Miles & Points 101: Nate's Points-Earning Philosophy

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Nate’s Points-Earning Philosophy

I believe that the cost of flights is the major expense that holds most people back from international travel. Cheap accommodations are much easier to find than cheap flights. Airbnbs, cheap guest houses, and hostels are all great places to stay if you’re on a budget. However, it’s not always easy to find an affordable flight if you want to travel to a different continent. This is why I focus on earning and maximizing frequent flyer miles over hotel points

If you’re like me, you’re a busy person which means that your time is very valuable. So, instead of getting caught up in all of the small ways I can earn points, I like to focus on the big wins!  

As great as it is that the shopping portals and dining programs let you earn a few extra points, I don’t worry about squeezing every point out of these programs. If I’m going to make a big purchase like a new computer, I’ll make sure to maximize that purchase through a shopping portal. But for the most part, I just buy everything on Amazon because I’m a devoted Prime user, and it’s the most convenient.  

I also never let dining programs dictate where I eat out. I’m signed up for the programs so if I happen to eat at one of the participating restaurants, I’ll earn the bonus points, but I’m not going to go out of my way to eat at a restaurant just because it’s on the list. 

I also don’t waste my time taking surveys and chasing promotions for a few hundred points here and there. 

Instead, I like to spend my time focused on big wins that will result in the maximum amount of value for the minimum amount of time required. As you may have already guessed, the biggest wins come through credit card sign-up offers and spending bonuses which is why the next section is going to be focused on maximizing credit card rewards.

Mike’s Points-Earning Philosophy

Unlike Nate, I think there’s just as much value, or more, in focusing on hotels in addition to flights.

In my mind, flights are an extremely fleeting experience. It’s great to fly in business class, but the fact is that it’s over in a matter of hours. Hotels, on the other hand, account for a much larger amount of your trip time. If I fly in business class for eight hours then stay in a luxury hotel for seven nights, the hotel stay is what I’m going to remember most about the trip (and I’m a huge aviation nerd - I go plane spotting for fun, so this is saying a lot). 

Additionally, hotel benefits go a lot further than airline benefits. Hotel benefits for elite status members or co-branded credit card holders can include spacious room upgrades, discounted rates, free breakfast, lounge access (yes, hotels have lounges too!), late checkout, early check-in and more. As we’ll cover in a later section, hotels offer huge opportunities to earn points when you’re staying on cash bookings as well, which earn you free nights very quickly.  

So yes, you could find a cheap hostel if you wanted to dedicate all of your points to airlines, but I’d much rather book a cheap economy flight, suffer for a few hours, and stay at the Ritz-Carlton in an Executive Suite with private butler service on the beach for seven nights (yes, I did this recently too!). 

Don’t get me wrong, I still stay in hostels and cheap hotels sometimes. I also fly in business class a lot of the time, too. My philosophy boils down to this: Make my points last as long as possible while still enjoying memorable and luxurious experiences in moderation.

If booking a 5-star resort will deplete my entire points balance, I’ll stay somewhere cheap. If booking a first-class flight halfway across the world will use points that took me a year to earn, I’ll book economy. It’s a balance that we all need to find!

Determine a Goal and Create a Plan

I hesitated to include the “goal setting” section below, and it’s because there are so many variables to take into consideration that it can get a bit confusing. I did my best to lay it out in a simple and concise way (with examples). So hopefully it will click with you, but if it doesn’t, don’t let it get you down. We are here for you!

If you’re still confused about which cards will help you accomplish your travel goal after reading the section below, we’re here for you. We publish daily content about points and miles, credit cards, and more in our Daily Drop newsletter (shameless plug, but trust me, it’s awesome). 

Before we dive into this section, I need to caution you. A lot of people mess up when applying for their first credit card. They just apply for the card with the highest sign-up offer, or they apply for several cards that they’ve heard are “the best.” However, it doesn’t matter how many points you earn if they can’t get you where you want to go. 

Before you start applying for credit cards, it’s important to have a goal. Where do you want your points to take you? 

Setting a goal will allow you to work backward to figure out which cards you can sign up for that will get you where you want to go. Let’s say you live in Chicago, and you want to fly to Italy next year. Now that you have a specific goal, you can come up with a plan to get there. Let me walk you through the process: 

Step 1: Figure out which airline will get you there. 

To do this, I recommend searching for award flights between your home airport and goal destination. You’ll conduct the searches on the airline’s website, just like I showed you in the section above.

You want to figure out which airline offers the best award availability to your destination during the time that you want to travel.  

For example, if you live in Chicago and want to fly to Rome, Italy next summer, you’ll search the Delta, American, and United websites to see which airline offers the best award availability. Don’t worry about specific dates. Instead, check the overall award availability for the entire month you’re planning to travel. 

