Travel rewards are complicated.<\/p>\n
Nearly a quarter of travelers (24%) say they have difficulty understanding earning and redemption rules, according to a 2022 survey of 2,041 U.S. consumers by iSeatz, a loyalty program service provider. Yet this complexity makes travel rewards a prime target for spreadsheet-wielding obsessives who want to wring every penny from their points and miles.<\/p>\n
These experts love to share lavish vacations on social media and online forums, nitpicking over the best overwater bungalow in the Maldives. They rarely share the more mundane expertise they\u2019ve garnered, even though these basic tactics are the most important, especially for beginners.<\/p>\n
Understanding and avoiding these four simple mistakes can help you make smart\u00a0travel rewards\u00a0decisions, whether you\u2019re visiting the Maldives or Milwaukee.<\/p>\n
Also see<\/strong>: Air travel may reach a breaking point this summer, with more storms, fewer staff and busier skies<\/p>\n This mistake is so critical, it should probably also be Nos. 2, 3 and 4 on this list. Travel credit cards are a great way to earn points and miles and accrue other benefits, but credit card debt \u2014 even in relatively small amounts \u2014 will quickly erase the value of these perks.<\/p>\n That\u2019s why travel rewards experts never carry credit card debt from month to month if they can avoid it.<\/p>\n Americans currently hold nearly a trillion dollars in credit card debt, according to the Federal Reserve Bank of New York. And delinquency rates, which dropped early in the pandemic, are on the rise. Despite this, Americans are spending more and more on travel, with credit and debit card spending on travel categories in 2022 exceeding 2019 levels, according to a May report from Bank of America.<\/p>\n In short: Many Americans are spending money they might not have on travel and accruing more credit card debt. That\u2019s a big no-no from a travel rewards perspective.<\/p>\n Have you ever received an email from an airline with a subject line similar to \u201cPurchase miles for 50% off for a limited time\u201d? These promotions might sound like a good deal \u2014 who doesn\u2019t want to save that much? Yet they rarely are. In fact, experts\u00a0rarely buy points and miles\u00a0directly.<\/p>\n Why? These rewards are essentially a currency managed by the companies who offer them. So exchanging one form of currency, such as U.S. dollars, for another, such as\u00a0Delta SkyMiles, severely limits the range of goods and services you can purchase. It also puts the future value of these currencies in the hands of the airlines, hotels or credit cards that manage them.<\/p>\n For example,\u00a0Marriott There are situations \u2014 such as purchasing a few miles to achieve a specific redemption \u2014 when buying points or miles might make sense. But in general, you can ignore those flashy promotions.<\/p>\n Related:<\/strong> 4 ways I use credit cards to make my family\u2019s travel cheaper<\/p>\n Most general\u00a0travel credit cards\u00a0(not co-branded cards such as those associated with specific airlines or hotels) offer points that can be used two ways:<\/p>\n Many beginners tend to choose the first option. It\u2019s the simplest \u2014 all you do is search and book travel through the portal, as you would a cash fare. And it offers consistent per-point value.<\/p>\n Yet rewards obsessives know that the best value often comes from the second option \u2014 transferring points to specific programs and booking award travel through them.<\/p>\n For example,\u00a0World of Hyatt If you can transfer your points to a high-value program such as Hyatt, you can stretch your credit card points much further. Of course, you should do so only if booking award travel through one of these programs fits into your travel plans.<\/p>\n Also see:<\/strong> Go here, not there: 6 charming summer destinations off the beaten path<\/p>\n We all know the drag of paying for monthly subscriptions we aren\u2019t using, whether it\u2019s Paramount+ or that Pilates membership. Yet, because credit card fees are billed annually, it can be easier to forget about them.<\/p>\n Ignoring\u00a0annual fees\u00a0for cards you aren\u2019t using can add up quickly, especially for premium cards that can carry fees north of $400. So ruthlessly pruning cards that aren\u2019t pulling their weight is an important practice among travel rewards experts.<\/p>\n Keep in mind: Canceling a card outright isn\u2019t always the best move, as it can\u00a0lower your credit score. Consider\u00a0asking for a retention offer, such as additional points or miles, to make the card\u2019s fee more digestible, or switch to a no-fee card.<\/p>\n1. Accruing credit card debt<\/strong><\/h2>\n
2. Buying points and miles<\/strong><\/h2>\n
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\n Bonvoy points\u00a0have dropped in value from nearly 1.2 cents apiece in 2019 to 0.7 cent in 2022, a 42% decrease, according to an analysis by NerdWallet. And while dollars may lose their value over time, as we\u2019re all now keenly aware, they\u2019re less prone to major fluctuations.<\/p>\n3. Always redeeming credit card points through travel portals<\/strong><\/h2>\n
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\n points are worth 2.8 cents each, according to the latest NerdWallet analysis. That\u2019s far more than the 1 to 1.5 cents many credit card programs offer when booking travel directly.<\/p>\n4. Paying unnecessary annual fees<\/strong><\/h2>\n