How to Book Award Travel: Maximizing Your Points and Miles
Our expert guide on booking award travel teaches tips and strategies to maximize your hard-earned points and miles for flights, hotels, and more.
The offers and details on this page may have updated or changed since the time of publication. See our article on Business Insider for current information.
Affiliate links for the products on this page are from partners that compensate us and terms apply to offers listed (see our advertiser disclosure with our list of partners for more details). However, our opinions are our own. See how we rate credit cards to write unbiased product reviews.
Introduction to booking award travel
Many people think credit card rewards are convoluted and hard to use.
That's not necessarily true. With minimal effort, you can redeem credit card rewards for nearly free hotel stays, rental cars, airfare and more. The convoluted part is learning to redeem rewards efficiently so you can squeeze every last drop of value from them.
This guide offers a crash course on quickly earning travel rewards from the best credit cards so you can book amazing travel deals for far less than cash value. We'll also share the knowledge you need to find these great rates on your own.
Nearly free travel is possible with credit card rewards
Before collecting credit card rewards, identify your travel goals. Not all credit card rewards accomplish the same outcome. For example:
- If you want free flights, you should collect airline miles
- If you want free hotel stays, you should collect hotel points
- If you want free food and other expenses, you should collect cash back
- And if you want some combination of all three benefits, you should collect flexible or transferable points, which we'll discuss below
How to earn credit card points
The fastest way to accumulate rewards is by earning credit card welcome bonuses. Most rewards credit cards come with a chunk of either points, miles, or cash that will deposit into your account after you meet minimum spending requirements.
There are dozens of credit card welcome offers available — quite literally millions of points and miles to be earned — if you're willing to open credit cards and earn their bonuses.
Many rewards credit cards also provide bonus points when you spend money in certain categories. You'll earn points for your everyday purchases far more quickly if you take the time to identify and acquire the right handful of credit cards for your personal spending habits.
Opening multiple credit cards
You've probably been conditioned to believe that opening multiple credit cards harms your financial health. It's not — at least, there's nothing intrinsically irresponsible about it. As long as you pay off your balance in full every month and don't spend beyond your means, credit cards can be valuable tools for your finances and travel habits.
If you use credit responsibly, your credit score may actually increase after opening more credit cards, which we explore in Business Insider's guide on how to get an excellent credit score. And with healthy usage, your cards can provide significantly more value than what you might pay in annual fees.
Don't overspend to earn rewards
If you don't have the best track record with credit, or if you simply don't think you're responsible enough to open lots of credit cards, don't do it. Rewards credit cards come with outlandish interest rates. In other words, unless you're able to pay your credit card in full each month, you'll pay out the nose in fees. And accruing debt on a rewards credit card isn't easy to overcome.
It's also a good rule of thumb to keep from jumping into credit card rewards until you have a credit score of at least 700. This will give you the best chance of being approved for pretty much any card you want.
Earning transferable points
Transferable points are the real powerhouse in the flexible rewards space. Transferable points are popular among travelers for two primary reasons:
- They're easy to earn. Each flexible points currency can be earned on multiple different credit cards within that issuer's ecosystem. Most of these cards also earn bonus points on specific categories of spend.
- Points transfer to multiple airline and hotel partners. This is helpful if you have various travel goals and don't want to limit yourself to a single airline or hotel currency. For example, if you want to stay at both Hilton and Marriott properties, you could collect Amex Membership Rewards points, which transfer to both hotel programs.
How to redeem travel rewards
So, you've earned a stash of points, miles, and/or cash back. Now, what are you going to do with them?
The world of miles and points can be a bit complex. Let's look at a quick explainer of how to use each type of reward. Once you understand how they work, you'll understand how to find good deals.
Airline miles
Let's get a misconception out of the way first: Each airline mile you collect does not give you the ability to travel on a plane for 5,280 feet. In other words, just because you've collected 24,901 miles doesn't mean you can circumnavigate the Earth. Perhaps it's less confusing to just think of them as airline rewards.
Airlines have different ways of pricing award flights:
- Some price award seats according to the distance you fly (British Airways does this)
- Some price them according to the country or regions you're flying between (Air Canada Aeroplan does this)
- Some price them according to the cash rate of the ticket you want to book (Southwest does this)
- Some price them according to a secret algorithm that makes seemingly no sense to the naked eye (American Airlines does this)
Once you learn these guidelines, you can plan ahead for the cost of travel on certain airlines.
Most airlines have a large network of airline partners. This is important because you can usually use your miles to book flights on partner airlines, as well. For example, if you collect American Airlines miles, you can use them to book award travel on American Airlines as well as the following partners:
- Air Tahiti Nui
- Alaska Airlines
- British Airways
- Cape Air
- Cathay Pacific
- Etihad Airways
- Fiji Airways
- Finnair
- GOL Airlines
- Hawaiian Airlines
- Iberia
- Japan Airlines
- JetBlue
- Malaysia Airlines
- Qantas Airways
- Qatar Airways
- Royal Air Maroc
- Royal Jordanian Airlines
- Silver Airways
- SriLankan Airlines
As you can see, American Airlines miles can get you pretty much anywhere in the world.
