Unlike airline miles, credit card points are still relatively uncommon and unknown to people, even though the similarities between the two are high. In this article, I explain all there is to know about credit card points.
Introduction to Credit Card Points
The concept behind credit card points is basically pretty much similar to airline miles. The points you have earned through credit cards can be redeemed on things for different rewards, more commonly discounts. It is important to maintain a good and stable credit score to be able to take advantage of credit card points. Another important aspect to remember is the concept of annual fees and interest rates. When you have a certain kind of credit card, also known as a reward card, you have to pay an annual fee. This is normally close to $300 or $400, which is not much if you divide it on a monthly basis. Reward cards also have a higher interest rate compared to normal credit cards.
How to earn credit card points
Earning credit card points is very simple. On every swap of your shiny credit card, you get points. The number of points depends on the purchase value. Earning policies normally vary from bank to bank. Some credit cards offer a point against every dollar spent, some a number of points at a certain threshold while some provide extra rewards on specific purchases. The most common ways to earn credit card points are as follows:
- Restaurant Bills
- Online shopping
- Partner hotels
- Spending on partner stores
- Issuance of a new credit card
Sell points
One of the easiest ways to get cash to save travelling cost is by selling CC points. You can sell even convert them into airline miles to be used later on flights for discounts or upgrades.
Redemption policies
Redemption means a point forgone for every reward taken. It is not necessary that if you have more points, you can redeem more rewards. The value of point depends on your credit card policy. The standard burn rate or redemption rate is one cent per point. Some high value points are earnable through Blue Cash Everyday, Starwood Preferred Guest, Blue Cash Preferred and Gold Delta SkyMiles, all offered by American express. Chase Sapphire card is also one of the most popular credit cards in the industry.
Rewards And Benefits
Credit Card Points have endless benefits and rewards. The most common ones are as follows:
- Flight discounts
- Flight upgrades
- Hotel discounts
- Rental card discounts
- Reduction on restaurant bills
- Online shopping discounts
Types of Rewards
Normally there are two types of rewards, namely Tiered and Flat rewards. The difference between the two is the way the points are earned. Either you earn them on each spend or earn an accumulated amount once you have reached a certain level of spending.
