Don't Make These 5 Credit Card Points and Miles Mistakes

by Natasha Gabrielle | Updated July 21, 2021 - First published on March 9, 2021

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Earning points and miles can be rewarding, but you want to make sure you avoid making costly mistakes.

Many people choose to use credit cards strategically to earn points and miles from sign-up bonus offers and regular spending. It can be fun to work towards your goals, but there are some common mistakes that people make when using their credit cards. If you're one of those people, you may not be getting a good redemption value, or you may not earn the points or miles that you thought were coming your way.

If you want to make sure you're making the most of your rewards, don't make these five credit card points and miles mistakes.

1. Redeeming points or miles for cash

Unless you have a credit card that is strictly a cash back card, it likely doesn't make sense to redeem your points or miles for cash back or statement credit. That's because many top rewards credit cards offer more value for other redemption methods. This includes redeeming points for travel credit or transferring your points or miles to partners. Here's an example:

A popular rewards card has a 60,000 point welcome offer. Those points are worth $600 if you choose to redeem for cash back statement credit. If you redeem your points for travel in the issuer's travel portal, those points are worth $750. Another option is to transfer the points directly to an airline or hotel partner. You may get a lot more than $750 in value by doing that.

2. Not checking award availability before transferring points or miles

Transferring your points or miles to a partner airline or hotel can be a great opportunity. You can often get more value by doing this. But before transferring your points, you'll need to check award availability to see if your specific dates are available. If you move your points or miles over before doing this, you may be stuck with no availability.

3. Using the wrong card for the wrong purchases

Each credit card will have its own earning potential. You may need to spend in specific categories to earn more points. A common mistake that people make is not thinking about the credit card that they're using before they charge a purchase. They may be missing out on earning more points when using the wrong card. If you have a card that earns 5 points on restaurant and takeout purchases, make sure that you pull out that card when it comes time to pay the bill.

4. Not meeting a card's minimum spend and missing out on the welcome offer

You'll notice that a lot of credit cards have a welcome offer for new cardmembers. In most cases, these welcome offers require you to spend a minimum amount of money within a specific time frame -- usually three months. If you don't meet the minimum spend in that time frame, you won't earn the welcome bonus points or miles. Some people miss out because they don't track their spending. Ensure that you stay organized, understand how much you need to spend, and the timeline you have so that you earn your next welcome offer.

5. Using a debit card or cash instead of credit cards

It's important to be financially responsible when using credit cards. With that in mind, if your goal is to accumulate as many points and miles as you can, you'll want to make sure that you're using your credit cards regularly. Stop pulling out your debit card or cash, as you'll miss out on the ability to earn the points and miles you would have when you used your credit card. Once you get into the habit of using your credit card regularly, it'll get easier to remember.

When you know what mistakes to avoid, you can better plan your spending and earning goals. By avoiding these above mistakes, you can have a more positive experience on your credit card rewards journey.

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