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Today, we’re talking about travel goals and why they are essential to successful award travel. With so many options for rewards cards in the US, how do you choose which credit card to apply for?
Card providers release increased signup offers and new cards regularly, and it's tempting to apply for every 100K offer that gets released, work the minimum spend, then refresh your AwardWallet account and bask in all the zeros. But, the reality is, those points and miles may not get you any closer to your destination.
Why? Because you don’t have a plan. We field lots of reader questions asking “Which credit card should I get?” or “Which rewards program should I focus on?” And the best answers we can give are “Where do you want to go?” or “What are your goals?”
Without a goal in mind, you can’t create a plan to get there. Without a plan, you’re collecting an “asset” that could be devalued at any time, is restrictive in how and when it can be used and collects no interest.
This is why you hear the phrase ‘earn and burn’ bandied about with such gusto. If you hoard points and miles in any program, chances are those rewards will devalue over time. If you don’t have a plan to use them, you would be better off with a cash back card, placing the accrued funds in a savings account, and keeping your eye out for cut-price travel deals you can pay for with cash.
Planning a Successful Travel Rewards Strategy for Beginners
Before we go too deep, this post is aimed towards those at the start of their points and miles journey. If you’re an old hand, you've most likely built up a small arsenal of tips and tricks for using any points and miles on the market. But, if you are just starting out in rewards travel, a successful (and realistic) rewards strategy involves a few key factors.
- Learn how your credit score is calculated, how to monitor it, and how to protect it
- Place yourself in a financial position in which you won’t carry a monthly balance on any credit cards
- Pick a high traffic destination that offers a range of air carrier and chain hotel accommodation options; think big cities
- Analyze the different programs to decipher which combination of points and miles will work best for your goals and spending habits
- Put together a rewards card application and spending plan, work your minimum spends, and maximize points promos and category bonuses, and track everything
- Book your rewards travel and enjoy the sweet taste of travel rewards success!
If you don’t take these steps and simply apply for every card you can get, in any rewards program, you will most likely still string a trip together. But, it will take you longer, you’ll spend more, and you will end up with orphaned points and miles in programs that are of little use to you.
As you gain a better understanding of rewards travel, and the programs you enjoy using, you’ll dig deeper into how those programs work, and how to maximize the value you get from your rewards.
Putting Your Rewards Plan into Action
Drilling down on one particular travel goal and building out your rewards plan is a great first step, but it’s only part of the process. Next, is putting your plan into action. What might this look like? We've put together an example to show how planning an award vacation works, so will summarize the steps here.
- Picking your destination. For your first trip, look towards common and high-trafficked destinations. There are more options to get there, and you're following in the footsteps of those who have used miles to get there in the past. High trafficked destinations will have online guides, trip reports, and how-to posts from other travelers. It will save you time, and allow you to wrap your head around planning, collecting miles, and the booking process before tackling harder to reach destinations.
- Picking a program to get you there. Figuring out which points and miles to collect is one of the trickier aspects when you're new to points and miles. Most often overlooked are airline partnerships and alliances, something we delve into deeper in our example post.
- Learn what points transfer to your chosen rewards program. For example, if you decide to redeem an award with Korean Air SKYPASS, you can transfer Marriott Bonvoy points to Korean. If you redeem through Singapore Airlines KrisFlyer, you can transfer Ultimate Rewards, Marriott points, ThankYou Rewards, Capital One miles, and American Express Membership Rewards points.
- Plan a card application and spending plan. Once you know which points and miles to collect, you can plan how to accumulate the points and miles needed for an award. This can be a combination of signup bonuses on new cards, maximizing promos and category bonuses, and optimizing your everyday spending so that every dollar is accumulating points towards your goal. Our typical recommendation for a first travel rewards card is the Chase Sapphire Preferred® Card due to the flexibility it has with redeeming earned rewards.
- Booking your award. This is something you'll need to study in detail while you’re collecting the points needed. Searching award availability and booking an award can be a confusing experience the first few times and is different for most programs. It pays to try booking a few sample awards, so you are familiar with the award booking process in your chosen program.
Collecting points and miles without a plan how to use them is like buying a bunch of ingredients at the supermarket before you’ve decided what you want to cook. To make an amazing dish, you have a recipe, you buy ingredients, you follow a plan. For successful rewards travel, you choose a travel goal, plan what carrier/program will get you there, focus solely on the points and miles that will get you there, and follow your plan.
Your travel goal is the mark on the map you want to go to, and your points and miles plan is the directions to get you there.
Remember to check out the beginners' guide to award travel planning and if you have any questions, please hit us up in the comments and we’ll do our best to find you the answer.
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