Why collect travel points?
Everywhere you look, there are bonus miles and points just waiting to be earned, whether it’s by going about your everyday shopping or simply reading an email. Once you start to take advantage of them, you’ll be earning the points you need to get where you want in no time.
How do you collect travel points?
Credit cards are the single most lucrative source of points and miles out there. Credit cards are offering huge signup bonuses of up to 100,000 points or miles. Many credit cards also offer great ways to rack up bonus points with your everyday spending by creating bonus spending categories where you can earn multiple points per dollar.
Should I do most of my spending on a credit card?
The way I see it, every time you pay for something in cash, you are throwing away points. If you are financially responsible, you should be charging every single dollar of your normal expenses possible on a points-earning credit card, and these days, you can put almost everything on a credit card, including your phone, utilities, gas, groceries, dining and sometimes even rent, though, in this last case, watch out for processing fees.
Do I need to have good credit to do this?
Yes, only those with really great credit can pull it off. The risks involved, means it’s an activity that is best suited to members of the credit elite and also those whom are VERY financially responsible.
Does this affect my credit score?
Every credit card application has the potential to lower your credit score by a few points. It’s a “hard inquiry.” Inquiries account for 10 percent of your credit score. Each inquiry remains on your credit report for two years, but only affects your score for the first year. The effect on your score diminishes over that time.
Opening a new card may cause your credit score to go up if you carry a balance on other cards and the new card helps you lower your utilization ratio. It can make your score go down by lowering the average age of all your credit accounts.
Closing a credit card can affect your score in different ways. If you carry a balance on other cards, the loss of the available credit could cause your utilization ratio to go up and your score to come down. If you have zero balances across the board, closing a card doesn’t affect your utilization ratio at all. Utilization accounts for 30 percent of your credit score.
If you close an older card, your average account age might come down, and your score could drop. If you close a newer card, your average account age might go up, and your score could rise. Account age makes up 15 percent of your credit score.
If you have great credit and a long credit history, opening and closing cards may not affect your score in a major way. On the other hand, if your credit score is average or weak, or falls near the cusp of two credit score categories, the changes could more significantly affect your score.
Why are companies willing to give so many bonus points?
They want your business. Simple as that. They will offer more rewards than the next company to do so. Companies hope to create loyal card members.
How do you avoid paying interest on the cards?
Pay your full statement amount every month. Do not carry over a balance on ANY cards. If you do, you risk negating the rewards you received by incurring interest.
Can anyone travel using points, perks, and deals?
Yes. Anyone with good/excellent credit and great financial understanding and spending habits.
Is traveling with rewards points easy?
YES. However, NO. Hardcore point travelers are known to spend upwards of an hour every day reading up on credit card offers and figuring out the best ways to earn and maximize their points. What you don’t pay for with money you pay for with your time. From bonus points offers to interest rates and fees, to knowing how to maximize redemptions and all the different ways to book a trip, there’s a lot to track. You need to be very detail-oriented.