A couple years ago one of my friends, who’s a big-time lawyer for a covert government agency, explained how he and his wife were earning all kinds of points on credit cards, which they then used for awesome vacations. I was mesmerized. I had dabbled in “travel hacking” and got a couple airline mile cards and used them for 1 or 2 fun trips, but that’s it. Then I started traveling more for my job and took my first international business class flight that I paid for with miles. This was the beginning of the end. It was a game-changer. My back didn’t hurt. The food was fantastic. It was comfortable. I was able to actually sleep. I was hooked. And it was free! I had always loved traveling but had felt like really fun, exotic travel was out of my reach. Not anymore. Seeing the vibrant, exciting world and experiencing wild adventures were now within my grasp. And they are within yours too. And we can do it without breaking the bank.
This is called “travel hacking”, “credit card hacking”, getting free travel, ballin’ on a budget, and much more. It is something that I have become enamored with the last couple of years.
Definition from “A beginner’s guide to travel hacking”
Travel hacking involves working within the existing rules set up by airlines, hotels, and credit cards, and using them to your advantage to earn travel perks including free or discounted flights, lodging, and other upgrades. It is the art of collecting frequent flier miles and hotel/credit card points and then redeeming them for free, low cost, or upgraded travel.
Some things to know about this phenomenon:
It’s never too late to start
It can actually be fun
It is something that very few people take advantage of
It doesn’t affect the credit card companies bottom lines—for every person that utilizes the offer that the credit card company makes without running up a large balance there are countless others who will fall into the credit card company’s trap and give them many multiples on their money
Most people think it’s too complicated, too expensive, or too time consuming to be worth their while
It’s totally legal. Even the word “hacking” is misleading. Because it sounds like something we shouldn’t be doing. Like hacking into computers. But getting miles, credit card points, or hotel points for free, that enables someone to travel around the world is definitely something we SHOULD be doing. It’s silly not to take advantage of these great offers.
There are entire websites and classes and seminars dedicated to travel hacking. That might make it seem like it’s too hard to learn and utilize, but it’s not! I try and pay attention to high leverage (high payoff/low time commitment) actions. This is definitely one of them.
DISCLAIMER: I’m still a JV (Junior Varsity) travel hacker. And I don’t have any affiliate links. So please use the Berean principle with everything I say and check it out for yourself.
WARNING: Philosophical rant starts now. According to the federal reserve, Americans owe a whopping 1.04 trillion (with a “t”!) in credit card debt. The average balance on a credit card in America is $4293 according to Experian. Credit card companies are some of the culprits driving this debt higher and higher. They are for-profit businesses and they are behemoths. They make their money from taking advantage of people. They are making hundreds of billions of dollars off of people’s debt. It is oppressive. Don’t get me wrong, it’s still the individual consumer’s responsibility to be wise with their money. It’s still on us. But the credit card companies prey on people’s weaknesses and our Amercian greed and consumer mentality. More is better. These incentives and sign up bonuses are ways of luring you over to their card, getting you to start spending on their card, and then hopefully continue to use their card. Or even not be able to pay off the balance that you charged to get the sign up bonus. And then the game has begun. The interest game.
Take notice that the sign up bonuses are when you CHARGE the minimum amount, not when you pay it off. This is a trap. The credit card companies use lucrative sign-up bonuses as a trap. They want to bring consumers over and keep them. Do you think that the credit card companies give sign-up bonuses for the good of their customers? They really want their customers to be able to travel around and enjoy themselves?!? Nope. It is purely business. And they have done studies and have algorithms and have big data that tell them how many miles or points to offer as a sign-up bonus and still be silly profitable. They aren’t doing us as the consumers any favors. At time of writing, the latest quarter, JP Morgan Chase reported a profit (PROFIT!), not revenue, of 8.3 billion with a “b.” in a quarter. So yeah, their ploy is working for most people.
But not for you, you savvy, sneaky, creative, soon-to-be travel hacker!
You should NOT travel hack if any of these apply to you:
- You have any credit card debt you don’t pay off at the end of each month. NEVER, EVER, EVER EVER EVER EVER EVER carry over a credit card balance from month to month. If you are in credit card debt, travel hacking is not for you…yet. Wait till you’re out of cc debt, then let’s get after it. I can’t stress this enough. Seriously.
- You know you can’t stay organized in the least about this. You have to track the cards and spending in a minimum organized way.
- You don’t have relatively good credit. Most of the sites recommend a 700 minimum credit score.
- You can’t meet the minimum spend requirement for a card reasonably easy, then wait till you can.
To get started, just google “travel hacking” and check out some of the “beginner” posts. They will familiarize you with the language and the concept much better than I can. Here are two to check out:
10x Travel page where you can download a free ebook
Next week I will share with you the “why”, my recommendations, and how to get started.
For those of you who have done this, what do you recommend? Any pointers or tips as someone is getting started? Please comment below.
