[Updated August 2016]

After credit card rewards, for most people airlines will offer the next best chance to earn rewards (free flights). Now who wouldn't like to fly to a tropical island for free?

First, a bit about my travel patterns and then I can explain my system for airline rewards. I am based in San Francisco which means I have easy access to the San Francisco, Oakland and San Jose airports. I travel for work to New York, Chicago and Atlanta 2-3 times each per year. This is my primary source for earning status and miles. I travel to visit my family in San Diego and my wife's family in Seattle a few times a year. I also love to ski/snowboard so I fly to Salt Lake City and Denver twice each year. Lastly, I try to do one big international trip per year with the wife during the summer. 

Most people would read the above paragraph and assume that I fly United (the major US carrier with a hub in SFO). They would be dead wrong. I hate United. In my opinion, they are the worst US airline - they are always delayed, they treat their customers with a lack of respect and they have very old planes in their fleet. So which airlines do I fly and why?

• Delta is currently my carrier of choice for three main reasons: they have a good track record of being on time, they treat me well when I have a problem and they upgrade me on almost every domestic flight (everyone in SF has status on United...no one flys Delta so the security lines are short and you get upgraded). Oh, and the most important reason: they fly direct from San Francisco to every destination on my list except Chicago. The drawbacks are that they are mediocre for international flights and their reward program was drastically devalued in 2015. In fact, their international rewards are very hard to redeem. 
• American Airlines is the carrier I will be switching to in 2017. The main reason is because they fly direct to Chicago (but not Atlanta) and because they now offer 3 status miles for every mile traveled on a business class ticket. That's huge as it means I can make executive platinum next year with my work travel + one big international trip. They also have a better reward system for international flights than Delta (though it was devalued in 2016). Their upgrades domestically are a bit more complicated and harder to come by, but that's okay for me since I fly Southwest for my personal trips anyways.
• Southwest is the carrier I fly for my personal flights to Denver, Salt Lake City, Seattle and San Diego. Free snowboard bag to Salt Lake City and Denver is clutch plus you can book tickets using Chase Ultimate Reward points and cancel for free anytime with a full refund (of points and fees paid). It's the perfect way to book ski vacations months in advance (when flights are as little as 6,000 points round trip) and then cancel them if the snow is bad or you decide to do something else. I love the flexibility of Southwest.

So now that you know what I fly and why, here is how I maximize point accumulation on these airlines:

• Earn status: Status is the key to happy flying. Every airline offers some form of status (usually for flying 25,000 miles minimum with higher tiers of status as you fly more). One of the benefits you get with status is that you earn bonus miles. For example, Gold Status on Delta earns a 100% bonus miles reward on any flight. American and United have similar benefits for their premier customers. The key to earning status is to earn all of your miles on one carrier (versus spreading your flights out). You can also try status challenges, airline credit cards that contribute to qualifying miles and mileage runs to earn status. 
• Sign up for promotions: You'll have to check forums and the airline's websites for current promotions. From time to time, airlines will offer 2x or 3x miles on specific routes. There are also long standing promotions like SPG Delta Crossover Rewards whereby I earn 1 delta mile for every $1 spent at a Starwood hotel. Double dipping rewards is a really nice feature of earning status on Delta and Starwood!
• Rapid Reward Dining: Simple enough, just sign up for Southwest's dining program and you get 3 points per dollar spent when dining out at a participating restaurant. It's not much, but it also requires no effort on your part. The best part is that the miles you earn from this dining program are in addition to your credit card rewards. For example, right now Chase Freedom's category is restaurants, so if I spend $100 at a restaurant that participates in Rapid Reward Dining, I will earn 500 ultimate reward points AND 300 southwest points. Using my minimum redemption value of 1.5 cents per point, that's $12 in rewards on a $100 meal. Not bad!
• New Account bonuses: I stopped signing up for cards for bonuses. However, before I stopped, I racked up hundreds of thousands of miles signing up for credit cards. American Airlines had a 100,000 mile bonus, Delta had 35,000, American Express Platinum had a 100,000 point bonus (which transfers into airline miles). You can easily rack up a couple free flights a year by churning cards. It just isn't worth it to me any longer.