Hotel points
Hotel points work similarly to airline miles:
- Some hotels charge a points price that fluctuates according to the cash price of the room (Hilton does this)
- Some hotel programs place each property into a "category" with a somewhat fixed price, regardless of the cash price of the room (Hyatt does this)
For example, Hyatt charges between 17,000 and 23,000 points per night for a "Category 5" Hyatt hotel. The Hyatt Regency Waikiki Beach is a Category 5 hotel. That means even if the hotel costs $1,000 per night, you'll never pay more than 23,000 points for a standard room.
Flexible rewards
Flexible rewards, as the name implies, can be used in various ways. Let's examine the three most popular redemption options.
Redeem for cash
Depending on the type of points you have, you can redeem them for cash at varying rates:
- Amex Membership Rewards points — 0.6 cents per point on average, or up to 1.1 cents per point on select cards
- Bilt Rewards — 0.5 cents per point
- Capital One miles — 0.5 cents per point
- Chase Ultimate Rewards points — 1 cent per point
- Citi ThankYou points — 0.5 cents per point (1 cent if you've got select cards)
- Wells Fargo Rewards — 1 cent per point
In nearly every single scenario, cash back is not a good redemption option with these points. If you're interested in cash back, you should be using cash-back credit cards instead of travel credit cards.
"Buy" travel through a portal
All flexible rewards can be used to reserve things like airfare, hotel stays, rental cars, and more through a proprietary bank portal at a fixed rate, though the rate can depend on the credit card you have.
- Amex Membership Rewards points — 0.7 to 1 cent per point through the Amex Travel Portal
- Bilt Rewards — 1.25 cents each through the Bilt Travel Portal
- Capital One miles — 1 cent per point through Capital One Travel
- Chase Ultimate Rewards points — Between 1 cent and 1.5 cents per point (depending on which card you have) through the Chase Travel Portal
- Citi ThankYou points — 1 cent per point through the Citi Travel Portal
- Wells Fargo Rewards — 1 cent per point
Transfer to valuable travel partners
Converting your rewards into airline miles and hotel points gives them the most potential. Each flexible points currency offers its own unique transfer partners. Here's a quick rundown of each program with its transfer partners. All transfer ratios are 1:1 unless otherwise specified.
You can also redeem flexible rewards for purchases such as gift cards, merchandise, your Amazon cart, and even student loans, but you'll often find that the value per point is quite poor compared to the value you could get from redeeming for travel.
When to use rewards vs. cash
Just because you can book a free flight or hotel stay with credit card rewards doesn't mean you should. Believe it or not, "free" isn't always a good deal. Sometimes, it's wiser to pay with cash.
Most points and miles currencies don't have a firm value. Depending on the way you redeem them, you can get wildly different return rates for your rewards. Discerning when you should use rewards and when you should use cash boils down to low-level algebra.
The magic formula
Whenever you're looking to reserve free travel with credit card rewards, you should know exactly how much value you're getting for your points. There's an easy formula to keep in mind:
(cash price of travel - award taxes and fees) / award cost in points = value per point
For example, a round-trip coach flight between Chicago and Venice costs $958 in late October. The award price for this trip is 60,000 United Airlines miles and $65 in taxes and fees.
United Airlines
Using the above formula, we will:
- Subtract the $65 in taxes you'll pay with your award flight from the cash price of the ticket ($958 - $65 = $893).
- Divide this new figure by the number of miles you'll pay ($893 / 60,000 = $0.014).
As you can see, booking this award ticket will give you a value of 1.4 cents per United Airlines mile. Since Business Insider values United miles at 1.3 cents apiece on average, you'd be getting slightly above-average value per point spent on this flight.
How much are points and miles worth to you?
Because the value you can receive from credit card rewards can vary so much, you'll have to decide what constitutes "good" value for your points and miles. Business Insider has its own points and miles valuations guide, created by experts who use credit card rewards constantly.
What you should know about traveling with credit card rewards
If you dedicate some time to learning the ins and outs of traveling on points, there's practically nowhere in the world that you can't go for pennies on the dollar.
Award travel frequently asked questions
How can I find the best redemption options for my points and miles?
Utilize award search tools and airline websites to compare redemption options. Consider transferring points to airline or hotel partners for better value, and pay attention to award charts to understand how many points or miles you'll need for your desired travel.
What strategies can help me avoid high taxes and fees on award tickets?
Look for airlines with lower fuel surcharges on award tickets. Booking domestic flights or using airlines that charge minimal fees for international routes can also help reduce costs.
Can I book award travel for someone else using my points or miles?
Yes, most loyalty programs allow you to book travel for others using your points or miles. However, some programs may require the traveler to be a family member or designated nominee.
How much are travel rewards points worth?
Every points system has its own redemption rules, and different "currencies" offer varying value. For uniformity, use Business Insider's guide to points and miles valuations to reference how much value you're getting from a potential flight or hotel stay.
Can I combine points and cash for bookings?
In most cases, you'll have to book flights all in cash or all points. Some hotel chains allow you to combine points with cash for hotel stays, and credit card issuers often allow you to choose how many points you want to use to offset the cash price of a booking.
What to do if there's no award availability?
It isn't the end of the world if you can't find an award redemption. Consider booking an alternative route or destination, booking a cash backup but checking for award availability closer to your departure date, or plan far in advance and lock down reservations as soon as hotels or airlines open up award availability calendars.
How far in advance should I book award travel?
Most points and miles experts agree that you'll get the best deals and availabilities on award flights is right when the airline opens up availability — up to 330 days in advance for some companies — or within a week or two of your departure date. You can also use deal-tracking apps and award search websites to set up alerts when award travel availability opens up.