Award availability is always changing, so if you find an award flight now, it doesn’t exactly mean it will be available once you have earned the points you need to book the flight. The point of this search is to determine which airline will hopefully have the best availability in the future after you have the points in your account. 

For this example, let’s say your search determines that United Airlines offers the best award availability.

[The solid blue lines show excellent award availability during the month of July]

Now that you know which airline offers the best availability, you need to determine how many points that airline charges for the trip, which takes us to the next step. 

Step 2: Determine how many miles you need for your trip. 

It should say how many miles the trip will cost when you search for award availability. So if you see this, be sure to make a note of it. 

[This award ticket between Chicago, USA and Rome, Italy costs 60,000 points and $115.93 in taxes and fees]

Step 3: Determine which credit cards you can sign up for to earn the points you need. 

Once you know how many points you need, you can now determine which cards you need to sign up for to earn the points. 

We’ll continue with our example of flying from Chicago to Italy with United Airlines. As you saw above, we’ll need 60,000 United miles to book this trip. 

At this point, we’ll want to search through the top travel credit cards to learn which ones we can sign up for that will help us earn at least 60,000 United miles. 

💡 Every month, the Daily Drop team updates our list of top credit cards which is a great place to start looking for your first (or second, or third) credit card.

A quick look at the cards on our site will show you that a very obvious option for earning United Miles is the UnitedSM Explorer Card.

At this point you have a couple of options:

Option #1: Use strategic spending to earn the 60,000 points if the welcome offer is below that.

If you don’t want to sign-up for any more credit cards, you can earn any remaining points through strategic spending, and by strategic spending I mean putting as much of your regular spending as possible on the card (not more than you would normally spend, just your regular spending)

Let’s say you’re able to spend $3,000 per month on your credit. At this rate, after signing up for the card, it would take you seven months of spending to earn an additional 20,000 points that maybe you need for your round-trip flight.

This definitely isn’t a bad option. Earn a free flight to Europe doing exactly what you normally do, just sign-up for the right credit card and move your spending to that card. Not bad, right?

Well if you’re impatient like me and want to speed up the process (assuming you’re comfortable signing up for a second card), you can move on to option #2. 

Option #2. Sign up for a second card to earn the points even faster!

This is where the path forward gets a little less obvious.

So, now we need to look at the credit cards that earn transferable points which can be transferred to United Airlines. In this case, a great card to earn more United miles would be the Chase Sapphire Preferred® Card. By signing up for this card you can earn a bunch of Ultimate Rewards points which can be transferred to United at a 1:1 ratio. So after you earn the sign-up offer, you will be able to transfer your Ultimate Rewards to United miles.

Just by signing up for both of these cards and earning the welcome bonuses, you could have well over 100,000 United miles (depending on current offers) which is more than enough to accomplish your goal of flying from Chicago to Rome.

Step 4: Apply for the cards and meet the minimum spending requirements 

Once you’ve determined the right credit cards to help you accomplish your goal, it’s a pretty straight forward process. You need to apply for the cards and meet the minimum spending requirements in order to earn the sign-up offers. 

Step 5: Redeem your points

Now it’s time for the fun part. Once the points are in your frequent flyer account, it’s time to head to the airline’s website to find and book your award flight!  

Step 6: Go travel! 

While you’re on the plane en route to your destination, be sure to take a moment and think about how awesome it is that everyone on your flight paid hundreds of dollars for their ticket, and yours was almost free. :) 

How to Choose the Best Credit Card(s) 

Now that you have a system for identifying which credit cards you should sign up for, let’s look at how you can evaluate each credit card offer individually. When you’re trying to determine which credit card will help you achieve your travel goals, you want to pay attention to several factors including the welcome offer, spending bonus, annual fee, minimum spending requirement, and additional benefits. Let’s look at each of these in more detail.

The sign-up offer (sometimes called a welcome offer)

 Unless you spend a lot of money on your credit cards (like $100,000+ per year), you’ll probably earn the majority of your frequent flyer miles through sign-up offer. Credit card welcome offers are a great way to earn a large chunk of points in a little amount of time.  

A signup offer is a bonus that banks offer to potential cardholders as a way to incentivize them to sign-up for a new credit card. We’ve already talked about how many billions of dollars banks make in fees from credit card users, so you should have a good understanding of why banks would offer these lucrative bonuses.  

Almost all welcome offers are structured the same way. They all require you to meet a minimum spending requirement (explained below) within a certain amount of time after signing up for the card. This is the bank's way of making sure you’re actually using the card instead of signing up for it just to get the points. 

Once you’ve met the minimum spending requirement and paid off your bill, the points usually post to your account within 30 days.  

I think you get the point. A welcome offer is a pretty simple concept, which is why I want to spend the rest of this section focused on how you can spot the best welcome bonuses. The card offering the most points may not actually be the best deal. In order to determine which card has the best sign-up offer, you’ll need to take into account the value of the points you’ll be earning. 

