Credit Card Points for Beginners: The Complete 2024 Guide

Welcome to Credit Card Points for Beginners: The Complete 2024 Guide. Imagine this: You’re stretching out in a lie-flat business class seat, sipping champagne at 35,000 feet, en route to your dream vacation in the Maldives. The ticket price? $6,000. What you actually paid? Just $95 and some credit card points.

This isn’t a fantasy – it’s exactly what I did last year, and it’s why I created this Credit Card Points for Beginners: The Complete 2024 Guide. Whether you’re planning your first rewards card application or looking to maximize your existing cards, this guide is for you.

In this guide, we’ll cover everything from choosing your first rewards card to advanced booking strategies. Unlike other complicated guides out there, this Credit Card Points for Beginners: The Complete 2024 Guide breaks down complex concepts into simple, actionable steps.

By the time you finish reading this Credit Card Points for Beginners: The Complete 2024 Guide, you’ll understand exactly how to turn everyday purchases into dream vacations. The strategies in this guide have helped thousands of beginners transform their travel dreams into reality.

What You’ll Learn in Credit Card Points for Beginners: The Complete 2024 Guide

In this comprehensive guide, you’ll discover:

• The basics of credit card points and how they work
• Which points are most valuable (and which to avoid)
• Step-by-step instructions for earning your first 100,000 points
• How to turn those points into nearly-free travel
• Common mistakes that beginners make (and how to avoid them)

Who Credit Card Points for Beginners: The Complete 2024 Guide Is For

This guide is perfect for you if:

• You’re new to credit card rewards and travel points
• You have a credit score of 670 or higher
• You pay your credit card bills in full each month
• You want to travel more but spend less
• You’re willing to invest a little time to learn the basics

If that sounds like you, you’re in the right place. Even if you’ve never earned a single point before, you’ll find everything you need to start your journey toward free travel.

Why Trust This Guide?

I’m not a credit card company representative or a paid spokesperson. I’m just someone who’s been using these strategies for the past five years to travel to 25 countries – mostly in business class – while spending less on travel than I used to spend on economy tickets.

Every strategy in this guide is something I’ve personally tested and verified. I’ll show you exactly what works, what doesn’t, and most importantly, how to get started the right way.

Before We Begin

This guide is substantial, but don’t feel overwhelmed. I’ve designed it to be easy to follow, with clear action steps at the end of each section. You can bookmark it and return as needed – many readers tell me they reference this guide multiple times as they progress in their points journey.

If you are looking for more ways to score free trips, check out our Travel Hacking Beginner’s Guide.

Continue reading to learn what credit card points are and how they work →

Introduction

Welcome to the world of credit card points for beginners! If you want to save money on travel, you’re in the right place. This guide will teach you the basics of travel rewards, helping you use credit card rewards programs to your advantage.

Credit card points are great for saving money on travel. They can help you get premium experiences without spending a lot. By learning how to earn and use these points, you can cut down on travel costs.

First, let’s cover some important basics. Credit card APRs can range from 18.74% to 27.74% variable APR³. To avoid debt, always pay your balance in full each month³.

When picking a credit card, look at sign-up bonuses, earning rates, and how you can use your points. Some cards have 0% APR for a while, which is good for big purchases or moving balances³. Always compare APR, fees, and benefits before choosing a card⁴.

As you start your journey with credit card rewards, remember to use credit wisely. Keep your credit utilization under 30% and ask for a credit limit increase after 9-12 months of on-time payments³. With these tips, you’re all set to dive into the world of credit card points and travel rewards!

What Are Credit Card Points?

Credit card points are rewards you get for buying things. They come in various forms and differ by card type and issuer⁶.

Types of Rewards

The main rewards are cash back, points, and miles. Cash back gives you a percentage of your money back. Points and miles are earned per dollar spent, with options like cashback, vouchers, products, and air miles⁷⁶.

You can earn rewards from daily purchases, travel, and fuel. Some cards give more points in certain categories, like hotels and car rentals⁷⁶.

Value Comparison

The worth of credit card points can change a lot:

• On average, points are worth about $0.01 each.
• Premium cards may offer values of $0.0125 to $0.015 per point.
• Strategic redemptions can reach up to $0.03 or $0.04 per point.
• Some redemptions, like statement credits, might yield only $0.005 to $0.008 per point.

It’s important to note that credit card points are typically valued differently from credit card miles⁷.

When picking a rewards card, think about your spending and what you like to redeem. Choose cards that fit your lifestyle to get the most from your points or cash back⁶.

Getting Started: The Basics

Starting your journey with credit card points has a few key steps. Let’s look at what you need to know as you begin to explore credit card rewards.

Prerequisites

To earn valuable credit card points, you need a good credit score. Aim for 720 or higher to get the best rewards cards. You’ll also need to spend a certain amount, usually $3,000 to $6,000, in the first few months to get big welcome bonuses⁸.

Common Terms

Get to know these important terms:

• Loyalty programs: Schemes by airlines, hotels, and credit card companies to reward customers.
• Welcome bonus: A big point offer for new cardholders, usually 40,000 to 60,000 points, sometimes up to 100,000 points⁸.
• Category bonuses: Extra points for spending in certain categories like dining or travel.
• Redemption: Using your points for travel or other rewards.

To earn points fast, pay your bills in full each month and use less cash. This way, you can build points quickly while staying financially responsible⁹. Knowing these basics and setting travel goals will help you enjoy the world of credit card rewards⁹⁸.

Types of Credit Card Points

Credit card points come in different forms, each with its own benefits. Knowing about these types helps you get the most out of your rewards. It also helps you choose the right cards for your needs.

