Which Credit Card Should You Buy Points With?

Which Credit Card Should You Buy Points With?

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I frequently write about promotions for purchasing airline miles and hotel points, as this can represent an excellent value.

While I generally don’t recommend buying points without a particular use in mind, in some cases you can get outsized value, particularly for aspirational redemptions (whether that’s a five star hotel or first class flight).

Buying miles for Cathay Pacific first class can be a great deal

While we’ve seen some award costs increase over the years, we’ve for the most part continued to see robust promotions for purchasing points. These often get better and better to account for the devaluations we’ve otherwise seen.

While the main consideration when buying points should be that the deal as such makes sense, in this post I wanted to talk about what credit card you should use when buying points. This might not be as obvious as it sounds, since different programs go about points purchases in different ways.

Using the right credit card can make a material difference in terms of the value you get.

Buying Hilton points for a stay at the Conrad Bora Bora can be a great deal

Maximizing credit card rewards when buying points

Using the best credit card to purchase points might not be quite as straightforward as it sounds. This is due to an important distinction with how loyalty programs choose to process these purchases:

  • If the airline or hotel program processes points purchases directly, you’ll want to use a credit card that offers bonus points for airfare and hotel purchases; that’s because the purchase of points is processed the same way as an airfare or hotel purchase
  • A lot of loyalty programs use points.com to process points purchases, in which case that wouldn’t qualify as an airfare or hotel purchase; in that case you’ll want to use a card that maximizes your return on everyday spending

With that in mind, let’s talk about some of the most popular programs for purchasing points, and how they process those transactions.

Which loyalty programs process points purchases directly?

The following programs process points purchases directly (and therefore points purchases with them qualify as airline spending):

Avianca LifeMiles processes mileage purchases directly

The following programs use points.com for points purchases (and therefore points purchases with them generally don’t qualify as airline or hotel spending):

Emirates mileage purchases are processed by points.com

When points.com processes the purchase, you’ll see a points.com logo at the bottom of the purchase page, as you can see below.

Which credit card should you use to buy points?

As you can see above, some airline programs process points purchases directly. In those instances, you’re best off using a card that offers bonus points on airfare spending.

Those typically include the co-branded credit cards of the respective airline, or otherwise, your best bet would be one of the below, which are flexible cards offering bonus points on airfare purchases.

5x Membership Rewards points per dollar spent directly with airlines or through Amex Travel, on up to $500,000 on these purchases per calendar year and then 1x
The Platinum Card® from American ExpressThe Platinum Card® from American Express
3x Membership Rewards points per dollar spent directly with airlines
American Express® Gold CardAmerican Express® Gold Card
3x Membership Rewards points per dollar spent directly with airlines
American Express® Green CardAmerican Express® Green Card
3x Ultimate Rewards points per dollar spent on airfare
Chase Sapphire Reserve®Chase Sapphire Reserve®
3x ThankYou points per dollar spent on airfare
Citi Premier® CardCiti Premier® Card
2x Ultimate Rewards points per dollar spent on airfare
Chase Sapphire Preferred® CardChase Sapphire Preferred® Card

As you can see, some cards offer up to 5x flexible points per dollar spent, and I value those points at 1.7 cents each. To me that’s like an incremental 8.5% return on that spending, which is incredible.

Furthermore, for these purchases you can also potentially take advantage of some travel credits offered by cards:

So, the above is my advice if buying points from an airline that processes mileage purchases directly. But what about the other airline and hotel programs, which process points purchases through points.com?

My general advice with points.com purchases is to:

Citi® Double Cash Card
Learn More Terms Apply.
  • Earn 1% cash back when you make a purchase, earn 1% cash back when you pay for that purchase
  • $0
Chase Freedom Unlimited®
Learn More Terms Apply.
  • Earn 3% Cash Back on Dining
  • Earn 3% Cash Back at Drugstores
  • Earn 1.5% Cash Back On All Other Purchases
  • $0
Capital One Venture X Rewards Credit Card
Learn More Terms Apply.
  • Earn 2x Venture miles on every purchase
  • No Foreign Transaction Fees
  • 10,000 bonus miles every account anniversary
  • $395
Capital One Venture Rewards Credit Card
Learn More Terms Apply.
  • Earn 2x Venture miles on every purchase
  • No Foreign Transaction Fees
  • Global Entry/TSA Pre-Check Credit
  • $95
The Blue Business® Plus Credit Card from American Express
  • 2x points on purchases up to $50k then 1x
  • Access to Amex Offers
  • No annual fee

Bottom line

For many, buying points is one of the best ways to book premium cabin airline tickets or five star hotels at huge discounts. If you want to maximize the return you get out of your miles & points purchases, it’s valuable to understand how different programs process those purchases.

As you can see above, you can earn up to 5x points on points purchases processed directly by airlines, and up to 2x points on purchases processed through points.com, which personally I value as an incremental return of 3.4-8.5%.

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  1. Eskimo Guest

    Great post.
    Maybe do another one for gift card purchases too.

    1. Steve Diamond

      Buy gift cards at office supply stores if you have a 5x or a grocery store if you have a 3x or more on at a grocery store.

  2. betterbub Member

    Wyndham points are also processed by points.com

  3. Levi Member

    The point about using a card that you're working on a SUB for generalizes to any card that offers a special reward for hitting a target, assuming that target is valuable. The best examples there are hotel cards which offer free night certificates for spending.

    If you consider the Hilton Surpass certs to be worth 60k Honors points, for instance, you can view that as effectively raising the rewards on every one of the first...

    The point about using a card that you're working on a SUB for generalizes to any card that offers a special reward for hitting a target, assuming that target is valuable. The best examples there are hotel cards which offer free night certificates for spending.

    If you consider the Hilton Surpass certs to be worth 60k Honors points, for instance, you can view that as effectively raising the rewards on every one of the first $15k by 4 points, which puts it in the same approximate league as the 2x transferrable point cards.

    Elite credit for spend targets can be harder to value, but may still be worth considering. For example, the AFKL card's 40 XP every year (on top of 20 XP every year for having the card) for $15k is fairly compelling, since qualifying for Silver or better means excess XP rollover and provides the meta benefit of uncapping how many AFKL miles you can buy in a year. Since a miles purchase is one of the easier ways to hit spending targets, having the ability to buy a few thousand dollars worth of miles when the clock is running out can make this game a lot easier/less stressful.

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The comments on this page have not been provided, reviewed, approved or otherwise endorsed by any advertiser, and it is not an advertiser's responsibility to ensure posts and/or questions are answered.

Steve Diamond

Buy gift cards at office supply stores if you have a 5x or a grocery store if you have a 3x or more on at a grocery store.

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Eskimo Guest

Great post. Maybe do another one for gift card purchases too.

0
betterbub Member

Wyndham points are also processed by points.com

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