Travel is an important goal for many people. Unfortunately, most of us have limited money to spend on travel. But what if you could travel more often? Or, maybe travel in luxury? And best of all, what if you could do that without spending more money than you can manage? You can travel more without spending more. Let me teach you how.
The Basic Strategy
The key to improving your travel without spending more than your budget can handle comes from points and miles. Specifically we usually target points and miles for travel expenses that can be earned from credit cards. I’ll explain how that works in this article, but first, here’s a basic overview of the strategy.
- Open a credit card and get the welcome bonus
- Use those points to book flights, hotels, and sometimes other travel related expenses
- Repeat with other credit cards as often as you want
NOTE: Typically in this strategy, you will want to close or downgrade a card to a no-annual fee card after 1 year. Doing so, you usually can avoid paying the annual fee for the second year and maximize the strategy while paying less out of pocket.
For example, let’s say you wanted to spend some time in Hawaii. Using this strategy, you could get a round trip economy flight from just about anywhere in the U.S. and 6 nights in a vacation rental on any of the islands. All it takes is two cards and an out-of-pocket cost of less than $200 (not including costs of food, activities, or local transit). Compare this to $2,000+ it would typically cost for the same flights and vacation rentals.
Have different goals? The numbers may not be the same as the example, but the strategy is the same. You can travel just about anywhere using points and miles. The best part is, anyone can do it. Stick around to see how you could travel more without spending more.
WARNING: This strategy can be used by anyone, but requires certain conditions before you should start using it. To effectively earn points with this method you need to have no credit card debt, pay off your credit card in full every month (so you don’t pay any interest and can keep a good credit score), and have a credit score over 700 to begin with (to qualify for the cards with good bonuses).
Credit cards can be financially devastating if not used properly. If you currently have credit card debt, a low credit score, or are worried about spending more than you should on these cards, DO NOT start this strategy before resolving those issues first.
Feel free to contact me via this form to discuss my recommendations for your individual situation to get you on track so you can use this strategy for your travel goals.
How to Maximize the Strategy to Travel More Without Spending More
Maybe you’ve heard or even tried using credit card rewards to travel, maybe not. If you’ve tried, you may have found that it can be really hard to accumulate enough points to book a flight or a hotel with a single credit card. The fastest way to accumulate points is through credit card welcome bonuses.
Earning Points and Miles Like a Pro
Credit card welcome bonuses are, by far, the fastest way to earn travel rewards. Welcome bonuses vary from card to card and each bonus will have its own requirements. A relatively typical bonus structure is somewhere around 60,000 points after spending around $4,000 points within 3 months. Cards with this structure typically have an annual fee around $100. By opening multiple credit cards throughout the year and earning the welcome bonuses, you can earn hundreds of thousands of points quite easily.
If you are concerned about ruining your credit, don’t worry, this strategy can actually increase your credit score. I personally started with a credit score around 760 and opened up two new cards my first year. By the end of the year, my score was over 780. I know of others that have been doing this a while and have even better credit scores.
Redeeming Points and Miles Like a Pro
There are many ways to redeem points and miles. The most basic method is to use points from a specific loyalty account to book travel with that company (e.g. using United Miles to book a United flight). Sometimes these present a very good value for your miles, but more often than not, you can get better value by booking with partners. This is specific to airlines, hotels have fewer ways to get extra value from their points as you typically can only book a hotel using the points with that hotel’s loyalty program.
Airlines have created partnerships and alliances to expand the destinations and flights available to their customers. One of the biggest benefits, in my opinion, of these partnerships and alliances is that it allows you to book flights on partner airlines using another airline’s points. These bookings will often be the greatest value for your points. You can learn more about airline partnerships and alliances here.
To use the example of flying to Hawaii, one of the best ways to get good value is booking a United Airways flight using Turkish Airlines points (called Miles & Smiles). You can book any United flight to Hawaii (in economy) using only 10,000 Turkish Miles & Smiles each way. There is a catch. There are a limited number of seats available to book via partner airlines. This article, How to Find Saver Awards, has more information on finding seats available to book via a partner program.
Crafting an Individual Strategy
And there you have it. You now know the basics of earning and using points and miles. There is a lot more to learn so that you can maximize your travel. The goal of this blog is to help you meet your travel goals without spending more than you can manage.