As the summer travel season nears, it’s the perfect time to make sure you’re getting the most out of your travel rewards card. Whether it’s airline miles or credit card points, these perks can help you save big on your dream vacation. However, if you’re new to the rewards game, you may not be maximizing the full potential of your card.
Here are five ways you could be missing out on valuable points and miles, and how to avoid these common pitfalls:
1. Missing Spending Minimums
Many travel rewards cards offer generous sign-up bonuses, but there’s usually a catch—you have to meet a specific spending threshold within the first few months to claim those points or miles. If you don’t hit that target, you miss out on the bonus entirely.
Emily Jablon, co-founder of the travel blog MillionMileSecrets.com, recommends putting everyday expenses, like utilities and your cellphone bill, on your card to help reach that spending minimum. Daraius Dubash, also a co-founder of the blog, adds that if you have large upcoming expenses, such as wedding costs or home renovations, you should charge those to your card to meet the requirement.
But remember, it’s essential to only spend what you can realistically pay off. Charging more than you can handle could land you in a debt spiral, wiping out any potential benefits from the rewards.
2. Carrying a Balance
While standard credit cards may have interest rates in the single digits, rewards cards often come with higher APRs—sometimes as high as 30%. These higher rates help subsidize the rewards, which means if you’re carrying a balance, the interest you’re paying could easily cancel out any rewards you’ve earned.
Dubash advises avoiding travel rewards cards if you tend to carry a balance. “It’s almost never worth the miles and points if you’re racking up interest,” he says. To really benefit, aim to pay off your balance in full every month.
Rewards Credit Cards
3. Struggling to Find Reward Flights
A common frustration with travel rewards cards is the limited availability of award flights. If you’re having trouble finding flights that fit your needs, consider alternative strategies.
Jeffrey Kwok, of CanadianKilometers.com, notes that some airlines, like Aeroplan, only show select routes online. However, other seats may be available if you call the airline directly. Be aware that some airlines charge a fee for phone bookings, but it could be worth it if it helps you secure the flight you want.
Another trick is to search for flights on partner airlines within the same alliance. For example, ANA (All Nippon Airways), part of the Star Alliance (which includes Air Canada and United), has a comprehensive award search tool that can help uncover available seats across partner airlines.
4. Undervaluing Your Rewards
Not all points and miles are created equal—redeeming them in different ways can yield vastly different values. For instance, using points to pay your credit card bill may offer less value compared to transferring them to an airline’s frequent flyer program.
Kwok suggests that transferring points to an airline often provides more value than redeeming them for gift cards or travel through the credit card’s rewards program. However, the trade-off is flexibility. “You’re limited by the award space the airline alliance releases,” he says.
It’s helpful to calculate the value of your points before redeeming them. For example, if 25,000 points get you a $200 gift card but can also cover a $350 flight, redeeming for airfare gives you a higher value—about 1.4 cents per point versus less than 1 cent for the gift card.
5. Letting Rewards Expire
Your hard-earned points are useless if they expire before you use them. Different programs have varying rules about when points expire, so it’s important to stay on top of this.
While some programs allow you to reinstate expired points for a fee, it’s easier to ensure they never expire in the first place. Dubash and Jablon recommend using tools like AwardWallet.com to track your rewards and set reminders for expiration dates. Keep in mind, while some credit card rewards don’t have an expiration date, closing your account could result in forfeiting your points. Always redeem them before canceling a card.
By keeping an eye on these potential pitfalls, you’ll ensure you get the maximum value out of your travel rewards card. With a bit of planning, you can save significantly on your next getaway while avoiding any nasty surprises down the road.