You learned in the redemption section above that, in most cases, airline miles are much more valuable than hotel points. And transferable points can be just as valuable as airline miles because you can actually transfer them to frequent flyer programs, and they become airline miles. 

So, if I were in your shoes and just getting started, I would look for the credit cards offering the welcome bonuses with the largest amount of airline miles or transferable points.  

This is where the “best” sign-up offer starts to get subjective. The type of airline miles/transferable points you want to earn is going to depend on which airline you prefer to fly. 

For example, if you live in Atlanta, GA (a major Delta hub), it’s probably going to make the most sense for you to focus on signing up for credit cards that will earn you Delta Skymiles. Whereas someone who lives in Dallas, TX (a major American Airlines hub), would probably want to focus on credit cards that earn American Airlines miles. 

With that said, if you’re in doubt of which airline you should focus on earning miles with, I would highly recommend starting with United miles (as long as you don’t live near a major Delta or American Airlines hub). 

United miles are easy to earn, you’ll get more value out of them than you would Delta Skymiles, and in my experience, they offer much better award availability than American Airlines.  

The spending bonuses

Another important benefit to take into consideration when signing up for a travel credit card is the ongoing spending bonuses that you’ll receive when you make purchases with your card.

Before we go any further, I have a favor to ask you… Please stop paying for stuff using cash or your debit card! Almost any credit card you sign up for will reward you with some type of point for every dollar you spend on the card. 

When you use cash or a debit card to pay for things, you don’t earn any points. So you are literally throwing away points any time you don’t use a credit card. I understand that you can’t pay for everything with a credit card, but anywhere a credit card is accepted (and they don’t charge an additional fee) please use your credit card so you're not throwing away free points. It pains me when I see people doing this! Okay, I digress.  

Let me illustrate why spending bonuses are so valuable. Based on my internet research, the average American family will spend ~$60,000 each year. Let’s assume you can’t pay for everything using credit so, let’s subtract $10,000, and we’ll say that the average American has the opportunity to put $50,000 worth of spending on credit cards each year. 

First let’s look at the difference between using a debit card (that doesn’t earn points) and using an airline credit card that earns 1 point per $1 spent.  

Debit Card - $50,000 x 0 = 0

Airline Credit Card - $50,000 x 1 = 50,000

Just by switching to a credit card that earns 1 point for every dollar spent, you’d earn an extra 50,000 points per year. With most airlines, 50,000 points is enough for two round-trip tickets inside the U.S.! Please don’t throw away two free flights. 🙂

The good news is credit card spending bonuses give you the opportunity to earn even more than one point for every dollar you spend. Depending on the card and what you’re buying, you could earn up to 10 points per $1 spent. By spending strategically on your cards, you have the opportunity to earn a lot of miles and points every year.

The way most spending bonuses work is you earn extra points when you use your card to make a purchase in certain spending categories. 

For example: 

You earn 2x points every time you use your Chase Sapphire Preferred card to pay for travel expenses.  

You earn 4x points when you use your American Express® Gold Card at U.S. supermarkets. 

You earn 5x points when you use your Hilton Honors American Express Card at gas stations.  

There are also cards that choose to keep things simple and just offer extra points for every dollar you spend, and the category doesn’t matter. 

For example, the Capital One Venture Rewards Credit Card earn you 2 miles for every dollar you spend, and the Chase Freedom Unlimited® earns 1.5 points for every dollar spent on purchases that don’t fit into another spending category.  

Make sure you crunch the numbers 

Let’s say the points that matter to you most are Marriott Bonvoy points. Your instincts might tell you that the best way to do this is to use the Marriott Bonvoy Brillitant® American Express® Card for all of your purchases, right?

Nope. This is a great option for the elite benefits, free night award, and points for Marriott-specific purchases, but is otherwise not your best option. Since you can transfer American Express Membership Rewards points to Marriott, you can actually earn far more points using something like the Amex Gold card or Platinum Card® from American Express when spending in different categories. Here is my strategy for earning Marriott Bonvoy points: 

Marriott Hotels: Marriott Bonvoy Brilliant Card (18.5x)

Dining: Amex Gold Card (4x)

Flights: Amex Platinum Card (5x)

General Purchases: Marriott Bonvoy Brilliant Card (2x)

This is why having a multi-card strategy for earning points can be extremely effective, especially if you use our tips from earlier about justifying annual fees. 

So, what’s the strategy?  

With so many cards offering bonuses in different categories, it’s important to have multiple credit cards in order to maximize the bonus points you earn on purchases. 

To decide which welcome offers are most valuable for you, take a minute to think about where you spend money. If you spend a lot of money on groceries, make sure to sign up for a card that earns bonus points at grocery stores. If you spend a lot of money eating out, make sure to sign-up for a card that earns bonus points at restaurants. Better yet, sign up for multiple cards so that no matter where you are, you’ll have a card that earns the maximum amount of bonus points.  