To sum up: My main goal with airline miles is to maximize accumulation of miles on my long-haul business trips and then redeem miles for international trips (American) and short personal trips (Delta). Southwest I always fly for free using Chase ultimate reward points.

Next: How to maximize hotel reward points.

​Questions? Comments? Tweet me @RetireOnRewards.

[Updated July 2016]

​I travel to New York (lower east side), Chicago (the Loop) and Atlanta (Buckhead) for work and I like to snowboard in Lake Tahoe, Park City and Vail so I need a hotel chain that has a good presence in these places AND a great rewards program. After crunching all the numbers, it was a no-brainer to commit all of my loyalty to Starwood. 

I was indoctrinated into the Church of Starwood Preferred Guest ("SPG") when I was an Associate at McKinsey. We stayed in hotels 4-5 nights per week and they were always Starwoods. I never questioned it at the time and I really took the program for granted. With greater time and perspective, I've really come to appreciate just how great SPG is for both hardcore business travelers and infrequent casual vacations.

Earning Starpoints

There are a few ways to earn Starpoints:

• Stay at Starwood Hotels and earn 2 starpoints per dollar spent on applicable room rate, food/beverage and services (including spa treatments). The key is to charge everything to the room. You earn 3 starpoints per dollar if you have Gold Status and 4 starpoints per dollar if you have 75 Night Platinum Status. You can also earn for spend when you hold events like conferences or weddings at Starwood facilities.
• Spend money on the Starwood American Express and earn 1 starpoint per dollar on all purchases and 2 starpoints per dollar on all purchases at Starwood Hotels. I had this card when I worked at McKinsey and it really accelerates the accrual of points. It also helps you achieve status by giving you credit for 2 stays and 5 nights. The drawback is a $95 annual fee so I canceled it after I left consulting.
• Sign up for Delta Crossover Rewards and receive 1 starpoint for every dollar spent on a Delta flight if you are a Delta Medallion member. 
• Sign up for Uber Rewards and receive 1 starpoint for every dollar spent on Uber.
• Sign up for the Starwood/Caesar's Partnership and receive 2 starpoints (and status credits) for every dollar spent at Caesar's Palace Hotels (including Harrah's, etc.).

Earning Status & The Key Benefits of Status

Earning Gold and Platinum status at Starwood is easy:

• Free Gold status if you have an American Express Platinum Card
• Earn Gold status with 10 stays or 25 nights (award stays/nights count which is really nice)
• Earn Platinum status with 25 stays or 50 nights
• Lifetime Gold status (5 years of gold and 250 nights) / Lifetime Platinum (10 years of platinum and 500 nights)

The biggest benefits to me are upgraded rooms (including suites at Platinum Status) and late checkout at 4pm. There are many more benefits, here is a good summary.

Redeeming Starpoints

There are two main ways to redeem Starpoints:

• Search for rooms on the SPG website and book using points. The amount of points required for an award night ranges based loosely on the price of the room - more expensive room, more points required. I only book award nights if I am getting at least 2 cents per point in redemption value (and usually I get much more).
• Transfer Starpoints to airlines at a 1:1 ratio (and receive a bonus 5,000 miles when transferring 20,000 points). I only transfer to Delta but you can transfer to about 30 different airlines (including United, Virgin America and many international airlines).

My Pro Tips

I only travel about 6 times per year for work so I would not qualify for SPG Gold Status. However, I discovered a few tricks that help me get to Gold each year. 

• If you book rooms for other people traveling with you, you can earn credit for the stays/nights of your guests up to 3 rooms.
• If you have a multi-day stay in a city like New York that has more than one SPG property, you can book one night each in multiple hotels so you can accrue multiple stays. For example, you can book the W Times Square and the Sheraton Times Square on back to back nights so you get two stay credits instead of one.
• If flying out of a city (like Denver or Salt Lake City after skiing) at night is more expensive than the next morning, you can book a cheap room at an airport Starwood (the Aloft at Denver Airport is usually $99/night) and earn easy, cheap stays.
• Don't forget to rack up starpoints when you go to Vegas, Atlantic City or Lake Tahoe! If you are staying at a Caesar's property, you can charge any restaurant in their system (even at another Caesar's hotel) back to your room. 

