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How points and miles helped me get serious about personal finance

May 26, 2021
6 min read
How points and miles helped me get serious about personal finance
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I got into the points and miles world when I was 18. As a college student, I wanted to travel around Europe and visit family in Prague during my first winter break. After all, how else do you spent a month off of classes? I was presented with an issue though: Making just over minimum wage at my college IT support gig, I couldn't afford to drop $1,000-plus on airfare.

So, I set out to find cheaper ways to travel. As fate would have it, I stumbled upon The Points Guy's YouTube channel and quickly became an avid reader of the website. As a result, I opened a United Explorer Card to take my first trip to Europe, and my points portfolio quickly grew from there.

Related: Best credit cards for college students

But the points and miles hobby had an unexpected side effect: It helped me get my finances in order.

Let's take a closer look.

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How points, miles and credit cards changed my financial mindset

(Photo by Andrew Matthews/PA Images via Getty Images)

The points and miles hobby is inherently tied to personal finance. After all, you need to keep your finances in check when juggling multiple credit cards. Here's how the points and miles hobby changed my personal finances for the better.

Rewards credit cards help me plan and stick to a budget

Before I used credit cards, I wasn't much of a budgeter. I swiped my debit card for things I needed to purchase and went about my life. At the end of the month, I'd save what little was left over. This resulted in a lot of unnecessary spending — especially on a college salary. Thankfully, credit cards helped me change this.

I've always been afraid of credit card debt, so when I got my first credit card I forced myself to start better budgeting my expenses. I saved a set amount of money every month, and let myself spend the rest — but no more.

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(Photo by John Gribben for The Points Guy)

I eventually opened multiple cards that earned bonus points in different categories. I always try to earn as many points as I can on everyday spending, so I use different cards for different purchase categories. For example, groceries at U.S. supermarkets and restaurants go on my American Express® Gold Card to earn 4 points per dollar (on up to $25,000 on purchases per calendar year; then 1 point per dollar at U.S. supermarkets), Lyft rides go on my Chase Sapphire Preferred Card for 5x points, and so on.

Having multiple credit cards makes it far easier to keep track of a budget. I give myself a set amount of money to spend in each category every month and charge each category to a different card. This helps me better track my spending, stick to a strict budget and earn the most possible rewards. It's a win-win.

Related: What you need to know about credit card debt — and how to get out of it

Get more and spend less by stacking discounts and finding the best deal

Many online shopping portals offer bonus rewards when you shop with Nike. (Image courtesy of Cashback Monitor)

Points and miles also made me obsessed with finding the best deal. I love stacking coupons, shopping portals and other ways to save money and earn points on whatever I have to spend money on. Truthfully, sometimes it can be a little bit obsessive, but it's helped me save money (and earn a ton of points and miles) over the years.

For example, I recently earned $80 in cash back and rewards on a single meal by stacking a dining program, reservation service, rewards credit card and cash-back app. I live for these kinds of deals because they — like redeeming points and miles for travel — let me get more while spending less.

Related: Stacking rewards with shopping portals — reader success story

Return on everyday spending encouraged me to start investing

I grew up knowing the importance of saving money, but investing didn't come to me until my early 20s. I always thought that investing in stocks or cryptocurrency was too risky. At the same time, the bulk of my savings was sitting in a high-yield savings account that still earned less than the rate of inflation.

This started to change as I got into credit card rewards. When deciding to use a card, I always calculate the return on spending I get from using a card. For example, The Platinum Card® from American Express earns 5x points on flights (booked directly with the airline or via American Express Travel; up to $500,000 on these purchases per calendar year), equal to a 10% return on spending based on TPG's valuation for American Express Membership Rewards.

This thinking eventually encouraged me to put money in the market. After looking at my return on savings, I realized my money wasn't doing much in a savings account. Nowadays, I invest the majority of my savings. So not only is my spending working for me, but my savings are too.

This is more of a mind frame change than anything else. Realizing that there's a way to create wealth in ways other than simply spending less money and getting a raise at work was powerful for me. There's no doubt that this shift was spurred by the points and miles hobby.

Related: 7 ways to improve your finances in 1 week

Bottom line

Points and miles have changed my life in a multitude of ways, from helping me see the world to eventually becoming my career. Changing my mindset on personal finance is just one of the many ways points and miles have affected my life. In this case, points and miles changed how I use and save money by forcing me to analyze how I spend and save.

Featured image by Getty Images/iStockphoto
Editorial disclaimer: Opinions expressed here are the author’s alone, not those of any bank, credit card issuer, airline or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

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How we chose these cards

Our points-obsessed staff uses a plethora of credit cards on a daily basis. If anyone on our team wouldn’t recommend it to a friend or a family member, we wouldn’t recommend it on The Points Guy either. Our opinions are our own, and have not been reviewed, approved, or endorsed by our advertising partners.
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TPG featured card

Best card for premium perks while traveling
TPG Editor‘s Rating
Card Rating is based on the opinion of TPG‘s editors and is not influenced by the card issuer.
4 / 5
Go to review

Rewards

2 - 10X points
10XEarn unlimited 10X miles on hotels and rental cars booked through Capital One Travel
5X5X miles on flights booked through Capital One Travel.
2X2 Miles per dollar on every purchase, every day

Intro offer

75,000 bonus miles
Earn 75,000 bonus miles when you spend $4,000 on purchases in the first 3 months from account opening, equal to $750 in travel

Annual Fee

$395

Recommended Credit

740-850
Excellent
Credit ranges are a variation of FICO© Score 8, one of many types of credit scores lenders may use when considering your credit card application.

