Travel can be a major expense for families, and for some families, dream vacations are out of reach. But credit card rewards can reduce the cost of family travel and may make your family vacation dreams a reality.
Most families spend between $1,000 and $4,999 on travel each year, according to the NYU School of Professional Studies U.S. Family Travel Survey 2017. But in the U.S. News travel credit card survey, more than 20 percent of respondents earned $1,501 or more in rewards in the past year.
Credit cards frequently offer points, miles or cash back for purchases at grocery stores, restaurants, gas stations and other merchants. These rewards can typically be redeemed for travel expenses, making it possible to pay for family vacations with rewards earned from household expenses. However, earning enough points for a family vacation can be difficult and may require strategic planning.
The Challenge of Family Points Travel
A single 50,000-point credit card sign-up bonus may be enough to book a flight when you’re traveling solo, but when you multiply fares by three, four or more, booking family travel with points might seem impossible.
“Earning points is a big challenge for families, because even a small family consisting of two parents and two kids needs four times the number of miles that an individual would use for each trip,” says Jeff Brownson, UpgradedPoints.com family travel blogger.
Even if you earn enough points or miles to accommodate your entire family, finding award seats on the same flight can be almost as challenging as earning the rewards. “Finding four seats is usually doable in economy class, but if you want to fly in a premium cabin or have a larger family, it gets significantly more difficult,” Brownson says.
Strategies for Family Travel Rewards
Choosing the right credit cards, planning your spending and staying organized can help you earn the points you need.
[Read: The Best Rewards Credit Cards of 2018.]
Use a credit card for everyday purchases. Charge household expenses to a rewards credit card instead of using a debit card or other method of payment. You can earn rewards on purchases you would have made anyway, which can help you meet sign-up bonuses and reach your family travel goals faster. And it may feel easier to pay bills when you know it’s helping you earn points for an upcoming vacation.
However, be wary of credit card surcharges. Some businesses charge a fee to use a credit card. For example, you might have to pay a 3 percent fee to charge a utility bill to your card. Surcharges can outweigh the value of rewards, so it may not be worth it to use your credit card on some purchases.
Be careful not to charge more on your credit card than you can afford to pay in full each month. Avoid spending more than you normally would on everyday expenses just because you’re earning rewards.
Get all potential earners involved. Sign-up bonuses can offer a fast way to earn the points you need for family rewards travel, and you can double the sign-up bonus if both parents have a card. With two accounts, a 50,000-point sign-up bonus can be worth 100,000 points if both parents meet the minimum spending requirement.
If you plan to pool points, research transfer policies before signing up. Some rewards programs don’t allow points transfers, not even between spouses. But you may be able to transfer points to your spouse’s loyalty programs. For example, American Express does not offer the ability to transfer points to another person, but points can be transferred to eligible loyalty programs held by the cardholder or an authorized user. Verify that points transfer at a 1:1 or higher ratio so you won’t lose any value.
It may not be necessary to pool points to use sign-up bonus rewards from two different accounts on the same family vacation. You could book flights with the rewards from one card and hotels with another and never need to combine the points.
Earn rewards from work or business expenses. If you travel for work, use a travel rewards credit card for expenses. You’ll be reimbursed for expenses and can retain the rewards. If possible, keep your travel to the same few loyalty programs so you can consolidate earnings. For example, sign up for a hotel brand’s rewards program and choose hotels within the brand whenever possible.
Small business owners can use business credit cards to earn rewards for business expenses, then use those rewards for family travel. Many business credit cards offer rewards programs that can be redeemed for personal use or pooled with personal rewards earnings.
For example, the Ink Business Preferred Credit Card earns Chase Ultimate Rewards, which can be redeemed for family travel. Points earned with this card can be pooled with Chase Ultimate Rewards earnings from personal cards such as the Chase Sapphire Preferred Card.
Choose the right co-branded travel card. If you have a particular destination in mind, choose cards that offer the best rewards value for the expenses you’ll pay to get there. You can find the best card for your flight, reach the rewards level you need to book it, then move on to the best card for your hotel.
“Figure out where you want to go and only then apply for the cards that can help you get there,” says Dan Miller from PointsWithACrew.com, a website that focuses on helping families travel cheaply.
[Read: The Best Airline Credit Cards of 2018.]