Now that you've figured out how to accumulate rewards, click here to learn how to optimize redemption of reward points.

Questions? Comments? Tweet me @RetireOnRewards.

 [Updated September 2016]

For most individuals who are  not hardcore business travelers, credit card spend and new account bonuses will be the primary way that you accumulate points and rewards. Before I dive into the cards I use, let me start by sharing a little bit about my spending habits. I spend ~$40,000/year on credit cards and about 75% of the spend is restaurants, travel and Amazon. I do spend about $3500/year on gas. I don't spend much at grocery stores as I mostly use Google Shopping Express or Instacart from Costco or Safeway. If I spent a lot at grocery stores, I would consider getting the American Express Blue Cash Preferred Card (6% at grocery stores) or the Bank Americard Cash Rewards (no fee, 3.5% on groceries if you are a  Platinum Honors banking customer).

So let's dive into what I have in my wallet:

• Chase Sapphire Reserve - $450 annual fee, earns 3 ultimate reward points for every dollar spent on restaurants (including Postmates) and travel (including Uber) as well as 1 point for all other spend. There are two reasons why I keep this card. Ultimate reward points are very flexible - I transfer them 1:1 to United, Southwest and Hyatt. There are many other transfer options (including Singapore Airlines and British Airways which are great for booking international reward tickets). The second reason why I keep the card is because you can combine points earned by Chase Freedom and Chase Freedom Unlimited into the more valuable ultimate reward points on your Sapphire. This is a really nice boost which I'll explain shortly. The minimum value that I will redeem an ultimate reward point is 1.5 cents per point (and I can usually get more value than that with international travel). That means that Chase Sapphire earns a minimum of 4.5% cash back on restaurants and travel which are the only categories where I use this card. Note, you get $300 in airline credits per year which drop the annual fee down to $150/year. 
• Chase Freedom - No annual fee, earns 1 point for all spending and 5 points for spending in a specific category every quarter that rotates. For example, one quarter might be 5 points for every dollar spent at gas stations or restaurants or Amazon. The limit on these 5 point categories is 7,500 points per quarter. When combined with Chase Sapphire, the 5 ultimate reward points per dollar spent is a minimum of 7.5% cash back when used in a bonus category. That's HUGE! I max out the bonus category every quarter (and my wife has her own card so she can also earn the max bonus).
• Chase Freedom Unlimited - No annual fee, earns 1.5 points for all spending. When combined with Chase Sapphire, these points translate into 2.25% rewards. As of 9/16, this has replaced my Fidelity card.
• Costco Anywhere Card by Citi - No annual fee with Costco membership, earns 4% cash back on gas, 3% on restaurants and travel, 2% at Costco, 1% everywhere else. I only use this card for gas (unless gas is the Chase Freedom bonus category) and Costco. Cash back comes in the form of a rebate check at the end of the year. 

So, to quickly recap. Before I make a purchase, I go through this decision tree:

• If the purchase is in a bonus category for Chase Freedom (and I have not hit the bonus limit yet), then I use Chase Freedom. 
• If not, then I use Sapphire Reserve if it is a restaurant or travel, Citi Costco for gas purchases and then Chase Freedom Unlimited for everything else.

Note: Before you sign up for ANY of these cards. Please google the name of the card + "new account bonus". For clicking a random affiliate link, you can get a nice sign up bonus. 

Phew, now that I've covered cards that I currently use. I'll quickly cover cards that I've had in the past:

• Citi Forward - I loved this card. 5% cash back on Amazon and restaurants with no reward limits. Unfortunately, they stopped issuing it and then degraded the rewards. It was great while it lasted.
• Fidelity Rewards Visa - No annual fee, earns 2% cash back on all purchases. I used to use this card for everything that didn't fit into a bonus category. Now I use the Chase Freedom Unlimited.
• Starwood American Express - If you are a hardcore business traveler that stays at Starwoods, this card is fantastic. You get 2 starpoints for every dollar spent at Starwood Hotels / Restaurants and 1 starpoint on everything else. You also get 2 stays and 5 nights credit toward earning status every year. I had this card while at McKinsey, but I don't stay at enough Starwood Hotels anymore to justify the $95 annual fee.
• Delta, American Airlines, United cards - I've had them all at one point or another. None of them are worth using (though the new account bonuses have been really nice). Chase Sapphire is much more flexible for earning and redeeming rewards.

