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Award Travel—strategically redeeming your miles & points for "almost free" travel—has been around for decades. Why is there a large segment of the population that doesn't take advantage of Award Travel—even though they travel frequently? Chances are, they have been victimized by one of three myths surrounding Award Travel. Let us examine these myths and debunk them—one at a time!
All opinions and reviews expressed herein are the author's alone and have not been reviewed or approved by any credit card issuer, airline, bank, hotel chain, or other entity. Some of the credit card offers and links appearing in this article are from companies from which we may receive commission or a referral bonus when you click on the link. You do not need to use our links but we appreciate it when you do—it helps support our website!
1. Credit Cards Are Bad
Perhaps the biggest myth that hinders a lot of people from applying for travel credit cards is that credit cards are bad. Granted, irresponsible behavior can lead to a host of credit problems. In addition, unexpected financial reversals—such as a job loss or an unanticipated large bill (i.e. car repair, house repair, etc.)—can also leave a bad credit taste in your mouth. Learn more in the following post: Avoid These Five Mistakes With a Credit Card!
Nevertheless, using credit cards as a method and not a source of funds is the gateway to benefiting from credit card rewards. In other words, you want to make sure you already have enough funds in your checking account to cover any purchase with your credit card. For example, if you plan to purchase $300 worth of groceries, make sure you have that amount in your checking account before using your credit card to complete the transaction.
By adhering to this methodology, you will be able to pay your credit card bill in full each month and avoid paying any interest. Furthermore, with the right credit card, you will earn miles or points that can be redeemed for Award Travel! You can also stack your rewards in creative ways to earn even more! To learn more about this and other ways to add to your savings, see the following post: Five Easy Ways to Combat Inflation Using Your Credit Card & More!
Granted, it can be hard to break an old habit—such as always using your debit card. For many years, I only used my debit card. However, when I experienced the benefits of using credit cards as a method of payment and saved thousands of dollars toward travel expenses, I was a changed man. In other words, I would have paid thousands of dollars more had I continued to use my debit card as opposed to the credit cards that yielded those rewards. You can learn more about this in the following post: Why You Lose Money When Using a Debit Card.
How should you choose a travel credit card that is the right fit for you? You can review five popular travel credit cards in the following post: An Easy Guide to Five Credit Cards Designed to Get You Started With Award Travel.
Additionally, AwardYourMiles has developed a Miles & Points Calculator. Select the credit card and enter the amount of money you spend on average per month in the corresponding category. It will calculate the monetary value of your first and second years using the credit card and the miles/ points generated from your spend.
AwardYourMiles has also developed a Credit Card Selector Calculator. It uses our proprietary algorithm which determines the best credit card in our database based on your spending habits. You will be able to determine the value of each credit card in your first year of use!
Myth debunked—credit cards aren't bad!
2. Award Travel Is Only for the Wealthy
Some individuals assume that Award Travel only benefits the wealthy. Granted, the more you spend with your credit card, the greater your rewards earned will be. However, sign-up bonuses move the needle the most. And, a lot of the sign-up bonuses require a minimum spend within a certain period that is attainable for individuals who are far from being considered wealthy.
For example, the Chase Freedom Flex℠ currently has a 20,000 Ultimate Rewards® welcome bonus; the minimum spend requirement is only $500 in the first 3 months from account opening! If converting the 20,000 Ultimate Rewards® to cashback—or $200—that is a 40% return on spend! Spending $500 within 3 months is something most of us are able to do. With a $0 annual fee and 5X rotating bonus categories, this is a powerful no-annual-fee credit card. You can learn more about this card in the following post: Chase Freedom Flex—A Remarkable No Annual Fee Card!
Although the Chase Freedom Flex℠ is marketed as a cashback card—or a $200 welcome bonus—the value of 20,000 points, when used strategically for travel, could translate into 1.5 to 2 times that value! In other words, the actual value of the 20,000 points could be $300 to $400—or even more! You can apply for this card here!
There are premium travel cards that move the needle even more—such as the Chase Sapphire Preferred® Card. It currently packs a punch with a welcome bonus offer at 60,000 Chase Ultimate Rewards® points! You can learn more about this card in the following post: Chase Sapphire Preferred—The Best Credit Card Just Got Better!
This is a must-have credit card for anyone getting started with Award Travel! It does require spending $4,000 within 3 months from account opening. One way to meet this requirement is to pre-pay expenses. For example, by paying your auto & homeowner's insurance premium in full for a whole year in advance, it will be easier to meet the required spend amount. In addition, your insurance carrier may give you a discount for paying in advance for a full year! This will help you reach the sign-up bonus for the Chase Sapphire Preferred® Card and possibly give you a discount on your premium! You can apply for this card here!
Myth debunked—Award Travel is not only for the wealthy.
3. Award Travel Is Complicated
Redeeming Award Tickets can seem like learning a new language. If you've never done it before, it can be a bit challenging. However, with some practice, it can become easy!
When it comes to learning something new—riding a bike, starting a new job, baking for the 1st time—there is a learning curve. Award Travel is no different. Learning about airline alliances, partnerships, loyalty programs, credit card rewards, transfer partners, award charts, routing rules, etc. can be complicated—at first. But, over time, with some training and experience, it can become second nature.
With Award Travel, flexibility is the key! This includes being flexible with your dates of departure/ return along with your departing/ destination airport. Some individuals "take what they can get" and make bad redemptions. This is exactly what loyalty programs want you to do—overspend your miles/ points. With a little creativity, you can save a substantial amount of your miles & points! To learn more about how to do this, see the following post: An Easy Example of How to Leverage Your Miles & Points for an Award Ticket.
"Opening the right credit cards + using them responsibly + redeeming rewards strategically = tremendous travel savings!"
Do you feel overwhelmed with all the options available when it comes to redeeming your miles & points? Would you like some assistance to get you started in the right direction? You will benefit from the services of a Credit Card Miles & Points Consultant. You will be assisted with regards to earning miles & points through credit card use and leveraging those miles & points for Award Travel. Or, feel free to use any of our Award Travel Tools online. Get started today!
Myth debunked—Award Travel is not complicated with some training and experience.