4 Proven Steps to Maximize Credit Card Rewards for Travel Redemption

If you’re anything like me, the distant memories of Mexico’s sandy beaches are slowly fading away. Most of us have been staying put since the pandemic started – almost a year ago now and while vaccines have been widely developed, there’s still a long road ahead of us until we return to “some form of normality.”

Americans are becoming aware of travel reward programs that as per a recent 2019 NerdWallet travel credit card study about 1/3 or 35% of Americans say they have a travel rewards credit card. With that in mind, here are 4 proven steps to easily jump-start on your vacation fund and make the most of your credit card rewards for travel redemption. So when the time comes to book that much needed vacation, you’ll be sipping down fresh coconut water beachside without breaking the bank.

How to maximize credit card rewards in 4 proven steps

1. Have the right card
2. Earn the welcome bonus
3. Use it for everything else
4. Maximize limited-time offers and promotions

1. Have the right card

Like any other industry, financial institutions have flooded the credit card market with tons of options making it more difficult for consumers to choose the right product. What might seem like an ideal credit card for you will not necessarily be ideal for others.

Take a close look at your spending patters and choose the rewards program that most closely matches your spending behavior. Do you spend more on groceries than dinning out? Or do you most often spend on take out? Are you constantly on the road and spend a lot on gas and tolls?

These are just a few spending habits to consider when applying for the right credit card that best fits your needs.

2. Earn the welcome bonus

Credit card companies offer a welcome bonus after account opening as an incentive for applicants and as a way to stand out from competitors. These offers typically require you to spend a fixed amount of money within the first three months of account opening in order to earn the bonus.

It is one of the easiest and most effective ways to earn reward points quickly on expenses that you might already have or were planning on having.

A typical sign-up bonus can pay for 1.6 round trip flights. (NerdWallet, 2019)

Again, if you’re anything like me, a real life example would be great.

Lets say you finally decided to remodel your kitchen into the kitchen of your dreams. You looked at your finances, calculated your budget and decided that it was going to cost you X dollars. Instead of using your checking account or your debit card to fund your dream kitchen, you could apply for a credit card and max out the initial spending requirement to meet the welcome bonus.

3. Use it for everything else

Get the most for your money and charge everything on your card. Not just travel related expenses, but everything else as well. Rewards cards offer a set number of points or miles for every dollar you spend. So the more you spend, the more you earn.

This doesn’t mean spending more than you can afford; it just means using your card for expenses you already currently have.

Make sure to pay at least your statement balance in full every month, not doing so won’t hurt your credit score but it will definitely eat up any rewards you’ve earned by now having to pay usually high interest charges.

It’s important to note that unless your account is in good standing, you won’t be able to redeem any rewards you’ve accumulated.

4. Maximize limited-time offers and promotions

From time to time, credit card companies offer various ways in which consumers can take advantage and maximize their spending through the use of different bonus categories.

Most recent, travel rewards credit cards have realized that consumers’ spending habits have shifted away from travel categories to groceries stores, home improvement stores, and delivery services such as DoorDash, Uber Eats, or Instacart to name a few; that they have began offering new limited-time earning categories.

Check out The Points Guy for a close look at your card’s limited-time benefits during the pandemic and to evaluate whether if it’s worth keeping it or not.

Needless to say, it makes sense to be aware of these new limited-time categories to earn the most for your dollar.

And there you have it, now that you have signed-up for the right credit card that best fits your spending behavior and have maximized your purchases in all available categories, make sure to redeem for travel through your credit card’s rewards portal and happy holidays!