Travel rewards have the potential to significantly amplify your travel budget, enabling you to embark on journeys that might otherwise be too costly or explore destinations further afield. By redeeming airline miles, you can secure flights valued in the thousands of dollars, and with a generous accumulation of hotel points, you’re able to enjoy stays at upscale resorts that would normally be out of reach.
However, it’s vital to remain vigilant about the intricacies of travel rewards. In addition to the basic travel fees, there are several hidden costs that could jeopardize your budget if you’re not prepared.
If you possess a couple of travel credit cards and an ample collection of points and miles, it’s essential to familiarize yourself with the overlooked taxes, fees, and additional expenses that you need to anticipate before setting out on a major trip. Here are some of the most common culprits to keep in mind.
1. Government-imposed airline taxes and fees
Using airline miles for what seems like a “free flight” can be appealing, but remember that you will still be responsible for relevant government-imposed taxes and fees, much like you would if you were purchasing a ticket outright. On domestic routes, these airline taxes may be as low as $5.60 per leg for each passenger, but for certain international flights, you might incur charges that run into the hundreds.
To sidestep any unpleasant surprises, ensure you are aware of these taxes and fees, and calculate them prior to your booking. Being informed will help you avoid any setbacks that could dampen your travel experience.
2. Fuel surcharges
Be mindful that some airlines impose substantial fuel surcharges on their international award bookings. British Airways is particularly notorious for this practice, especially on flights that include a stop at London Heathrow. You might think you’re securing a “complimentary flight” to Europe when, unexpectedly, you’re faced with several hundred dollars in fees.
Unfortunately, there isn’t much that can be done regarding fuel surcharges aside from exploring various airline loyalty programs to identify routes with lower fees. This emphasizes the advantage of collecting flexible rewards that can transfer to multiple airlines instead of being tied to one
When you hold mobile rewards points that you can shift to different airlines or use for bookings via a travel portal, it gives you the freedom to compare various routes and award fares.
3. Parking charges
Even if you redeem flexible travel credit or hotel loyalty points for a complimentary stay at a resort, you might still incur extra costs beyond the nightly rate, such as mandatory parking fees, which are often associated with valet services.
If you’re planning to redeem hotel points for accommodation while using your own vehicle or a rental car, it’s crucial to check in advance about any parking fees, including the costs associated.
4. Resort charges
Hilton Honors is known for waiving resort fees for award stays, and members with World of Hyatt Discoverist status or higher also benefit from similar accommodations.
However, not every hotel program has policies in place to waive these resort fees, even for elite guests. Before finalizing your reservation, always verify whether a resort fee applies, and if it is a requirement.
5. Baggage fees
Some airline credit cards provide the benefit of a free first checked bag. Unfortunately, if you do not possess a card that offers this feature, you may not be eligible for a checked bag at no charge, irrespective of whether you booked with miles.
In fact, if you lack a co-branded airline credit card, you will likely be required to pay fees for checked luggage, typically around $35 per bag for flights within the U.S., outside of a personal item and a carry-on bag.
6. Seat assignment fees
Don’t overlook the potential for seat assignment fees, especially if you wish to select your seat beforehand. While some airlines allow complimentary seat selection prior to your flight, many, particularly those based overseas, will charge you for the privilege until just before departure.
Additionally, exercise caution if using rewards for basic economy fares, as you will usually be charged for selecting a seat and for any carry-on baggage beyond a personal item.
7. Food expenses
Regardless of your destination or what’s included in your package, budgeting for meals is important during your travels. Even if you’re staying at an all-inclusive resort booked with points, you’ll invariably have expenses for meals while traveling to and from your destination, particularly at airports where food prices can be exorbitant.
The bottom line: Ensure you allocate funds for meals and snacks throughout your journey to avoid any regrets later.
8. Airport parking
Planning to drive to the airport? Be prepared for airport parking expenses, whether in the airport lot or nearby. While long-term parking can be reasonably priced at around $7 or $8 daily at some locations, covered and valet parking can escalate to $25 or more per day.
You could opt for a taxi or rideshare service like Uber or Lyft to save on parking costs; however, this option also carries its own associated fees. It’s beneficial to have a strategy for airport transportation so that you can budget effectively.
9. Rental car insurance
Lastly, renting a car using credit card rewards is a fantastic way to explore at minimal cost, but you may encounter significant rental car insurance premiums at the rental desk based on your travel location.
If you’re traveling to a place where additional insurance is optional, your existing auto coverage may suffice in the event of damage or theft. Furthermore, some credit cards provide primary rental car insurance coverage as a free benefit.
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