Estate Planning for Loyalty Points

Loyalty points are increasing in popularity. As of 2024, the average person in the United States has 9 active loyalty programs and 90% of companies offer some sort of loyalty program to their customers. While individual points may not be worth much, they can add up quickly and could be worth passing on. Loyalty points are a kind of pseudo-financial asset, similar to video game skins, however, given their digital nature, they are much more difficult to pass on than a hand-held store credit like Kohl’s Cash.

57% of consumers surveyed for a brand loyalty report in 2022 expressed frustration with the time it takes to accumulate enough points to earn rewards. This compounds the importance of being able to pass points on, as it can often take a lifetime to acquire an important amount of points. Despite this, companies that offer loyalty point programs have yet to make it simple for people to pass them on, potentially because they are financially disincentivized to do so.

Bequest.com is working on a solution to solve this problem. There are still a few things you can do now to know your options. Firstly, reading the loyalty point program’s terms of service will usually offer some insight into how the program deals with transferability. If transferability is prohibited, you will not be able to, say, leave your loyalty point card behind for a family member to then use. Some terms of service will also explicitly mention that once a user passes away, their account is considered to be closed. In fact, as digital assets increase in popularity, more and more fiduciaries are using tools like Bequest.com to ensure all digital accounts belonging to a deceased person are closed as part of the estate administration.

Secondly, some loyalty programs offer a shared family account. If you are in a position to trust that your family members will not spend your points indiscriminately, adding them to a family plan is a good way of ensuring your points will not go to waste once you pass on. Information on shared plans will also be available in the terms of service.

If you or clients have questions about how to plan for loyalty points and other digital assets, check out Bequest.com to find compliant, tech-forward solutions.

1. https://queue-it.com/blog/loyalty-program-statistics

2. https://info.bondbrandloyalty.com/pathways-to-growth-guide