Then sign up for a card like the Capital One Venture or the Chase Freedom Unlimited that earns bonus miles on every purchase, and this will be your go-to card when you’re buying something that doesn’t fit into any bonus category on your other credit cards. 

Additional Benefits

Most credit cards advertise a host of benefits that you’ll receive when signing  up for the card, but in a lot of cases, these benefits aren’t very valuable. They’re just there to make the card sound better. This is why I normally focus my attention on the welcome offer and the spending bonuses offered by a card.

However, some travel credit cards offer additional benefits that can be extremely valuable. This is especially the case with credit cards that charge you a high annual fee. For example, some premium credit cards offer a free Priority Pass Membership that allows you to get into over 1,500 airport lounges around the world for free. This membership is worth $200+, and it’s included free with some credit cards. 

Another big benefit offered by some of the most popular travel credit cards are travel credits. With this benefit, the bank will reimburse a certain amount of money you spend on travel every year. For example, the Chase Sapphire Reserve® offers a $300 travel credit every year which is essentially $300 in free travel that you can spend however you want. 

You may also see credit card companies offering: 

  • Free Airport Lounge Access

  • No Foreign Transaction Fees

  • Car Rental Insurance

  • Lost Luggage Reimbursement

  • Free Checked Luggage

  • Free Hotel Award Nights

  • Priority Boarding

I won’t go into the details of each credit card and each benefit because it would add an extra ten pages to this guide. Plus, they are constantly changing. But don’t worry, I’m not leaving you hanging. Every credit card page we have on our Daily Drop site lists out those details.

At this point, we’ve covered the benefits you want to look for when signing up for a card. Now we need to look at the less fun stuff. The stuff you want to watch out for when signing up for your next credit card.

The Annual Fee

An annual fee is what you have to pay every year for the privilege of keeping the card. The day you sign-up for a new credit card is called your “membership anniversary.” Every year you keep the card, you’ll be charged the annual fee on your membership anniversary (if it has one). It’s not a very nice anniversary present, is it?  

Annual fees can range anywhere from $0 to $700, and several travel credit cards even waive it for the first year to entice you to sign-up for the card. This means you won’t have to pay the annual fee unless you decide to keep the card for a second year. 

You shouldn’t let these annual fees scare you away from maximizing your miles and points with travel credit cards because, in almost every case, the benefits that you receive from the card will drastically outweigh the cost of the annual fee. 

Even the cards that charge an annual fee of $450+ can offer value way beyond that amount. In fact, these premium credit cards are some of my favorites because of the huge value they offer.

For example, the Amex Platinum card has an annual fee of $695. Now let’s look at the value of this card’s benefits.

The welcome offer on this card usually ranges between 75,000 to 100,000 points, but has soared as high as 150,000 points. The minimum value you’ll receive from a Membership Reward point is $.01. Therefore, at a minimum, the welcome offer alone is worth a minimum of $750, but is almost always higher. 

[75,000 x $.01 = $750]

This card also offers a $200 airline fee reimbursement. Plus, you’ll get $200 worth of uber credits ($15 per month Jan. - Nov. and $35 in Dec.), a Priority Pass membership that I would value at least $300 (depending on how often you use it), and finally, a number of other credits such as the $240 digital entertainment credit (for things like Hulu, Disney+ and more).

The card offers a host of other benefits, but those are the big ones. Now, let's do the math:

[$750 + $200 + $200 + $300 + $240 = $1,690 Worth of Benefits]

$1,690 (benefits) - $695 (annual fee) = $995  

This is a pretty easy concept to grasp once you sit down and do the math. However, most people just see the high annual fee and never consider signing up for a premium credit card. 

The lesson here is to take the annual fee into consideration when you’re signing up for a credit card, but don't let it be the deciding factor. You need to determine the overall value you’ll receive from a card before writing off credit cards with high annual fees.

The Minimum Spending Requirement 

*Accurate at time of writing

I’ve referenced minimum spending requirements several times throughout this guide, so you probably already have an idea of how they work. I’ll start by making sure we’re on the same page, though I want to spend the bulk of this section talking about how you can meet minimum spending requirements and why you shouldn’t let them hold you back from signing up for new credit cards. 

A minimum spending requirement is an amount of money you have to spend on your credit card in order to receive the welcome offer. Credit card companies use minimum spending requirements to make sure you’re actually using a credit card and not just signing up for the card to receive the bonus points with no intentions of ever using it. 

Almost all credit cards give you 90 days to meet the minimum spending requirement (but this can vary). This means that you have 90 days from the day you signed up for the card (not the day you received it in the mail) to meet the spending requirement.  

