I used to fly Continental a lot on business. Mainly that’s because it has a hub at nearby Cleveland Hopkins Airport. So I had a lot of flight choices.
But a while back, I cried “uncle.” The hassle of flying has driven me whenever possible to another smaller airport that is simply more pleasant to get through. There, I can park about 200 yards from the ticket counters - literally. The airport is clean and the security line is a lot shorter. I can still check a bag up until 30 minutes before my flight. And because the airport has only 10 gates, I’m not exhausted by the time I get to the plane. Oh, and best of all, this small airport offers free WiFi and plenty of electrical outlets. They even have a complimentary small-business center that business travelers can use.
When I shifted airports, I had to shift some other things. The biggest change is that ever since I started using this small airport, out of necessity I have to use a wider variety of airlines.
And that to another change. Before when I flew out of Cleveland, I used a credit card that earned frequent flyer miles on Continental for every purchase I made with it. Naturally, I tried to amass as many miles as possible under one carrier so that I could qualify for upgrades and free tickets. But since I no longer fly as often on Continental, I started looking around at cards that let me use my points at whatever airline I wanted.
Let me share key factors to look at when it comes to rewards programs for a credit card or charge card, based on my own experience:
How flexible are the rewards? What can you use them for?
Circumstances do change, like they did for me. In my case, I wanted to be able to use my points for a variety of purposes -- especially air travel with any airline I want. But I’ve also used rewards points for small gifts for staff and friends, such as gift cards; and a few luxuries for myself. So I looked at how many different things I could redeem my points for.
How many points do you earn for each purchase?
After flexibility, this is the single biggest thing I looked at. Do some comparison shopping. Luckily all this information is available online. It’s pretty standard for card issuers to grant you one point for each dollar spent on the card. But did you know that under certain conditions on certain cards, you can earn 2, 3, even 10 points per dollar spent? Hmmm, let me think – 10 points versus 1 point… It makes a huge difference and can earn you free travel much faster.
How easy is it to cash in your rewards points?
I love the convenience of being able to go online and “shop” using my rewards. It’s a nice option to have a place to go online that makes the experience of using rewards akin to the shopping experience, with a pleasant user interface.
How easily can you book travel using points?
Since air travel is the biggest single use I make of my rewards card, I wanted to be able to seamlessly book travel and use reward points, without a lot of hassle. So is there a central place to book travel using the awards? Can you easily transfer points back and forth from your existing frequent flier accounts – without making time-consuming phone calls? Half the time I am booking travel late in the evening when I have a few minutes to concentrate after a hectic day – I want to be able to get in and out quickly.
How do the sign-up bonus points compare?
You can go online and find plenty of cards that offer bonus reward points, and can compare them. One caveat: don’t get dazzled by a big number of bonus points. Remember, they are one-time only. The points you earn over the years will far surpass the initial bonus. Consider the totality.
I asked Adam Jusko, founder of the credit card site, Index Credit Cards, for additional pointers. Here’s what he suggests when evaluating rewards programs:
"Pay close attention to exactly what's being offered. For example, a card that offers 1% cash back is a better deal than a card that offers 'up to' 1% cash back, but it's easy to miss the difference and sign up for the less generous card. Along those same lines, if you are signing up for a points or miles card, be sure you understand not only how many points or miles you get, but also the formula used when redeeming them. For example, one issuer's formula might have 10,000 points equaling $100 in value, while another issuer may value that same 10,000 points at only $50. Each card issuer sets its own reward point values, so don't assume they are the same across the board."
Over the years I’ve earned a lot of free travel – and almost as important to me, lots of upgrades to first class -- by lumping purchases on to a single card and using the points or rewards wisely. I’ve been able to attend more conferences and events this way, because I didn’t have to pay for air travel. When I did pay, I could fly more pleasantly and arrive relaxed. If you, like me, use speaking gigs to build your professional reputation, getting free air travel is a key tactic to execute on that strategy.
One thing I’ve learned: rewards can be an important expense management tool for a small business. So compare them with the same care as you’d compare any other major purchase.