How To Get the Most Out of Credit Card Points

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If you’re using a credit card but not getting points, you’re missing out. 

For many years, I’ve gotten a good amount of cashback on my purchases, so I was shocked when I found out my dad had no idea credit card rewards even existed. Friends of his had earned a free trip to Europe through their credit card points and my dad couldn’t believe it was possible.

But to earn things like a free flight across the Atlantic, you need to do more than just spend on your card. Here are six specific tips and tricks for getting the most out of your credit card points.

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1. Select the Right Card for Your Lifestyle

It may seem obvious, but your credit card needs to match your lifestyle. 

If you’re big on travel, choose a travel credit card that rewards spending on flights and hotels, such as the Chase Sapphire Preferred® Card or the Capital One Venture Rewards Credit Card.

If you want to save on groceries or gas, find a rewards card dedicated to those spending categories, such as the Blue Cash Preferred® Card from American Express, which earns its highest rewards in those categories.

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Choosing a credit card based on your typical spending ensures you’ll get the most value. For example, if you regularly stay in Airbnbs, you might not benefit much from a branded hotel credit card. 

Whereas if you're a huge fan of chains like Hilton and Marriott, you might get great use out of the Hilton Honors American Express Card or the Marriott Bonvoy Boundless® Credit Card.

Don’t just pay attention to how you earn rewards — you also want to think about how you redeem them. You need both to fit the types of purchases you make. 

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Another consideration is how much effort you’re willing to put into the task. 

If you don’t mind monitoring rotating rewards categories or juggling multiple cards, that’s fine. But if you’d rather use a single card that offers cashback on everything, keep it simple and open a card that does just that. 

2. Pay Attention to Welcome Bonus Requirements

Many credit cards offer you tens of thousands of rewards points, worth hundreds of dollars, just for signing up. 

Find out your requirements to earn the sign-up bonus. It’s typically a minimum spend within a fixed period, such as spending $3,000 within the first three months after opening the account. 

The key to maximizing your points here is timing. Consider opening your new credit card when you expect to spend more, like during the holidays. 

Or, if you have other credit cards, temporarily divert all of your regular expenses to your new rewards card to earn the bonus. 

Some bonuses, like earning Southwest’s Companion Pass, require extra attention to timing because the pass is good for the remainder of the year you earn it, plus the following calendar year (so you want to hit your welcome bonus in January rather than August).

One thing to keep in mind is that cards with higher welcome offers often have higher annual fees — so be sure the rewards are worth the cost.

COMPARE: Best Credit Card Sign-up Bonuses

3. Know How to Earn Your Rewards

Every credit card has a different earning structure. 

Some cards offer a flat rewards rate like 2x points on all purchases, which is great for simplicity. 

For example, the Capital One Quicksilver Cash Rewards Credit Card offers flat-rate cashback on everything. The Chase Freedom Unlimited® is another card with a super simple cashback system.

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Other cards might automatically reward your highest spending category each month at a higher rate, or require you to select the category you want to be your biggest rewards earner. 

I have certain credit cards that rotate bonus-earning categories, so every three months, certain categories earn 5%. I pay attention to when those categories change so I can use that card when it’s most beneficial.

For example, the Chase Freedom Flex® has a rotating cashback system that, if you follow it, can earn you tons more points in different categories each quarter.

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4. Know How To Redeem Rewards

Some cards are very limited in redemptions, and you might only be able to get cash or gift cards. Others offer a ton of flexibility.

Find out if your card offers cashback or statement credits, discounts on certain purchases like travel or online retailers, or other big perks.

For example, I use the Chase Sapphire Preferred® Card, and I can squeeze the most value out of my rewards points by booking travel through Chase Travel^℠. My rewards are worth 25% more this way.

While it’s fine to redeem points for simple rewards like cashback, spending a little time to learn the tricks of redemptions can pay off even more.

If you have more than one card with the same issuer, you might be able to pool your points to maximize rewards. You can use different cards to earn efficiently, but then combine points for larger rewards. 

READ MORE: How To Maximize Your Chase Sapphire Preferred® Benefits

5. Activate Bonus Rewards Categories

For some credit cards, there’s an extra step to earn extra points or take advantage of deals. 

Read your card’s terms to see whether it mentions “enrollment” to receive certain benefits, like several free months of streaming or complimentary membership to grocery delivery. 

Perhaps your travel card gives you bonus points if you book two separate hotel nights by a deadline.

It’s usually pretty easy, but neglecting that extra one-click step could mean missing out on perks. I do this for “special offers” on one of my cards, where I sign up for things like 10% cashback at favorite restaurants and retailers.

6. Pay Your Card In Full

Earning rewards for spending is fantastic, but let’s be honest — if you end up paying interest charges or going into debt, rewards aren’t worth it. 

You can make the most of credit card points by paying off your entire balance on time each month. 

If you’re tempted to overspend in pursuit of rewards or benefits, think carefully. With the average credit card APR at over 21%, carrying any balance is a huge risk. 

Paying off your card is also best for your credit score and overall financial fitness. 

READ MORE: How To Pay Off Credit Card Debt

FAQs

Should you save your points or use them right away?

Many cards’ points never expire, but that’s not always the case. Check the rules in case your card does let points expire after a certain length of time. 

Saving them up until you have enough for a bigger purchase can be a great reward, but don’t let them languish in your account unused forever. 

How do you cash out credit card points?

Credit card reward programs vary by issuer and the type of card, so you need to understand how your card works. 

You may be able to use points at online retailers, use them to purchase flights, redeem them for statement credits, transfer them to retail partners, and many other options. 

The Bottom Line

The world of credit card rewards is vast, and you can earn significant perks. However, knowing how to earn and redeem credit card points is key to getting the most out of a card. 

Choose credit cards based on your lifestyle, so you can maximize rewards without changing your budget or spending habits.

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Disclosure: Opinions expressed here are the author's alone, not those of any bank, credit card issuer, hotel, airline, or other entity. This content has not been reviewed, approved or otherwise endorsed by any of the entities included within the post.