Have you ever wondered how some individuals manage to travel to exotic locations without burning a hole in their pocket? The secret often lies in using credit cards strategically for travel. By smartly using credit cards, you can earn considerable rewards and lower your travel costs. But how exactly does this work and how you can get started? Let’s go through four essential ways to enhance rewards and lower costs through the proper use of credit cards for travel.
Table of Contents
1) Select the correct credit cards
To get the most out of your travel, you need to choose the cards that offer the best travel rewards. Search for cards that offer generous sign-up benefits, high reward rates on travel and dining and additional perks like airport lounge access or travel insurance. For instance, many airline-branded credit cards offer bonus travel miles on signing up and making a specific number of transactions or crossing a specific purchase threshold within the first few days. Likewise, hotel-branded credit cards can offer free elite status and free nights, which can enhance your travel experience.
2) Optimise sign-up bonuses
Sign-up bonuses are one of the best ways to rack up a considerable number of miles or points. Such bonuses require you to spend a particular amount within the first few months of availing the credit card. To meet such requirements without overspending, plan your bigger expenses, such as planned purchases or annual bills, around the time you avail the card. This way, you can hit the spending threshold without unnecessary expenses. Moreover, keep a watch on the limited time offers that can enhance your rewards even further.
3) Use category benefits smartly
Many credit cards provide higher reward rates on particular spending categories such as dining, travel, and groceries. To enhance your rewards, use the correct credit card for the correct purchase. For example, if you have a card that offers triple points on a hotel stay, ensure to use it every time you travel. Some credit cards even rotate such categories periodically, so remain updated on such changes to make sure you are always earning the maximum reward points possible.
4) Avoid interest and charges
While the rewards from travel can be substantial, they can be negated by high finance charges. To truly lower costs, it is crucial to pay off your credit card balance in totality by the due date every month to avoid interest charges. Moreover, be mindful of annual charges. Some high-fee credit cards offer sufficient benefits to justify the costs, but if you are not using these perks, it may be worth downgrading to a low annual charge or zero-fee credit card. Also, look for credit cards that waive foreign transaction charges, saving you money on transactions abroad.
Ending note
By selecting the correct credit card, optimising sign-up bonuses, avoiding finance charges and other fees, and using benefits on specific categories wisely, you can enhance your rewards and lower your costs. Begin by evaluating your travel goals and spending habits, then choose the best credit cards to meet your requirements. With a little planning and strategic spending, you can find yourself jet-setting to new destinations without breaking the bank.
