Let me be the first to welcome you to Easy Travel Points and exciting world of points and miles. If you’re reading this beginner’s guide, you’ve probably heard of people travelling across the globe in a luxury first class suite and spent only a few dollars on the ticket. At first, you probably thought there’s no way it could be true or there had to be a “catch”. Then you decided, if it really was true, you needed to figure out how they did it so you could travel in luxury as well.
Spoiler alert; this is absolutely possible, anyone can do it and no, there isn’t a “catch”. A few years ago, I was in the same boat you are and was determined to figure out how I could travel the world without spending a fortune.
While there is definitely some strategy that goes into getting the most value out of each point, let’s start with the basics. Even if you never want to dive into the more complex parts of this hobby, you can save a lot of money traveling the world.
That’s why I have compiled this beginner’s guide to points and miles. It contains all of the information I wish I knew when I started.
What Are Points And Miles
The best way to describe them is to think of old fashioned loyalty punch cards. You know, the ones that give you a free smoothie after you purchase ten. Points and miles work the exact same way. They are what credit cards, airlines and hotels will give you to encourage you to be a loyal customer. You can then redeem these points to be used for free travel with that company.
Easy Airline Example – You travel a lot for work and you always fly on your favorite airline. After each flight you take, the airline deposits miles into your frequent flyer account. After you have earned enough miles, you can redeem them for a free flight with that airline.
Simple Credit Card Example – You have a credit card that gives you a point for every dollar you spend when you use the card. The credit card company will then let you redeem those points in exchange for a plane ticket.
Each airline, hotel and credit card company has a different set of guidelines for their loyalty programs. Some programs are definitely more valuable and easier to use than others. Which leads us to the big question; what are my points worth?
What Are My Points Worth
The next step in this beginner’s guide is understanding what your points are worth. The simple answer is they’re worth whatever you can redeem them for. I know that sounds like a cop out but here me out.
The truth is, each loyalty program values their points a little differently. Some programs allow you to redeem each point at a fixed value which makes it easy. Others give you a variety of ways to use them, so they can be worth more depending on how you choose to use them.
Regardless of how the program is structured, I’m going to show you how to figure out what each point or mile is worth. All you need to figure out how much your points are worth is a little elementary school math. Don’t roll your eyes at me math-haters, it’s easy, you can do this.
Dream Vacation Example – We’ve all seen those over-water bungalows in a gorgeous tropical location, right? You find on the hotel’s website that you can book the bungalow for $1,000 per night. Let’s pretend there are two loyalty programs that let you use their points to book that exact same room. Program A requires you to redeem 100,000 points per night and Program B requires you to only use 50,000 points per night. In this example, we can see that Program A’s points are worth 1 cent each ($1,000 / 100,000 = $.01). However, programs B’s points are worth double at 2 cents per point ($1,000 / 50,000 = $.02).
Using this basic calculation, it will help you figure out what each loyalty program’s points are worth. While programs that have a fixed redemption value are easier to understand, using those that don’t have a fixed value can help you get more value out of each point. Figuring out how to get the most value out of each point is what makes this hobby so much fun. Plus, that’s how you’ll be able to travel around the world for less.
Real Hawaii Example – Recently, we our family went to Kauai, Hawaii for Spring Break. The week we wanted to go, the airline was selling seats to Kauai for $800 per person. However, I was able to book the exact same ticket using only 25,000 points. In this example, each point I used was worth 3.2 cents ($800 / 25,000 = $.032).
How Do I Earn Points & Miles
Remember, this is just a beginner’s guide, so this isn’t a complete list. However, here are a few of the easiest and most popular ways to earn points and miles.
While not the most efficient, the most popular way to earn points is to travel. Each time you fly, or stay at a hotel, you earn points or miles with that program. Unless you are a road warrior, it can be tough to earn enough points to use on a vacation.
Credit Card Sign-Up Bonuses
The fastest way to earn points is to sign up for a credit card that offers you a welcome bonus. Each credit card will have their own unique offer but each one typically will require you to spend a minimum amount within a specific time frame in order to qualify for the bonus. Also, the sign-up bonus for a card can fluctuate throughout the year, so keep an eye when for when they increase.
My favorite card for beginners is the Chase Sapphire Preferred. Currently, it comes with a generous 80,000 bonus points when you spend $4,000 within the first three months of opening your account. You can read here why I love this card and recommend it so often.
Credit Card Purchases
You can earn points and miles using a travel rewards card to make everyday purchases. Depending on how much you spend each month, this can really add up quickly. Most cards also have “bonus categories” which allow you to earn extra points on certain purchases. For example, a card may offer you 3 points for every dollar you spend at a gas station. So if you spend $40 to fill up your tank, you earn 120 points.
A lot of retailers partner with various shopping portals to give you points for by their products. In fact, just the other day, I earned 110 points with an airline when I bought pizza for dinner. I first went to the sopping portals and found the pizza chain that I was going to order dinner from. I clicked on their logo which took me to the pizza chain’s website where I ordered dinner. By taking this one extra step I was able to earn miles for my next vacation.
How Do I Redeem My Points
The last, but also the most important, topic of this beginner’s guide is knowing how to redeem the points you earn. After you have accumulated a healthy stash of points, the fun of planning your next trip begins.
Being flexible is the key to getting the most value out of your points. With our trip to Hawaii, we had to leave a day earlier that we had wanted or it would have cost us almost twice the amount of points to go. With that in mind, here are a few ways to use your miles to travel the world.
Airline Miles – Each airline has an award chart that will tell you how many miles you need for specific redemption options. You can use these miles to fly on that airline or any of the airlines in their “alliance”. This will allow you to visit virtually any location in the world.
Hotel Points – Hotel points are very similar to airline miles. Each hotel chain also has an award chart that will show you how many points you need to stay at each of their properties.
Credit Card Travel Portals – Some credit cards will allow you to redeem their points, at a fixed rate, with almost any airline or hotel. For example, a credit card issuer can value each point at 1.25 cents if used to book travel through their portal. If you found a great flight to Europe for $500, you could book that by using 40,000 credit card points. While you could get more value redeeming your points a different way, this is a very easy and straightforward redemption option.
Credit Card Transfer Partners – Some credit cards have also partnered with various airlines and hotels to allow you to transfer their points to these partners’ loyalty programs. Once you transfer the points to a partner, they can be used as described in the first two options above.
I know there’s a lot of information in this beginner’s guide to digest but don’t worry, you’ll quickly get the hang of it. Be sure to sign up for our newsletter, follow us on Instagram and Twitter and like us on Facebook for helpful tips and guides to help you along the way. I absolutely LOVE helping people travel plan their dream vacation, so if you have any questions along the way, please Contact Me! I’m always available to help.