What would you say if someone offered you a three-week trip to Peru for only $650? Hells yeah, amiright? Peru is known for being an affordable place to visit, but even by “affordable” standards, that’s very low. The reason? I didn’t pay anything at all for my flight down there and back.
Yep, you heard me right. I didn’t pay two peanuts for my flight.
Man, I miss airline peanuts. Especially the honey-roasted ones.
Anyways. The reason I was able to go down there for so cheaply was because I had travel hacked my flights. And it worked so well that I’ve even been to Chicago and Boston since then, also for free!
It sounds too good to be true, but believe me, it’s possible. That doesn’t mean it’s easy, though. Here’s how I do it.
- 1 Travel Hacking 101: How It Works
- 2 The Different Types of Travel Rewards Credit Cards
- 3 My Travel Hacking Strategy
- 4 Book Travel!
Travel Hacking 101: How It Works
The basic premise of travel hacking is that instead of paying for travel with money, you pay with points that you earn from using travel rewards credit cards.
How do you get these points? Two ways, really:
- Sign-up bonuses
- Everyday spending
For example, the Amex SPG card gives you a 25,000 Starpoint sign-up bonus if you spend $3,000 within the first three months of getting the card. Most credit cards have their own proprietary name for their points system, and they require you to spend a certain amount of money within a certain time frame to earn the sign-up bonus.
The name of the game is to accrue as many points as possible. Then, you use them to buy flights, hotels, and sometimes even tours and other transportation whenever you want to take a trip.
Sounds simple, right? Unfortunately, the details are a bit more complicated than that…
The Different Types of Travel Rewards Credit Cards
Not all travel rewards cards were created equal. In fact, there are three main types of travel rewards credit cards that can be used to pay for travel in different ways:
Branded Hotel or Airline Credit Cards
These are the credit cards you see offered by airlines and hotels. My first travel rewards credit card was the Alaska Airlines Visa Signature card. Obviously you can book travel with the company who’s offering the credit card, but you can usually use your points in a few other places too. For example, most airlines are a part of an airline alliance, and your points from one airline’s credit card will be redeemable for all the other airlines in the alliance network too.
Related: If you book an Airbnb stay through my link, you’ll get a free $40 credit to your account!
Portal-Based Credit Cards
I’m sure there’s a better name for these cards than this, but I can’t remember what it is. These credit cards aren’t offered by specific brands, but you can use your points to redeem travel at a wide range of hotels, airlines, and often even for car rentals. Cards offered through Chase are the most popular example of this; to redeem your points, you’d book travel directly through Chase’s Ultimate Rewards portal. Most portal-based systems do have a huge amount of travel you can book, but it’s still limited.
Travel Reimbursement Credit Cards
These spiffy travel rewards credit cards don’t limit your options at all, and that’s why they’re my favorite. You can book travel wherever and whenever you want, and the points you’ve accumulated will automatically knock off a portion or the entire cost of your travel, depending on how many points you have.
My Travel Hacking Strategy
One of the most important things about travel hacking is that you need to have a strategy. It’s not something you dive into willy-nilly like a barn hoedown.
Decide Which Travel Rewards Card to Open
First, I decide which travel rewards credit card I want to open. At this point, me and Zach have opened up about 10 cards between us (although we later closed some of them). I’ll think about what kind of travel I want to do in the future—do I want free flights somewhere? Hotel stays? Flexible points?
For example, one of my goals is to drive the Ring Road in Iceland with Zach. We’d have to rent a camper van (ideally this awesome van with Chuck Norris on the side). It’ll be hard to use a branded credit card to pay for that, so I opened up the Barclaycard Arrival Plus, since it’s a reimbursement-style credit card that we can use for whatever travel we want.
Put All Spending On New Travel Rewards Card
After I open a new card, I’ll put all of our spending on the new card. That way, we know we’ll be able to spend enough to earn the sign-up bonus. If you don’t earn the sign-up bonus, you might as well go burn all your underwear and buy a new set. It’s that much of a waste.
This can gets confusing when reconciling my budget (how do you know how to categorize the purchase if the payment is made to the credit card company?), so here’s my secret: I list the payee as the actual payee, and make a note of which credit card I used in the “memo” column, like so:
This also allows me to track how much I’ve spent on a credit card so I know when I’ve hit the minimum spending requirements to get the sign-up bonus. All you have to do is search for the credit card name, and it’ll tally up all purchases made with that particular card.
Pay Off The Travel Rewards Card Every Few Days
This is key. If you can’t do this step, you might as well throw a flock of chickens in your living room to shit everywhere since that’s basically what’ll happen to your bank account.
I log into my credit card account at least every few days to do the following:
- Record any purchases in my budget (along with a note about which credit card I used to make the purchase)
- Pay off any charges that have cleared
I do this for a few reasons:
- It’s easier to reconcile your budget every couple of days rather than once every week or two, when small errors have multiplied into Godzilla-like proportions
- It lets me keep tabs on my spending and forces me to recognize every purchase
- It lets me know how I’m doing with my budget (am I close to hitting a category limit? Do I still have money in my dining out budget?)
- It keeps my credit card bill from getting way out of control
Earn the Sign-Up Bonus, Then Decide Whether to Close or Keep the Travel Rewards Card
Since my ingenious strategy above allows me to see how much I’ve spent with a certain card, it’s easy for me to track when I’ve hit the sign-up bonus. It can take a month or so after you reach this spending level for the sign-up bonus to be applied.
Once you open the card, you usually have a full year before any annual fees are charged to the card (although that’s not always the case—sometimes you’ll be charged the annual fee right off the bat). This gives you a long runway to decide whether you want to close or keep the card.
If I know I’ll use the card in the future or it has some spiffy benefits (like the Priority Pass access to airport lounges that comes with the Chase Sapphire Reserve card), I’ll keep the card. If not, I close the card once I’ve earned the sign-up bonus (and once I double-check that the points still stay in my account if I close the credit card).
Now comes the fun part! Since each travel rewards credit card works a bit differently, you’ll need to do some research about how the program works and how to redeem your newly-won points (you did do that before you started…didn’t you?).
Since me and Zach aren’t world-class jetsetters, we’ve managed to amass a bit of a bank of points (say that ten times fast…haha). This works out great for us since sometimes we do travel to see family at the last minute. For example, when Zach flew to Boston for a work trip, I was able to tag along and visit my favorite uncle who lives nearby and has cancer.
Travel hacking has literally opened up the world and my distant family to me, and for that I’ll forever be thankful. However, with that said, travel hacking isn’t for everyone (more on that next week…sign up for the newsletter below to be notified when this post comes out).
Hopefully once our lives calm down a bit we’ll be able to travel a lot more for funsies. Here’s a small list of places we want to go:
- Ring Road in Iceland
- Hobbiton movie set in New Zealand
- Norway fjords
- 70,000 Tons of Metal heavy metal cruise festival
- Wacken Open Air heavy metal festival
- Hellfest Open Air heavy metal festival
- Basically any overseas heavy metal festival
Hopefully we’ll get to visit soon!
If you’d like to learn more about the nitty-gritty of travel hacking before you dive in, check out the free Travel Miles 101 email course. It taught me everything I need to know about travel hacking. It’s crazy that it’s free since it’s such a good course. I highly recommend taking the full course before you start travel hacking, so you get the full scoop on how to do it right.
Have you ever tried travel hacking? Do you think you’d ever try it? Leave a comment below?