Redeeming Bonus Reward Points: Maximizing Travel Benefits

Travel redemption of bonus reward points can be a great way to save money on future purchases. The best way to redeem your rewards will depend on the type of credit card travel point you’re redeeming — airline miles, hotel points or flexible travel points.

Airline miles can be redeemed for flights, cabin upgrades and experiences like concerts or sporting events. You’ll typically have to redeem your miles with that airline or one of the airline loyalty program’s partners.

Hotel points can be redeemed for free nights, room upgrades, food and drink, and spa services at specific hotels and resorts. Most hotel points can also be transferred to the hotel loyalty program’s partner airlines.

Flexible travel points offer the most redemption options. Programs with flexible travel points typically have a travel portal where you can use your points for things like car rentals, cruises, flights, hotel stays and vacation packages. Most of these credit cards also allow you to transfer your points to airline and hotel partners, which gives you even more choices.

Redemption options for airline miles

Airline miles can be redeemed in a variety of ways, depending on the airline and the user's preferences. Here are some of the most common redemption options for airline miles:

• Award Flights: One of the most popular ways to redeem airline miles is to book award flights or "award tickets". These are flights that can be purchased using your accumulated miles instead of money. The process for booking award flights varies depending on the airline but usually involves logging into your loyalty account on the airline's website and searching for award flights. Some airlines, like American Airlines, allow you to redeem miles for flights with partner airlines as well.
• Cabin Upgrades: If you have already booked a flight, you may be able to use your airline miles to upgrade your cabin class. For example, you could use your miles to upgrade from economy to business or first class, depending on availability.
• Seat Reservations: Some airlines allow you to redeem miles for seat reservations, giving you the option to select your preferred seat on a flight.
• Car Rentals: Many airlines have partnerships with car rental companies, allowing you to use your airline miles to rent a car at your destination.
• Hotel Stays: Similarly, some airlines have partnerships with hotels, giving you the option to redeem your miles for hotel stays.
• Vacation Packages: In addition to individual bookings, some airlines offer vacation packages that can be redeemed with miles. These packages may include flights, hotels, car rentals, and other travel amenities.
• Travel Experiences: Airline miles can also be used to enhance your travel experience beyond just transportation and accommodation. Some airlines offer unique travel experiences, tours, or activities that can be redeemed with miles.
• Admirals Club Memberships: For frequent travellers, using miles to obtain an Admirals Club membership can provide access to exclusive airport lounges and other benefits.
• Donating to Charity: If you're feeling generous, some airlines allow you to donate your miles to charity, helping to support various causes while also providing tax benefits.

It's important to note that the availability and value of these redemption options may vary depending on the airline, your membership status, and other factors. Additionally, some airlines may offer other unique redemption options beyond what is listed here. It's always a good idea to review the terms and conditions of your preferred airline's loyalty program to understand the specific redemption options available to you.

Redemption options for hotel points

There are several hotel loyalty programs that allow you to redeem points for hotel stays and more. Here are some of the most popular programs and their redemption options:

• Marriott Bonvoy: Marriott Bonvoy members can redeem points for free nights, upgrades, and other perks. They also offer a fifth-night-free benefit, where you receive the lowest-priced night for free when booking five consecutive reward nights. Marriott Bonvoy points can also be transferred to their 39 airline partners.
• Hilton Honors: Hilton Honors points are best redeemed for free nights, especially during peak seasons or events where cash rates are high. Hilton Honors also offers the fifth night free on award reservations, allowing you to get better value for your points.
• World of Hyatt: World of Hyatt is known for its relatively cheap award rates compared to other hotel brands. They also offer a fifth consecutive award night free for members with Silver elite status or higher.
• Wyndham Rewards: Wyndham Rewards points can be redeemed for hotel stays, as well as Vacasa vacation rentals starting at 15,000 points per bedroom, per night.
• IHG One Rewards: IHG One Rewards points are easy to use and can be redeemed for hotel stays, including some sought-after Six Senses resorts. They also offer a fourth consecutive award night free for members.
• Accor Live Limitless: Accor Live Limitless points are redeemed at a rate of 2,000 points for a 40 euro discount on your hotel bill. This program is best suited for travelers who frequently visit Europe and Asia, as most of their properties are located in these regions.
• Choice Privileges: Choice Privileges points can be redeemed for free nights at Choice Hotels properties, starting at just 8,000 points. They also offer exclusive cruise offers and the option to donate points to charitable organizations.
• Radisson Rewards: Radisson Rewards members can redeem points for hotel stays, donations to charitable organizations, and other benefits. They also offer the option to pay for stays using a combination of points and cash.

When choosing a hotel loyalty program, consider factors such as the location of the hotels, the ease of earning points, and the value of the redemption options offered. By maximizing your redemption options, you can make the most of your hotel points and enhance your travel experiences.