Why We Chose It

The Capital One Venture X card is one of the best all-round travel credit cards ever launched. Not only is it offering a tremendous welcome bonus, but cardholders can earn tons of miles on everyday spending and receive a 10,000-mile anniversary bonus to boot. Its annual fee is $395, but cardholders can count on up to $300 in statement credits toward travel booked through Capital One Travel each year and other valuable benefits like access to Priority Pass lounges and Capital One’s own growing family of airport lounges.

Pros

  • Excellent welcome offer worth 75,000 miles after you spend $4,000 on purchases in the first three months.
  • Up to $300 in annual travel statement credits toward bookings make through Capital One Travel.
  • 10,000 bonus miles (worth $100 toward travel) each account anniversary.

Cons

  • The $395 annual fee might be expensive for some, but this card’s benefits provide much more value than that.
  • If you don’t travel frequently, this might not be the best card for you.
  • Earn 75,000 bonus miles when you spend $4,000 on purchases in the first 3 months from account opening, equal to $750 in travel
  • Receive up to $300 back annually as statement credits for bookings through Capital One Travel, where you'll get Capital One's best prices on thousands of options
  • Get 10,000 bonus miles (equal to $100 towards travel) every year, starting on your first anniversary
  • Earn unlimited 10X miles on hotels and rental cars booked through Capital One Travel and 5X miles on flights booked through Capital One Travel
  • Earn unlimited 2X miles on all other purchases
  • Unlimited complimentary access for you and two guests to 1,400+ lounges, including Capital One Lounges and our Partner Lounge Network
  • Receive up to a $100 credit for Global Entry or TSA PreCheck®
  • Use your Venture X miles to easily cover travel expenses, including flights, hotels, rental cars and more—you can even transfer your miles to your choice of 15+ travel loyalty programs
  • Named editors' choice for "Best New Credit Card of 2021" by The Points Guy
  • Earn 10 miles per dollar when you book on Turo, the world's largest car sharing marketplace, through May 16, 2023
Best card for premium perks while traveling
TPG Editor‘s Rating
Card Rating is based on the opinion of TPG‘s editors and is not influenced by the card issuer.
4 / 5
Go to review

Rewards Rate

10XEarn unlimited 10X miles on hotels and rental cars booked through Capital One Travel
5X5X miles on flights booked through Capital One Travel.
2X2 Miles per dollar on every purchase, every day
  • Intro Offer
    Earn 75,000 bonus miles when you spend $4,000 on purchases in the first 3 months from account opening, equal to $750 in travel

    75,000 bonus miles
  • Annual Fee

    $395
  • Recommended Credit
    Credit ranges are a variation of FICO© Score 8, one of many types of credit scores lenders may use when considering your credit card application.

    740-850
    Excellent

Why We Chose It

The Capital One Venture X card is one of the best all-round travel credit cards ever launched. Not only is it offering a tremendous welcome bonus, but cardholders can earn tons of miles on everyday spending and receive a 10,000-mile anniversary bonus to boot. Its annual fee is $395, but cardholders can count on up to $300 in statement credits toward travel booked through Capital One Travel each year and other valuable benefits like access to Priority Pass lounges and Capital One’s own growing family of airport lounges.

Pros

  • Excellent welcome offer worth 75,000 miles after you spend $4,000 on purchases in the first three months.
  • Up to $300 in annual travel statement credits toward bookings make through Capital One Travel.
  • 10,000 bonus miles (worth $100 toward travel) each account anniversary.

Cons

  • The $395 annual fee might be expensive for some, but this card’s benefits provide much more value than that.
  • If you don’t travel frequently, this might not be the best card for you.
  • Earn 75,000 bonus miles when you spend $4,000 on purchases in the first 3 months from account opening, equal to $750 in travel
  • Receive up to $300 back annually as statement credits for bookings through Capital One Travel, where you'll get Capital One's best prices on thousands of options
  • Get 10,000 bonus miles (equal to $100 towards travel) every year, starting on your first anniversary
  • Earn unlimited 10X miles on hotels and rental cars booked through Capital One Travel and 5X miles on flights booked through Capital One Travel
  • Earn unlimited 2X miles on all other purchases
  • Unlimited complimentary access for you and two guests to 1,400+ lounges, including Capital One Lounges and our Partner Lounge Network
  • Receive up to a $100 credit for Global Entry or TSA PreCheck®
  • Use your Venture X miles to easily cover travel expenses, including flights, hotels, rental cars and more—you can even transfer your miles to your choice of 15+ travel loyalty programs
  • Named editors' choice for "Best New Credit Card of 2021" by The Points Guy
  • Earn 10 miles per dollar when you book on Turo, the world's largest car sharing marketplace, through May 16, 2023