How to Best Use Your Travel Points

how to use travel points-family watching airplane take off at airportThis is 2019, where you have money everywhere except for the places you actually need it. You’ve got $4.50 in your Venmo app, which is just low enough that it pulls from your bank account every time you send a payment anyways. You have 16 punch cards that you keep throwing away because you never use them, but then you get more because you showed up to the coffee shop without your punch card again. Bird scooters, Starbucks, and other apps on your phone have about $1.50 that you had to preload. To top it off, you’ve got travel reward points that might mean something but could also just be worthless. Where do you go from here?

We can’t help you with that other stuff, but travel points—that’s something we have some experience with. Today we’re going to outline how to earn them, what they mean, and how to use them.

How do I acquire travel points?

  1. Credit cards: This is by far your quickest route to reward points. There are a myriad of credit card options out there (this can help you evaluate them), but they all give you bonus points for signing up and allow you to earn points on all your purchases. Some cards let you earn points just for flights, and some earn points you can use generally on travel. Some cards let you earn more points when you eat out, buy groceries, or spend a lot of money in a given time frame.
  2. Sign up with your favorite hotel and airline: In addition to points or miles you earn from credit cards, all major airlines and hotel chains have loyalty programs you should join. These programs give you reward points, typically based on how much you spend, and often come with perks like upgrades, late checkout, or early boarding. Points won’t accrue very quickly unless you have a credit card linked to the account or you are a frequent traveler, but they are still worth the benefits.
  3. Pay attention to where you spend: Depending on the credit card or hotel loyalty program you sign up for, your credit card company might have a network with other businesses. These are sometimes called Bonus Malls. Bonus Malls list retailers that, when you spend money at their store or on their service, will earn you extra travel points. Sometimes these are stagnant, but often they change, offering special deals and perks around Black Friday, or seasonally, so it’s best to keep tabs on them. NerdWallet explains Bonus Malls in depth here.  

Do I want points or do I want miles?

That depends on what you want to use them for. Most mile rewards are limited to redeeming for airline travel only. Typically they are paired with a specific airline’s frequent flyer program. On the other hand, points can be used on flights, hotels, rental cars, or other travel experiences.

Unlike cash-back rewards, it can be tricky to understand just what a mile or a point means and how much it will get you. The Points Guy sums up the valuation of points and miles on common credit cards and loyalty programs, and he updates it every month. That’s a great place to start for determining what rewards are worth and which card is right for you.

On average, points are worth 1-2 cents, with the highest value around 2.5 cents, and several programs where a point is less than 1 cent. It would be nice if it were as easy as picking the program where the points are worth the most, but of course you have to evaluate how points are earned as well. Different cards allow you to earn extra points for spending in certain categories, for spending over a certain amount in a year, or for spending at specific retailers. Outline your budget and where your money is already going and pick a card that will help you get the most points.

How do I redeem travel points?

There are two different kinds of points: points earned directly through a loyalty program, and transferrable points, the kind you earn on your credit card. Transferrable points are more valuable and easy to accumulate, so you don’t need to be a frequent traveler in order to pay for your next vacation entirely with points. The best and most efficient way to redeem travel points and miles is to transfer them directly to an airline frequent flyer program or a hotel loyalty program. This gets you the highest value for your points. Redeeming points for cash back or gift cards is typically the worst option, getting you the least value for your points.

The internet is home to dozens of tools to help you use your points at the right time on the right thing. Lifehacker has a guide to whether you should use frequent flyer miles or keep saving them. Mile Value calculator will help you determine how much the points you’ve already accrued are worth. AwardWallet can help you track all of your reward program accounts all in one place and will alert you when your miles are about to expire.

Overall, travel points can be incredibly valuable, but they require a little more attention and knowledge of the system to make sure you’re using them to their full potential. When you search for hotels through Roomkey, you’re on your way to earning points that you can redeem on hotel rooms around the world. Think of us as your hotel loyalty points guru, and go forth and save!