One more quick note. The best new account bonuses for credit cards have been the American Express Platinum 100,000 membership rewards points, the Chase Sapphire 60,000 ultimate reward points and Hyatt's two free nights at any Hyatt Hotel (Maldives is the best redemption). I no longer churn credit cards for new account bonuses as it is not worth the headache. If you want to learn about it, here is an article on the topic and here is a site that has current bonuses. Note, I don't get paid for any of these links and I just choose to link to Nerd Wallet because their site has a clean UX and the founder is a cool guy.

Next: How to Optimize Airline Rewards.

​Questions? Comments? Tweet me @RetireOnRewards.

[Updated June 2016]

​There are three main ways to accumulate rewards:

• Credit card spend on reward credit cards and bonuses for opening accounts. Find out what is in my wallet and how to rack up points fast. 
• Frequent flier programs with airlines. I fly Delta and American for work and add in Southwest for award flights. Here is how I maximize rewards on these carriers.
• Hotel rewards programs for staying at hotels. I primarily stay at Starwood hotels for work and add Hyatt for award stays. Here is how you earn free hotel nights fast.

You can also collect airline miles for renting cars (I use Hertz for work), eating at restaurants (I use Rapid Rewards Dining) and even running a conference at a Starwood Hotel.

Once you decide what rewards programs to use, go to their websites and sign up for accounts. Keep track of all your usernames and passwords and download apps if the loyalty programs have them. The SPG app and the Delta & American apps are quite useful.

My three pro tips for accumulating rewards fast:

• If you are organizing an event, vacation or dinner for a group of people, you should offer to pay on your card to maximize rewards and collect cash from people for their portion. This works very well with hotels as you can also get hotel rewards for multiple rooms you book with Starwood.
• You should consolidate all of your hotel and airline loyalty to one partner so you can gain elite status and earn rewards faster.
• If you aren't trying to buy a home in the next 24 months AND you have good credit, you can open 1-2 credit cards per year to take advantage of new account bonuses. [2014 Update] I stopped opening new accounts as it is just not worth the headache anymore. YMMV.

Note: It is really important to remember that you should not spend money just for the sake of rewards. I do not believe in mileage runs or buying something you wouldn't otherwise buy just for the points. Otherwise, this whole system fails.

Ready to start earning rewards? Let's start with credit card rewards.

Questions? Comments? Tweet me @RetireOnRewards.

[Updated June 2016]

I use two brokerage accounts for Retire on Rewards - a traditional IRA with Schwab and a taxable account with Fidelity. 

In an ideal world, I'd have all of the rewards consolidated into one account for simplicity and I would prefer that account be a Roth IRA as it is the most advantageous for tax purposes. For a quick overview of Roth IRAs vs. Traditional IRAs, click here.  I don't qualify for a Roth IRA so I use a traditional IRA. Since I can only contribute $5,500 annually to the IRA account, I need to have a taxable account that houses my reward balance during the year until I make my contribution (and carry any overflow if I save more than $5,500 in a given year).

Why Schwab? Simple. My employer uses them for a work sponsored SEP-IRA plan so I decided it was better to have both IRAs under one roof. Schwab also offers free trades for certain ETFs and free dividend reinvestment. Minimizing fees is a big part of my investing strategy so they met my criteria.

Why Fidelity? Fidelity issues a Visa credit card which offers a flat 2% cash reward on all purchases. This is my default card and the reward automatically gets added to my Fidelity account when I reach $50 in rewards. If I hadn't been a Schwab customer for a really long time (OptionsXpress starting in 2004), I'd just have a Fidelity IRA and a Fidelity taxable account. I like their platform better than Schwab and their fees are lower. 

One other potential choice was Merrill Edge because they offer 30 free trades if you are a Platinum Bank of America customer. There is also a really nice Platinum bonus if you use the Bank Americard Credit Card. Full details here. However, I love Silicon Valley Bank and the free trades are not enough of a reason to switch. 

Now that your brokerage account(s) are set up, it's time to start accumulating rewards! 

​Questions? Comments? Tweet me @RetireOnRewards.