Over the past few weeks, we have spent a lot of time talking about both airline miles and hotel points, and some ways to earn them. Today, we are going to take a brief moment to discuss the third type of points “currency”: transferable points.

Transferable points are those earned via a credit card issuer that can be transferred – hence the name – to a number of different airline and hotel partners. So let’s talk about how they work, why these might be worth more than “normal” points/miles, and examine my personal favorite of them to get an idea how to maximize earning.

As we have discussed before, credit card issuers want your business, and they want their cards to be your primary go-to credit cards for spending. To entice you, they will partner with different airlines and hotels on co-branded credit cards (where the card is both from American Express and Delta, for instance), sometimes offering huge numbers of miles/points for signing up, which they purchase from the airline or hotel chain at bulk rates not available to us as consumers. However, most of these issuers also have rewards credit cards that are not specifically branded with a partner. These cards earn points, just like the others, but these generic points are governed by a different set of rules, and have names like Chase Ultimate Rewards points, Citi Thank You points, American Express Membership Rewards points, and a few others.

Earning works similarly to other credit cards. Depending on the card, it earns anywhere from 1-5 points (typically) on different categories of spend. For instance, the Citi Premier earns 3 points per dollar on travel expenses and gas, 2 on restaurants and entertainment, and 1 on all other spend. Other cards have different “bonus” categories. And, just as with co-branded cards, issuers will sometimes offer large lump sums of points as sign-up bonuses. (The aforementioned Citi Premier is offering 60,000 for a $4,000 spend in the first three months.)

So what can you do with these points? Well, here is where these transferable currencies take the crown. Citi currently has 14 airlines that you can transfer these points to, in increments of 1,000 at a 1:1 ratio, in order to book award tickets with those airlines (or their partners). Similarly, Chase, AmEx, and others have transfer partners, with some overlap and some unique. So think of these almost as a wild card in poker. For instance, if Delta charges 25,000 miles each way to fly from Los Angeles to Hawaii, but Flying Blue (the reward program for Air France and KLM) offers that same ticket on Delta (one of their partners) for 17,500 miles, you can transfer your Citi points there and save some dough. If another airline is cheaper (this can take some research), perhaps your currency works there as well. Likewise you can use this to take advantage of some airlines’ more generous rules about stopovers (a multi-day layover) or open-jaw award bookings.

The other advantage of these currencies is that they can be used in a few other ways. First, they can pretty much all be redeemed for cash at $.01 per point. This isn’t the best value, of course, but it’s an option if you just want the cash. Secondly, they can be used for a set amount (roughly 1.5 cents per point in most cases) for travel booked directly through the issuer’s travel agency. So if I want to use points but there’s an awesome flight deal, I can possibly find some savings. (If a round-trip flight to Europe on American is normally 60,000 miles, but it’s on sale for $300, I can book that for 20,000 Chase Ultimate Rewards points through their travel portal.)

There are typically two “levels” of card within each of these issuers: free and fee. The free cards will allow you to earn points, but not to transfer them to partners. To do so, you’ll need one of the fee cards, but will then be able to combine all the points between all your accounts.

Does that all make sense? Good. (If not, feel free to comment or email me with questions.)

So which of the transferable currencies is the best? There’s really no right answer, but my personal favorite is Chase Ultimate Rewards. Why? First of all, they have a large range of cards, from the free Freedom, Ink Cash, and Freedom Unlimited cards to the mid-fee Sapphire Preferred and Ink Plus, to the $550 annual fee Sapphire Reserve. I personally carry the Freedom, Ink Cash, and Sapphire Reserve (yes, the fee is worthwhile to me).

This flexibility in cards allows me to maximize my spend. The Freedom card gives me 5 points per dollar on a different rotating quarterly category (this quarter was grocery stores, next is Amazon/Whole Foods) up to $1,500. The Ink Cash card gives me 5 points per dollar on telecommunications, business supplies, and a few other business-related expenses. And the mighty Sapphire Reserve offers 3 points per dollar on travel and dining out. Between these, it means the majority of my expenses are earning multiple points per dollar.

Chase only has 10 transfer partners, but with three of those being US-based carriers (United, Southwest, and Jet Blue), I feel this maximizes my flexibility, especially as all three major airline partnerships are represented. They also have largely had great customer service, and have an easy-to-use travel portal.

Others will swear by Citi (I also carry the earlier mentioned Premier card) or AmEx (I don’t have any), so this is just my personal experience speaking, and certainly not representative of everyone or their needs. Also, I don’t get anything from Chase for recommending them.

I hope this primer on transferable points helped, and that you take this next step toward becoming a points and miles guru.

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