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Your Guide to Saving Money With Travel Rewards Credit Cards

Last Updated: March 23, 2022
10 min read

Travel. It excites us, helps us de-stress, improves our health, and may even makes us smarter. So, what’s getting in the way of our next trip?

For many of us, the answer might be money.

The good news: if you have a credit card with travel rewards, you may be able to offset a trip’s priciest expenses with airline miles, hotel discounts, vacation packages, and more. With the Discover it® Miles Travel Credit Card, you can redeem your Miles as a statement credit towards travel purchases.1

This guide will help you maximize your credit card rewards perks while minimizing travel expenses. You’ll also find some cheaper, offbeat destination suggestions to help you get the most out of your rewards and, in turn, your next vacation experience.

1. Why pay for vacations with a credit card?

Credit cards offer two big incentives when you use them to book travel: points and protection. Not only can your purchases earn you points or miles toward future travel, but your travel credit card may offer benefits like protection for unauthorized purchases

If you travel often, look into credit cards that offer travel rewards. The Discover it® Miles Travel Credit Card, for example, earns 1.5 Miles per dollar spent on purchases and, at the end of the first year of card membership, Discover matches all the Miles you’ve earned — and there’s no limit on how many Miles you can earn.2 You can also turn Miles into cash, or redeem as a statement credit for travel purchases like airfare, hotels, rideshares, gas stations, restaurants and more.1 You can also redeem Miles to pay any part of your monthly bill, including your minimum payment. However you redeem, Miles have the same value and never expire.3

Paying for a travel expense with a credit card can also protect your purchase. If you have to, you can dispute a charge through your credit card by a company that fails to deliver for the goods or services paid for. But it’s important to read the fine print. Look into what coverage your specific card offers before you book your trip so you’re not caught off guard on vacation.

However, while it’s easy to use a credit card for purchases in most countries, having cash on hand can be helpful if you’re traveling abroad. If you need local cash during your trip, it may be smart to use your debit card so as to avoid your credit card’s advance fees and interest charges. While you may be charged for an ATM fee and a small currency conversion fee with a debit card, it still may be less expensive.

2. Check the perks on your current credit card

Some credit cards offer perks to help you save on your next vacation. So before you hit the road, take a closer look at your rewards.

  • Booking: Did you know that certain credit cards may offer additional rewards or additional cash back by booking your travel with your credit card? Before you book your next trip, review your credit card’s rewards details to make sure you’re making the most of your benefits.
  • Rental insurance: It’s also worth checking if your card has car rental coverage. You may be able to forgo the added expense of secondary rental insurance and use your credit card’s built-in car coverage. Some credit cards will cover collision repair if you rent the car with your card. Several credit cards also offer discounted rates on car rentals when you book through your issuer’s rewards portal, but coverage varies and limitations apply, so make sure to check with your issuer.
  • Flight accident insurance: You may also be covered with flight accident insurance for you, your spouse, domestic partner, or eligible dependent children when you purchase your airline tickets if your card provides the coverage. But not all cards provide this coverage.
  • Foreign transaction fees: You can also see if your card waives foreign transaction fees, which often add 1-3 percent to overseas purchases. Some credit card companies don’t charge the foreign currency transaction fees, which can provide a big cost savings.

Be aware that to take advantage of many of your credit card’s travel benefits you will need to book your entire travel using your credit card.

3. Find the best travel rewards credit card

If you’re unsatisfied with your current perks, consider getting a new credit card with better or different travel rewards. There are generally two main types: cards that offer points redeemable only with particular hotels or are tied to a particular airline, and cards that offer generic points or miles that can be redeemed for most travel expenses. The Discover it® Miles Travel Credit Card offers even more flexibility by allowing Cardmembers to redeem Miles for cash in any amount to pay their bill, including their minimum payment.

Many people look for four things from their travel rewards cards:

  • Value: The return in cents per dollar spent, as well as bonus miles or miles matching opportunities. The amount of cents earned per dollar spent varies by card, and should be considered alongside costs or fees (such as a card’s annual fee) as well as redemption flexibility when picking a travel card.
  • Flexibility: Travel credit cards that offer the most opportunities for redemptions – no blackout dates, a variety of partners, or ease of using the points or miles.
  • Cost and fees: As mentioned above, costs and fees should be considered alongside reward value. Are the card’s fees justified by its rewards and benefits? Make sure what you get from the card will pay off at least as much as the amount of the fee.
  • Sign-up bonuses: Many travel cards have large sign-up bonuses to entice applicants. The Discover it® Miles Travel Credit Card is unique in its sign-up bonus, in which it offers a mile-to-mile match of all the Miles new Cardmembers have earned at the end of their first year.2 For example, if you earn 35,000 Miles, you get 70,000 Miles. 

If you’re already a loyal patron of a particular hotel chain or airline, it may be worth getting a card that will give rewards specific to those brands. But if you’re more often a leisure traveler who doesn’t habitually use the same travel carriers, you should look into unaffiliated travel rewards cards, which allow you to pool miles or points that have cash value so you can spend for a hotel stay or flight on nearly any airline.

Another question to ask yourself: are you a frequent flier or a frequent buyer? Frequent fliers benefit from airline programs that link to credit cards. They can earn miles for flights and hotels. But those who use their cards more for purchasing should look for spending-based rewards programs. Remember that each travel rewards card has its own perks and downfalls, so shape your decision to your personal travel and spending habits. Some cards have travel blackout dates while others carry an annual fee. Also be certain you understand everything a card has to offer to avoid missing out on benefits such as travel insurance or partner discounts.

