I get asked pretty often how our family is able to afford to travel so much while living in one of the most expensive areas in the country. I’m proud to say that we rarely pay for a vacation completely out of pocket because I am a huge proponent of utilizing airline miles and hotel points to pay for our trips. Travel is expensive but utilizing hotel points and airline miles makes it possible to travel for relatively free.
The world of points and miles can easily become overwhelming with decisions including where to pool your loyalty, when to use a credit card for points. You’re also constantly asking yourself if it’s worth using those precious points. That’s where I come in.
If you haven’t already, opt-in to my newsletter by adding your email to the link on the right side of this page for my free Points and Miles Guide to help get you started and serve as a reminder for the tips I provide in this post.
Things to Know Before You Apply for a Credit Card
Free Credit Report
Your credit score is a very valuable asset and the last thing you want to do is ruin it over a vacation. So my first bit of advice is to know your credit score before applying for a card. Did you know that the FTC allows you to check your credit score for free every 12 months? A lot, but not all, rewards cards require you to have a credit rating of Good or higher so it’s important to know where you stand before the hard credit pull.
Can you meet the minimum spend?
The first thing I consider when I see a credit card sign-up bonus that looks appealing to me is whether or not I will be able to meet the minimum spend. Most of the time, I am able to meet the minimum spend within the time frame just from my monthly bills and miscellaneous spending. However, when the minimum spend is especially high (some are $5,000 in 3 months), I know I probably won’t be able to meet that on a credit card and do not bother applying for those credit cards.
I can’t stress enough how important is to have a plan for meeting the required minimum spend when you open a rewards card. Hard pulls on your credit just aren’t worth it, in my opinion, without a plan to earn the rewards.
How to avoid credit card interest
The interest on rewards credit cards are notoriously high and can get us in a lot of trouble if spend more than we have the ability to pay for. A follow-up to your plan to meet the minimum spend, you also need to have a plan to not spend more than you have in cash to pay off as soon as possible.
Sometimes we carry a balance on our credit cards from month to month but for no more than a few months. If we keep a balance on a credit card for too long, we end up paying way more in the long run. This lowers the value of the rewards you’re earning for spending.
Bonus Points 101
“Bonus points” are what you get for meeting a minimum spending requirement within a pre-determined amount of time. The amount of a bonus usually amounts to the cost of a round-trip domestic airplane ticket or two nights in a hotel.
Bonus points are important because you will probably never be able to acquire that many points or miles at one time any other way.
It is important to note that credit card offers vary depending on the time of year, company changes, etc. I recommend keeping an eye on the card you really want for 2-3 months to see if the bonus increases as well as checking out The Points Guy’s reviews on that credit card.
Pro-Tip: Something also worth noting is that you want to have a redemption in mind. Do you have a location that you really want to travel to and you can and want to get there with points? If so, do your research. Better yet, let ME do your research! Does that location have chain hotels (Marriott, SPG, Hilton, Hyatt, IHG)? What airlines fly to that location? What airline partners fly to that location? One you’ve narrowed down the answers to those questions, start looking into what cards and bonuses will get you there. Also super important: make sure that you have enough time between securing the bonus and when you need to book your travel. Once the spend has been met, if could take up to 10 weeks to see those miles or points in your account.
Other Ways to Earn Points and Miles
Shopping Portals
Online shopping portals are a no-brainer way to earning thousands of points and miles. Most rewards programs utilize them and if you’re already shopping online, it just makes sense to earn bonus points while you’re at it. Sometimes you can earn 20x points per dollar spent depending on the portal and the store.
Dining Programs
Some rewards programs also award bonus points or miles through dining programs so be sure to do your due diligence here too. Sometimes you’ll find that your favorite and most frequented restaurant is a part of a dining program that you could be earning additional miles to.
Now that you’re a little more familiar with hotel points and airline miles through credit cards, what about transferrable points vs. points and miles that go directly to the hotel or airline?
Transferrable Points
Transferrable points give a ton of flexibility and allow you to move points to multiple partners, not just one. Transferrable points come in the form of Citi Thank You points, American Express Membership Rewards and Chase Ultimate Rewards. Each of these programs have their own transfer partners but some of them overlap which is GREAT for getting a ton of points to one place for an awesome redemption (Singapore Suites 2020, I’m looking at you!).
One reason I love transferrable points is because it allows me to use points for flights such as on Southwest without needing to have a large pool of points with the airline. I can use my transferrable points for Southwest, United or any other number of airlines which is great when my preferred airline has less than desirable itineraries to a destination.
Redemptions
