by Brett Smiley
If free food tastes better, a cross-country flight that costs exactly zero tastes best. Of course you shouldn't eat an airplane, but you get the idea.
I'm always surprised when I hear that someone doesn't take advantage of credit card rewards programs, the kind that will get you hundreds of dollars worth of hotel rooms on your next vacation simply for spending money (with plastic) you would have spent anyway. Some people prefer to pay with cash or by debit (from a checking account). Many guys fear the credit card debt succubus - and rightfully so - while some guys just never learned how to game the system. There's also a segment of the population that lacks good credit and can't get approved for cards that offer solid rewards. (Acquiring a good credit score is an entirely different article.)
But if you have good or excellent credit and you're not in the rewards game - you're missing out. You can do a lot better than Starbucks gift certificates. Here's how it works:
THE BASICS
Numerous banks issue credit cards with attractive rewards programs. They'll offer a lot of points for signing up for free air travel or hotels, or cash back and merchandise, among other things. Put simply, they want you to use the card and eventually carry a balance, and pay the bank interest. Don't be that guy! The key to everything here is, you'll pay the balance in full every month. Otherwise, you'll eventually pay interest that exceeds what you'll have gained through rewards.
QUICK REWIND
As we alluded to earlier, you'll need good credit to acquire one of the best rewards cards. Props to the Free Credit Report.com band, but the company's service isn't free. You can get your actual free credit report at
annualcreditreport.com or find out more about your rating at
creditkarma.com. (
The Boston Globe explains
the difference between a credit report and score here.) Now, onto the fun part...
SHOP AROUND
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Put another way, what is it you want? There's solid cards for free travel, like the
Chase Sapphire Preferred card that begins with 40,000 bonus points and the
Delta Skymiles America Express card that jump starts with 30,000 points. As for hotels,
Marriott and
Hilton run similar programs that will toss you a lot of bonus points after signing up and spending a bit (more on this part below). Free flights and hotels will soften the blow of spending big bucks to attend a wedding where you'll give a gift, or to a bachelor party, where you likely to drop your card on a bar and pour beer into your head, i.e., more points.
THE POINT(S)
The point is - seek rewards programs that reward work for you. It's nice of banks to stuff your mailbox with offers for low APR credit cards or 0% balance transfer offers, but typically the offers that come in the mail don't offer great benefits. If you've got a Southwest or Delta hub near your home and find that you often use a particular airline, see if that airline offers a rewards card. There's various blogs that cover the latest rewards offerings, the best of which is thepointsguy.com.
APPLY YOURSELF
Oh yeah, you actually have to apply for the card. Do it online and often you'll receive an instant decision - an approval, rejection or a note that your application requires further review and you'll hear in about 30 days. But before you click submit, make sure you read the fine print and know what you're getting into. Some have annual fees (between about $49 and $99); often they'll waive it in the first year but not the second.
BEFORE YOU BATHE IN THE GLORY
In order to trigger the bonus points, the card issuer will usually require you to spend between $500 in the first three months on the low end and $5000 on the high end. Assuming you don't live at mom's house and have utility bills, car insurance payments, go out to eat and so on, it's fairly easy to meet the requirement if you pay with credit anywhere you can pay with credit. You're on your own at the nudie bar. Just make sure you keep track of what you're spending and have spent, which you can do online.
COLLECTING POINTS
This is part of knowing your program. Programs differ slightly in the way they dispatch points. Some offer triple points for expenditures on gas and groceries. The Capital One Venture card will give you two points for every dollar spent, regardless what you're buying. Others like Chase Sapphire have arrangements with merchants and offer up to 15 points per dollar spent at a store. It's a great deal when you already intend to buy something; for example I needed a pair of workout shoes last month and got 10 points per dollar for purchasing through Shoebuy.com.
SWEET REDEMPTION
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So you've triggered the bonus (which may take a few weeks) and accrued some additional points. Excellent. You can find your exact points balance online and browse through the rewards offerings. If you're confused and/or lazy, call the 800 number on the back of the card and have a representative guide you through the redemption process. Tell him or her how awesome you are. With some cards, your points correspond directly with the travel benefit. For example, each point may be worth one cent, so 10,000 points equals $100 worth of travel. In some cases, the points are kind of arbitrary. Thanks to the Sapphire card bonus (which also provides 20% discounts on airfares) and some additional spending, I just booked a round trip ticket from New York to Los Angeles plus a one-way flight worth a combined $600 ... for free.
KEEP AN EYE ON YOUR POT OF GOLD
Your bonus may come with an expiration date. Even if they don't, the points may lose value over time. According to a report on
CNN Money, Hilton, Marriott, and Starwood hotels have announced that they will raise the number of points needed for a stay at some of their properties. Stay ahead of the curve. Also note that you can't apply for numerous cards at once because that will adversely impact your credit. It's also difficult to trigger bonuses on various cards if you're all spread out.
CELEBRATE
The big day has arrived. It's time for your free flight. Sit down. Order a Bloody Mary or an
absinthe drink on Virgin America. The drink isn't free but the seat is. Loosen your belt. Feels good, bro.
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ld be that stupid. But it turns out, many people are that stupid, including a college professor who also happens to be a theoretical particle physicist. His story, however, is even worse.
Put another way, what is it you want? There's solid cards for free travel, like the 
So you've triggered the bonus (which may take a few weeks) and accrued some additional points. Excellent. You can find your exact points balance online and browse through the rewards offerings. If you're confused and/or lazy, call the 800 number on the back of the card and have a representative guide you through the redemption process. Tell him or her how awesome you are. With some cards, your points correspond directly with the travel benefit. For example, each point may be worth one cent, so 10,000 points equals $100 worth of travel. In some cases, the points are kind of arbitrary. Thanks to the Sapphire card bonus (which also provides 20% discounts on airfares) and some additional spending, I just booked a round trip ticket from New York to Los Angeles plus a one-way flight worth a combined $600 ... for free.