The amount of money you have to spend in the first 90 days varies by card, but a very common minimum spend requirement is $3,000. Using these numbers as an example, in order to receive the welcome offer on this fictional credit card, you would need to spend $3,000 in the first 90 days after signing up for the card. You’ll sometimes hear this referred to as “$3,000 in the first 90 days of card membership.”  

Once you’ve met the minimum spending requirement and paid off your bill, the sign-up will be deposited in your account. Unfortunately, this doesn’t happen instantly. It’s common to have to wait 30+ days to receive your sign-up bonus. 

For a lot of people who are just getting into the miles and points world, the minimum spending requirement can be a roadblock that hinders them from signing up for new credit cards. They are scared they won’t be able to meet the requirement and receive the sign-up offer. 

If we take into consideration that the average American family spends $60,000 per year, that’s $5,000 per month. The average person should have no trouble spending $3,000 on a credit card in 90 days. 

However, I realize that everyone’s situation is different. It might not be easy for you to know whether or not you can spend $3,000 on a new credit card in 90 days. That’s why I want to give you some tips for meeting minimum spending requirements. You should never increase your spending on things you don’t need just to meet a minimum spending requirement, which is why I want to focus on several ways you can “spend money” without actually “spending money”... stick with me. 

8 Ways to Meet Your Next Minimum Spending Requirement

1. Add an Authorized User

Most credit card companies will let you add an authorized user for no extra fee. As an authorized user on your account, anything they spend will go toward your minimum spending requirement. So, if you have a spouse, you could add them as an authorized user. With both of you using the credit card, you’ll meet the minimum spend quicker than you would with a single person’s spending.

2. Buy Gift Cards to Use in the Future 

You could buy gift cards for your local grocery store, or you could buy gift cards for the gas station near your house. Try to focus on places you consistently spend money, so you don’t end up with gift cards that never get used. Gift cards to a specific store work best because there is no fee for the gift card purchase.

3. Buy Visa/Mastercard Gift Cards 

If you want to ensure flexibility in your spending, you can purchase Visa/Mastercard gift cards for a fee. You’ll want to buy the highest denomination gift card possible because the fee will be the same no matter how much the gift card is worth.

For example, our neighborhood grocery store (Kroger) sells $500 Visa gift cards that can be purchased for a fee of $5.95 each. Paying a 1% fee on your money isn’t a great deal, but if it helps you meet a minimum spending requirement that will get you hundreds of dollars worth of free travel, it is probably worth it. 

4. Pay Your Bills in Bulk

Many companies that you pay monthly will let you pay for multiple months in bulk if you just call. Some monthly bills you may be able to pay in bulk include: cable, car insurance, health insurance, cell phone, utilities, and more. Not every company will let you pay for future months in bulk, but it doesn’t hurt to call and try if you’re desperate to meet a minimum spending requirement.

5. Donate to Charity  

Most large charities will accept credit card. If you plan to donate a large chunk of money to a charity, time your donation with a new credit card application. It’s a really easy way to meet your minimum spend.

6. Pay Your Mortgage and/or Car Payment with Your Credit Card

In most cases, you won’t be able to pay your mortgage directly with a credit card. If you could, that would be awesome! You’ll most likely have to use a third party service (such as Plastiq) that charges around a 2% fee. Paying a 2% fee on a large expense like your mortgage doesn’t make sense if you’re just doing it to earn points from your credit card spending, but if it helps you meet your minimum spending requirement which nets you hundreds of dollars in free travel, it could be totally worth it!

7. Pay Your Taxes with Your Credit Card 

Signing up for a new credit card (or two) before tax season could be a good idea because it makes it super easy to meet your minimum spending requirements on those new cards. Again, you won’t be able to pay your taxes without going through a third-party service and paying a fee, but the fee is worth it if you need the extra spending to meet your minimum spending requirement. The IRS has a list of approved third party companies you can use to pay your taxes using a credit card.

8. Send Money to Someone through PayPal

PayPal allows you to send money to people using a credit card if you’re willing to pay an additional fee. Again, it usually doesn’t make sense to pay the fee just to earn points for spending with your credit card, but if you need to meet a minimum spending requirement, it might be a good idea. 

9. Pay Your Rent with a Credit Card 

Just like with number 7, you can pay your rent with a credit card using 3rd party services (or more recently, with the Bilt Mastercard®!). Many rental companies also have tenant portals that allow you to pay with a credit card for a pretty small fee of around 1.5-1.75%. If you need to pay an extra $20 per month on rent to unlock hundreds (or thousands) of dollars worth of free travel, I consider this a worthwhile move. Personally, I use this method when I have a high minimum spend requirement and want to take a big chunk off of it right away. If I pay my rent for two months with a credit card, I know my normal day-to-day spending will take care of the rest without even needing to think about it.

Those are my top ways for meeting a minimum spending requirement. Hopefully, now you see that there are a lot of options, and you won’t let a minimum spend intimate you from signing up for your next travel credit card. 

