Top Beginner Mistake With Travel Rewards Cards, Per Expert

New travel rewards cardholders frequently leave significant value on the table by mismanaging their cards from the start, according to Brian Kelly, founder of The Points Guy, a leading credit card and travel rewards advisory site. Kelly shared his expertise with MarketWatch in what amounted to a primer on navigating the increasingly complex world of travel credit cards.

The central error beginners make, Kelly explained, is failing to offset annual fees through strategic redemptions. Many consumers sign up for premium travel cards attracted by sign-up bonuses, then treat the card like an ordinary credit card — spending points on low-value redemptions or letting them accumulate unused, effectively negating the benefit of paying a sometimes steep annual fee.

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Kelly's advice comes at a time when travel costs continue to climb, putting pressure on consumers to maximize every dollar spent. Travel rewards cards, when used correctly, can serve as a meaningful hedge against rising airfare and hotel rates — but only if cardholders understand the mechanics of point valuations and redemption tiers. The gap between a poor redemption and an optimal one can represent hundreds of dollars in real-world value.

Understanding annual fees is also critical, Kelly noted. A card charging $500 or more per year can still deliver net positive value — but only if the cardholder actively uses the card's travel credits, lounge access, and other built-in perks. Beginners who ignore these benefits effectively pay a premium for a product they are not fully using.

For consumers feeling squeezed by higher travel prices, Kelly's framework offers a structured approach: calculate the realistic value of a card's perks against its annual cost before applying, and prioritize redemptions for flights and hotels over cash back, where point value is typically highest. Continue reading at MarketWatch.com.