Beginner’s Guide to Miles & Points

 

I’ve created this page as a way to introduce folks who are new to miles and points to the joys of collecting miles and points, and the cheap travel which is possible.

Emily and I pay a fraction of the retail cost to fly and stay in hotels.  We do this by collecting miles and points.  We participate in a number of promotions, but the main way we earn miles and points is by signing up for credit cards which offer large sign-up bonuses.

Collecting miles and points requires a bit of organization, but it is not rocket science (otherwise I wouldn’t be able to do it!).

Step 1 – Sign-up for miles and points programs

Sign-up for a few hotel and airline loyalty programs.  There are many programs to choose from, but I recommend signing-up for just a few programs initially.  You can always sign-up for the rest later on.

Make sure to copy and paste your account number, username, and password into an Excel or Word document to help with Step 2.

Step 2 – Manage your miles online

I use AwardWallet.com to manage our miles.  AwardWallet not only tracks Emily and my miles, but also our parents’ mileage accounts.  It is a free service, but with a small donation ($5 for 6 months) you get premium services such as alerts when your miles are expiring.

Simply sign-up for Awardwallet.com and enter in your username and passwords for your accounts from Step 1.

Step 3 – Credit card strategy & does applying for credit cards damage my credit score?

The easiest way to collect miles and points without flying is through credit-card mega bonuses (think 50,000 or more miles and points from just 1 credit card).

I earned over 1 million miles and points this year from credit card sign-up bonuses and my credit score is still over 700.  Credit cards are the easiest way to earn miles and points.  Your credit score does decrease each time you sign-up for a credit card, but the effect of that is small (less than 5 points), and over the medium to long term your credit score improves because of the increase in available credit.

If you are not taking out a big loan in the next 2 years (equity, house, student,  etc.) than apply for credit cards and build up a hotel point and air mile balance.  If you are applying for a big loan in the next 2 years, than I would recommend very few or no credit card applications so as to ensure that you’re doing everything possible to get your loan.

According to MyFICO, applying for credit cards reduces your score usually by 3 to 5 points per application, but banks look at other factors such as how often you’ve applied for credit recently when they evaluate big loans.  Much better in my opinion, to get that big loan first at the lowest possible interest rate, and then apply for credit cards.

If you do decide to apply for credit cards make sure to pay your bills off when they are due and to not pay interest.  Paying interest on credit cards is a losing proposition  – even if you manage to earn miles and points.

Even if you don’t want to apply for credit cards, I recommend getting 2 of my favorite credit cards which give you a lot of flexibility.  I do get a referral if you apply for these 2 cards, but Emily and I are very grateful for your support!

1) Chase Sapphire Preferred Visa – This is my favorite card and one of the very few cards which Emily pays an annual fee for.  Basically, you earn a 40,000 point sign-up bonus after spending $3,000 within 3 months, and double points for dining and travel expenses.  These points give you more flexibility since they can be transferred to different airline and hotel partners.

Here’s a link to my review of the card.

2) American Express SPG card – Another of my favorite cards and for which I’d pay an annual fee.  Here’s a link to my review of the card.

Step 4 – Eat, Shop and earn miles

Put all your expenses on a credit card and sign-up for programs which give you miles for dining.  Check EVReward for the best online mall to earn miles and points from.

To be continued…

530 Responses to Beginner’s Guide to Miles & Points

  1. I have a virgin atlantic cc the black one from bank of america, do you still get miles if you pay your account down before the next closing date? I want to keep my credit utilization under a certain percentage so that’s why I’m asking.

    Thanks,
    Nimish

  2. Do hyatt check only primary account holder Id during check-in? I want to make reservation for a room for 4 nights 2 adults(me & my gf), but she is staying for only 2 nights then I would like to invite a friend of mine for rest of the stay. Is that doable? Thanks

  3. @Devon – That’s a tough route for business class seats. I’d consider flying 1-way using American Airlines miles and another 1-way using United miles. There are easy ways to collect American Airlines miles.

    @Nimish – You get the miles regardless of when you pay the balance due on your card.

    @ Scott – You can add your girlfriend or friend as the 2nd person on the reservation so they can check in for you. You can just give your girlfriend’s key to your friend when he arrives at the hotel.

  4. Can you explain “different product” as it relates to applying for various credit cards?

  5. @Don – It means either a business or a personal card. Or if the card has different versions (e.g the Southwest cards have 4 distinct versions).

  6. This summer I plan to get married :). My wedding will likely cost me 25-30k. My question to you is, how can I use credit card bonuses in such a way to maximize my rewards that I can use towards say a honeymoon?

    I’ve just entered this world of credit card rewards. Discovered your blog and have been reading the internet for the past 1.5hrs to educate myself on this system.

    In this article you say that paying interest negates any rewards. That makes sense. So if I don’t have the capital to avoid interest fees on the reward cards, would you agree with transferring the many introductory 0% apr cards without rewards?

    Any help appreciated. keep up the great work.

  7. Hey Darius,

    What would you consider a good deal for first time sign-up bonus? I am currently debating if I should spend 10K to get 25,000 Avios because the cost of buying GCs has increase.

    Raymond

  8. Hi Darius,
    I signed up for the 50K mile Southwest Visa thru chase and am almost at my $2K spending amount in the first 3 months to get those points. I wanted to sign up for a Chase Ink business card that says they will give a 50K bonus if you spend 5K in the first 3 months, but there appears to be a catch. It says the 50K is only for “new cardholders” with chase. Do you know if they stick to that rule? I don’t have any other “business” account cards with any bank.
    also, I have 30k in ultimate rewards points and want t know the best way to transfer them to my Southwest account to try to get the companion pass.

