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Have you ever heard the term travel hacking? Travel hacking is a fancy term that basically just means you leverage credit cards to earn points that can be redeemed for flights, hotels, car rentals, and more. I learned about it a few years ago and to say it changed my life would be an understatement. We started off slow, redeeming points for a domestic flight here and a hotel there, but in the past several months I have finally honed our strategy to take trips for $0 out of my pocket!
Sound too good to be true? In this post, I’ll be sharing exactly what is travel hacking, the best credit cards to travel hack, and how you can start travel hacking too!
Table of Contents
What is travel hacking?
In simple terms, travel hacking is the process of earning and then using credit card points to redeem for “free” travel. I put free in quotations because technically, you are spending real cash to get those coveted points.
Most, if not all, credit cards give you points or cash back on purchases that you can redeem for various items. You can “pay yourself back” and erase some of your credit card balance, purchase gift cards, or redeem them for travel.
Credit card companies are able to offer you these rewards because being in the credit business is VERY lucrative. In case you didn’t know this, anytime you swipe your card, the merchant is charged an approximate 3% fee for the credit card company to authorize it. You also pay annual fees on certain cards and millions of Americans are paying millions of dollars in interest on credit card debt. So in return for using their card, these companies give you a tiny little slice of their profits through points or cash back. In addition, when you open a new credit card, you’re offered a huge sign up bonus if you hit a minimum spend. This is where the real magic happens!
Travel hacking, specifically, is putting all of your normal daily spending on a credit card and using those points for flights and hotels!
However, the key here is to be very, very disciplined. If you have are currently paying off credit card debt this method is not for you. If you aren’t able to pay off your balance in full every month, you aren’t getting the rewards for “free.” Make a budget, stick to it, and don’t spend more than you have in your checking account. Check all those boxes? Then you should be using a credit card!
I’m going to say that again: do not go into debt using credit cards. Do not spend more than you currently have. Make a budget. Stick to your budget.
Travel hacking for beginners can seem overwhelming but I’m going to break it down for you!
How to start travel hacking: for beginners
Travel hacking can quickly become overwhelming and confusing but the bones of it aren’t complicated at all. My goal for this post is to introduce you to travel hacking and give you a step-by-step guide to make it as easy as possible. Truly, anyone can do this! As long as you are financially responsible and can spend within your means, there’s no reason you shouldn’t be doing this. Have I mentioned the free travel yet??? Stick to these steps first and then use some other resources for advanced travel hacking strategies when you get the hang of it.
1. Have a goal in mind
Do notttttt go out and start opening credit cards willy-nilly until you have a goal in mind! What do I mean by that? Amass as many points as possible? Fly first class? Never pay for travel again? While these are good goals… they aren’t specific. What I mean is this: when you open a card, know EXACTLY how you want to spend the bonus points. For example, we recently opened a credit card with an elevated bonus point offer. We have a trip to Italy planned for April. So with this card’s bonus I want to use the points to book business class flights with Turkish Airlines. We’ll also use bonus points from another card to book our hotels. I have a goal and I have a plan!
2. Find a credit card that fits your needs
After you set your goal, do a bit of rudimentary research to find out what airlines and hotels you may be interested in booking. You don’t have to have it all figured out but it’s smart to have an idea of how many points you’ll need. Some hotels, like Hyatt, make it really easy to search their hotel and just click “book with points” but others and most airlines will require you to have a loyalty account to see award bookings.
From there, open a credit card and ensure you can hit the minimum spend to get the bonus points. I love this post on ideas to hit the minimum spend.
Related: 4 cards every travel hacker needs
3. Hit the minimum spend and receive your bonus points
Yay! You did it! You received thousands and thousands of bonus points that you can now redeem for travel. This is the easy part. Sit back and enjoy your stash of points… but not for too long!
