By signing up for travel credit cards, earning travel points through bonus offers and regular spending, and using your points in the smartest way possible, you can travel to far-flung corners of the world while minimizing out-of-pocket expenses. (See also: 5 Steps to Getting a Free Vacation in 9 Months with Credit Cards)
While this probably sounds intriguing and fun, and it is, there are so many nuances to this strategy that it’s easy to get it all wrong. To be a pro, you need to know which types of travel currency to pursue, how to maximize your miles, and how to avoid the many pitfalls that come with using credit cards in general. (See also: How to Use Travel Rewards Cards to Get Free Trips)
1. Missing out on a sign-up bonus
Credit card sign-up bonuses offer one of the easiest ways to earn points or miles in a hurry. Often, you can earn up to 50,000 hotel points or airline miles after meeting a minimum spending requirement in the $1,000–$5,000 range within three months. Sounds easy, right?
Unfortunately, far too many people jumble the details along the way. Either they fail to meet the minimum spending requirement because they mix up the dates, or they misread the fine print and don’t spend enough.
Either way, you’ll want to avoid this mistake if you want to maximize the points and miles you earn. It helps to read the offer details and understand it inside and out before you take the plunge.
2. Failing to optimize
Failing to optimize is another common mistake many new travel hackers make. When you don’t understand the details of individual rewards programs, it’s easy to assume they’re all the same. The thing is, not all travel programs are created equal — not even close. (See also: How Travel Rewards Credit Cards Really Work)
Here’s a good example of failing to optimize: Let’s say someone has 50,000 Chase Ultimate Rewards points and needs to book a flight from Chicago to Los Angeles. Because they don’t know any better, they might go ahead and book their flight through the Chase Ultimate Rewards portal for the current price, which happens to be 32,000 Chase points on that specific day.
If they had dug a little deeper, however, they might find that you can often fly Southwest Airlines from Chicago Midway Airport into LAX for less than 13,000 points round trip. By transferring their points to Southwest instead of booking through the portal, they could have saved 19,000 points!
The bottom line: Make sure you consider all your options before you use your points for travel. With some creative thinking and planning, you could find a much better deal. (See also: 7 Frequent Flyer Rules to Go Farther on Fewer Miles)
3. Racking up credit card debt
Often, people who aren’t financially sophisticated dive into the credit card rewards hobby without setting limits or expectations. Unfortunately, not having a plan for credit or never tracking your spending can easily lead down the winding road of credit card debt.
To avoid debt and all the stress that comes with it, only use credit cards when you have a spending plan in place — and the discipline to pay your balance in full each month. If you wind up in debt, the rewards you earn will be wiped out by the credit card interest you’ll pay each month.
4. Letting your points expire
It’s crucial to make sure your hard-earned points don’t expire before you’ve had a chance to use them. While some programs like Delta SkyMiles and Chase Ultimate Rewards offer points that never expire, other travel currencies can expire if you don’t “earn or burn” any points for 12–24 months.
The best way to avoid expiring currencies is to know when your points will expire and enact a plan to “restart the clock.” Most of the time, it’s fairly easy to save points by shopping through a loyalty shopping portal or spending even a handful of points. (See also: How to Save Frequent Flyer Miles That Are About to Expire)
5. Earning points without a plan
I can’t tell you how many times I’ve seen people earn points and miles without any type of plan at all. Sometimes they are pursuing a currency that won’t even work with their travel plans. For example, I know one person who built up a giant stash of Southwest Rapid Rewards points for a trip to Europe, without ever realizing that Southwest doesn’t fly to Europe. (See also: Choose the Best Travel Rewards Credit Card with this Guide)
The best way to get ahead in the game is to get strategic about the points and miles you’re earning and why. Figure out where you want to go, then decide which travel currency will get you there. Better yet, pursue flexible travel currency like Chase Ultimate Rewards or American Express Membership Rewards. That way, you can earn all the points you want and decide how to use them later on. (See also: Tools for Tracking Your Rewards Points)
6. Waiting too long to book
While it’s possible to book award travel right up to the last minute, anyone who has been in this hobby for a while will tell you it’s better to book ahead.
If you can book a flight six to nine months in advance, for example, you’ll normally find more award availability than you will closer to departure. The same is true for hotels; since hotels have limited award availability, waiting too long to book can mean missing out. (See also: 12 Expert Tips for Redeeming Miles for Free Travel)