Points and Miles Mistakes

There are seven mistakes you could make with points and miles. 

I’ll walk you through each of them, so you don’t fall into any of these traps.

1. Missing a welcome offer

One of the best parts of a new credit card is its welcome offer: for example, if you spend $4,000 in three months after opening the card, you’ll earn 60K bonus points. If you don’t spend that much by the deadline, you’re leaving upwards of 60K bonus points on the table. This means missing out on the number of points it’d take to redeem for a roundtrip economy flight to Europe—or possibly a business class seat! 

This can be a lot to spend in a short amount of time, but if you use your new card for all of your regular monthly spending (like groceries, streaming subscriptions, gas, and transit), you’ll get there closer than you think. If you’re planning a big-ticket purchase like a computer, or have major home repairs to do, use your new card for that. 

The one thing you should never do while trying to earn a welcome offer is to spend beyond your limits. This leads me to our second points and miles mistake.  

2. Paying credit card interest and carrying a balance

Credit cards are only rewarding when you aren’t paying interest. According to the Federal Reserve, the average interest rate on credit cards was 21.47% at the end of 2023, so if you’re accruing interest on a travel credit card, you’re hustling backward. 

How do you avoid paying interest? By paying off the statement balance in full by the bill’s due date. If even this makes you anxious, you could treat your credit card almost like a debit card: Each time you make a purchase on the card, make a card payment, paying off that specific charge.

3. Not using your card’s perks

Here at Going, we’re all about cheap flights. We never want you to overpay for travel, and that also means not paying for credit card benefits you aren’t using.  

Many travel rewards credit cards charge annual fees, but the cards offer perks and statement credits as a counterweight. If you’re not using your card’s credits, you are leaving money on the table.

Let’s say your card, like the Capital One Venture Rewards Card includes a statement credit for an application fee to Global Entry or TSA PreCheck. If you haven’t used this credit, you’re paying for a benefit you’re not using. Not only that, you’re also wasting extra time in security lines or paying too much for travel. 

4. Not using the right card

Right up there with not earning a welcome offer and not redeeming your card perks, is not earning the maximum points you can per purchase. Let’s say you the American Express Gold Card, which earns 4X points at US supermarkets (up to up to $25,000 per year). If you use a card that earns only 1X points on your next grocery run, you are missing the opportunity to earn extra points. 

According to the Bureau of Labor Statistics, the average monthly grocery bill is a little under $500. That could translate to roughly 2,000 points, so paying with the wrong card could cost you 1,500 points a month!

5. Transferring points without a plan

Transferring your points to your card’s airline partners is the best way to maximize your points, but it’s important to remember that transfers are a one-way street. Once you transfer credit card points to airline miles, you cannot move them back to your credit card account. 

That’s why it’s risky to transfer without a plan. You should only transfer credit card points when you’re ready to book a flight and only transfer the amount of points you need. If you transfer more or transfer points speculatively, then your points-turned-airline-miles will very likely lose value as airline miles depreciate over time. (Just like your car.)   

The one exception to this rule is when you are canceling a card or downgrading to a card that doesn’t earn travel points. In that case, your points might expire upon account cancellation or downgrade. It’s best to transfer your points to the airline you most likely will use in the near future.

6. Redeeming points for gift cards

Friends don’t let friends redeem points for gift cards.

Although it may shock you, there are things worse than transferring points without a plan. Chief among them is using your points for low-value redemptions. Credit card companies often market the ability to redeem your points for gift cards or to buy merchandise through their portals, but redeeming your points this way will likely be worth less than 1 cent per point. 

Using your points for statement credit or to book through your bank’s travel portal—redemption methods that card companies also market loudly—only nets you about 1-1.5 cents per point and are also not great redemption options. 

7. Applying for too many cards

There is such a thing as being too eager. One bank will automatically reject your application if you’ve opened more than five cards in the past 24 months. Too many applications in a short period of time will lead to multiple hard inquiries on your credit report, and your credit score could take a hit.

If you can’t wait, or just want to take advantage of a limited-time card offer and find yourself coming up against a 5/24 limit, try a player-two strategy where you refer your partner or friend for the new card!