You can earn tremendous value through opening and using credit cards that reward your patronage and your spend with airline miles and/or hotel points. I personally have found that travel and rewards credit cards give me more value than any cash back card possibly could, and give me access to a form of travel that might otherwise be more “aspirational” than realistic, such as access to hotel suites and first-class lounges that I would not otherwise pay for.
But, there are clear signs to be on guard for that you have gotten carried away, and it is important to understand when you have crossed the line. Here are some signs:
1. Staying in hotels that are a great distance geographically from where you want or need to be, just to get points or use nights of credit. For most people, this simply doesn’t make sense, except in the very rare circumstance where you are a night or two short of obtaining premium status at the end of the year. For the most part, staying in a hotel just for the purposes of earning or redeeming points will wind up being damaging to your vacation or make your business trip less productive. This having been said, there are some places where the line is kind of hazy. When I go to Maine in August, for example, it is very difficult to find a nice place to stay for less than $450 to $500 a night. I have no problems staying at the Hyatt Place in Portland, a Hyatt category 3 hotel, for 12,000 points as there is plenty to do in and around Portland. However, staying at the Sheraton at the airport in Bangor for 7,500 points in order to visit Acadia National Park is far less sensible.
2. Traveling circuitous and indirect routes to rack up points. This practice used to be widespread among seasoned business travelers seeking to get premium status before year-end. Now that all of the major airlines have moved over to a revenue based status system, it is less common. It is silly to do it unless you are trying to get premium status. It simply makes no sense to fly from LA to Tokyo through JFK and Heathrow to get airline points (unless you need to pick your passport up in New York).
3. Traveling circuitous routes to fly a specific airline or to qualify for a specific class of service. The point of travel is to get from point A to point B quickly and efficiently. If the shortest travel time from New York to a small city in Eastern Europe is on Austrian Airlines, I will fly Austrian Airlines (which is perfectly fine with me anyway because it is a United and a Singapore partner). Among the most stupid articles I have read on this issue is this one - traveling from Madrid to JFK through Moscow is madness, especially if you are doing it to “experience” Aeroflot and Sheremytyvo.
4. Getting overexcited by 2x or 3x point earning opportunities. Getting 2x or 3x points on a credit card is just not a way quickly to run up points, unless you are prepared to spend gobs of money in one specific category. Cardholders are more wise to focus on categories where they can get 5x or more points. I personally use an Amex Platinum card for airline expenses and use a Chase Freedom card for the rotating quarterly spend category, but otherwise do not choose one card over another when making a purchase just to get 2x or 3x.
5. Allowing oneself to fall for those hawking point you don't want or need. I was walking down the street in New York yesterday and saw a sign outside of Vitamin Shoppe saying that they were giving out bonus points to anyone who walked in the door that day. For a moment, I briefly forgot that vitamins and supplements are a scam directed at people who don’t eat well or exercise properly. That was when realized that I needed to write this article.