This story originally appeared on SmartAsset.
Using a travel rewards card to pay for your next trip could be a smart move if you want to rack up miles, points or cash back on what you’re spending. The key to getting the most mileage possible out of your travel rewards is avoiding flubs that could diminish their value. Here are the most common travel credit card mistakes that could leave you feeling shortchanged.
1. Not Joining Travel Loyalty Programs
Loyalty programs are designed to reward you for being a faithful customer to a particular brand and they can provide you with a great opportunity to save money on travel. For example, if you’ve got an airline-branded credit card, you could earn miles to use towards free flights by linking your card to the airline’s dining program or online shopping portal.
You can also double dip on rewards if you enroll in a hotel loyalty program and book a room with a card that pays out points for hotel purchases and airline miles at the same time. Signing up for these programs doesn’t take much time, so there’s no reason to miss out on the chance to boost your rewards balance.
2. Using Miles for Merchandise or Gift Cards
Most credit card companies offer some flexibility in terms of how you can use your travel rewards. But it’s important to be careful about how you redeem your rewards. Generally, you stand to get the most bang for your buck when you use miles to pay for flights versus swapping them out for a gift card or merchandise from the card’s online shopping portal. While your miles may be worth a few cents each for air travel purchase, they could end up being worth less than a penny apiece if you use them for something else.
3. Not Doing the Math on Rewards Transfers
Some travel credit cards allow you to transfer your points or miles into other frequent flyer or hotel loyalty programs. If you’re already a frequent flyer with a specific airline, that might make it easy to use the miles you’ve earned with your card. But it could cost you if your rewards don’t transfer on a 1:1 basis.
For instance, 50,000 miles on your card may only be worth 40,000 miles with the airline, so it pays to run the numbers before transferring rewards over.
4. Carrying a Balance
Carrying a balance on your credit card when you’re trying to max out your travel rewards could be a counterproductive move if you’re paying interest on what you spend. If your card is charging you 13% or 15% interest, the price you pay for having credit card debt could easily outweigh what you’re earning in rewards. The same goes for if you’re paying a high annual fee. Earning $50 worth of rewards might not be worth it if you’re paying an annual fee of $95.
5. Paying a Foreign Transaction Fee
A foreign transaction fee can get tacked onto certain credit card charges when you make international purchases. This fee typically amounts to 1% to 3% of the transaction amount. So for $1,000 in charges, $10 to $30 would go straight to the fees. If you spend a lot of time traveling outside the U.S., choosing a card with no foreign transaction fee can make your rewards stretch further.
A travel rewards card can be an excellent tool for saving money on trips, if you’re using it the right way. Sidestepping potentially costly blunders can ensure that your efforts to save aren’t wasted.