Restrictions kill one-third of all loyalty reward points, study says

If you are saving loyalty reward points for your dream vacation, be wary of loopholes that can kill nearly one-third of your points.

The 10 largest credit card issuers offer up about $48 billion in loyalty rewards each year, but one-third of those rewards are never redeemed because of loopholes and limitations, according to new study by CardHub, a credit card review site.

Requirements that you meet a minimum threshold before you can redeem your reward points was the most common limitation found in the study, followed by rewards that expire after a missed payment.

Capital One cards have the fewest reward limitations, the report said, while the Discover It Card has the most.

Odysseas Papadimitriou, chief executive of CardHub, offered this tip: Get a card that offers real cash rewards, not fictitious currency like “dividend dollars.” Reward programs can reduce the value of fictitious money, he said, “but they can’t change the value of cash.”