Summary of How to Choose the Best Travel Credit Card(s)

The five main factors you want to consider when signing up for a new credit card are the sign up bonus, the spending bonuses, the additional bonuses, the annual fee, and the minimum spending requirement.  

I recommend focusing on earning airline miles and transferable points because these points offer the most value. Before you just start signing up for cards, I recommend deciding which airline you want to earn miles with. Then, you can narrow down your options, and from there see which card(s) offer the most valuable benefits after subtracting the cost of the annual fee from the equation 

The last thing you need to do before signing up for a card is make sure you can meet the minimum spending requirement. The last thing you want to do is sign up for a card and miss out on the bonus points because you didn’t meet the spending requirement in time. If you use the tips I offered above for meeting a minimum spending requirement, you shouldn’t have any trouble. 

Signing Up for Credit Cards

Maximizing Welcome Offers

The strategy for maximizing sign-up offers is simple: The more credit cards you sign-up for, the more bonuses you’ll earn. Now, signing up for multiple credit cards may sound irresponsible, but don’t forget about the credit scores lesson you read way back at the beginning of this guide. 

Banks view additional lines of credit (that you manage responsibility) as more proof that you can responsibly handle the credit that’s extended to you. Therefore, opening additional credit cards could actually help increase your credit score. 

Together, Kara and I have signed up for over 20 credit cards, and both of our credit scores are above 800.

My Credit Score:

Okay, hopefully now I have you convinced that signing up for multiple credit cards is a good thing. Now let’s talk about the best way to go about signing up for multiple cards.  

Bank Restrictions on Signing Up for Credit Cards 

The order of the credit cards that you sign up for is actually surprisingly important.  If you plan on signing up for several cards to maximize your points, you’ll run into restrictions from banks that could stop you from being approved for a new credit card from their bank.  

The most important rule to be aware of is Chase’s 5/24 rule. This is a restriction that Chase has put in place to keep people from signing up for too many credit cards in a short amount of time. The rule is if you’ve gotten five or more new credit cards within the last 24 months, Chase will not approve you for a new credit card. ☹️

This rule doesn’t just refer to Chase credit cards. If you’ve gotten more than five credit cards from ANY bank in the last 24 months, Chase will not approve you for a new card. 

The reason it’s so important to know this rule is because Chase has some of the best travel credit cards. So you’ll want to start by applying for Chase credit cards first. You should get your five most desired Chase cards before moving on to apply for cards from other banks.  

The other biggest restriction is American Express’s “Once per lifetime” sign-up offer. If you’ve ever researched this before, you may have heard of the term “churning.” This is when people would sign up for a card to receive the welcome bonus, get the bonus, then cancel the card, and sign up for it again to get the welcome bonus again. This practice is frowned upon by banks, and American Express’s “once per lifetime” rule was put in place to stop people from churning. The rule is pretty self-explanatory. You can only receive the sign-up offer on a card once per lifetime. 

Recently, American Express has been relaxing this rule by not including the same language in their terms and conditions. If you have held a card in the past (or currently hold it) and want to apply for the same card, you may still be able to get the signup offer if you don’t see any mention of the above rule in the terms and conditions. 

These are the two biggest restrictions you need to take into consideration when signing up for a new credit card. They might sound complicated, but the only thing you really need to remember is to start by signing up for Chase credit cards first.

Once you’re ready to actually start signing up for cards, there are two different approaches you can take. I call one the “fast track” and one the “slow and steady.”

The Fast Track

The fast track is for people who need to earn a lot of miles and points fast like Kara and I did when we decided we were going to start traveling full-time. This involves signing up for multiple credit cards from different banks on the same day, then waiting three months (for your credit score to rebound) and doing it again. This is the fastest way to earn miles and points from sign-up offers, and it’s the strategy Kara and I used the year before we left to travel full-time. However, it’s not the strategy I would recommend for most people. You need to be really organized, and you need a way to meet multiple sign-up bonuses at the same time for this strategy to work. 

For most people, I recommend the slow and steady strategy. 

Slow and Steady

This strategy involves signing up for a credit card (or two), meeting the minimum spending requirement on the card(s), and then (when you’re ready) signing up for a new card and repeating the process at a comfortable rate. 

This is a great way to save up miles and points over time by signing up for new cards at your own pace.  

For example, you could sign up for one new card, spend the next three months meeting the minimum spending requirement, and once you’ve received the sign-up offer, you could sign up for a new one. This would allow you to sign up for four new cards every year. Depending on which cards you signed up for, this could easily result in earning 200,000 points per year which, in most cases, would be enough for three round-trip tickets to Europe. 🎉

If you have the ability to meet the minimum spending requirements, and you want to earn points faster, you could sign up for a new credit card every other month which would result in six new cards at the end of the year. 

