From Morningstar:

A decade ago, I became interested in credit card rewards after seeing a brochure for a hotel-branded credit card. Since then, I have spent hundreds of hours learning and reading up on travel hacking and credit card points. It’s important to consider several factors before delving into credit card rewards.

While some refer to flights and hotel stays funded by points or miles as “free,” the reality is that there is an opportunity cost. There’s also a possibility that fees and charges can easily offset the monetary value of points and miles.

Optimizing credit card spending for rewards can be draining and may require a fair amount of mental energy. It’s important to consider if certain points-maximizing strategies are worth the cognitive load they entail.

Participation in the points and miles hobby may lead to lifestyle inflation, as many enthusiasts spend more to travel more frequently and in a more luxurious way than they would be able or willing to do if they were paying out of pocket. It’s important to recognize that this approach may not actually reduce your spending.

The next article will explore the mechanics of credit card rewards, including how and why they are offered and the part they play in the business models of airlines. It will also highlight some favorite points and miles case studies. Stay tuned for more insights.



Read more: 4 Lessons From my Credit Card Points & Miles Journey