By Mark Quiner

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The way to really get your points up is to sign up for a card that has a good sign-up bonus.
My advice would be to be picky. Never sign up for a card that offers less than 50,000 points. Sometimes you can find ones that offer 100,000. Hotel cards work a little differently. Never use points for merchandise. Its never a good deal.
Earning the points is the first step, but you need to see how you can use them. The industry standard is that 1 point is worth 1 cent. If you can use points to get more than a penny a point you’re getting a good deal.
If you are cashing them in for a penny a point, you’re at the market, and if you cash them in for less than a penny a point you shouldn’t use them.
I  would say there are three different kinds of cards:

√ Airline cards,
√ Hotel cards,
√ and cards that have their own program.
The last category would be like the Chase Ultimate Rewards or American Express Membership Rewards. Those programs allow you to transfer points to other things. For example, they will allow you to transfer points to United Airlines at a certain ratio, at which time you can cash them in for an airline ticket.
All that being said, I like the hotel cards and I like the cards that have their own program. Its more flexible. I find that when I’m traveling I’m not usually flexible, and to get a good deal on an airline ticket you need to be flexible because they have a lot of blackout dates. By contrast, cashing points for hotels is fairly straightforward. The cards that I like the best are the following:
• Amex Starwood Preferred Card. I think its $100 /yr. You will probably only get 25k-30k points for signing up but I’ve found I can cash these points in at a ratio of about 2.5 cents/point. Starwood owns Westins, Sheratons, St. Regis, W’s among other things so they have good hotels.
• Chase Sapphire: You can often find deals for 50,000 points. That gets you points with Chase Ultimate Rewards and you can transfer those to various things like airlines and hotels.
• Amex platinum: I have that card. It’s expensive, but there was a 100,000 point sign up deal. The card is $450/yr. I get more than my money’s worth out of it. If that deal comes up its worth the $450. If not, wait for it. You can’t carry a balance with this card.
From a simplicity standpoint, just pick one, get your bonus, use the points, use the card for a year or two, then cancel it and get another one. As long as you’re paying on time it won’t really affect your credit profile. Having multiples isn’t necessarily bad, but its just hard to keep track of.
To stay abreast of the best deals, visit http://thepointsguy.com/.
[Thanks to Mark Quiner for permission to share his insights on this subject.]

 

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