How do credit card miles work?

With travel rewards credit cards, you can earn rewards in the form of miles or points and then redeem them later on. Rewards are typically earned by making purchases with the card. And options for redeeming those rewards can include everything from flights to statement credits on your account.

Learn more about choosing a travel rewards credit card, earning miles and redeeming miles.

Key takeaways

• A travel rewards cardholder typically earns miles by making purchases with their card. 
• Major travel card categories include airline cards, hotel cards and general travel cards.
• Rewards redemption options vary by card. But they can include things like covering travel-related purchases or redeeming rewards for a check, statement credit or gift card. 
• Some card issuers offer bonuses for opening a travel card and spending a set amount with the card in a specified period of time.

Travel rewards credit cards often allow cardholders to earn rewards in the form of miles when they use the card for purchases.

Here are three types of travel credit cards that typically offer rewards in the form of miles:

• Airline cards: A credit card issuer sometimes partners with an airline to offer its customers an airline card. Cardholders can use the airline miles they earn to book flights or get other perks through the airline and its partners. 
• Hotel cards: Hotel cards work a lot like airline cards. But in this case, a credit card issuer partners with a hotel or hotel chain. Cardholders can earn rewards by using their card and then redeeming the rewards for hotel stays. 
• General travel rewards cards: With a general travel card, you typically won’t be tied to a specific airline or hotel. That can mean more flexibility when you’re redeeming miles. Options can include everything from flights and hotel stays to car and vacation home rentals. Depending on the card, additional perks might include airport lounge access, priority boarding, rental car insurance and statement credits for Global Entry or TSA PreCheck®.

Here are two common ways to earn miles on a travel card:

• Earning an early-spend bonus: Some credit cards may offer bonus miles for opening an account and then spending a specified amount on the card over a set time period. With the Capital One Venture card, for example, you can earn 75,000 bonus miles once you spend $4,000 on purchases within the first three months from account opening.¹ An early spend bonus might also be called a sign-up bonus or welcome bonus.
• Making purchases with the card: Generally, you earn miles for every dollar you spend using a travel rewards card. Depending on the card, different types of purchases may also come with different reward rates. For example, the Capital One Venture card offers unlimited 2X miles per dollar on every purchase and 5X miles on hotels and rental cars booked through Capital One Travel.

Ways to earn miles can vary by credit card issuer. So can ways to redeem them. 

Here are some common options for redeeming travel credit card miles: 

• Travel-related purchases: With travel credit cards, you can typically use miles to cover all or part of a travel-related purchase made with the card. Some cards may have restrictions on the types of purchases rewards can cover. With an airline or hotel card, for example, you may be limited to spending your miles at the hotel or airline attached to your card. But a general travel rewards card may let you redeem miles for a variety of travel-related purchases. 
• Capital One Travel: You can use your miles for things like hotels, rental cars and flights booked through Capital One Travel. 
• Miles transfers: Some credit card issuers may let you transfer miles you’ve earned to the loyalty programs of their airline and hotel partners. You can use those transferred miles to pay for things like flights, flight upgrades and hotel stays.
• Cash back or statement credit: With some travel cards, you can turn your miles into cash in the form of a check or statement credit. 
• Gift cards: Some travel cards let you redeem miles for gift cards. That way, you can still use the miles you’ve earned even if you don’t have a trip on the horizon. 
• Capital One Entertainment: Use your miles, your card or a combination of the two to purchase concert tickets and other unforgettable experiences on Capital One Entertainment. 
• Amazon.com and PayPal purchases: Pay for Amazon.com purchases with your miles by linking your eligible Capital One rewards card to your Amazon account.² And pay for PayPal purchases with your miles by linking your Capital One rewards card to your PayPal account and using your miles for purchases anywhere PayPal is accepted, including at sites like Target®, Apple®and The Home Depot®.³

The right travel card for you will likely depend on things like your spending habits and lifestyle. So when you compare cards, be sure to understand the differences in their earning and redemption options. You may want to take any extra benefits and perks into account as well. 

The FDIC also recommends considering factors like annual percentage rate (APR), balance transfer APR and credit card fees. It can also help to understand common credit card terms like credit scores and credit limit before opening an account. 

Here are commonly asked questions about how credit card miles work:

With a travel rewards credit card, you can typically earn miles on purchases made with the card and then redeem them for travel-related purchases and more. Some cards may offer additional ways to earn and redeem miles. They may come with other travel-related perks, too.

Ready to start looking at travel cards? You can start by comparing Capital One travel rewards cards to find one that’s right for you. You can also check whether you’re pre-approved for Capital One credit card offers without hurting your credit scores.