Back in May 2020 Chase had temporarily added a feature called “pay yourself back”. It was meant to give some relief to the customer during the pandemic. The idea was that you could redeem your points at 1.5 CPP against eligible purchases made within last 90 days with Chase Sapphire Reserve. At this time the eligible purchases includes grocery stores, dining, home improvement stores, and charities.
The category that stands out the most during the pandemic is the grocery. Unfortunately, this feature as a whole is only supposed to last from May 31 to September 30. However, Chase recently made “pay yourself back” feature (not categories) a permanent one and I am finally bothering to write on it.
Make no mistake the categories will get worse over time. But I seriously doubt the categories on October 1st will be significantly worse. I suspect the new categories might range from almost as good as the existing one to even better. The latter is a little tough to achieve because – what is better then grocery category during a pandemic? The answer is probably “grocery + anything else” or maybe the answer some are looking for is “pharmacy”.
Anyway, the inevitable dilution of this feature will likely take time. It is quite possible that this feature will altogether disappear at some point like so many other features have like the once famous 7% dividend. But what will happen to our points balance by then?
Zero. I suspect most of us will walk out of this with zero ultimate rewards points. To elaborate why let me categories folks with UR balance into four categories namely (1) those who redeem at less then 1 cpp (2) those who redeem at 1 cpp (3) those who redeem at 1.25/1.5 cpp and (4) those who transfer to travel partners.
The first group are uninformed folks who burn UR points on gift cards at less than than 1 cpp. Hopefully none of you belong on that category.
The second “cash is king” group cash out UR at 1 cpp. Anyone who belongs to this category is likely gunning for 1.5 cpp through CSR or maybe even 1.25 cpp through CSP. If cash is king to you and you happen to have large stash of UR then you will burn UR at 1.5 cpp through “pay yourself back” program.
The third group are the folks who buy tickets through UR portal by redeeming UR at 1.25/1.5 CPP. Hopefully most of these folks are not travelling which means they’re probably eating more veggies at home than they normally do. My point being, if 1.5 cpp through UR portal was your sweet spot and you have happen to have large stash of UR then you will burn UR at 1.5 cpp now through “pay yourself back” program.
The last group. I have to be a little careful here because I know there are folks in this group who’re going to hold out their UR because they value it at 2/4/6/8/10 cpp at Hyatt or whatever. I won’t bother making my case to those folks but for the rest here are some quick thoughts. Your UR is not giving you interest. You can’t invest your UR balance on stock. Points are likely to devaluate by the time travel resets to normal. So, turn it into cash.
The argument against hoarding points has always been, well, it is going to devaluate. This time around the likelihood of points in general devaluateing post-pandemic if not sooner is fairly high. When that happens, value of UR will tank for those who frequently use transfer points to its travel partners.
The other argument is that you aren’t getting interest on UR. You use UR to buy grocery or rather I should say, buy items from a grocery store (at 33.33% discount mind you), and boom you saved a whole bunch of cash. This cash, while laying in your bank, is going to give you interest. Or perhaps you want to try to make quick money off the booming corona-stock market and with UR converted to cash, you have a little more cash to play with.
Closing Thoughts
People have been buying groceries stuff from grocery store and burning huge chunk of their UR balance. Whatever UR balance is leftover by October 1st, folks will continue to drain it at 1.5 CPP without taking a single fight or staying at a single hotel, thanks to the almighty “pay yourself back” feature.
By the time corona is over with, we are all going to have 0 UR balance.
