Points Basics: Everything You Need to Know About Accruing Hotel & Airline Points
Want to travel the world for pennies on the dollar? We'll lets do it! My goal is to break down the "points game" process and show you how to get them, what they are, and how to develop a points strategy.
How to get them?
Most typically points are awarded from the following:
1. Hotel Stays
3. Credit Card spend and sign-up offers
Unless you are already traveling a lot AND stick to one airline and or hotel then Credit Card spend and sign-up offers will be your best opportunity to earn lots of points quickly and start traveling! Always make sure to pay off your card in full each month. Credit Card companies offer lucrative sign up bonuses, because they make lots off of money from those that can't afford what they are buying!
What they are worth?
For the most part, points are not worth anything until you redeem them. They are similar to cash in that they are a devaluing asset. Point programs are constantly being devalued, so make sure to actually use them, rather than hang on to them forever. I'm not saying to blow them when it doesn't sense as there will be cases when it will make more sense to use cash rather than your points.
Here is how to determine point value:
Cost of flight/hotel in cash: $500
Number of points required for same flight/hotel: 50,000
The value of your points in this example is $0.01. Exactly 1 cent.
This same flight/hotel may cost $250 on another day, but the points will remain. In this case the point value is half a penny, making this an inferior redemption and maybe a better time to use cash.
There are many different types of points out there. Don't let that discourage you. You'll find that lots of these airlines and hotels partner making it a little easier to manage. Follow this simple plan to create your Point Strategy.
1. Know where you want to go. Whether it's a visit to see the family or an inspirational luxury vacation, it'll be much easier to get there by having a plan.
2. Research how many point's it'll take to get there and/or stay there. Site's like Award Ace and Hotel Hustle are great tools to use. For example: Los Angeles to London may cost you 60,000 United miles round trip or 60,000 Delta miles. Keep in mind both airlines may have additional charges on award tickets, so note those as well.
3. Earn points through stays/flights, credit card spend and/or credit card sign-up bonuses. Credit card sign-up bonuses are the quickest way earn points. Always make sure that you get the best sign-up bonus as many banks and bloggers may advertise inferior offers. It may take multiple sign-up bonuses to get you to where you want to go. Always make sure to understand the effects of signup for a new credit card and that you can both meet the minimum spend and pay off your card in full each month.
4. Time to go! Book your award ticket/hotel and enjoy doing something that you've only dreamed of!