of U.S. charities.

This past March, American Express announced a coronavirus-specific campaign where Amex matches each donation’s dollar equivalent (up to $1,000,000 total) when cardholders use their points to donate to Feeding America through JustGiving. The campaign has since ended, but food insecurity still exists. You can still donate to Feeding America, the second-largest U.S. charity according to Forbes, through the JustGiving program.

If you aren’t sure which charity you’d like to support, can search for organizations on Amex’s JustGiving platform and donate Membership Rewards points to specific fundraisers, crowdfunding efforts or charities, including the NAACP Foundation, chapters of Ronald McDonald House Charities, Make-A-Wish, the American Civil Liberties Union (ACLU), Black Lives Matter and more.

Hilton credit cards

If you have a Hilton Honors-branded credit card, you have the option to donate your points via PointWorthy. Similar to Amex’s JustGiving partnership, cardholders have the option to search by charity. You can also filter by state, cause or specific keywords.

The Hilton Effect Foundation is currently highlighting six organizations to donate to (via PointWorthy) that support at-risk groups affected by the coronavirus in the U.S. and beyond.

Other credit card issuers

Some of the most popular Discover credit cards are loved for their 5 percent Cashback Bonus, which includes a set of categories that rotate each quarter that you can earn 5 percent cash back within (after that, it’s 1 percent, and activation is required).

You can donate your Cashback Bonus® rewards to a list of 10 partner charities, including the American Red Cross and Make-A-Wish.

Both Citi and Wells Fargo also allow cardholders to donate points, but the options offered are quite limited. Citi, for example, allows point donations to only eight causes, two of which assist the American Red Cross and two that assist UNICEF.

Keep in mind fees and security

You may be subject to an interchange fee to process your rewards donation (normally a few dollars), but don’t let it be a deterrent from donating. Some issuers waive interchange fees, and in the case of Amex, when you donate through JustGiving, there’s no fee.

If you have a particular charity in mind that isn’t listed by your issuer, you may be able to donate your rewards through them directly or via a third-party point donation site like PointWorthy. It’s important to verify the legitimacy of the charity or website before donating to avoid scams.

Other ways to donate

Redeem for gift cards or cash back

Unfortunately, not every issuer allows for direct rewards donations (including Chase and Bank of America)—but that doesn’t mean there aren’t alternative ways to donate using rewards.

“Good grassroots options could include redeeming for gift cards or cash back and then donating those to a person or charity,” says Ted Rossman, industry analyst at Bankrate. “You could also ask your favorite charity what would be useful to them.”

Once you have the gift cards in hand, you can pass them out to those who are donating their time toward coronavirus relief or racial equity efforts in your community, for example.

In terms of a tax advantage, redeeming your rewards for cash back and then donating the money directly to a charity is your best bet.

“You can’t usually deduct the value of points or miles, but if you redeem for cash back and then donate it, you can deduct that,” Rossman says.

Donate your airline and hotel rewards

Most major hotels and airlines allow you to donate loyalty points and miles to charity.

For example, Marriott is partnered with over twenty organizations you can gift your points to in exchange for a monetary donation, including World Central Kitchen and UNICEF, to name a few.

For donation-specifics, check with your airline and hotel loyalty programs; you can also donate miles directly to an organization.

Another worthy option is Miles4Migrants, a nonprofit that uses donated frequent flyer miles to book airfare for migrants, including refugees, experiencing financial hardships. Given the recent surge of Afghan asylum-seekers, now is the perfect time to donate your stash of unused miles—it could quite literally save a life.

Transfer points to family or friends

Should you personally know someone that needs help (maybe a friend who could use miles, for example, to escape a difficult situation), consider directly transferring your credit card rewards to them or even pooling your points.

Rules and restrictions for point transfers and pooling vary from issuer to issuer, so do your research before reaching out to a loved one.

What about charitable credit cards?

You may be curious about continuing your charitable contributions with a non-profit-branded credit card, yet the amount you’re actually donating to an organization by using the card usually isn’t all that much.

The Susan G. Komen Cash Rewards Visa® credit card from Bank of America, for example, offers a donation equal to only .08 percent of each purchase, plus $3 when you open the card and an additional $3 each year you renew. A better option may be the Citi® Double Cash Card, which earns 1 percent cash back when you make a purchase and then another 1 percent when you pay it off. By directly donating the dollar value of rewards you earn with this card, you’ll likely end up contributing more than you would with a nonprofit-branded card.

“That’s my general advice about charity credit cards — it’s probably best to focus on earning as much cash back as you can and then giving that,” Rossman said.

The information about the Susan G. Komen Cash Rewards Visa credit card from Bank of America has been collected independently by Bankrate.com. The card details have not been reviewed or approved by the card issuer.

Written by
Claire Dickey
Editor, Product
Claire Dickey is a product editor for Bankrate, CreditCards.com and To Her Credit. Before joining Bankrate, Claire worked as a copywriter for brands within the telecommunications industry as well as a hybrid marketing and content writer.
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