If you asked me three years ago if I ever thought I’d make it to Europe, my answer would be “Never!” With prices averaging $1200 for a cheap economy ticket and hotel prices going for around $300 a night in London, a European vacation was only in my dreams. My sister tried to talk to me about miles and points years ago and I just didn’t pay attention. I thought credit cards were evil and there was no way we could ever earn enough miles to go anywhere. A few years ago, I stumbled across the miles and points hobby after a delayed flight earned us some miles and we had to decide which airline to credit them to. That search opened the door to travel hacking for us. Since that initial search, miles and points have enabled us to take our family of six to Europe for 2 weeks. The girl that never thought she’d make it to Europe, has now been there three times in three years and to Tokyo once!
When I first started researching miles and points I found that the majority of blogs were written by young professionals or families who were taking first class luxury trips with their miles and points. I could only find a few blogs geared towards travel hacking for the average family. While there is nothing wrong with luxury travel, those kinds of trips are not a reality for my family (hello four kids and college tuition!). The amount of miles required for one first class flight could easily get us 2-3 flights in coach. As much as I enjoy flying international business class, we are a coach flying, fit-as-many-people-in-a-hotel-room-with-free-breakfast kind of family. Whether your goal is to take your family to Disney World or Europe or take a first class trip with your spouse, the strategies you learn here will have you on your way in no time!
So, what is travel hacking?
Travel hacking is when you sign up for a rewards credit card that offers miles or points as a sign up bonus, meeting the minimum spend and using those miles/points to book travel. For example: You sign up for an American Airlines Citi credit card and earn 50,000 AA miles after spending $3,000 in the first 3 months. American charges 25,000 miles for a roundtrip domestic ticket in economy. You now have enough miles for two domestic round trip tickets. It really is that easy!
Get Started in 4 easy steps!
Step 1: Check your Credit Score
Step 2: Know how you’ll meet your minimum spend
Step 3: Where do you want to go? Have a “Goal Trip” in mind
Step 4: Apply for credit cards that will get you there!!
Step 1: Check your Credit Score
No, you don’t have to be wealthy or travel often for work to get involved in the miles and points game, but you do have to be financially responsible. The first rule is to know your credit score. Your credit score should be over 700 with no recent bankruptcies. You can find your credit score by signing up with Credit Karma or Credit Sesame, it is free of charge. Sometimes finding out your credit score is a little like stepping on the scale, we don’t want to know the number! In this hobby, that first step is crucial. Many people I talk to are worried that applying for credit cards will affect their credit score negatively. While it’s true that you may see your credit score drop a few points after an initial application, as long as you are paying off your balances every month and not carrying debt, you will see that score rebound after a couple of months. I can tell you that in the past three years, my husband and I have both applied for over 10 credit cards each and both of our credit scores have improved by almost 100 points!
This hobby is not for everyone. If you are in debt or have difficulty managing your finances you should not apply for credit cards. You should be able to pay off your credit card balances every month. Paying interest every month negates the points you earn.
If you will be applying for a mortgage or car loan in the next few months, do not apply for new credit cards now.
Step 2: Ways to meet the minimum spend
Before applying for credit cards you should have a plan on how you’ll meet the minimum spend. This is the amount required you spend in a certain amount of time (usually $3,000 in 3 months) in order to receive your sign up bonus. For our large family this has never been a problem. We pay for everything with the card we’re trying to meet minimum spend with (put away that debit card and never pay with cash!). Paying monthly bills plus day to day expenses adds up very quickly! Some examples of how we meet our minimum spend include:
- Pay for groceries, gas and dining out
- Pay ALL bills: cell phone, electric, trash, water, cable, Netflix, Hulu, Amazon
- Pay for childcare, school lunches, kids sports, etc.
- Pay for doctors appointments and prescriptions (put away that FSA card and get reimbursed later).
- If we have a large minimum spend to meet (like when we apply for two cards at one time) we’ll consider paying our mortgage, car payment and college tuition (this usually includes paying a small fee).
Before you begin:
Get organized! This step may not seem important when you sign up for that first credit card, but when you’re on credit card number eight and you’re trying to figure out your sign up date on your third card, you’ll be glad you did this first step!
Sign up for airline and hotel reward programs. This is key as you’ll need to enter those numbers when you apply for certain credit cards. It’s important to keep record of your rewards program numbers and login information. We keep a template that I print out and we also use AwardWallet. AwardWallet is great, it keeps track of your miles and points and alerts you when you get close to your expiration date so you don’t let your points expire. They offer both a free and paid subscription, use the one that works best for your situation. Make sure you opt in for hotel emails so you don’t miss out on specials and promotions and always enter your rewards number on every paid flight you take or hotel stay you make to earn points. They DO add up!
Airline Frequent Flier Programs:
- American Airlines AAdvantage Program
- United Airlines MileagePlus Program
- Delta SkyMiles Loyalty Program
- Southwest Airlines Rapid Rewards Program
- JetBlue TrueBlue Program
- Alaska Airlines Mileage Plan
Hotel Reward Programs:
- Best Western
- Club Carlson (Radisson, Park Inn, Country Inn & Suites)
- Hilton Honors (Hampton Inn, Homewood Suites, DoubleTree)
- World of Hyatt
- IHG Rewards Club (Holiday Inn, Candlewood Suites, Staybridge Suites,, Intercontinental)
- Marriott Rewards Program – (Residence Inn, Fairfield Inn & Suites, Courtyard, Springhill Suites)
- SPG – Starwood Preferred Guest – (Sheraton, Westin, Four Points, St. Regis)
- Wyndham Rewards Loyalty – (Ramada, Baymont, Days Inn, Travelodge, Knights Inn)
Start a spreadsheet to keep track of your new credit cards. This will help you stay on top of application dates, bonuses, annual fees, etc.
Step 3: Where do you want to travel?
Most importantly, have a goal trip (or two) in mind before applying for your first card. Be purposeful when applying. Always have a plan! I talk to so many people that say “I got this card but I’m not sure what I can do with these points”. Start with the end in mind.
Step 4: Apply for your first credit card.
Before you get online and start randomly applying for cards, there are a few rules to follow. There are several major credit card companies and they each have rules on how they approve you, how many times you can get a bonus, etc.
Here are a few of the most important:
American Express. AMEX only lets you receive a card bonus once a lifetime. For this reason you want to make sure you’re applying for a card when they have the highest possible bonus.
Chase. Chase has some of the most lucrative sign up bonuses and some of the most restrictive rules. Chase will only approve you for a card if you are under the 5/24 rule. This means you can’t have applied for more than 5 credit cards in the past 24 months. For this reason, we encourage (insist!) you start with Chase cards before moving on to other bank cards.
Citi Bank. Citi only allows you to earn a sign up bonus once every 2 years per award program (i.e., one AAdvantage card per 24 months, one Hilton card, etc. Business cards are excluded in this rule) The clock starts ticking as soon as you apply OR close a card.
Ready to start traveling for free? Check out my next post: Credit Cards 101 to help you decide!
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