Redemption options for flexible travel points

Booking Travel

You can use your points to book travel through your credit card company's travel portal. The value you get per point depends on the card you have. For example, with Chase Ultimate Rewards, you can book travel through Chase and get a value of 1 cent per point with cash-back cards, 1.25 cents per point with the Chase Sapphire Preferred Card or Ink Business Preferred Credit Card, and 1.5 cents per point with the Chase Sapphire Reserve.

Transferring Points to Partners

You can transfer your points to partner airline and hotel loyalty programs. This option typically offers the highest redemption value. For example, with Chase Ultimate Rewards, you can transfer your points on a 1:1 basis to about a dozen airline and hotel loyalty programs, including Aer Lingus, Air Canada, British Airways, Emirates, and Marriott. The exact value you get per point depends on the partner program and how you redeem the points within that program, but transferring points to partners usually provides a higher value than booking travel directly through the credit card company's travel portal.

Cash Back

You can redeem your points for cash back, usually in the form of a statement credit or a direct deposit. This option typically offers a lower redemption value, with 1 cent per point being a common rate.

Gift Cards

You can use your points to purchase gift cards. This option may offer a higher or lower redemption value depending on the specific card and the gift card. For example, Chase Ultimate Rewards sometimes sells specific gift cards at a discount, so you can get a higher value per point.

Merchandise and Experiences

You can use your points to purchase merchandise or exclusive experiences. For example, Chase Ultimate Rewards allows you to redeem points for Apple merchandise through their portal at a rate of 1 cent per point. They also offer exclusive experiences, such as private dinners with celebrity chefs or VIP travel packages to big events, to cardholders of certain cards.

How to redeem points for good-enough value

When you start researching travel rewards redemptions online, you will likely come across an emphasis on "maximising" value. On the surface, this makes sense – after all, isn't that what we're trying to do with all currency, from dollars to miles?

Yet it's important to accept good-enough reward redemptions, especially when starting with this hobby. Your goal should be to offset or eliminate the cost of your travel goals, not to fly around the world in first class (unless that is your goal). In other words, the way to get the most objective value from your points might not align with your other priorities.

• Use the 80/20 rule to avoid perfectionism. Look for easy redemptions that check most of your boxes. Don't labour for four hours looking for the perfect redemption – it likely doesn't exist.
• Make sure you're getting the baseline value for a given travel currency. Use a calculator to ensure you're getting a good deal. If a given flight or hotel stay gives you above-average value, that's good enough.
• Have fun. If slogging through award calendars searching for availability is starting to feel like a chore, take a step back and find another, easier strategy.

Common pitfalls to avoid

• Don't try to learn everything. The travel rewards world is full of jargon, regulations and know-it-all experts. Don't try to learn it all before you start, or you'll never start. Stick to your goals and learn what you need to in order to achieve them. Your knowledge will naturally expand.
• Don't hoard your points. Saving money is generally a good thing, as its value can increase over time. Saving travel points, on the other hand, is generally a bad financial move, as they tend to devalue over time. Don't just earn points: spend them!
• Don't chase value. Booking a business-class flight to Norway in January might offer the best bang for your points, but do you really want to visit Norway in January?

How to maximise credit card travel points

Credit cards that offer travel points can be a great way to save money on future travel. Here are some tips on how to maximise the travel points you earn from your credit card.

Sign Up for a Credit Card with a Sign-Up Bonus

If you’re new to the rewards game, get a head start by taking advantage of sign-up bonuses. These bonuses typically offer new cardholders a large number of bonus points or miles for opening a card and spending a certain amount in a specific period.

Plan Your Redemption in Advance

Planning ahead is key to getting maximum value from your rewards. If you start by deciding on a goal, it’s much easier to choose a credit card that’ll allow you to reach that goal.

Learn the Ins and Outs of Your Rewards Program

If you ask any rewards expert how they travel free with credit card miles, they’ll tell you to learn the nuances of your rewards program. Here are some questions to keep in mind when you’re reading the terms and conditions:

• How do you redeem travel points with the program?
• Are there any blackout dates or other restrictions on when or how you can redeem rewards?
• How hard is it to find award seat availability?
• Who are the transfer partners, and what are the rules for transferring your points or miles?

Know the Average Value of Your Rewards Program’s Points/Miles

You should get familiar with the value of a rewards program’s points or miles. This’ll give you an idea of how far you can stretch a program’s points, and will also tell you if a particular redemption is above or below average in value.

Find the Sweet Spots in Your Rewards Program

Every rewards program has its “sweet spots” — redemption options that offer a particularly good value. Experts who frequently travel free with credit card miles always keep these deals in mind when planning award travel.

Do the Math Before You Redeem

Quickly calculate the value of a redemption to see if you’re getting a good deal. In general, you’ll want to aim for redemption values of at least 1 cent per mile.

Be as Flexible as Possible

When searching for flights online, have you noticed that when you check the “flexible dates” box, you can sometimes get a much better value just by leaving a day earlier or extending your stay by a day? The same principle applies with award travel. You can often make your points and miles go further simply by being flexible.

Frequently asked questions