Hacking with travel rewards credit cards 11


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Unless you are a professional business consultant who is on the road 320 days a year, it is unlikely you’ll ever earn enough frequent flyer or hotel points to travel the world for free. But that’s OK! You can still earn enough points and miles to see the world in style by travel hacking.

Loyalty points from travel rewards credit cards can be most valuable in high-cost destinations like New York City

Loyalty points can be most valuable in high-cost destinations like New York City

If you read our tutorial last month, you’ve already figured out how travel rewards programs work. And since you’re not a professional road warrior, you need to hack your way to free travel. This month, we’ll show you how to accumulate travel loyalty points/miles without ever getting on a plane or staying in a hotel.

The key to earning big points/miles is to get a travel rewards credit card. There are two main types of credit cards:

General Travel Rewards Credit Cards

    – These cards allow you to accumulate “points” that can then be turned into free airfare and hotel stays in locations from Austria to Zambia. A number of large banks offer this type of credit card including the Capital One Venture Card, the Chase Sapphire card, and the American Express Platinum Card. With these cards, you can book your travel directly with the card provider (for example, Chase Sapphire purchases accumulate into Chase Rewards Points, which you can then use to book your travel).

Company-Specific Credit Cards

    – Every airline and hotel company has their own travel rewards credit card (all underwritten by Visa, MasterCard, or American Express). These are good option if you are loyal to single brand or have strong preferences. If you live in an airline hub city, you might get a credit card affiliated with that airline.

So, which credit card is right for you? You first need to ask yourself the question – what are my travel objectives? For example, we both work full time and take many vacations by adding time to business travel. This means our airfare is often paid for by our companies, so hotel points are the most valuable to us. Which travel rewards credit cards you choose will be based on your travel priorities.

Travel hacking your way around the world with a travel rewards credit card.

Company-specific rewards card

Travel reward credit cards all work in the same way. First, all cards have a bonus period. Once you are approved for the credit card, you are eligible for a bonus once you meet the requirements. Typically this bonus can range between 15,000 up to 50,000 points once you meet a minimum spend. This minimum spend level is usually something like $2,000-$5,000 over a period of time (we’ve seen as short as one month and as long as six months). Once you meet the requirements of the bonus period, the extra points are yours.

Second, travel rewards credit cards also provide you an on-going source of points/miles by rewarding you with 1-5 miles per dollar (or euro) spent. Some credit cards offer a higher-point-per-dollar rate when spent with them (for example, Marriott hotels offers 5 points per dollar when spent at Marriott locations, 2 points per dollar on all other travel, and 1 point per dollar on everything else). This tiered structure is very common among company-specific travel rewards credit cards. General travel credit cards tend to offer a fixed point level.

While most travel hacking tips tend to be the most beneficial to North Americans, it’s worth noting that travel rewards credit cards are not limited to Americans or Canadians. Nearly every major airline has a travel loyalty credit card (Lufthansa, Turkish Airlines, etc.). There may be more restrictions on these in some countries, but they are offered.

 

Next month, we’ll share our top travel hacks you probably haven’t thought about trying.


About Lance and Laura

Working a 50-hour-per-week desk job with only 3 weeks of vacation per year doesn't mean you can’t see the world. Since 2008, Laura and Lance Longwell have been blogging at Travel Addicts, writing about how to maximize a North American vacation allotment while cave tubing in Belize, cruising the Nile in Egypt, or exploring the French Quarter of New Orleans. Laura and Lance have pretty much always had the travel bug. When he was a child, Lance’s parents ensured he saw all 50 U.S. states by the age of 15. Laura’s parents sent her to England for a month in preparation for moving halfway across the U.S. for college in Manhattan. Over the last 15 years, they have traveled together across 5 continents taking in street art, food markets, music, and the tasty beverages of their various destinations. Business travel and a desire to mix convenience with value have led them to use frequent flyer miles and hotel loyalty programs regularly to offset the costs of travel and gain upgrades (who doesn't want to fly first class to Paris?). They write about their experiences with points and miles, teaching others the art of travel hacking. Read about Laura and Lance’s travels at Travel Addicts, or follow them on Facebook, Twitter, and Instagram for their latest updates.

11 thoughts on “Hacking with travel rewards credit cards

  • JoAnne Jones

    Be aware that the merchants pay these rewards and it is very hard on small businesses. A less than 2% fee can go to anywhere between 3.5 and 5%. You are often getting those reward points on the backs of others.

    • Lance and Laura Post author

      JoAnne, we agree with you that the economics of reward credit cards are complicated. While it is true that credit card transaction fees are paid by merchants, those fees would be paid regardless of whether the credit card was a travel loyalty card or not. Additionally, merchants typically pass through those credit card transaction fees into higher prices for all consumers (so even consumers paying cash are likely paying higher prices because of credit card fees). So, consumers ultimately pay a price for it (whether they earn rewards or not). Our feeling is, if you’re already paying for it, why not earn the rewards?

  • Tim

    Great little hack shared on the tacking vacation time to business trips … most people are too wrapped up in their work to remember to do something like this!

    • Lance and Laura Post author

      Thanks Tim. Coupling vacation time onto business trips is something we’re passionate about. We’ve got a few more business-to-vacation tips coming soon!

  • Nancie

    I got into collecting points when I was on the road in corporate Canada. I think I’ve had a dozen free flights over the years. The last one was back in 2002 when I took the points I had left and traveled business class on Singapore Air to Egypt. That was fun! I don’t collect points like I used to, but they still add up. Right now I have enough to get myself back to Nova Scotia, if only Air Canada would let me book the route I want.

    • Lance and Laura Post author

      Thanks Nancie. Great point – these points really do add up. When we write about travel hacking, our first tip is always to sign up – you can’t get the points if you don’t play the game. And they do really accumulate.

  • Rashad Pharaon

    Thanks for the great breakdown. It can be overwhelming to start looking into all the different cards that are out there. I also like your no-BS approach – rewards cards aren’t magic, and simply getting one doesn’t mean you’ll automatically fly free forever!

  • Gina

    Hey Michael 🙂 I’m going to need a new travel card by the end of this year. I currently have an Amex JetBlue card because I went often to Puerto Rico from NY and now Florida from NY, JetBlue is the main airline. It worked well for me and only $40 annual fee. But once 2014 is over, I don’t wish to pay them $40 /year for an airline I don’t plan to use next year. I haven’t researched much YET but my friends travel card, Amex premiere gold rewards card, which he loves and has paid for his many over seas flights, is like $120/year.

    Are the other 3 you mentioned at a high annual fee like that as well?

    Also, what’s your opinion on closing CCs? Beside the Amex, I have a MasterCard win American Airlines (I’ve never even earned the points!) which is charging me $90/year (I didn’t even know) because I only used it as a balance transfer card. It’s the only card I have a huge credit limit with (important in emergencies) but it needs to go. First I’m going to ask if I can transfer to another MasterCard with hopes of no annual fee and same credit limit.. But doubt they have good travel cards?

    But my question is, is it bad for my credit score to close a CC? Someone told me that and now I’m scared. Idk what to do there!!

    Next, when I asked MasterCard amer airlines why I had no points they said BC they don’t offer points for balance transfers. That’s BULLSHIT! Haha I get why, but do you have any idea if any of them do? (Possible travel hack?)

    Thank you! Xx

  • Caryl Anne

    These were great tips of advice that I’m sure anyone could use or follow. I’ve always believed it’s best to compare and shop around before deciding on any credit card. That way you figure out which one best fits you and your needs while saving money. Thanks for sharing!

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