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The Importance of Diversification

One strategy that many have implemented is to pool all their points into one loyalty program so that they have more points to redeem for something more significant. In today’s post, I will discuss the pros and cons of having fewer loyalty programs versus many programs.

Pooling Your Points


If you are the type of person who does not really collect points to begin with, then pooling your points into one program can make sense. That way, you will have less work to do to keep track of your points and you can add up your points more quickly to redeem for an award.


Often I hear stories about how people only really have one or two loyalty programs that they use to collect points, only for their points to expire anyway. So because all their hard work to pool their points into one program expired anyway, they just gave up on collecting points all-together.

Collecting points isn’t for everyone and if you are the type of person who wants to pool your points into one account be sure to remember to keep track of the expiry policies. It will be painful when you see all your points expire. That being said, companies can change their expiry policies anytime, like Air Miles, and once they change their policies, then you will need to use your points in a hurry.

What happens when devaluations hit? As soon as they decrease the value of each point (i.e. require more points to redeem for the same reward), then all the work you put in to collect points at the value you thought each point was worth has devalued. Think about it this way, what if every month you earned $100? In one year, you would have $1,200 in your account, but because of a devaluation, that $1,200 is now only worth $1,000. I wouldn’t be too happy about that.

There is no way to know which program will be hit with a devaluation, that is one reason why diversification is important.


There are so many different bonus promotions going around because each program is competing with each other, so why can’t we have our cake and eat it too? Collecting points is not for everyone because it requires work. The good thing is that the more work you put in, the more you will be rewarded.

I am sure your banker or financial planner will always tell you to diversify your money. Keeping track of so many different programs can be a hassle. This is why websites like AwardWallet exists to help facilitate keeping track of points. These Mileage Managers help you keep track of all your loyalty programs in the same place so that you do not need to log into each individual account, one at the time. Award Wallet has been such a time saver for me, giving me more time to do other things.

A diversified portfolio of points helps you counter devaluations by giving you more flexibility both for earning lucrative bonuses when available and increase your redemption options for redeeming a reward. American Express Membership Rewards, Starwood Preferred Guest Starpoints  and RBC Rewards are some of the better transferable points programs out there. Transferable points gives you the opportunity to move your points to the program of your choice at the time when you need the points the most.


If you really want to maximize your points, then diversification is the key. But if you do not want the hassle, then pooling your points will make more sense.

Do not forget to read our Pointshogger 101 page to help you learn how to get started with collecting points.

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