What are points and miles?
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This post is the first in our new series that will make up the Million Mile Secrets Learning Center.
Oh, the places you’ll go…as soon as you understand the miles & points hobby! Earning and redeeming travel rewards can take you to places you’ve never dreamed possible, for just pennies on the dollar. But understanding the travel rewards system can seem complicated and overwhelming.
Luckily, it doesn’t have to be this way. Earning points and miles is not as hard as you think, and you can start doing it without changing anything in your day to day life.
What are points and miles?
Points and miles are a form of currency, the same as a dollar bill. Just like you can exchange a dollar for goods and services, points and miles work the same way. You can spend your travel rewards on things like flights, hotels and more. You pay in points or miles, instead of in cash.
Points and miles can be split into three general categories.
- Airline miles & points — these can be used for free flights and upgrades. Airline loyalty programs include American Airlines AAdvantage or Delta SkyMiles.
- Hotel points — these can get you free nights at hotels. Examples include Marriott Bonvoy and Hilton Honors.
- Bank points —these can be used for a multitude of redemptions, including cash back, booking travel through a bank portal or transferring points to airline and hotel partners. American Express Membership Rewards, Citi ThankYou, Capital One Miles and Chase Ultimate Rewards are popular bank point programs.
Most think that you earn airline miles from flying or hotel points from staying at a hotel, but there are a number of other easy ways to accumulate points.
For most, the easiest and quickest way you can earn rewards is through credit cards. This means you earn points and miles simply by making normal purchases on your credit card.
Pro Tip: A lot of travel rewards cards offer large welcome bonuses, which you get just for signing up and spending a certain amount on the card. Take advantage of those since they are usually the quickest way to rack up rewards!
Why should you care?
Here’s the thing, using cash or your debit card will get you what you want at the time of your purchase, but you won’t earn rewards to use in the future.
If you start making purchases using rewards credit cards, you’re going to start accumulating a lot of points you otherwise wouldn’t have had. Paying for a meal at a restaurant suddenly gets you miles you can put toward flying to your next vacation. And grabbing an Uber or Lyft can get you points toward a hotel for your next getaway. On top of what you get from your credit card, you can also earn bonus points by using a shopping portal when shopping online or linking your credit card to a dining rewards program
As long as you’re paying your credit card bill off in full and on-time and aren’t spending more than you normally would, you’re going to be much better off using a rewards-earning credit card over a debit card. Over the course of a year, you can effortlessly rack up tens of thousands of points that can be used towards a vacation or straight cash back.
Plus there are so many cards to choose from, which means you can find one that fits your budget and lifestyle. You don’t have to travel all the time or pay a big annual fee to get rewards. Instead, find a card that fits your goals and spending habits and start earning rewards.
We’ve listed the best types of cards for each category:
- Best travel credit cards
- Best rewards credit cards
- Best cash-back credit cards
- Best airline credit cards
- Best hotel credit cards
What can you do with your points and miles?
Now, you’re probably wondering what you can do with these points and miles. The answer depends on which points you have. Almost all major airlines and hotels have loyalty programs, so you can get free nights at amazing hotels or fly first class. Certain credit cards even allow you to “erase” travel purchases you’ve made. Here are some highlights of what you can do with your rewards:
Book a stay at a luxury hotel
Using hotel points to book your next vacation can score you an expensive hotel for a dirt-cheap (or free) price tag. Browse to find the best accommodations you can get for your hotel points, book and enjoy your stay in luxury! You may have to use more points for luxury hotels, but you can sometimes save $1,000+ a night when booking at top properties around the world.
Pro Tip: Here are some great Hilton hotels you can book with points.
Fly for free
There’s nothing worse than having to pay a high price for a last-minute short domestic flight. With airline miles, you can book flights around the U.S. on all of the major US carriers.
Travel rewards give you the ability to upgrade your trips in ways you never thought possible. Have you always dreamed of flying first class (and eating off real dishes on a flight)? Book your trips with miles and fly in style, comfort and in a seat that normally costs thousands of dollars. You’ll only ever have to pay the taxes and fees which are as little as $5.60!
Book an all-inclusive vacation
To make your points stretch really far, book a stay at an all-inclusive resort. One of Million Mile Secrets’ top picks is the Hyatt Zilara Cancun, but shop around to find your favorite. Stays at resorts like these cost more points, but you’ll be getting food, drink and (sometimes) entertainment all for free.
In general, you’re almost always going to be getting the most value out of points and miles when redeeming for travel. However, you can also redeem rewards from other companies the loyalty program partners with. Think gift cards to Amazon or Starbucks, experiences (like concerts) or cash back.
With select cards, you can even opt to use your points and miles to pay off your credit card bills with a statement credit. Cards with this option allow you to trade in your points and miles for cash. After you request the trade, you’ll receive the money through a check or a direct deposit, both of which you can use on your next credit card payment.
Pro Tip: If you’re more of a numbers person and want to know the actual dollar value of your points and miles, read our guide on what each currency is worth.
The idea that travel rewards are a complicated system made only for frequent travelers who can afford to pay big fees is a myth. In reality, anyone can use a rewards credit card and earn points and miles for making everyday purchases.
You can use miles for airfare, hotel points for free nights, and bank points for cash back, travel and experiences.
Take a look at our beginner’s guide for a more holistic intro to the miles & points hobby. Once you learn how to earn and burn travel rewards, you’ll be jet setting away on your dream vacation in no time.
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Earn 60,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. That’s $750 toward travel when you redeem through Chase Ultimate Rewards®
2X points on dining at restaurants including eligible delivery services, takeout and dining out and travel & 1 point per dollar spent on all other purchases.
Get 25% more value when you redeem for travel through Chase Ultimate Rewards®. For example, 60,000 points are worth $750 toward travel.
Either $5 or 5% of the amount of each transfer, whichever is greater.
Editorial Note: We're the Million Mile Secrets team. And we're proud of our content, opinions and analysis, and of our reader's comments. These haven’t been reviewed, approved or endorsed by any of the airlines, hotels, or credit card issuers which we often write about. And that’s just how we like it! :)