Points and Miles Lingo for Beginners

These are the words, phrases, and acronyms you need to know. These are the same ones I’m constantly asked about by friends and family. Consider this your cheat sheet to start speaking Points and Miles like a pro in no time.

Annual Fee (AF): A fee that processes once a year. It’s the cost of keeping a card open. Annual fees range anywhere from $0 to almost $900, which sounds completely unhinged the first time you hear it! But higher annual fees usually come with more credits and perks. You can often cover the cost of the fee entirely with travel credits, dining credits, and other built-in perks — it just takes a little effort. I hold several medium-to-high annual fee cards, and the value has always outweighed the cost.

Cash Back Card: A rewards credit card that pays you back a percentage of what you spend on eligible purchases. A 2% cash back card, for example, earns you $2 for every $100 spent. Travel hackers and points people generally aren’t big on cash back cards, since that same spending can usually generate far more value through transferable points. That said — some Chase cash back cards let you choose between taking your rewards as cash back or converting them into Chase points, as long as you also hold one of Chase’s transferable-points cards. It’s a neat trick and a solid addition to your points strategy, as long as you’ve got that other Chase card in your wallet to unlock it.

A few of the Chase cards that unlock this trick:

• Chase Sapphire Preferred® Card — the standard, mid-tier consumer travel card
• Chase Sapphire Reserve® — the premium consumer travel card
• Ink Business Preferred® Credit Card — the primary business credit card option
• Sapphire Reserve for Business℠ Credit Card — the ultra-premium business travel card

Cents Per Point (CPP): This is how we measure the value of the points you’re spending on a redemption. Basically, how good of a “deal” you scored. This only matters if “getting the most for the least” matters to you. Around here, we like to measure redemptions in memories made and dreams achieved, even if it wasn’t technically the best CPP on the books. That said we almost never take a redemption below 1 CPP, because that’s the baseline cash value of your points if you just used them through the portal instead.

Credit Card Ecosystem (or Universe): This is how points and miles people refer to all the credit products available within one bank or brand. The Chase ecosystem, for example, includes every credit and cash back card Chase offers. Most travel hackers recommend dipping into a few different ecosystems once you’ve gotten the basics down, since each one has its own set of transfer partners.

Global Airline Alliance: A partnership between airlines around the world (think Star Alliance, Oneworld, and SkyTeam) that lets you earn and redeem miles across each member airline, not just the one you actually flew. So if you transfer points to one alliance partner, you can often use those miles to book a totally different airline within that same alliance. Great for sweet spot redemptions, since some partners price the same flight way cheaper than others.

Minimum Spend Requirement (MSR): The minimum amount you have to spend on a new card, within a set window of time, in order to actually earn the sign-up bonus. The best time for my family to open a new card is when we have a big expense coming up that I know will knock out the MSR quickly, so I’m not stressing about hitting it in time.

Loyalty Program: In the points and miles world, this almost always refers to an airline or hotel’s own rewards program. When you transfer your points into one of these programs, you’re then able to book flights or hotel stays directly through that airline or hotel. In other words, your travel credit card has several transfer partners, and those transfer partners are the loyalty programs for the airline and hotel brands themselves.

P1 and P2: Short for Player 1 and Player 2 in the points and miles game. This is your travel partner, and for simplicity’s sake, it should probably also be your partner in life. In my house, I’m P1 and my husband is my P2. It’s just a shorthand way to keep track of who holds which cards.

Transfer Bonus: A limited-time promotion offered by credit card programs (think American Express, Chase, or Citi) or by the airline/hotel programs themselves. These usually run for at least half the month, though sometimes they’re only live for a couple of days. They give you extra points or miles when you transfer your existing credit card points to a transfer partner. New bonuses pop up basically every month, so the 1st is kind of like Christmas morning around here. Definitely something to watch for while you’re brainstorming or planning a trip.

Transfer Partner: Many airline and hotel loyalty programs let you move your flexible credit card points directly into their systems, so you can book travel through the airline or hotel itself, usually at a much better rate than you’d get through the credit card’s own travel portal. This is how everyday credit card points become frequent flyer miles or hotel points.

Transfer Ratio: The exchange rate used when you move your points from one program (like a bank) to another (like an airline or hotel).

For example: Amex transfers to Hilton at a rate of 1:2. That means for every 1,000 Amex points you transfer, you’ll land 2,000 Hilton points in your Hilton Honors account. Transfer ratios vary from bank to bank. Chase, for instance, only transfers to Hilton at 1:1. Knowing these ratios ahead of time should absolutely be part of your trip-planning strategy.

5/24 Rule: The lamest rule in the entire points and miles game. This unofficial rule says that if you’ve opened more than 5 personal credit cards — across all banks — in the last 24 months, Chase will automatically deny your application for a new card.

Ways around it:

1. Wait it out.
2. Open business cards instead — they don’t count toward Chase’s 5/24.
3. Apply for any personal Chase cards you want first. Since Amex, Venture X, and Citi don’t follow this rule, you can apply with them afterward.

This rule also includes Travel Co-Branded Cards (an airline or hotel branded card issued by Chase, Amex, Citi, or another bank.) So if you’re eyeing the Chase Southwest card, it still counts toward your 5/24, since it’s a personal Chase card.