The most important things to remember are to apply for new cards at the rate you’re comfortable with, and make sure you meet the minimum spending requirements.

Maximizing Spending Bonuses

Signing up for multiple credit cards in order to maximize your miles and points isn’t just beneficial because of the sign-up offers that you’ll earn. It’s also important to have multiple credit cards that earn spending bonuses in different categories so you can maximize the points you’ll earn on every purchase.  

There are several main categories where credit companies tend to offer big spending bonuses (aka extra points for every dollar spent). These categories include: 

  • Dining

  • Grocery Stores

  • Travel

  • Gas

  • Entertainment 

  • Internet

  • Cable

  • Phone

  • Online advertising

You want to have a credit card that offers a spending bonus in the categories where you tend to spend the most money. There isn’t one card that gives out big spending bonuses in every category. Usually a card specializes in one or two specific categories. So, the card that offers the most bonus points on gas probably won’t offer the most bonus points on dining. For this reason, you’ll need to sign up for multiple cards in order to maximize your spending. 

You’ll probably also make a lot of purchases throughout the year that won’t fit into any category, which is why it’s also important to have a card that earns bonus points on every purchase no matter the category.  

If you’re maximizing your spending the correct way, you’ll probably have a few different cards you’re pulling out of your wallet on a weekly basis. You may have one card that’s dedicated to gas and groceries, one card that’s dedicated to restaurants, a go-to card purchasing travel, and one that you put all of your other spending on that doesn’t fit into the other categories. 

Signing Up for Credit Cards (tips for getting approved)

At this point, you’re probably itching to start signing up for travel credit cards. Filling out the credit card application itself is a pretty simple process that most of you have probably done before, so I’m not going to walk you through all of the steps. However, I did want to give you one tip that most people don’t know about that could increase your odds of getting approved.  

According to the amendment to the CARD Act, you can list any income to which you have "reasonable expectation of access." This means if you have a spouse or partner, and you have reasonable expectation of access to their money, you could report your joint income on the application as opposed to just your personal income. 

For example, Kara and I are married and share a bank account, so I definitely have a reasonable expectation of access to her income. So on the application form, I report our joint income where it asks for total gross annual income.

Also, if you have a side hustle, you can report the income you make from it in addition to the income you make from your "official" job.

Why do you want to report your income as highly as possible on your application? It's simple. Banks want to see that you have the ability to pay back your debts. The more money you make, the more money you have to pay back debts. In most cases, the higher your income, the better chance you have of getting approved for a credit card.

With all of this said, do not lie about your income in order to increase your chances of getting approved for a credit card. That's considered credit card fraud, and it has serious consequences. 

What Happens If You Aren’t Instantly Approved

If you get nervous before submitting a credit card application, you’re not alone. I still get a nervous/excited feeling everytime I submit a credit card application because I’m already thinking about how I’m going to use my points if I get approved.

When you submit your credit card application online, you’ll have the chance to be instantly approved. If this happens, congratulations! You should receive your new card in a couple of weeks, and you are now on your way to earning the sign-up offer that will afford you hundreds of dollars in free travel. 

If you don’t get instantly approved, you’ll probably get a notification letting you know that your application is either pending or denied. 

If either one of these situations happens, not all hope is lost! Don’t automatically assume that you’re not qualified for the card. There are many reasons your application may not be instantly approved. 

For example, you could have mistyped something on your application or accidently left something blank, or the bank may just need some clarity on something you entered on the application. I once forgot to add the last zero on my annual income, so it looked like I was applying for the card with only four figures of annual income. That’s why my application wasn’t instantly approved (rightfully so).

If You Receive a Denial 

If you receive an automatic denial, you still have a chance of getting approved if you call the issuer and talk to a real person. All banks allow this, and you can easily find the phone number by Googling. 

If you’re denied for a credit card, I highly recommend calling to learn why you were denied. It could be something as simple as leaving a 0 off your income. When you call, the representative will ask you follow-up questions to your application and resubmit the application for review, and they’ll usually make the decision before you get off the phone. 

If you get approved, it does not require a second credit check, and it will not hurt your credit score. So there’s no reason not to call.

If You Receive a Pending Notification 

If you receive a pending notification, you still have a chance of getting automatically approved. I’m not going to pretend to know why sometimes banks take longer than usual to approve an application, but people do receive approvals several days after submitting applications without having to give any additional information. In some cases, you may receive an email letting you know, or the card may just show up in the mail one day (that’s what happened when I applied for my most recent business credit card). 

If you get a pending notification, I recommend waiting a few days before taking any action. If you still haven’t heard anything, I recommend calling to check the status of your application. This can be intimidating if you’ve never done it before, but it can increase your odds of getting approved, so I highly recommend it. 

You can start the conversation with something like, “Hi, I’m calling about the application I submitted for the [fill in the blank] card I submitted a few days ago. I wanted to see if a decision had been made, and if not I was wondering if there was any additional information you needed from me?”