4. Earn ’em and burn ’em
This is a saying I’ve heard going around the points and miles community recently. When I first began travel hacking, my big mistake was just stashing points for trips that were way too far away and never using them. Don’t be like me! Just like inflation makes our hard earned dollars worth less, point devaluation happens often. Your 100,000 points won’t be worth as much in one year as they are today.
This goes back to step number 1–have a goal in mind! When you earn your points, you should already have an idea of how you want to use them.
And this is the fun part! Cash in those points for free flights and hotels. I recommend transferring points from a bank to a partner airline or hotel… but that’s going into the weeds a little bit. It will get your the best value for your points so we can talk about that in another post! Reach out to me if you have specific questions.
5. Enjoy your trip
It’s time to go on that hard earned vacation paid for with bonus points!!!
6. Rinse and repeat
Once you are ready to start planning your next vacation, repeat all these steps below. Congratulations, you are officially a travel hacker!
Some travel hackers choose to continue to open credit cards for the big sign up bonuses repeatedly. Some will open a card, close it after a year, and then open it again in 2 years to get the bonus again. This is an advanced strategy and can certainly be discussed in another post! These are awesome strategies to continue to get large amounts of points for those trips you want to take!
There’s also nothing wrong with opening 3-4 solid cards and rotating spend so you’re earning a slow, steady stream of points. This strategy definitely takes a lot longer to accrue points but this is a personal process and what works for me may not work for you.
The best credit card for travel hacking
The Chase Sapphire Preferred is the #1 recommended card for beginners across the board in the travel hacking community. And there’s good reason for that! The typical sign up bonus is 60,000 ultimate rewards points or ~$750 in travel. Ultimate Rewards (URs) are also very flexible and transferrable which is why it is a crowd pleaser.
With the Chase Sapphire Preferred you’ll receive:
- 60,000 URs once you hit the minimum spend
- 2x points on travel purchases (5x when purchased through the Chase portal)
- 3x on dining
- 3x on online grocery purchases
- $50 annual hotel credit
- 10% bonus points on your card anniversary
- As well as various other perks throughout the year
The annual fee is $95 but with $750 in travel, you’re getting more than your annual fee back in card perks.
Other good starter cards include the Capital One Venture and the American Express® Gold Card.
Travel hacking and your credit score
You may be thinking that all of this credit card opening can’t be good for your credit score. Quite the opposite! As long as you are paying your balances off in full every month, your score will most likely increase! This is because you are increasing the amount of available credit you have. The lower your percentage of credit utilization, the better your score.
You may see a temporary drop of 2-3 points after getting approved for a new card (due to the hard inquiry), but should go back up in 2-3 months!
The best travel hacking resources
I will be the first to tell you I am no expert! I am still learning new things every day. I’m not a gatekeeper either so below are my favorite resources that I use daily and used often when starting on our travel hacking journey.
Choose FI Travel Hacking Course
The Daily Drop email subscription
Straight to the Points email subscription
Instagram Accounts: MadePossiblebyPoints, LetsTravelHack, ProfitsandPoints, TravelHacksMack, TravelHackingMom, StraighttothePoints and many many more!
For a good starting point, I highly recommend Choose FI’s travel hacking course. I learned so much and still reference it often.
It’s worth mentioning again that you SHOULD NOT use this method if you struggle with credit card debt. If you currently have credit card debt, focus on paying that off first and building good spending habits.
Final thoughts
Travel hacking is the process of signing up for credit cards and earning the sign up bonuses to earn points that you redeem for flights and hotels. Travel hacking can be very helpful in achieving your travel goals if you have a good strategy and good resources to learn. Anyone with a good financial foundation can do it! If you’re willing to put in a little work and can pay off your credit card balances in full each month, you’ve got nothing to lose. We’ve saved thousands upon thousands on flights to Colorado, hotel stays for weddings, and more. Once you get started, you’ll be all in! I hope this guide to travel hacking for beginners has been helpful to you. I can’t wait to see where you go!
Would you try travel hacking? Have you ever “travel hacked” a trip? Let me know in the comments below!
pin these to come back later!
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