Why I’m Writing This—And Why It’s Not What You Expect
I’m a travel agent, which might make you think I’m going to tell you that points and miles are the only way to go. But I’ve been in this business long enough to see the other side of the story—where travel rewards actually end up costing people more time, money, and sanity than they ever save.
The truth is, I’ve booked plenty of travel for clients who would have been better off never signing up for that airline credit card or hotel loyalty program. And I’ve seen the frustration when someone realizes the “free” flight they earned after two years of spending actually came with hundreds of dollars in fees and a routing that added six hours to their trip.
This isn’t about trashing rewards programs. It’s about being honest about when they make sense—and when they don’t. If you’re wondering whether you should be chasing points, or if you’ve already started to feel like the game isn’t worth it, let’s talk through the scenarios where travel rewards can be a genuinely bad idea.
The Hidden Costs of Chasing Travel Rewards
The biggest trap with travel rewards is focusing on what you earn while ignoring what you spend. Here are the costs that eat away at the value of your points:
Annual Fees
Many travel rewards cards charge $95 to $550+ per year. If you’re not using the card’s perks—like lounge access or free checked bags—you’re paying for benefits you don’t need. That “free” flight you’re saving for might just cover the annual fees you’ve paid over two years.
Foreign Transaction Fees
Some travel cards actually charge foreign transaction fees (typically 3%). If you’re traveling internationally and using that card, you’re losing money on every purchase. A no-annual-fee card with no foreign transaction fees often comes out ahead for the average international traveler.
Interest Charges
This is the big one. If you carry a balance on your rewards card, the interest will almost certainly outweigh any rewards you earn. A typical rewards card has an APR around 20% to 25%. If you charge $2,000 and pay it off over six months, you’ll pay more in interest than the value of any points you earned. Credit card companies love this because they profit heavily from interest—your rewards are subsidized by people who pay interest.
Opportunity Cost
Every dollar you spend on a rewards card is a dollar you’re not putting toward a no-fee cash-back card. Many people assume points are automatically better, but a flat 2% cash-back card with no annual fee can often outperform a complicated travel rewards setup—especially if you don’t travel frequently or flexibly.
When Points and Miles Lose Their Value
Another major issue is that the value of travel rewards isn’t stable. Programs devalue their points regularly. Here’s what that looks like in practice:
- Devaluation events: Airlines and hotel chains frequently change how many points are needed for a flight or room. A route that cost 25,000 miles last year might now require 40,000—and by the time you’ve saved up, the goalposts have moved.
- Blackout dates: That award seat you want? It’s not available on the day you need to fly. Blackout dates are common, especially for peak travel times like holidays or summer weekends.
- Limited availability: Even when there aren’t explicit blackout dates, airlines release only a few award seats per flight. You might find availability on a Tuesday flight at 6 AM but not on the Friday afternoon departure you actually want.
- Fees on award bookings: Many loyalty programs charge booking fees, carrier-imposed fees, or fuel surcharges on award tickets. I’ve seen clients redeem 50,000 miles and still pay $200 in taxes and fees—that’s not really a free flight.
These factors mean that the points you earn today might not be worth what you think they are when you finally try to use them. And if you’re not willing to be flexible with dates, times, and destinations, you may find you can’t use your rewards at all.
The Lifestyle Trap: Spending More to Earn More
Credit card companies are experts at behavioral psychology. They know that if you’re trying to earn a sign-up bonus or hit a spending threshold, you’re more likely to overspend. Here’s how the trap works:
- You sign up for a card offering 60,000 bonus miles after spending $4,000 in the first three months.
- You start charging everything to that card—groceries, gas, dining, even bills.
- You find yourself buying things you wouldn’t normally buy, just to meet the spending requirement.
- You justify larger purchases because “you’ll earn points.”
- You end up spending more than you would have without the card, and the points you earn are worth less than the extra money you spent.
It’s easy to tell yourself you’re being smart by earning rewards, but the math doesn’t lie. If you wouldn’t have spent $4,000 in three months anyway, the sign-up bonus isn’t free money—it’s a reward for spending money you might not have spent otherwise. Studies show that people spend more when paying with credit versus cash, and that effect is amplified when points are involved.
I’ve had clients tell me, “I got a free trip to Cancun with points!” only to later admit they spent $2,000 more on dining and shopping that year than they normally would have. The trip wasn’t free—they just moved money from their checking account to their credit card bill without connecting the dots.
Who Should Actually Skip Travel Rewards?
Not everyone is a good fit for travel rewards programs. Based on what I’ve seen over the years, here are the types of travelers who are usually better off staying away:
The infrequent traveler. If you take one trip per year or less, you won’t earn enough points or miles to justify the annual fees and the mental overhead of managing multiple programs. A cash-back card is simpler and more valuable.
Anyone who carries a balance. Full stop. If you don’t pay your credit card balance in full every month, rewards cards will cost you money due to interest charges. Paying off debt should always come before earning points.
Travelers who value flexibility. If you need to book specific dates, routes, and times—or if you dislike strict cancellation policies—rewards can be frustrating. Award availability is limited, and changing an award booking often comes with fees. Sometimes paying cash gives you more freedom.
People who prefer simplicity. Managing multiple loyalty programs, tracking point values, and optimizing earning categories can become a part-time job. If that doesn’t sound fun, it’s okay to skip it entirely. A single cash-back card or an honest travel agent can do the job without the mental load.
Travelers on a tight budget. Rewards programs often reward spending. If you’re trying to minimize expenses, chasing points can actually push you to spend more than you should. Saving directly for travel is a smarter strategy.
A Smarter Approach: What to Do Instead of Chasing Points
If travel rewards don’t fit your situation, there are better alternatives that deliver real value without the complexity:
Cash-back cards. A simple, no-annual-fee card that earns 1.5% to 2% cash back on everything is often better than a travel rewards card for most travelers. The cash is flexible—you can use it for any travel expense, or just keep it. No blackout dates, no devaluation, no points to manage.
Dedicated travel savings. Instead of earning points, set up a separate savings account and automatically transfer a small amount each week or month. When you book a trip, you pay with actual saved money—no interest, no fees, no restrictions.
Work with a travel agent. This might sound self-serving, but I’ve helped countless clients find better deals on flights, hotels, and package trips than they would have gotten using points. We know the market, we can compare pricing across multiple systems, and we often have access to rates and perks you can’t find on your own. Plus, we handle the logistics so you can focus on enjoying your trip.
If you’re not sure whether travel rewards are right for you—or if you’re ready to explore other options—reach out to Bob’s Travel Service. We can talk through your travel habits, your goals, and your budget, and help you decide what approach will actually save you money. No pressure, no sales pitch—just honest advice from someone who’s been booking travel for a long time.