I keep hearing stories about how people use their rewards cards to travel to faraway places. I’m looking at various rewards credit cards because I want to make a big trip in the next five years (I’m thinking Japan or India). I make frequent short plane trips to visit family, and I’m good at paying off my credit card balances. So I want to get a rewards card that will give me airline miles and save them up till I have enough. But, if my trip doesn’t happen for another several years, won’t my miles expire? How can I prevent that? And do you have any tips for racking up a bunch of airline miles over the long term?
First, let’s get the easy stuff out of the way: No, your miles won’t expire, even if you wait several years before using them. As long as you keep your credit card account and/or frequent flier account active, those miles will be in the account when you need them.
To keep the account active, generally speaking, you just need to make one transaction within a two- or three-year period. Qualifying transactions include not just earning miles via travel or charges on the rewards credit card associated with the airline, but also buying miles or even redeeming miles. Terms vary, so be sure to read up on them once you open your credit card and frequent flier account.
Your main challenge is to
earn enough rewards miles to qualify for the trip. For this, there is good news and bad news:
The good news: It is possible to take the trip of a lifetime and foot the bill with rewards miles. It’s all about finding the best redemption value. On your chosen itineraries, for example, the awards requirements range from 70,000 miles to 180,000 miles for a trip to Delhi, depending on which airline you fly with, the time of year you travel and which U.S. city you depart from.
For a trip to Tokyo, reward trips range from 50,000 miles to 65,000 miles.
Just check to make sure the airline you go with offers reward flights to your chosen destination.
The bad news: To get the best value for you rewards miles, you will have to spend time researching and educating yourself about the many different factors that impact how many miles you’ll pay for that free trip. Here’s a step-by-step guide of some of the things to consider and how to proceed:
1. Decide on an airline. One of the most important choices you can make is which airline you accumulate miles with. If you are already using mainly one airline because it’s the most convenient from where you live, the choice is fairly easy. If not, narrow your choices to a couple of airlines.
2. Compare airlines credit cards and frequent flier programs. With airline rewards, what you see is not always what you get. Some airlines offer generous sign-up bonuses and rewards perks, but the redemption value of their miles is not that great — particularly on overseas trips.
Before deciding which airline to go with, go to each airline’s online reward booking service and check out the mileage requirements for your rewards ticket. Play with different scenarios, so you get a sense of which airline offers the best redemption value on your chosen routes.
For example, a ticket to New Delhi in the fall with American Airlines will cost you about 90,000 miles. If you try Delta in the fall, that ticket will cost you 100,000 miles if you fly from New York City, but more than 130,000 miles if you plan to fly from a small U.S. town.
If you book further out in advance, (say, six months), that ticket to New Delhi can be can booked for as little as 80,000 miles from NYC. But if you’re trying to book six months ahead to fly out of a small U.S. town, you’re out of luck — there are no tickets available, and you’d have to pay separately to get to NYC or another metropolitan area.
Consider the health of the airline as well. American Airlines overall offers one of the best redemption values on frequent flier miles. But American Airlines is in bankruptcy proceedings, and while that shouldn’t impact your ability to redeem rewards miles, you have to consider whether you’re comfortable with that added uncertainty.
3. Apply for an airline credit card. Once you’ve settled on the airline you want to accumulate miles on, get the airline credit card affiliated with that airline. Many airline credit cards come with a 30,000 to 40,000 mile sign-up bonus, a great jumpstart on rewards earnings.
4. Supersize rewards earnings. To maximize rewards mile earnings, charge all your expenses to the airline credit card if at all possible. If you’re married, get an additional card for your spouse, so that all his or her charges accumulate rewards miles as well.
If you’re planning a big purchase or doing a
home improvement project, save the money ahead of time, charge the purchases to your credit card, and use your savings to pay off the credit card balance in full. Just make sure you never charge so much that you can’t pay the bill at the end of the month — interest charges will quickly cancel out the free perks.
In addition, all airlines have agreements with program partners, which let you earn extra rewards if you stay at a hotel or rent a car with participating partners, for example. There are other opportunities to earn extra rewards by shopping with the airline’s partners as well. But beware: These are programs with plenty of incentives to spend more money, and you may not get the best price on the products offered.
A final note: Playing the rewards credit card game can be very profitable. But brace yourself — The more miles you want to earn, the more time and attention you will have to invest. There are people who fly around the world and stay at top hotels, courtesy of their rewards cards. But you can rest assured they spent a lot of time and energy getting to that level. As long as you’re comfortable putting in that kind of time, indeed, you can have your cake and eat it too.
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