At this point, they’ll usually open up your application, ask you a few simple questions, and you’ll have the answer by the end of the phone call.  

I hope these simple tips will increase the odds of getting approved for your next travel credit card! 

Think Outside the Box

If you really want to maximize your potential in this world, it can be really fun to come up with your own creative ways to earn and redeem points. Here are some of the things we’ve come up with over the years:

Be a travel agent

This is one of my favorite ways to earn points. If you’re like me, you love the puzzle of finding awards, scouting hotel prices and locations, and piecing together a trip from scratch. Well, most people are not like me, sadly… I have a ton of friends who love to travel but HATE the planning aspect of it. In their ideal world, someone else would do all the planning for them and they just need to show up at the airport.

I take advantage of this by offering to be a “travel agent” for my friends. Basically, I find great deals for them, plan out dates, book airline tickets and hotels, etc. and don’t charge my friends a cent for this service. The upside? I get all the points by paying for everything and my friends pay me back. They don’t have to deal with the planning and I earn a ton of points. Because of my travel experience, they also know that I can find the best deals out there. It’s a win-win.

Note: This should go without saying, but only do this with people who you can absolutely trust to pay you back.

Pay off friend’s debts

This is something that I’ve done a few times in the past, though I don’t imagine it will be a common opportunity. I have a couple of friends who got themselves into some debt - one of them missed a number of payments on their car and was drowning because of the interest that was racking up on the missed payments. I offered to pay off the entire debt with my credit card and let them pay me back over six months with no interest. 

Furthermore, when my friend agreed to this, I opened a new credit card immediately. Why? Because I used this one purchase to meet the entire minimum spending requirement of a new card. So I got a massive signup offer and thousands of points for the purchase itself without needing to spend a cent of my own money. My friend was also grateful to get out from under the accruing interest, and I was really happy to help that friend. Like with the last example, it should go without saying to only do this with people you trust to pay you back. In my case, there was no doubt in my mind that I could trust this friend, so it worked out great.

Points Stacking

This is the single most under-utilized method of earning points. Points stacking is when you use various points-earning methods at the same time, for the same purchase. You can accomplish this by using many of the methods we talked about already including using a card with high earning rates and purchasing via shopping portals. It also includes timing your purchases with promotions. The best way to illustrate this concept is to give you an example. 

I recently had to book a cash stay at a Hilton property. Given that I have a Hilton credit card, Hilton Honors elite status, and the fact that Hilton was offering a promotion at the time, it was the perfect opportunity for me to do some serious stacking. Let’s break down all of the ways I earned points on this purchase:

  • Hilton Honors American Express Surpass® Card - This card earns 12 points per dollar at Hilton properties

  • Hilton Honors membership - Anyone who is a Hilton Honors member (which you can sign up for for free) earns 10 points per dollar at all Hilton stays.

  • Hilton Elite Status - With Diamond Elite status, I earn an EXTRA 10 points per dollar on all Hilton stays

  • Hilton Promotion - At the time, Hilton was offering a promotion to get 3x the points on stays of 3 nights or longer (which mine was) - This means that instead of the aforementioned 10 points for Hilton Members, you get 30.

  • Rakuten Shopping Portal - The exact return varies, but at the time Rakuten was offering 4.5% cash back on Hilton purchases

  • Statement credit - On my Amex card, I had an offer to receive a statement credit of $50 on a purchase of $200 or more

My purchase was for $308.72 - For simplicity, let’s just use an even $300 to calculate my return:

  • Credit card - 3,600 points

  • Membership (w/ promo) - 9,000 points

  • Elite status - 3,000 points

  • Rakuten - $13.50 cash back

  • Statement credit - $50 credit 

If we conservatively value Hilton points at .5 cents each, then I got $141.50 of value from a $300 purchase - that’s a whopping 47% return. 

This is a pretty ridiculous example where things lined up perfectly, but I was able to jump on the opportunity because I know about points stacking. Even if you only did half of these things and got a 23% return, that is still basically an unheard of return on spend.

Charge whatever you can to hotel bills

When you stay at a hotel that has spa services, restaurants, or other paid amenities, be sure to charge them to your room bill instead of paying on the spot. The reason for this is that if the charges are part of your hotel bill, you’ll get points for hotel membership, elite status, etc. for these indirect purchases. Think about the stacking example from above - If I had added a massage, dinner at the hotel restaurant, or something from the gift shop to my bill, all of those purchases would’ve also gotten the ridiculous points-stacking returns as well.

Bottom Line

The world of miles and points and travel credit cards can be quite overwhelming and complicated when you’re new to it all! I hope that this guide provided some clarity and inspiration as to how responsibly using credit cards can help you plan for and achieve a bucket list trip (and many more in the future!) that you might not have been able to do otherwise.

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