A co-branded credit card is likely a strong choice if you’re earning rewards for specific expenses, including flights and hotels with particular brands. Some co-branded travel credit cards offer larger sign-up bonuses than general travel rewards cards. Additionally, they may offer brand perks that can enhance your travel experience and save on expenses. For example, you may get free checked bags or complimentary breakfast and room upgrades as a cardholder of an airline or hotel brand’s credit card.
Some airline and hotel brands offer perks that are especially valuable for families. The Alaska Airlines Visa Signature Credit Card has companion fare offers and free first checked bags for up to six passengers on the same reservation.
Miller says he finds good value with brands that have extended-stay properties, including Residence Inn by Marriott, Staybridge Suites by InterContinental Hotels Group and Homewood Suites by Hilton. For Miller, the two-bedroom suites offered at many of these hotels offer excellent value because he can book a single room for his family of eight. Additionally, many properties have kitchens, free breakfast and free dinner on selected nights, so you can save on meal expenses.
Earn flexible rewards. Your goal may be to simply accumulate rewards and decide on a destination later. Cards that offer points transfers may be a good choice if you want to earn travel rewards but don’t know how you want to use them yet.
“If we are just building up points and are going to pick our destinations later, we find it’s best to earn transferable points like Chase Ultimate Rewards, Citi ThankYou and American Express Membership Rewards,” says Brownson. “That way, we can transfer the points to the airline or hotel we need when it’s time to book our trip.”
For example, Miller recommends the Chase Sapphire Preferred Card for people with good credit who are just starting to earn rewards. It has a good sign-up bonus, and you can redeem points for 25 percent higher value when you book through Chase Ultimate Rewards. Points are transferable at a 1:1 ratio to several travel partners, including United, Southwest, Hyatt, IHG and Marriott.
Flexible travel cards, including the Capital One Venture Rewards Credit Card and Barclaycard Arrival Plus World Elite Mastercard, are another option if you’re earning rewards without a destination in mind. This type of card offers a travel credit, so you can pay for travel with any airline or hotel on your card and reimburse expenses with rewards. A general travel credit card can be especially useful for families because you don’t have to worry about finding enough award availability to accommodate your entire family, which can be tough if you’re traveling during peak seasons while school is out.
Of course, it’s a good idea to get a card that will help you earn rewards for your next trip while you’re on your current one. Travel credit cards frequently offer bonus points for flights, hotel stays, dining, entertainment and transportation. Charge any travel expenses you can’t pay for with points to a travel credit card and you can start saving rewards for future trips.
[Read: The Best Hotel Credit Cards of 2018.]
Get the best value from points. You may not earn enough points to pay for an entire vacation with credit card rewards, especially if you have a large family. But even if you can’t pay for all vacation expenses with points, you can pay for some or reduce the cost. Using a combination of points and dollars can make family vacations more affordable.
“Because we are a family of eight, it’s fairly rare for us to use airline miles to fly us all to the same place,” Miller says. “We use miles and points mostly for trips for my wife and I, or one-on-one trips with kids, or hotels, and often will drive to our destinations.”
Verify that your planned redemptions offer the best points value. If you have the option to book a flight or hotel with points, but not both, price them both out in points and dollars to see which one offers the most points per dollar value. Consider transfers to travel partners, which may offer a higher redemption value.
Staying Organized
Earning enough rewards for family travel may require multiple credit cards with different rewards rates and sign-up bonuses. You’ll have to stay organized to maximize rewards, avoid interest and plan out your travel options.
Plan ahead using school calendars. As soon as school calendars are published, shop for redemption options for potential travel dates. Find out how many points you’ll need to earn to make your family vacation happen on time and how long you have to earn them.
Plan sign-up bonuses. Carefully track minimum spending requirements so you don’t miss out on earning a valuable sign-up bonus. If you plan to open multiple cards, it’s generally a good idea to open one, earn the sign-up bonus, then move on to the next one.
Know card earning values. Be aware of which cards offer the best rewards earning for each purchase. For example, one card might be a better choice for earning rewards on groceries while another is best for dining out.
Stay on top of credit card bills. Pay the full balance each month to avoid paying interest and maximize your card’s value. Set up alerts so you don’t forget to make a payment, and consider setting up an automatic minimum payment so you won’t be stuck with a late fee if you forget to pay your bill on time.
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The Secrets to Booking a Family Vacation With Rewards originally appeared on usnews.com
