Types of travel rewards available

There are many different types of travel reward credit cards available. Most, however, allow you to choose a variety of different travel rewards, depending on your needs at the time. Here are the options offered by many travel reward credit cards:

Airline miles. Airline miles are among the most popular and often used rewards available. Most reward credit cards offer airline miles, and many airlines themselves offer credit cards with reward programs. For every dollar you spend, you usually get some airline miles. Then you can redeem them for an airplane ticket. The problem is that often these airline miles are not exchanged dollar for dollar. Many cards offer ranges thus:

• For tickets that cost $150 or less, it takes 15,000 points.
• For tickets that cost $150 to $500 it takes 35,000 points.
• For tickets that cost more than $500, it takes 60,000 points.

Those are just some examples. You can see how it would take forever to build up enough points for a free airline ticket. However, many airline travel rewards credit cards also have promotions for double points on certain purchases.

Hotel stays. Other travel reward credit cards offer hotel stays for points. You can earn free nights in some cases. Other possibilities include upgrades to a larger room, or sometimes discount tickets and rebates.

Rental cars. It is also possible to get points for rental car usage. Or discounts. Or upgrades to larger or fancier cars.

Trips. Still other travel reward credit cards will give you points toward free trips. These can be stays at a resort (like Disneyland or Vail) or on a cruise. Sometimes you just get discount or special rate coupons.

Other options for your travel reward credit cards. Many reward credit cards now are no longer just for earning travel related rewards. Even your miles card may offer flexible reward options. In many cases, you can take the points you have earned and use them for different things, including:

• Merchandise.
• Cash back.
• Concert tickets and other entertainment.
• Statement credit.

You may decide that these things will work better for you than travel rewards.

No matter the rewards, though, it is important to keep a few things in mind about travel reward credit cards.

Issues with travel reward credit cards

The biggest issue with travel reward credit cards (other than the fact that they aren't dollar for dollar) is the blackout dates. Sometimes, you can only use your rewards at certain times of the year. Many cards will not allow you to use your travel rewards during peak seasons or holidays. Others will simply give you a list of dates that you can choose from – and they may not always be very convenient for you.

Another thing to keep in mind is that if you carry a balance, then you can destroy the value of your travel reward credit cards. If you are paying thousands of dollars in finance charges, over the limit fees and other expenses, then getting a $450 plane ticket is not that great of a deal. The credit card company has still made plenty of money off of you. It is best to use travel reward credit cards only for things that you normally buy anyway, and to pay off the balance every month to avoid finance charges and other fees.

You should also consider consolidating your expenses. When you use several reward credit cards, you dilute the value of your rewards, and it is harder to accumulate points. Decide what you would use your rewards for, and work toward that goal. Make a budget and then put all of your expenses on the one card (paying it off each month, of course) so that you earn points faster.

A travel reward credit card can be a great thing if properly used. If you are disciplined and responsible, and look for ways to maximize your point earning power, you can take advantage of travel reward credit cards. However, you should be very careful not to destroy the value of your rewards with finance charges and other fees.