A Downside of Chasing Miles and Points….

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There are many benefits of chasing miles and points via credit card sign-up bonuses. Just by applying for a few new credit cards each year, I’ve been able to accumulate hundreds of thousands of miles and points every year. Those rewards have enabled my family to travel much farther and much more frequently than “normal.”

However, recently I discovered a downside: collecting refunds on canceled trips when you’ve used multiple credit cards, some of which are now canceled.

Considering Another Cruise Refund

After this pandemic hit, I quickly decided to cancel a cruise I had planned for 2022 since the ship would no longer be amplified and no longer porting out of Galveston. After 35 days, I finally got my refund. But it was an easy refund because I had only booked this trip a few months ago, and I used one of my current credit cards. The funds simply returned to the same credit card.

However, I’m also strongly considering canceling a cruise that my family scheduled for early next year. Without a coronavirus vaccine, I’m just not comfortable going on a cruise yet. Being quarantined for two weeks after the vacation would be a hardship. And, I don’t want to spend our vacation constantly wearing a mask (check out Royal Caribbean’s “Seaface” masks). I’d rather take the money to put towards a less risky vacation for the same time frame.

However, getting the refund would be a lengthy process. Refunds always go back to the original payment source. We’ve paid about $3000 for the cruise already, but the payments were spread out over about 6 credit cards during the past 2 years. And, some of the cards are now canceled.

What Happens When Refunds Go to a Canceled Credit Card?

When a company processes a refund to a canceled credit card, a few things can happen. If the card was canceled due to fraud but there is a new credit card number associated with the same account, the refund will simply go to the new card.

But if the card is completely canceled, the bank may choose to keep the funds and send a check to the former card holder. Or, more likely, the bank will not accept the funds and return them to the merchant (Royal Caribbean).

In my case, Royal Caribbean is taking 30-60 days to process refunds. Once the funds bounce back, I can request a check from Royal Caribbean or direct the funds to a different credit card. But that will take another 30+ days as well. In short, I don’t expect to get the refund money for at least 4 months, if I’m lucky.

Another Option

An easier option would be for me to move my cruise to a different ship and date in the future. We would love to cruise again, assuming the experience eventually goes back to most of its former glory. I would love to give my oldest kid one more chance to get into the teen club on a cruise before he turns 18.

If we picked a new cruise, all of the funds would simply move over. Easy peasy. And, this is what our travel agent recommends (of course).

But then again, we’d essentially be giving up that money for a few years. And if we decide not to cruise then, we’d still have the trouble of the messy refunds from multiple canceled cards.

Thankfully, my family isn’t desperate for the money right now. So, we can take some time to decide.

Have you dealt with refunds to canceled credit cards? How long did it take you to get your money back?

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Opinions expressed here are author’s alone, not those of any bank, credit card issuer, hotel, airline, or other entity. This content has not been reviewed, approved or otherwise endorsed by any of the entities included within the post.