As with learning all new things, we must start at the beginning. This post will serve as your how-to guide for all of the points and miles basics you need to know!

Before you start earning points and miles

First things first, using points and miles is only for people who have healthy credit and budgeting habits. You need to have an understanding of your credit score and credit history. Most credit cards require a good to excellent credit score, which is typically anything 660+. You can check your score for free through an app like Credit Karma. Many banks also offer free credit score checks and credit monitoring. If you have a low credit score or

You also need to be able to stick to a budget and not overspend. If you’re making late payments or consistently paying interest, then you can ruin your credit and the benefits of the points go away. It’s imperative that you pay your cards off on time and in full each month. If you’re unable to do this, then you should get your budget and spending under control first.

How to earn points and miles

First, the words points and miles can be used interchangeably. Generally, “points” is used for banks and hotels, and “miles” is used for airlines.

Here are the basics of how to consistently earn points that you can turn into travel.

1. Open a new card with a large sign-up bonus– this will be something like “earn 60,000 points when you spend $4,000 in the first three months of account opening.”
2. Put your regular, everyday spending on the new card. This includes things like groceries, gas, utilities, kids’ expenses, home goods, eating out, Netflix, etc. You DO NOT want to charge extra things just so that you can meet the spending requirements. Like I mentioned before, it’s important to pay your cards off on time and in full each month, so if you spend beyond that, then you’re in trouble.
3. Once you’ve spent the required amount in the required time frame- i.e. $4,000 in three months- you’ll earn the bonus points.
4. After you receive the points, you can turn around and use them to book travel!

Types of points

There are three main types of points- fixed value, co-branded, and transferrable/flexible.

• Fixed value points are earned through the bank, like American Express, Chase, or Capital One, and can only be used with the bank. These are generally earned from cash-back cards. These points have a fixed value of one cent per point, meaning every 10,000 points is worth $100.
• Co-branded points are points earned directly with a hotel or airline. These come from co-branded cards. For example, a Citi American Airlines AAdvantage card or a Chase Hyatt card. These bank cards earn points that can only be used with the program they’re for- like American Airlines or Hyatt.
• Flexible or transferrable points can be moved from the bank to an airline or hotel program. These are my favorite types of points because you can get outsized value from them. We often get much more than one cent per point value out of these points.

How to book travel

So now that you have the points, how do you actually use them to book trips? There are three main ways that points can be used.

Transfer to travel partners

The first (and most lucrative) way is to transfer your bank points to a travel partner. To do this, you must have a card with flexible points. These cards allow you to essentially turn your bank points into points with a specific airline or hotel. For example, I can transfer points from Chase to United. The points become United points and I can use them to book United flights.

I have two favorite beginner cards for this:

• Chase Sapphire Preferred– earn 60,000 points when you spend $4,000 in the first three months. Annual fee of $95. 14 transfer partners, including favorites like United, Southwest, Flying Blue, Hyatt, Marriott, and more.
• Capital One Venture– earn 75,000 miles when you spend $4,000 in the first three months. Annual fee of $95. 15 transfer partners including Air Canada, British Airways, Flying Blue, Turkish Airlines, Singapore Airlines, and more.

Both cards are excellent for beginners because the points are easy to earn and easy to use. I’d recommend starting with the Sapphire Preferred because it has more domestic U.S. partners whereas the Venture has international partners.

Use points in the bank travel portal

The second way to use points is in the bank’s travel portal. This works like Expedia or Travelocity, where you can enter search information and the bank will look at all the possible flights and/or hotel options, and then you choose which one you like best.

This is a common way to use points, but it’s not always the best way since you will typically just get one cent per point value. So if a flight costs $500, you will need 50,000.

However, some cards offer slightly higher value. The Chase Sapphire Preferred allows you to get 1.25 cents per point in the portal, so this means that you’d only need 40,000 points for that same $500 flight. 

Cash your points out

The final way to use points is to cash them out as a statement credit. In this case, they will be worth a basic one cent per point. This is my least favorite way to use points, however, it can be beneficial for things like theme park tickets, rental cars, and travel activities that are harder to cover with points otherwise.

Points and Miles FAQ

There are some common questions that come up over and over again when first learning about points and miles. Let’s answer them here:

1. Is it bad for my credit? This may be the most common question I get. The answer is no IF you are being responsible with your spending. Your credit score is determined by three main things: credit history, payment history, and credit usage. So as long as you do not overspend and you pay your cards off on time and in full each month, then your score will likely go up.
2. Can I apply even if I don’t have any income or am not the primary breadwinner (i.e. I’m a stay-at-home mom)? Yes! When you apply for a card you will put your entire household income on the application, including the income of a spouse/partner, or other family member you live with.
3. Do you keep all these cards open? No, we do not keep all of our cards open long-term. We always keep cards open for a full year, then after that, we keep them open if they have no annual fee or if there are benefits to make the fee worth it. Otherwise, we downgrade/product change to a version of the same card with no annual fee or we cancel the card. 
4. What about annual fees? Annual fees are always worth it for the first year because you earn a large welcome offer. After that, it’s important to take a look at the benefits to decide if they’re worth the fee. Often they are! We pay nearly $2,000 a year in fees, but we get multiple thousands of dollars worth of benefits from that. Free checked bags, lounge access, TSA PreCheck, travel credits, and more!

As you can see, there is a lot to learn when fully jumping into the points and miles world. But try not to feel overwhelmed. This article covers the basics to get you started and you can learn more as you go. I’m always here to help!