Most credit cards offering travel rewards use a points-based system to help consumers earn bonuses and other incentives. Consumers can get free airline tickets, hotel stays and rental cars by applying for and using travel rewards credit cards strategically.
Points System Basics
Some travel credit cards offer miles instead of points, and such cards are for users specifically interested in airline tickets. Travel rewards credit cards typically offer one point for every dollar spent. In some cases, consumers can earn extra points by making purchases at specific stores or using their cards in certain categories, such as dining. The requirements for earning extra points vary among travel reward credit card providers.
Fast-Tracking Points
Major travel brands help consumers fast-track travel bonuses for loyalty purchases. With loyalty programs, cardholders usually must use the credit card to make purchases directly from the travel brand to get extra bonus points. For example, an airline offering a travel rewards credit card gives extra points when the card is used to purchase its airline tickets. Travel brands typically have partnerships and offer bonus points for partner purchases, so a person aiming to amass travel rewards can buy airline tickets from the major brand and rent a car from a car rental business that partners with the airline.
Extra Incentives
Consumers can also rack up travel rewards fast by applying for credit cards that offer sign-up bonuses. Sign-up bonuses may be, for example, 50,000 points when the cardholder spends $1,000 in the first 90 days. Some companies offer extravagant travel rewards to their most loyal customers. For example, the British Airways Visa Signature Card offers 50,000 bonus points to cardholders who spend $3,000 in the first 90 days after signing up and a free airline ticket on British Airways for a travel companion for purchases of $30,000 or more in a calendar year. For these bonus points and extra incentives to be worth it, a consumer should have an active plan to pay off the debt on a monthly basis to avoid paying interest fees.
Redeeming Travel Rewards
Redeeming loyalty rewards is typically a fairly simple process — consumers can use their credit cards at the airline, hotel or car rental business offering the points and redeem them on the spot for the full value. Cardholders can also redeem loyalty points by making purchases on the travel brand’s website. Travel rewards cards that are not offered by travel brands transfer the points — or the miles — to the loyalty programs with which they partner. Consumers should be aware that travel points usually are not transferred on a one-to-one basis. For example, 10,000 travel points might only be worth 8,000 points when transferred to a partner brand.