  9. @Justin – Congrats! You can use the amount to get the sign-up bonus from credit cards (for example, Chase Sapphire Preferred, American Express Starwood etc.). That said, I wouldn’t apply if you don’t have the money to pay the amount in full.

    @Raymond – Anything above 40K miles is a good offer, but if you’ve already got those, it could make sense to get something else.

    @Jennifer – The business and personal cards are considered different products so it should be possible to get those different cards.

  10. Hi Daraius,

    Does any of Mileageplus explorer benefits apply to authorized user for this card? (I’m traveling alone). Thanks

  11. Hey Darius,

    I am having difficulty with household account with BA. I do not understand what does the household can only redeem for the other members. Do all members needs to register BA? I am very confuse! Please help!

  12. Did I miss read your comments about opening a business card that they do not check your personal credit only the business? I had applied for an Chase Ink Business card for one of our companies. My name and information was filled in as the card holder and I just got a check alert from LifeLock that they were requesting a credit check. With my high score it should not make much of a difference with the hit but I don’t understand why they did that.

  13. @Praveen – They don’t, unless the primary cardholder is traveling with you.

    @ Raymond – Each member has to sign-up and you then designate them as part of your household account.

    @ Doreen – They do inquire about your personal credit score, but the credit line doesn’t sit on your personal credit report.

  14. What travel card would you recommend for someone beginning on their first credit card coming out of college?

    I want to stay away from annual fee’s but would love a card that generates some sort of miles so I can travel :)

    Thankss

  15. I have Amex Business Sky Miles Gold and Amex Starwood Preferred Guest cards. I’m thinking of applying for another 1 or 2 Amex cards. What would you suggest?

  16. I am a frequent traveler and I get a lots of travel miles, rewards and earn points. With numbers of memberships and loyalty cards I have, some of these expires without me knowing it. Good thing I discover this website GIIFT that allows me to manage, share and monetize my miles, gift cards, points and membership – all in one place.

  17. Daraius,

    I currently have a US Air card through Barclay. It is my understanding they will eventually send me a new card that will be an AA card but still be issued through Barclay. I was thinking that I should go ahead and apply for the 50,000 mile bonus card with Citi now and eventually cancel the older Barclay card since both would be tied to the American Airlines program. Am I thinking right on this one?

  18. @Don – I’d consider the Starwood business card, the Simply Cash or perhaps the Platinum cards.

    @ Ashley – You can do that and even apply for the 100K mile Citi Executive card.

  19. Hello, I am a non frequent traveler (~2-3 times/yr). Just starting out this whole rewards credit card regime, I am very curious about it, which cards would you reccommend for a newbie like me? I am leaning towards the Chase Sapphire Preferred and…not sure which others. Any recommendations?

    Also wanted to point out I have a loan on a house that I started 2 years ago, not sure if that matters.

  20. IDaruis
    I’ ve had the united card for 3 years and the yearly fee is due. If i don’t renew it what is the waiting period for another one? Thanks

    Also I did sign up for both southwest personal cards, but the 2nd one was about 1 year later and received the 50,000 bonus points on each one.
    When I called chase to inquire if you could apply for the 2nd SW card and still get the bonus points, the rep said no. But I figured I would try anyway and I am glad I did.

  21. @JP – I’d consider the Chase Sapphire Preferred or the Barclays Arrival (or both!)

    @Bob nelson – It varies by bank, but you may be able to get the bonus on the business version.

  22. Darius,

    With you help I just got approved for 3 credit cards and will start my way to building miles for travel. Since my credit score is about 760, what’s your guess on how many points it’ll drop as a result of my 3 new inquiries.

    How many months down the road you recommend I wait before applying for additional cards.

    Lastly, since my wife is a homemaker, would it be possible to get her approved for any credit cards based on my income.

    Thanks for all you help.

  23. @Brian S – I can’t really say because credit scores vary by person. Your wife can get cards based on your income.

  24. Deborah Klipper

    Help! All I know is airfare is getting prohibitively expensive for my husband and myself on fixed pensions. A friend told me about this blog and how he gets all these cheap flights etc. All I really need is to know the best credit card, airline or plan to use for travel between Costa Rica and Montreal Canada. Can anyone address this for me please. BTW, I checked my credit score…not so stellar-668.

  25. @Deborah Klipper – Unfortunately, I don’t focus on the Canadian credit cards but only on the US market.

  26. Deborah klipper

    Thanks for,the prompt reply. I havea stateside bank and address, live in costa rica and visit family who live in montreal. I have a chase amazon credit card, a mastercard through my bank in texas, so i can get cards. I just wonder if there is any benefit for the aircanada and the aeroplan set up. If you are unfamiliar with this, not a problem. United is also affiliated partner with air canada so maybe something with united? I know you are busy, but thank you in advance. Deb

  27. I’ve hit the $10,000 spending on my AA card to qualify for the 100,000 bonus miles. I haven’t gotten my first statement yet. (moving really helps for meeting spend requirements). I’ve read that I can cancel the card within 30 days of getting the first statement and get the annual fee refunded. My Question: Will the miles post to my AA account now, or after I’ve actually paid off the $10k?

  28. Hey Darius,

    Can I still use AA miles to book partner’s such as Cathay? I noticed they have changed the rule and now I don’t know what’s the best way to use my 100k AA miles…

  29. @Deborah klipper – Nothing like getting cards in both Canada and the US. You can also collect United miles and use them for flights on Air Canada because they are part of the Star Alliance.

    @FR – They should post after the statement in which you complete the minimum spending closes.

    @Raymond – You sure can!

Leave a Reply

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>

Notify me of followup comments via e-mail. You can also subscribe without commenting.