Welcome to the Points Pro, where I answer your credit card and travel rewards questions each week. If you have a question you’d like answered, you can submit it here.
This week, CNBC Select reader Kendall asks :
Travel rewards sound great in theory, but there always seems to be a catch with blackout dates, transfer rules or inflated pricing. What are the best hidden-gem strategies for getting real value from points?
(This question has been edited for clarity and brevity.)
It’s understandable that Kendall’s frustrated when the promise of points doesn’t match the reality. Yes, there’s a lot you can do with that big limited-time welcome bonus, but how realistic is it for the average person to turn those points into a dream vacation?
That said, if you understand a few general principles, you can avoid common pitfalls and stretch the value of your points.
How to maximize credit card rewards
Understand how your points work
No two credit card rewards programs or travel loyalty programs are the same. There are different redemption options and expiration dates. So if you have a stash of miles or are looking to open a new credit card, it pays to take a closer look at what your points can and can’t do. You can increase the value you receive by avoiding easy-to-make mistakes.
Note the expiration policy
The biggest mistake you can make with points is letting them expire; it’s important to know how long you have to use them and what activities reset the expiration date. Expiration dates are more of a concern with hotel points or airline miles, as most credit card rewards don’t expire until you close the account.
Most travel loyalty programs reset the expiration date with any activity, such as earning or redeeming points. In some instances, you can transfer flexible credit card rewards to your airline account, and that will reset the expiration date. For example, you could transfer the Capital One miles earned with the Capital One Venture Rewards Credit Card to a program like Avianca LifeMiles, and it would reset the 12-month expiration clock. That’s a useful feature for your miles because, unlike with other programs, redeeming LifeMiles doesn’t extend the expiration date.
However, the rules vary, especially with international airline loyalty programs. Japan Airlines JAL Mileage Bank miles expire after 36 months, and you cannot extend their validity or reinstate the miles. In this example, it’s prudent to wait until there’s an award you want to book before you transfer Capital One miles to Japan Airlines.
The Capital One Venture Rewards Credit Card has a reasonable annual fee and earns flexible travel rewards, which makes it a great travel card for beginners or heavy travelers.
- Valuable welcome offer worth at least $750 in travel
- You can transfer miles to over 15 Capital One partners, including Emirates Skywards, Choice Privileges and Singapore Airlines KrisFlyer
- No foreign transaction fees
- Lacks ongoing travel benefits such as statement credits or lounge access
- Limited bonus spending category that only applies to certain Capital One Travel bookings
Highlights
Highlights shown here are provided by the issuer and have not been reviewed by CNBC Select’s editorial staff.
- Earn a one-time bonus of 75,000 miles once you spend $4,000 on purchases within 3 months from account opening, equal to $750 in travel
- Earn unlimited 2X miles on every purchase, every day
- Earn 5X miles on hotels, vacation rentals and rental cars booked through Capital One Travel
- Miles won’t expire for the life of the account and there’s no limit to how many you can earn
- Receive up to a $120 credit for Global Entry or TSA PreCheck®
- Use your miles to get reimbursed for any travel purchase—or redeem by booking a trip through Capital One Travel
- Enjoy a $50 experience credit and other premium benefits with every hotel and vacation rental booked from the Lifestyle Collection
- Transfer your miles to your choice of 15+ travel loyalty programs
- Top rated mobile app
Balance transfer fee
$0 at the Transfer APR, 4% of the amount of each transferred balance that posts to your account at a promotional APR that Capital One may offer to you
Foreign transaction fee
Pay attention to redemption values
Most credit card programs offer similar redemptions such as gift cards, statement credits (cash back), travel and merchandise. It’s really important to pay attention to the value you receive for each of these options, which varies by program and credit card.
Chase points are typically worth 1 cent each for gift cards, statement credits and travel booked through Chase Travel℠. You can also link your Chase Ultimate Rewards account to your Amazon account and directly redeem points for Amazon purchases, but the value per point drops to 0.8 cents. That’s a significant drop in value for a redemption that isn’t much different than cashing out your points for a statement credit.
Let’s say you earned the Chase Sapphire Preferred® Card’s (see rates and fees) current 100,000-point bonus (after spending $5,000 on purchases in the first three months from account opening). Those points are worth $800 at Amazon checkout. Or, you could buy $1,000 in gadgets from Amazon with your Sapphire Preferred, earn 1,000 points on the purchase and then redeem your 100,000-point bonus for a $1,000 statement credit. By understanding the value of each redemption, you could unlock $200+ in additional value with little effort.
The Chase Sapphire Preferred® Card packs a punch for a $95 annual fee card, offering annual travel credits, comprehensive travel protections, flexible rewards and more.
- You can transfer rewards to all of Chase’s travel partners including World of Hyatt, Southwest Rapid Rewards and many more
- Long list of travel and shopping protections
- Annual Chase Travel hotel credit
- Has an annual fee
- Requires a high credit score
Highlights
Highlights shown here are provided by the issuer and have not been reviewed by CNBC Select’s editorial staff.
- Earn 100,000 bonus points after you spend $5,000 on purchases in the first 3 months from account opening.
- Enjoy benefits such as 5x on travel purchased through Chase TravelSM, 3x on dining, 3x on vacation homes, 3x on gas & EV charging, 3x on top streaming services and online groceries (excluding Walmart, Target, and wholesale clubs), 2x on all other travel purchases, 1x on all other purchases
- Earn up to $100 in statement credits each account anniversary year for hotel stays through Chase Travel
- Count on Trip Cancellation/Interruption Insurance, Auto Rental Collision Damage Waiver, Lost Luggage Insurance and more.
- Get a year of complimentary Apple TV when activated by December 31, 2026 – a value of $156.
- Complimentary DashPass which unlocks $0 delivery fees & lower service fees for a min. of one year when you activate by 12/31/27. Plus, a $10 promo each month on non-restaurant orders.
- Receive one statement credit of up to $120 every four years as reimbursement for the application fee charged to your card for a Global Entry, TSA Precheck® or NEXUS application.
- Transfer points to leading airline and hotel loyalty programs
- Member FDIC
Balance transfer fee
Either $5 or 5% of the amount of each transfer, whichever is greater
Be flexible with your travel plans
Over the past decade, travel loyalty programs have moved away from fixed award charts in favor of dynamic pricing. What that means is, flying from point A to point B often varies in price based on demand, and the same room at a hotel could cost more on Friday than on Tuesday.
While this makes it difficult to know how many points you need to book a trip, there are two benefits to this trend. Blackout dates are less of an issue, and you can find great deals if your travel plans are flexible.
Since the pandemic, many airlines no longer charge change or cancellation fees for award flights. That means you can easily rebook your flights if the price drops. I regularly rebook my American Airlines award flights when I find cheaper options for the same route. In the past year, I’ve rebooked American Airlines award flights multiple times and saved 30% to 50% of the miles I originally paid.
Being flexible with when you travel and focusing on rewards that offer more flexibility can help you get more for your points and miles.
Plan before you earn
One of the biggest issues I run into when helping friends and family use their points is that they aren’t earning the rewards far enough in advance.
Intro bonuses typically don’t instantly appear in your account, though. You’ll usually need to spend a certain amount within three to six months, so it can take months before you have access to all those bonus points.
Booking award travel further in advance tends to give you more access to cheaper awards. This is especially true for high-value redemptions, like luxury hotels in popular areas and international premium cabin award flights.
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