- There are so many choices when it comes to travel credit cards that it can be hard to know where to start.
- And even when you’ve settled on a card, you may not be sure whether you’re maximizing its benefits and rewards.
- If you’re looking for some guidance, you’ve come to the right place. Keep reading for tips from Business Insider’s network of travel and credit card experts.
- See Business Insider’s list of the best rewards credit cards »
If you want to earn points and miles to book award flights and hotel stays, your best bet is to sign up for a travel credit card, earn its welcome bonus, and continue accumulating rewards with your everyday spending.
There’s no one right way to use rewards credit cards, but in this complicated hobby, every little bit of knowledge helps. That’s why we’ve rounded up the best tips for choosing and maximizing credit cards from our network of points and miles experts. Several of them spend more time travelling than they do at home, so they know a thing or two when it comes to maximizing points, miles, and travel card benefits.
Keep in mind that we’re focusing on the rewards and perks that make these credit cards great options, not things like interest rates and late fees, which will far outweigh the value of any points or miles. It’s important to practice financial discipline when using credit cards by paying your balances in full each month, making payments on time, and only spending what you can afford to pay back.
1. You can have lots of credit cards and a high credit score
It’s a myth that opening new credit cards automatically spells disaster for your credit score. Just ask Holly Johnson, who has 26 credit cards and an excellent credit score in the 800s. Johnson travels with her husband at least four months out of the year and uses cards like the Hilton Honours Aspire Card from American Express to enjoy elite status and annual statement credits.
As Johnson explains, the key is to use your cards responsibly. Whether you have one card or more than 30, falling behind on your credit card bills is a surefire way to tank your credit score.
2. The Chase Sapphire Preferred Card is great for beginners
In 2019 contributor Adam Bauer used Amex Fine Hotels & Resorts, a benefit of the Platinum Card® from American Express, to score a great deal on a luxury stay in Las Vegas. However, Bauer recommends a different option entirely to those who are new to credit card rewards.
The Chase Sapphire Preferred makes for a perfect entry point into the world of using points for travel. It even has a higher sign-up bonus than the Chase Sapphire Reserve (60,000 points after you spend $US4,000 in the first three months versus 50,000 points with the same spending requirement), and it comes with a great selection of benefits that covers all your bases.
You’ll earn 2x points on travel and dining, and you get some helpful travel protections like primary rental car insurance and trip delay insurance to cover you if anything goes wrong. When it comes time to redeem your Ultimate Rewards points, you have lots of great options, from using them to book travel through Chase with a 25% bonus to transferring them to airline or hotel partners.
Plus, the card has a $US95 annual fee, compared to $US450 on the Chase Sapphire Reserve. If you catch the award travel bug and decide you want to upgrade to the Reserve, you can always upgrade after your first year.
3. You can get thousands of dollars in value from credit card sign-up bonuses and benefits
Provided you don’t sit on your stash of points and miles and you can take advantage of other benefits like annual statement credits, you can come out ahead with premium credit cards. Here are just a few examples:
- Business Insider’s David Slotnick got $US2,000 in value from the Amex Platinum in his first year with the card, thanks to the card’s welcome bonus and perks like Gold elite status with Marriot and Hilton.
- Eric Rosen recently shared how using Chase Ultimate Rewards points from the Chase Sapphire Reserve allowed him to book award flights to Cabo San Lucas and save about $US4,000 on airfare during a peak travel period.
- The Business Platinum Card® from American Express has one of the highest annual fees around ($US595), but when you add up all its benefits – from annual statement credits with Dell to savings through the Amex International Airline Program – you could get up to $US7,000 in value. Again, that’s if you put all these benefits to use; if you’re not a frequent travel, a cash-back credit card could be a better option.
4. An annual fee isn’t always worth it – but it can be
Everyone has their own philosophy when it comes to paying annual fees for credit cards – even financial advisers differ on whether it’s worth it. If you’re on the fence, keep in mind that it comes down to whether or not you can put a credit card’s benefits to use.
Travel and credit card expert Caroline Lupini pays more than $US4,000 in credit card annual fees, but she says it’s worth it because she spends about eight months out of the year on the road and has no trouble getting value out of perks like the $US300 annual travel credit on the Chase Sapphire Reserve and the lounge access benefits of the Platinum Card® from American Express.
5. The United Explorer Card has a hidden feature that makes it easier to use your miles
Contributor Jason Steele uses hotel credit cards to enjoy free nights in Colorado, Hawaii, and more, and he uses an airline card to stretch his miles further for award flights. Steele stumbled across an unsung benefit of the United Explorer card: additional saver-level award availability.
If you have the Explorer card or another United credit card, you’ll have more opportunities to redeem your miles at the lowest mileage award level than non-United cardholders. You just need to be logged into your United MileagePlus account to see the additional saver-level seats. The difference between the cheapest award prices and the “standard” level of awards can be tens of thousands of miles, so having a United card can help you stretch the value of your miles much further.
6. It pays to have an ’emergency fund’ of travel rewards
Elizabeth Aldrich, who quit her job to work and travel and now lives in rural Costa Rica, says having various types of travel rewards on hand has helped her save money when she needed to book last-minute travel.
Her advice for building your own “emergency fund” of points and miles? It helps to have a few different points and miles currencies so you can be flexible. She focuses on Chase Ultimate Rewards, but also earns hotel points with the World of Hyatt Credit Card and airline miles with the Gold Delta SkyMiles® Credit Card from American Express.
7. ‘Double-dipping’ on credit card rewards helps you earn more points faster
The points and miles hobby can be even more rewarding when you have a partner earning rewards alongside you. Contributor Clint Proctor and his wife “double-dip” on credit card rewards by each opening cards like the Southwest Rapid Rewards Plus Credit Card. This way, they can each earn a sign-up bonus – getting them more points for travel and helping them earn the valuable Southwest Companion Pass, which lets you bring a friend or family member on flights with you for just the cost of taxes and fees.
8. Using the right card for each purchase matters
Credit card sign-up bonuses – which earn you a lump sum of points, miles, or cash back after you meet a minimum spending requirement – are the easiest way to quickly acquire rewards. But that’s just half of the equation.
To maximise his points-earning, Eric Rosenberg not only focuses on earning the most valuable sign-up bonuses, but he also makes sure he’s using the best credit card for every single purchase so he can earn as many rewards as possible. Rosenberg’s used credit card rewards to book travel including a trip to Israel in business class.
Here are his top picks for maximizing recurring expenses:
- American Express® Gold Card for 4x points at US supermarkets (on up to $US25,000 per year, then 1x)
- Chase Sapphire Reserve for 3x points on travel (excluding a $US300 travel credit)
- Ink Business Cash Credit Card for 5% cash back (5x points) on internet bills (up to the first $US25,000 spent each account anniversary year, then 1%/1x)
- Chase Freedom Unlimited for 1.5% cash back (1.5x points) on “everywhere else” purchases