How to become a points chaser


You've no doubt read stories about people funding extravagant trips with credit card rewards or who travelled the world with the points collected on everyday spending. But as a "regular" cardholder, how to maximize your rewards might be hard to fathom.

For starters, how do people collect so many points, keep them organized and then find unique opportunities to use them? We asked two travel experts to show you how you can accelerate your credit card rewards points.

Kendrick Uy, author of the blog Kendrick Travels, is currently eight months into a year-long trip around the world that has been funded, in large part, through his travel credit card rewards. As Uy writes in his blog, this level of points accumulation takes time, effort and savvy travel planning.

But even if you don't want to put forth quite so much effort, you can still rack up a significant number of points if you simply commit to a strategy, says Frugal Trader, who writes a savings and investment blog, Million Dollar Journey.

Here are some additional tips from serious points collectors:

1. Start at the end.
Start with a goal, says Avery Campbell, president of Awarding Canada Inc.

"Figure out which program will have the best awards table for that goal, and then figure out how you can get enough miles quickly into that program," Campbell says. He stresses the quickly because loyalty programs change, and points can be devalued.

Think not only about where you want to go, but whether you want to fly business or economy class. Then you can determine which rewards programs offer the best value for your trip, which can help you set your strategy to collect the points.

2. Change shopping habits.
Two of the big loyalty card programs, Air Miles and Aeroplan, partner with grocery stores and gas stations, where you can earn points on things that you're already buying.

Frugal Trader suggests shopping exclusively (or as much as possible) at stores that partner with your credit card. You should review flyers each week to see if there are any points specials - perhaps you can earn double points near the holiday season, or earn more points on seasonal items, such as barbecues in the summer.

"That does take an amount of focused effort," he says. "You would really need to strategize exactly what's in the flyer and what kind of bonuses you can get."

Shopping online might allow you to earn more points, or accumulate points at more retailers if your rewards card offers an online shopping portal. RBC Rewards, Aeroplan and Air Miles are among the points programs that have e-malls.

3. Shop wisely.
Norah Foster, a certified credit counsellor with K3C Credit Counselling in Ottawa, says it's important to have a budget so that you don't get carried away chasing points.

"People spend more on credit," Foster says. "Studies have proven that people overspend if they're going to use credit as opposed to if they had cash."

Don't get in the habit of purchasing items you don't need or can't afford to accumulate points, even if it's a good deal.

It's also important to pay off your balance in full each month, unless you have a card that doesn't charge interest on purchases.

"You're losing the value of the points as soon as you start paying the interest charges," says Boris Remes, co-founder of Canadian Points University. 

"As soon as you are unable to pay off your balance in full, stop using the rewards card and take steps to pay off your balance," Foster says.

If you have a problem with credit card spending, you can still accelerate your points accumulation with other payment methods. BMO, for example, offers an Air Miles debit card.

Gift cards are another option. Frugal Trader points out that Sobey's (and other stores) often offers bonus points for purchasing gift cards.

"Then take those and strategically shop within Sobey's to obtain as much as you can," he says. "Even better is if you buy the Air Miles gift card with an Air Miles credit card."

4. Look for featured offers and promotions.
"Keep an eye out for promotions, such as 20x promotions, and then concentrate your spending at that point," Frugal Trader says. Air Miles sends out coupon books that allow you to get many points for redeeming coupons at several stores.

Canadian Points University co-founder Jason Binstock suggests getting connected to online networks that will help you find even better deals where you can "triple dip" - or better.

Using a rewards card to make a purchase at a store that also pays rewards is an example of double-dipping. Purchasing a gift card for bonus points with a reward credit card, as Frugal Trader suggests, is triple-dipping. Getting a discount on top of that sweetens the deal even more.

"They're difficult to find, but there's all sorts of forums that are dedicated to recognizing those types of deals," says Binstock. FlyerTalk and Slickdeals are two that he suggests.

"Get into that mindset of trying to run through the scenario of a deal and how you could maximize it based off the promotions that come up," he says. For travel hackers, "part of the appeal is the chase for the amazing deal."

5. Try your hand at churning.
Card churning is when you sign up for a credit card that offers a large sign-up bonus, collect your reward in a few months, close the card, wait a few months, and sign up for it again, or for another card with a nice sign-up bonus.

"That's how most people in the travel hacking industry get miles quickly," Campbell says.

"It's definitely an option if you're really aggressive," says Frugal Trader.

However, it's best to try this if you don't need your credit score to be in top shape for a while. Applying for a credit card will lower your score slightly in the short-term, so if you're planning to apply for a mortgage or other loan, think twice about this tactic.

Additionally, some issuers are clamping down on churning, so you might not always be successful.

Binstock says that premium products, which often come with annual fees, often have much higher sign-up bonuses. He points to the American Express Platinum card as an example.

"In the first year of card ownership specifically, the amount of value that you get from the sign-up bonus mixed with the travel credit and the access to lounges, etc. ... you can get much more value than what the annual fee costs," he says.

"I would also layer that in with referring friends and family and helping them understand the valuation of an annual fee," Binstock says.

Churning is not a good option for people who don't have a good track record when it comes to paying off their credit cards, though.

"If you're carrying a balance on another credit card, then it doesn't seem likely that you'll have the discipline to pay another credit card off monthly," says Foster.

If you can't or don't want to sign up for multiple cards, you can try having another member of your household, say, your spouse, sign up for the same card.

Most serious points collectors recommend that you sign up for a rewards credit card - many of which come with attractive sign-up bonuses - and then use that card to pay for everyday purchases.

"Both individuals in the family could apply for the same card and get points in the two respective accounts and basically manage two accounts responsibly to redeem points for their dream trip," Remes says.

However you want to chase rewards, remember that the most important rule is to not carry a balance on a card charging interest.

If you're following your budget, and if you're paying your balance in full, Foster says, you're essentially earning extra money, which is the purpose.

"If you're not paying that balance off, then there's no value in that for you at all."

See related: 4 ways to maximize cash back rewards cards, Pros and cons of co-branded credit cards, 5 basic rewards-chasing mistakes
Updated June 12, 2017

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