10 Tips for Financing Your Next Vacation With Travel Rewards Points

Summer Hull has taken her family to Hawaii, Walt Disney World, Paris, the Maldives and around the U.S. to visit relatives – all on airline and hotel rewards points.

“We literally have gone around the world,” she says. “Our baby’s not even 1 year, and she’s been on a dozen miles and point trips.”

While the trips aren’t completely free, she estimates that travel reward points cover 80 percent of the costs. Hull, who publishes Mommy Points, an advice blog featured on the rewards site BoardingArea, says that with a good strategy most families can earn enough points to cover one or two nice vacations a year. “It’s absolutely something you can do with a family,” she says.

It’s important to find all the ways you can earn points, and there are many beyond flying or staying at a hotel, says Gary Leff, author of frequent flier site View From the Wing.

“You can earn points for just about anything that you do or buy,” Leff says. He earns points for transactions from his checking account, for example. “You can even earn points for buying a home,” he says, as well as from refinancing your mortgage. “There’s really very little you can’t earn points from,” he adds.

The best way to get started is to first decide where you want to travel, says Zach Honig, editor-in-chief of The Points Guy. Next, you should do some research to figure out which programs will get you there.

“It can be very complicated, but if you’re focusing on just one or two programs, it’s easier for a beginner to get it to work,” he says.

Typically, the easiest way to earn a lot of points at once is to apply for a new credit card. But not all cards provide the same value, plus tying your rewards points to future flights with Southwest Airlines, for example, doesn’t work if the destinations you want to visit aren’t served by Southwest.

To get the points bonus for a new card, you’re typically required to charge a minimum amount, usually $1,000 to $4,000, in the first three months. If you fall short, you don’t get the bonus. “Companies don’t want you to sign up for 20 cards and get the bonuses immediately,” Honig says. “You have to prove to them that you’re a customer worth having.”

Many cards waive the fee the first year but charge an annual fee afterward. If you end up paying interest charges on any of your cards, that can negate the value of the bonuses and the points you earn.

“There’s definitely some risk to get the reward,” Honig says. “It pays to do as much research as you can.”

If your schedule isn’t flexible, it may be harder to find award tickets on airlines. The most valuable travel rewards often are for international trips in premium flight classes, Leff says. “Domestic coach at the holidays is generally not going to be a good use,” he says.

Plus, a point in one program may be worth more than a point in another, Leff says. Some programs allow you to use points at a number of airlines or hotel chains. “The programs are not created equal,” Leff says. “I like to earn points that can be transferred to a variety of programs.”

Here are 10 tips for financing your next vacation with points and miles:

Decide where you want to go. Your strategy is going to be different if your goal is to take a family to Disney World versus taking a solo trip to Singapore. Find out which airlines and hotel chains serve your destinations and then see which cards offer the best deals for what you need. And while you can often rack up points quickly by opening up a card or two, make sure to give yourself ample time to accumulate the points needed if you are traveling with a large party or your trip will require a significant amount of points.

Research credit card offers and apply for one or two new cards. Make sure you understand what you have to do to claim your initial bonus. “The fastest way to rack up a ton of points is to sign up for a credit card,” Honig says. “One or two cards should probably do it.” Be sure the programs you decide on will take you to destinations you want to go. You should also consider signing up for credit cards with complementary offers and benefits to maximize your efforts.

Use cards that give you more than one point per dollar. Some cards allow you to earn more points in specific spending categories, or offer sporadic bonus opportunities, and it makes sense to use those when you can. “Earning way more than one point per dollar really adds up,” Hull says. Flower sellers, for example, often offer extra points around the holidays. Some cards offer more points on groceries, gas or dining.

Know that all points are not created equal. A Hilton HHonors point may not be equal to a Starwood Preferred Guest point, and American AAdvantage frequent flier miles may not have the same value as Southwest Airlines Rapid Rewards miles. The Points Guy is one of a number of websites that calculates and publishes those values as a basis of comparison. “Don’t just look at the number of points and miles that you’re earning,” Honig says. “Keep an eye on the value as well.”

Read websites that explain and share strategy. The rewards points world is complicated, but luckily a number of websites and bloggers follow it closely, including The Points Guy, Mommy Points and View From the Wing. You can learn strategy and keep up with new offers by following these sites. “If you don’t follow someone who writes about it, you’ll easily miss [offers],” Hull says.

Use shopping portals and dining rewards. Most rewards programs offer bonuses through online shopping portals, meaning you can earn points both for shopping with the portal and for the charge to your credit card. For example, United Airlines has a MileagePlus Shopping site where you rack up points with purchases. You can also enroll your cards in dining programs such as AAdvantage Dining from American Airlines or Southwest Dining from Southwest Airlines, which will allow you to earn extra points for eating at participating restaurants. “We call that a double-dip opportunity,” Honig says.

Create a strategy. Once you’ve decided which cards you want, figure out how to maximize the points you can earn. “Your biggest time investment is at the front end … to come up with a strategy,” Hull says. “Once it becomes a part of your life … it doesn’t have to add any time to your life, certainly not more than an hour a month.”

Charge everything you can on rewards credit cards. Some credit card companies let you pay auto insurance, day care expenses, utility bills and other expenses with a card that earns rewards. You don’t want to do that if the charges incur fees that exceed the value of your rewards, but most businesses don’t charge you for using a credit card.

Keep track of points and expiration dates. Rewards points may expire if you don’t fly a particular airline or use a card in a certain time period. Look for apps and websites, such as AwardWallet, that help you keep track.

Be strategic when redeeming points. When you get ready to use your points, make sure you’re getting the best use from them. Most rewards programs let you use your points for shopping, but that is rarely the most effective use. And keep in mind that the same trip may also require a different number of points from different carriers. For example, an airline ticket to Europe can cost 30,000 or 150,000 points, depending on the airline and the time of year.