When I first started to collect credit card rewards it was cash back, not travel rewards that was king. I didn’t even want to think about getting on an airplane with a baby or a couple of toddlers. Travel rewards could wait.
But now that my kids are getting older, and we’re travelling more often as a family, I’ve shifted my credit card rewards preferences from cash back and free groceries to air travel and free hotel rooms.
I want to get the most out of my travel rewards and so I use these three tricks to help maximize earning potential on my credit cards and increase the chances of successfully redeeming points.
1. Funnel your spending
For a while I had one credit card that I used for groceries and gas, one card that I used for dining and entertainment, one card that I used for travel, and you get the idea…
Dividing up my purchases between multiple rewards cards worked great for redeeming cash back in smaller increments but I wasn’t able to build up a large bank of points that would be useful for booking a flight or hotel stay.
Now I funnel all of my spending onto one travel rewards credit card and use the points to pay for our summer vacation.
2. Take advantage of promotional offers
The rewards card landscape gets more competitive every year and with competition comes some incredible welcome bonuses and promotional offers.
What I look for in a new credit card offer is one that comes with a generous sign-up bonus ($250 or more worth of travel rewards), or an easily attainable early spend bonus (say, spend $500 in the first month and get 25,000 points).
Now most of the top travel rewards cards come with an annual fee between $99 and $150. So I also look for a credit card offer that will waive the annual fee in the first year. That way if I don’t like the card, or I don’t think it will replace my main credit card; I can cancel it before the annual fee comes due.
Watching for the right promotional offers throughout the year can easily add a few hundred dollars to your travel rewards earnings, not to mention other perks like free airport lounge passes, or cheap companion flights.
3. Look for a flexible program to redeem travel rewards
Earning all the points in the world won’t matter if you can’t redeem them how you want and when you want to. Rigid and inflexible travel rewards programs often mean having to deal with flight charts, blackout dates and seat restrictions, not to mention having to book your travel through one particular airline, hotel, or booking company.
Related: So you’re ready to dump Aeroplan. Now what?
A better way is to be able to book your travel anyway you want; whether it’s a room through Airbnb or VRBO, a flight from a discount airline, or a direct long-haul flight at a time that’s convenient.
The best travel rewards programs allows you book and pay for your travel on your own with your credit card and then lets you pay off those charges online with your points. No phone calls, no hassles, just pure flexibility that gives you the opportunity to squeeze every bit of value from your credit card travel rewards.
Final thoughts
While I enjoyed the simplicity of cash back credit rewards programs over the years, I’ve found that travel rewards can be much more lucrative if you know how to maximize your earnings and keep your redemption options as flexible as possible.
Perks like free companion flights, free airport lounge passes, free hotel rooms, and more are all within reach with the right travel rewards program.
Last year I cashed in on over $1,500 in credit card rewards by optimizing the two cards I use for everyday spending while also taking advantage of several promotional offers with juicy sign-up bonuses. I used the same approach this year to increase my rewards to over $2,000.
Here’s how I did it:
- Capital One Aspire Travel World Elite MasterCard – $1238
- Scotia Momentum Visa Infinite – $234
- American Express Air Miles Platinum – $230
- TD First Class Visa Infinite – $220
- Amazon.ca Rewards Visa – $72
- Scotiabank Gold American Express – $50
- Total rewards – $2,044
Now, both the Capital One and Scotia Momentum cards come with annual fees and so I subtract any annual fees paid to get my total net rewards for 2015.
- Total rewards earned – $2,044
- Annual fees paid – $219
- Net rewards – $1,825
My everyday rewards cards this year were the Scotia Momentum Visa Infinite and Capital One Aspire Travel World Elite MasterCard. I used the Momentum Visa for groceries, gas, and drug store spending as well as for recurring bill payments. I used the Capital One card for pretty much everything else, including travel.
With these two rewards cards alone I was able to net more than $1,250 on my everyday spending this year.
But I’ve found that our family has shifted more and more of our grocery spending to Costco, which doesn’t accept Visa cards. That’s why you see higher earnings from the Capital One card this year and why I’ve decided to cancel the Momentum Visa before the annual fee kicks-in next year.
A couple of credit card promotions caught my eye this spring, including one for the TD First Class Visa Infinite where I was able to earn 40,000 TD Rewards and pay no annual fee for the first year. I redeemed those points on two hotel rooms this summer and saved $220 cash.
Next I grabbed a great offer from American Express for its Air Miles Platinum card. This promotion pays 2,000 Air Miles, which I was able to turn into $230 worth of free groceries using the Air Miles Cash program. The annual fee was also waived in the first year.
Both cards came with attainable early spending bonuses, but I have not used the cards since unlocking those rewards. I plan on cancelling both of these cards in the New Year before the annual fees come due.
I used the Amazon.ca Rewards Visa a bit more than usual this year due to my Amazon Prime membership. This card is also a must-have anytime you travel to the U.S. or abroad, as it’s one of the only cards not to charge 2.5 percent for converting your foreign currency purchases back to Canadian dollars.
Finally, I was able to redeem $50 worth of Scotia Rewards from when I held the Scotia Gold American Express card last year.
Final thoughts
There has never been a better time to cash in on credit card rewards. The competitive landscape means that credit card issuers have stepped up their game when it comes to bonus offers and base earning rates.
Look no further then the newly revamped Capital One Aspire Travel World Elite MasterCard, which offers an incredible 40,000 point early spend bonus and gives cardholders the most flexible and fair redemption options of any other travel rewards card.
By making the most of the two cards I used for everyday spending and taking advantage of some timely credit card offers I was able to earn over $2,000 in credit card rewards and net over $1,800 in rewards this year after fees.