When it comes to redeeming the points you earn on your credit card, not all things are equal. Not only is every points program different, but what you're actually redeeming for – whether it be for travel, gift cards, or groceries – will have a different value. Not everyone has the time to figure out the ins and outs of every program, but it's easy to maximize the value of your points with little effort. Here are some tips on the best ways to use your credit card points. Understand what your redemptions are worth Most loyalty programs allow you to redeem your points for various things, but what you may not realize is that not everything has the same value. Let's take a look at the Scotia Rewards program as an example. Redeeming 10, 000 Scotia points will get you either: $100 in travel when booked through Scotia Rewards or on your own $74 for an Amazon gift card (it takes 13, 400 points to claim $100) $67 to $80 as a statement credit (since it'll cost you 3, 000 points to claim $20 or 37, 500 points for $300) Based on the above examples, it's clear that you get the most return for your Scotia Rewards points when redeeming for travel and less when redeeming for gift cards or statement credits.
This simply isn't the case, at least if you use them correctly and take a long term approach to credit cards. In the short term you will be dinged a couple of points if you apply for a credit card, though the long term benefits more than outweigh that, including your decreased credit utilization and positive payment history. To maintain a great credit score, I highly recommend: Keeping your oldest cards open, even if you don't use them much, and even if you downgrade them to a no annual fee product Always paying your credit card bill on-time (ideally early) Keeping your credit utilization low, and you can do this by paying off your bill before your credit card statement even closes, since the balance on the closing date is how utilization is calculated There's similar confusion about the impact that closing credit cards has on your credit score, so see this post for more details on how that works. Hopefully this inspires at least a few of you with debit cards or limited credit cards to start maximizing your points!
How do you earn credit card points? When it comes to earning credit card points, there are a few things you can do to expand your earning potential other than making day-to-day purchases. Here are some examples of what you can do to earn valuable points. Maximize specific spending In most cases, you earn credit card points by making specific purchases on your credit card. Many credit card issuers offer different point rates depending on the type of purchase. For example, if you're an avid traveler and spend a significant amount on tickets and hotel rooms, the Platinum Card® from American Express offers 5x Membership Rewards® points on flights booked directly with airlines, 5x points on flights and prepaid hotels booked on American Express Travel, compared with 1x points per dollar on all other purchases. Sign-up bonuses Many credit card issuers offer a sign-up bonus that allows you to earn a large number of points at once. Typically you'll have to meet a certain spending limit within the first few months of opening the card before you can claim on the bonus, so make sure it's a feasible amount for your budget.
How Long Does It Take To Earn An Award Ticket? Typically you need around 25k/45k/60k/70k miles for a free round trip ticket to most states in the US/Hawaii/Europe/Asia, respectively. This may take some time to earn through everyday purchases. However, many credit cards offer great sign-up bonuses! We list some related credit cards below. See Best Credit Card Sign-Up Bonus for more detailed and latest information. Chase Credit Cards: Chase Freedom 22. 5k UR + Chase Sapphire Preferred (CSP) 55k UR = 77. 5k UR, which can be transferred for 77. 5k UA Miles. Also, the Chase United MileagePlus Explorer Card sometimes offers 55k UA Miles, that's 132. 5k UA Miles in total! Citi Credit Cards: Citi Prestige Card 60k TYP + Citi ThankYou Premier 50k TYP + Citi ThankYou Preferred best offer 30k TYP = 140k TYP! That's enough to buy $2, 240 worth of AA tickets! AmEx Credit Cards: AmEx EveryDay Preferred (EDP) 15k MR + AmEx Premier Rewards Gold (PRG) 50k MR = 65k MR, which can be transferred to 65k BA/ANA/AC Miles.
You can use our Aeroplan rewards chart to identify which flight destinations offer the best and least value for your points. Aeroplan in particular can be a great program, but you'll really want to use one of the best Aeroplan credit cards such as the TD Aeroplan Visa Infinite Card to help you earn miles faster. TD Aeroplan Visa Infinite Annual fee: $120 (waived for first year) Earn 1. 5 miles per dollar spent on gas, groceries, pharmacies and Air Canada purchases Get 1 mile per dollar spent on all other purchases Welcome offer: Get 15, 000 Aeroplan Miles after you make your first purchase on the card Get a 5, 000 mile bonus each month (within your first three months) you spend at least $1, 000 – up to 15, 000 miles Take advantage of special promos On occasion, your loyalty program may have special promotions that can increase the value of your points. Just recently, RBC Rewards had an offer where you would could save 25% on points when purchasing gift cards. That means you only had to spend 7, 500 RBC points to get a $100 gift card instead of the usual 10, 000 points.