While points are great, you’re usually sacrificing at least a little convenience and the ability to book spontaneous, short-notice travel when you use them.
But with this smart and very simple credit card spending technique I’m getting ready to show you, you won’t have to plan your trip far in advance, or deal with complicated award bookings and other tricky redemption scenarios. But you’ll still get some incredible value, so your trip can be free or as close to free as possible.
It’s a great way to use points without having to think too much about how to redeem them. This makes the strategy perfect for beginners, but also for the experienced points user who wants to take a short-notice trip without coughing up a bunch of cash.
We’ve talked about these cards and strategies in detail before, but I really wanted to highlight and focus on the fact that you can put redeemable travel expenses toward the minimum spend, which gives these cards a leg up even against the most top-notch cards out there if you need to use points on short notice.
This is a very simple strategy, but I’ll use a bit of lingo–so be sure to check out our beginner’s guide is this is unfamiliar to you.
The gist is this, you will want to use a fixed value credit card. Then you’ll make whatever travel purchase you are hoping to redeem later with points on that card, as part of the minimum spend requirement.
You can take your trip, and relax, even if the minimum spend is not yet completed. Just be sure to finish it by the deadline on your card (the two cards we mention below have minimum spend deadlines of 90 days and 3 months). Then, once that minimum spend is completed, you’ll simply redeem the points to reimburse/offset the travel expenses.
There are a few caveats but this is very simple. Here are the real perks to this method to keep in mind:
- You can get the card at the last minute
- Take your trip soon after getting the card
- You redeem the points for any travel expense, not just special “award” flights, etc.
I’ll give a very simple example, but remember that any “travel” purchase would work the same way.
Let’s say that I got a last-minute invitation to a friend’s wedding on the other side of the country. I wasn’t really prepared to pay for a coast-to-coast flight, but I really want to go.
I’d apply for a fixed value card, like the Capital One® Venture® Rewards Credit Card, and potentially ask them to send it overnight or use two-day delivery. Then, I’d book my flight with the card. Ideally, that would be just a couple hundred dollars, and then I’d also put my hotel expenses on the card.
I’d go enjoy the wedding, kick back with friends for a few days, and then come back home.
Then, I’d keep using the card until the minimum spend was met. If that took more than one statement cycle, then of course I would pay my bill in full (no interest).
Once my minimum spend was met, I would get the bonus miles, and I would go into my account and have those miles redeemed against the flight and hotel purchases. Voila!
Which Cards To Get
In order for you to wipe out general travel expenses that you incur, you need a card that is extremely flexible. This card cannot be associated with just one particular airline or hotel, but must allow you to use your travel rewards with any airline, hotel or other travel expense that comes up. The two main cards with this capability are the Capital One® Venture® Rewards Credit Card and the Chase Sapphire Reserve. Both cards come with great early spending bonuses and allow you significant flexibility.
The Capital One Venture card comes with a 50,000 mile bonus after spending $3,000 on the card in the first three months OR 100,000 bonus miles (total) when you spend $20,000 on purchases in the first 12 months from account opening. There is a $95 annual fee. You’ll earn 2 miles for every dollar spent on the card. After meeting the minimum spend, you’ll have at least 56,000 miles available to erase any travel related expenses that were charged to the card, which means a value of $560. If you went for the 100K bonus, though, then you’d have 112,000 miles values at $1,120!
The Chase Sapphire Reserve is a premium/luxury rewards credit card. It’s not what we would traditionally call a fixed value card, but it operates as one because of its yearly travel credit. You get $300 every year to offset any travel cost. Together, these cards pack a powerful punch for a big trip.
What To Watch Out For
There are a couple of things to watch out for. The first thing to be aware of are the restrictions on how to use the miles earned from your credit card.
The good news is that this is more flexible than you might realize. You can book traditional flights and hotels, or take a family trip to somewhere like Disney or Great Wolf Lodge. All that matters is that the purchase is coded as travel, and then it’s a great use of your minimum spend.
But you’ll still need to familiarize yourself with the redemption minimums for the Capital One Venture. You’ll need to keep in mind the time period for making the redemption. The Capital One Venture does not appear to post the bonus as quickly as some cards do. I’ve talked to reps who say it can take a billing cycle or two, though I’m looking for more data points on this. This would be a bit more problematic if it took you a while to meet the full minimum spend. Because at the 90-day mark for the minimum spend, you’re also at the 90-day mark for redeeming any miles toward travel purchases you made on day 1.
That’s not an issue if your travel expense is large and you meet the full minimum spend quickly. But it could be a limitation in an example along the lines of my hypothetical wedding trip. In either case, both are great cards–just be aware of these details!
Going on that family vacation doesn’t have to be out of reach, either due to the cost or any perceived lack of points. With smart use of either fixed value credit card or a general travel credit you could save a lot of money, and still enjoy a nice getaway. Even at the last-minute.
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