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Imagine jetting off to exotic destinations without breaking the bank. With a travel credit card, you may be able to make this dream a reality.
By earning rewards that can slash the cost of flights, hotel stays, and experiences, you can take your travel game to the next level.
But here’s the secret: You have to be strategic to unlock the full potential of your card’s perks. Choosing the perfect card, getting that sign-up bonus, and mastering the art of points redemption can help cover your travel costs.
Here’s how to use credit card points for travel and make your vacations a bit more affordable.
How to travel for free with credit card rewards
Ready to score free or discounted travel using your credit card rewards? First, apply for a travel credit card that fits your needs and matches your spending habits. The card should offer rewards for the specific type of travel you want, whether renting a car, staying at a particular hotel chain, or going on a cruise.
Introductory bonus points can jumpstart your travel rewards. Some of the best card sign-up bonuses offer 60,000 to 100,000 bonus points (or more). When you’ve earned the sign-up bonus, use those points to pay for your travel expenses, including flights, hotels, or other eligible expenses.
“Most people can book a free trip just from the points they earned from the initial sign-up bonus plus the spending required to achieve the sign-up bonus. Redeeming travel rewards is where the fun begins!” says Zac Hood, founder of Travel Freely, a credit card rewards tracker app.
To continue earning points, try to put as much of your regular spending as possible on your credit card. This way, you’ll accumulate more points over time. Remember, the more you use your card, the more points you’ll earn, which means more opportunities for free travel.
4 credit cards that help you travel for free
Having the right mix of credit cards in your wallet can also help you travel for less. Here are four credit cards you should have in your wallet to maximize your travel benefits:
1. Travel credit card
Think of a travel credit card as a one-size-fits-all rewards card. You’re not limited to booking flights with a particular airline or staying at a specific hotel chain. Instead, you have the freedom to choose how you want to use your rewards. Want to book a flight with one airline but stay at a different hotel? No problem! The flexible redemption options of a travel card allow you to mix and match your travel plans according to your preferences.
You can use your rewards to cover the cost of flights, hotels, car rentals, train tickets, cruises, and even activities and excursions.
2. Airline credit card
An airline credit card rewards you for your loyalty to a particular airline or airline alliance. You can earn airline miles and redeem them for free flights, upgrades, or other travel perks.
Take the Delta SkyMiles® Reserve American Express Card, which earns 3X the points per dollar spent on Delta Flights and other Delta Vacations®.
The best airline credit cards come with generous sign-up bonuses. These bonuses provide a large number of miles right from the start, helping you reach a free flight threshold sooner than you might expect. Airline cards often come with flight-specific perks like priority boarding, free checked bags, and access to exclusive airport lounges.
Choose a co-branded credit card for an airline you frequently fly with or one that has a major hub in your city. This way, you can fully maximize the rewards and benefits associated with the card.
3. Hotel credit card
Like an airline card, hotel credit cards reward your loyalty to a specific hotel chain or hotel rewards program. You can earn rewards on everyday spending, which can then be redeemed for complimentary hotel stays or upgrades, allowing you to save big on accommodation costs.
For example, the Marriott Bonvoy Brilliant® American Express® Card lets you earn 6X Marriott Bonvoy points for purchases made at Marriott Bonvoy hotels and resorts, 3X points booked at worldwide restaurants and direct bookings with airlines, and 2X points on other eligible purchases.
Like airline cards, you can earn a generous sign-up bonus if you meet a specific spending limit within the first couple of months of owning the card. These bonuses often provide a substantial number of points or free nights as a welcome gift, giving you a head start toward your next free stay.
Hotel cards also come with perks like room upgrades, late check-out, complimentary breakfast, and access to exclusive amenities. Some hotel credit cards offer perks outside the hotel, such as partnerships with airlines or car rental companies.
If you frequently travel to destinations where your preferred hotel chain has a strong presence, you’ll have even more opportunities to enjoy free or discounted stays.
4. Cash back credit card
Cash back credit cards offer the versatility to earn cash rewards, which you can use to fund your travel. Some cash back cards are geared towards travelers.
With a cash back card, you earn a percentage of your purchases as cash rewards. These rewards add up as you use your card for various expenses such as groceries, dining, gas, and more. The more you spend, the more cash back you earn.
The beauty of a cash back credit card is that you can use those cash rewards however you like, including for travel expenses. Many cash back cards offer sign-up bonuses and special promotions that can boost your rewards.