Transferable Points Programs

Transferable rewards are the most flexible type of credit card points. These points can be transferred to many airline and hotel partners. This can often give you more value than just using them for fixed rewards¹⁰.

Some of the top transferable points programs include:

• Chase Ultimate Rewards – (BONUS: check out our Chase Ultimate Rewards Guide)
• American Express Membership Rewards
• Capital One Miles
• Citi ThankYou Points

These programs let you use your points for travel, cash back, or to transfer to partner loyalty programs. For example, the Chase Sapphire Preferred® Card gives you 5X points on travel booked through Chase Travel. You also get 3X points on dining and select streaming services¹⁰.

The value of your points can change. Some cards can increase your points’ value by 25% when used for travel through certain portals. Transferring points to airlines or hotels can sometimes give you even more value, often over 1 cent per point¹⁰.

Keep in mind, these flexible rewards often come with annual fees. These fees can be from $0 to over $550, depending on the card and its benefits¹¹. But for many, the benefits of these points make the annual fee worth it.

By understanding and using these transferable points programs, you can get the most out of your rewards. You’ll also have more freedom in how you use them.

How to Earn Points Fast

Getting credit card points quickly can change your travel plans. Let’s look at ways to increase your points fast.

Sign-up Bonuses

Credit card sign-up bonuses are the quickest way to get points. Many cards offer big bonuses for spending a certain amount in a short time. For example, the Chase Sapphire Reserve gives 60,000 bonus points if you spend $4,000 in the first 3 months¹².

Plan your big purchases to meet these spending requirements¹².

Category Bonuses

Use bonus categories to earn more points. Some cards give extra points for certain purchases. The Chase Sapphire Preferred, for instance, offers 5x points on travel booked through Chase Travel, 3x points on dining, and 2x points on other travel purchases¹³.

Choose your cards wisely for these categories to quickly increase your points.

Shopping Portals

Online shopping portals are great for extra points. Just click through these portals before buying to earn more rewards. Airlines, hotels, and credit card companies have their own portals with different bonus rates¹⁴.

The Ultimate Rewards shopping portal is a top choice for Chase cardholders to earn more points on online shopping¹³.

Stacking Rewards

Use different methods to earn more rewards. Buy through shopping portals and use dining programs like AAdvantage Dining or United MileagePlus Dining for more points¹³. You can also use apps like Dosh for up to 7% cash-back at certain merchants¹³.

By using these strategies, you’ll quickly build a big points balance for your next trip.

Best Cards for Beginners

Choosing your first rewards credit card can be exciting yet overwhelming. Let’s explore some top beginner credit cards that offer great value. They help you learn the ropes of earning points.

Entry-Level Cards

For newcomers to the world of credit card rewards, these options strike a balance. They offer earning potential and manageable fees:

The Chase Freedom Unlimited® stands out for its no annual fee and versatile cash back. It’s perfect for everyday spending. The Sapphire Preferred® offers valuable travel rewards. The Capital One Venture provides straightforward miles earning.

When selecting a card, consider your spending habits and travel goals. Start with a secured card if you’re unsure about your approval odds. After reviewing 200 credit cards and spending 50 hours on research, experts recommend this approach for beginners¹⁷.

Remember, responsible card use is key. Pay your balance in full each month and avoid overspending. This way, you can maximize the benefits of rewards credit cards for newcomers.

How to Redeem Points

Learning how to use your points wisely is crucial. We’ll look at the best ways to use your points and how to avoid common mistakes when booking travel rewards.

Best Value Redemptions

For the best value, aim for high-value redemptions. This means using your points for premium flights or luxury hotel stays. For example, a roundtrip from Dallas to Vancouver might cost 25,000 AAdvantage miles. But, you can get the same trip for just 20,000 British Airways Avios by transferring Chase Ultimate Rewards points¹⁸.

Worst Value Redemptions

Steer clear of using points for merchandise or gift cards. These usually offer low value. Instead, save your points for travel-related expenses where they can go further.

Step-by-Step Booking Guide

1. Compare cash prices to point costs to ensure good value.
2. Check transfer partners for better deals.
3. Use online booking tools or call customer service for assistance.
4. Don’t forget to factor in taxes and fees.

Being flexible is important. Transferable rewards like Chase Ultimate Rewards give you more options. You can book with multiple airlines and hotels¹⁸. With smart strategies, a few points can turn into a luxurious trip. Some have booked business class flights and luxury stays in Japan worth over $13,000 for just $388 using credit card rewards¹⁸.

Advanced Strategies

Exploring advanced strategies for credit card rewards can boost your points and miles. These techniques help you get more value from your cards. You’ll take your rewards game to the next level.

Card Combinations

Combining multiple cards is a powerful strategy. For example, use the Chase Sapphire Preferred® Card for 2x points on travel and dining. At the same time, use the American Express® Gold Card for 4x points on dining and groceries¹⁹. This way, you get the most points from different spending areas.

Timing Applications

Timing your credit card applications is key. Look for limited-time offers with big sign-up bonuses, worth hundreds of dollars in travel¹⁹. Apply for new cards every year or every six months to avoid hurting your credit score³.

Common Mistakes to Avoid

Avoid common mistakes that can hurt your rewards. Keep your credit card balances low to keep your credit score healthy³. Don’t let points expire or use them for low-value options. Instead, transfer points to airline and hotel loyalty programs for better value¹⁹.

Tools and Resources

Use tools and resources to improve your credit card strategies. Award search engines and point value calculators help you find the best ways to use your rewards. Credit card comparison sites are great for finding new cards and their benefits, like access to over 1,300 airport lounges worldwide through Priority Pass Select¹⁹. Stay organized and use these tools to maximize your rewards in 2024 and beyond.