4. Create a travel fund

Part of what makes travel so expensive is that on top of budgeting for your trip, you still have to factor in your day-to-day expenses at home, such as your mortgage and car payment.

There are some additional ways you can plan ahead and save money:

  • Set up automatic savings for a travel fund. Even saving $20 a week can amount to $1,040 you could use toward travel annually
  • Set up automatic payment for bills when possible on your credit card to earn rewards on those expenses.

5. Know the best time to book your trip, and consider off- peak travel

Once you’ve earned some miles to redeem towards the cost of your dream trip, it’s time to book your trip using rewards. But make sure you plan ahead to get the best deals – in some cases you may want to book as far ahead as possible (when the airlines first release their reward seats).

You can also save money by booking trips to places that aren’t in the middle of a busy season. Off-peak travel can mean smaller crowds, shorter lines, better service and pleasant weather instead of the scorching sun. And, of course, your savings can be significant. Remember that off-season periods will differ from one destination to another, and don’t forget to research local events, such as major concerts and national or international conventions. These might mean price increases and crowds even during seasonal off-peak times.

Dozens of factors go into the airlines’ pricing algorithms. You don’t have any control over most of them, but you do know that flying on holidays and school breaks will cost you more. The same applies to flying to Europe in the summer and the Caribbean in the winter. If you want to maximize your airfare savings, think Tuesday, Wednesday or Saturday during off-peak season. And if you want to do even better, brave the red-eye — and you might really save.

Some resorts and luxury hotels will have huge discounts starting during what’s called “shoulder season,” which happens right before and after the peak season. Sometimes you can save up to 70 percent on your stay in five-star hotels and tropical resorts during shoulder and off-peak months, and the weather will still be great.

But don’t overdo it! Traveling to a tropical paradise is always cheaper during the hurricane season, but do you really want to take this risk? When choosing your off-peak time, research your dream destination carefully. Traveling to the Caribbean will be cheaper in August or September, but it’s likely to be more pleasant and only slightly more expensive in October or November, right before the high season kicks in.

6. Take a different kind of winter vacation

The holiday travel season is one of the busiest times of year. If you’re looking to avoid crowds and find some cheap winter vacations, why not go beyond the usual popular travel destinations? Here are some tips:

  • Go to a warm weather city that doesn’t have beaches: lounging ocean side will always cost you extra. There are often many great cheap winter vacation deals to be had in inland cities like Dallas, Albuquerque, or Santa Fe that aren’t typical “tourist destinations,” yet the temperatures are comfortable and there’s plenty to do. You can probably even score a hotel with a pool.
  • Hit Vegas after the holidays: Las Vegas often has cheap airfare and generous hotel deals in the weeks after January 1. There’s not truly an “off-peak” season in Vegas, but early January is often as close as it gets to calming down.
  • Rent a mountain cabin at off-peak rates: did you know you can rent cabins in Colorado for big savings during the winter months? There are many camps, national parks and state parks that rent cabins and lodges year-round for groups, couples or families — and you can often save big money when you book in the winter.
  • Try a cold-weather city: Some of the best cheap winter vacations can be found in the Northern U.S. or Canada — there are often great discounts available on airfares and lodging during the winter months, when most tourists are trying to head south. Try Minneapolis-St. Paul (fun museums, parks and nightlife), Cleveland (located on Lake Michigan with a highly praised restaurant scene), Detroit (a resurgent city center), or Montreal (European-style culture and cuisine but without the transatlantic flight).

7. Explore one of these fall travel destinations on a budget

Traveling to some of these places during the fall before Thanksgiving is considered “off-season” by the travel industry, yet you can still catch great weather and enjoy smaller crowds while saving on airfare and hotels:

  • Mammoth Cave National Park (KY): For nature lovers, it’s hard to find a better place to hike, canoe, or explore the caves. If you’re not camping, you can reserve a spot at one of the many hotel properties nearby.
  • Cape May (NJ): Beach days are almost over in September, but there are always craft beers at Oktoberfest, bird shows, and the winery harvest every fall.
  • Savannah (GA): Haunted hotels, spooky tours, and creepy graveyards abound for Halloween season, plus a knockout food and wine festival in November.
  • San Francisco (CA): One of the country’s best travel destinations has reliably warm days every fall. Plus nature lovers can enjoy whale-watching tours and hikes along the coastal trails.
  • Bald Head Island (NC): Car-free and full of live music, great Southern food, fine wine, and craft beers.
  • Austin (TX): Endless live music, an eclectic food scene, the Texas State Capitol, and acres of lush parks.

So where are you headed? Take a look at the perks, miles, and reviews of the Discover it® Miles Travel Credit Card to begin your next journey.

TIP: Be sure to let your credit card issuer know before you travel. Because they keep an eye out for suspicious transactions, purchases made away from your home area might be flagged by the fraud department.

TIP: See all the travel benefits that come with Discover rewards credit cards. For instance, the Discover it® Miles Travel Credit Card can help frequent, or not-so-frequent, travelers reduce the overall cost of their travel purchases through the Miles they earn. Turn Miles into cash. Or redeem as a statement credit for your travel purchases like airfare, hotels, rideshares, gas stations, restaurants and more.

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