Choose a cash back credit card that aligns with your spending habits. Some cards may offer higher cash back rates on travel-related purchases, making them even more beneficial for your travel goals.
How credit card travel rewards work
Credit card rewards are fairly straightforward — you simply pay with your credit card and earn rewards. But each card has a different system for how you earn rewards, the value of your rewards, and how you can redeem rewards.
Your specific type of card — whether it’s a travel card, airline card, hotel card, or cash back card — will determine how you earn rewards. But what are those rewards actually worth? And how do you actually redeem them?
What are my credit card rewards worth?
The value of travel rewards depends on the specific credit card and rewards program. Most cards earn about 1-2 cents per point or mile. For example, if you’ve accumulated 50,000 points or miles, they could be worth approximately $500 to $1,000 towards travel expenses.
“I would say a general and simple rule of thumb is if you’re getting two cents per point of value, you’re doing a great job,” says Chris Hutchins, host of travel and money optimization podcast All The Hacks. “That is a threshold that I often use to decide whether I want to use my points. If I can get at least two cents in value per point, I’m happy.”
Some cards offer bonus points for specific spending categories. Examples of these bonus categories include groceries, gas stations, and streaming services. You can calculate how much your card’s rewards are worth and compare it to other cards.
The value of your rewards can also fluctuate based on flight or hotel room availability, seasonal demand, and other factors.
Some credit card rewards programs offer bonuses or redemption deals that can increase the value of your rewards. This includes discounted flights, promotional offers, or limited partnerships with travel providers.
How do I redeem my credit card’s rewards?
You can redeem your points or miles in many different ways, depending on your card.
Many credit cards have their own travel portals where you can book flights, hotels, rental cars, and other travel using your rewards. These portals may offer bonus rewards for booking through their platform.
With a hotel credit card, you can typically only redeem your rewards with that specific hotel chain. The same goes for airline cards: You can often only redeem your miles with the selected airline, often subject to availability and blackout dates.
Flexible travel cards allow you to transfer your points or miles to partner airlines or hotel loyalty programs. You can directly use your rewards to pay for travel expenses at a fixed redemption rate.
“If you have a card with flexible points, you can redeem your points or miles for a variety of travel-related expenses, including flights, hotel stays, rental cars, and more,” says Hood. “The flexibility lets you tailor your rewards to suit your travel preferences, providing an incredible value when used wisely.”
Other ways to maximize your credit card travel rewards
Here are some more ways to make the most of your credit card travel rewards:
- Start with a flexible travel card: Flexible rewards give you more options. “By having points that are very flexible and can work across multiple airlines and hotel groups, you give yourself the most options of finding a good deal for that next trip you want to take,” says Hutchins.
- Align your spending with bonus categories: If your card offers a higher rewards earning rate for a specific category (like gas or groceries), try to shift your spending to earn those bonus points.
- Compare rewards redemption options: In most cases, transferring your points to airline and hotel partners is the most valuable redemption option, says Hutchins. If that’s not an option, try to book travel through your card’s travel portal if they offer one.
- Keep an eye on promotions and offers: Look out for special promotions, discounts, or limited-time offers provided by your credit card issuer or travel partners. These opportunities can help you stretch your rewards further or earn bonus rewards on specific bookings.
- Plan your travel strategically: Be mindful of blackout dates, availability, and dynamic pricing when redeeming your rewards for flights or hotel stays. Planning ahead and being flexible with travel dates can increase your chances of finding better redemption options and value.
- Avoid paying interest: If you want to get the maximum value from your credit card rewards, you need to pay off your card’s balance in full monthly. Paying credit card interest can offset the value of your travel rewards. Plus, carrying a high balance can negatively affect your credit score and may limit your ability to apply for other travel rewards cards in the future.
The bottom line
Navigating the different travel rewards systems can feel overwhelming, like going down a rabbit hole. But taking the time to learn about your credit card rewards can bring incredible value.
This is just the starting point of your credit card rewards journey. The more you learn, the more you’ll benefit from rewards that can make your dream vacation a reality.
“If your points allow you to take a trip that you’re excited to take and you don’t spend money on it and you’re happy, those points were a good value,” says Hutchins.
[Disclaimer]: *Eligibility and Benefit level varies by Card. Terms, Conditions, and Limitations Apply. Please visit americanexpress.com/benefitsguide for more details. Underwritten by Amex Assurance Company
Opinions expressed are author’s alone, not those of any bank, credit card issuer, or other entity. This content has not been reviewed, approved, or otherwise endorsed by any of the entities included in the post.