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Navigating the "Travel By Points" Game in Malaysia
These are personal tips and experiences I've gathered. There might be better ways, so do your own research! This is just to make the topic easier to understand.
Important Considerations for Travel By Points
- Credit Card Sign-Up Bonuses are Key: The secret to amassing points quickly is racking up sign-up bonuses. Consider getting several credit cards for their initial point offers, which can range from 60,000 to 300,000 points (depending on the card). Relying solely on everyday spending (usually 1 point per MYR spent) will take forever. A business class ticket from KL to Europe might cost 70,000-100,000 points, so you'd need to spend a fortune.
- Meeting Spending Requirements: Make sure you can hit the minimum spending required to get a sign-up bonus. For example, some cards require you to spend RM50,000 in 3 months to earn 200,000 points, can you manage that? This hobby also demands good financial management, if you rack up credit card debt and pay interest, you'll lose money.
- Value of Points: Before redeeming your points for cash or booking travel directly through the bank's travel portal, do the math. Are you getting the best value? Sometimes, 100,000 points might get you RM4,000 cash back, but used strategically, those points could score a business class ticket worth RM16,000-RM20,000, or even a first-class ticket worth RM40,000-RM48,000!
Earning Points in Malaysia
- Leverage Family Spending: With a large family, using a credit card for all essential spending (groceries, shopping, dining, supplies) and paying it off monthly is already enough to meet the sign-up bonus. If your expenses are lower:
- Plan Ahead: Plan your travels for the next year or two (overseas holidays, balik kampung, etc.). Decide which credit cards you need to apply for, how many points you'll need, and how many cards you need to get those points.
- Strategic Card Applications: If your family needs around 300,000 points to buy four economy tickets to a long-haul destination, consider applying for cards for both partners in the family. Using referral links can get you extra points. This could easily save you RM20,000 - RM24,000!
- Time Your Spending: Consider larger expenses coming up (house repairs, appliances, taxes). Pay for everything with your credit card, and prioritise using cards that give 2x or 3x points on specific purchases to earn points faster.
- Maximize Bonus Categories: For example, a certain card might give 5x points on car rentals, 3x on online grocery shopping, and 3x on dining. Use that card for those specific purchases. Another card might give 5x on flights and hotel bookings, so use it for travel-related expenses.
- Hotel Loyalty Programs: Sign up for hotel loyalty programs (IHG, Hilton, Marriott) to earn even more points when staying at their properties. For example, if you're a top-tier member at a hotel chain, using that hotel's credit card to pay during your stay will get you even more points per MYR spent.
Impact on Credit Score in Malaysia
Will opening multiple credit cards hurt your credit score in Malaysia?
- I opened five cards last year (one every 2-3 months). My credit score was around 710 (as I mainly used cash), but it increased by 110 points within six months, now fluctuating between 780-800. Opening a card might temporarily lower your score by 3-5 points, but paying off your balance will increase it by 10-20 points the following month. The most important thing is to PAY OFF YOUR BALANCE EVERY MONTH to avoid debt and interest charges. With interest rates averaging 20-25%, paying interest means you're losing money.
PS: I'll break this topic into smaller posts for easier reading. Look out for them!
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