How I Travel Hack for Free Flights + Hotel StaysJan 27, 2023
[links included in this post are referrals. I may earn points if you are approved for the card through my referral link]
After 9 years without using a credit card, I opened one in September 2021 and now have 3 personal cards and 1 business card that I've opened since then!
We cut the cost of an Airbnb in Puerto Rico in half, covered 80% of our flights to Puerto Rico, visited family in Texas for 3 nights without paying out of pocket, flew our family of 6 to Denver without paying out of pocket, took a 4 night kidless vacation to NYC without paying out of pocket for flights or hotel, and SO much more.
The 2 Reasons I went 9 years without using Credit Card Rewards:
1. The long-term success of my finances and my relationship with money desperately needed a time in my life when I paid in cash, only bought things when the money was already in my account, and didn't even have the temptation to swipe and figure it out later.
2. While these rewards are extremely enticing and have opened doors to travel I couldn't have even imagined a few years ago, they don't cover everything. There still has to be a hefty amount of extra cash available in my budget to cover food, gas, entertainment, etc. The trip is not free - a few parts of the trip are free. 5 years ago, I was newly pregnant with my 3rd son, had recently quit my last part time job to be a full time stay at home mom, was putting every available penny towards a down payment on our first home, and Kyle was making less than $60,000.
Even if I had travel hacked my way to some free flights and hotels, I did not have the disposable income needed to pay for tons of restaurants, entertainment like a show or expensive museum, or all the other costs that come along with travel.
So while I am all about travel hacking now, those 9 years without a credit card are the foundation of the success and security I now see in my budget at home and on the road.
Before I share the specific cards I have and how I earn points with them, here is my little self-check for you:
- Have you demonstrated that credit cards are not a temptation to overspend or swipe mindlessly?
- Do you have an emergency fund of at least one month worth of expenses to protect you from the unexpected both at home and while travelling? (on a recent trip, the very nice van we were borrowing was towed and cost us over $300 to reclaim. This came out of our emergency fund. Do not go for the bare minimum here and assume nothing will happen. Assume something WILL happen and make sure you're adequately prepared for it!)
- Do you have a track record for planning your spending in advance (aka a budget) and then following through with tracking your spending (aka using the budget?) If not, travelling - and the expenses associated with it - with add up way faster than you expected. And the last thing I want to see from someone trying to enjoy a trip is the regret and stress they feel realizing that the trip is going to cause them financial strain upon arriving home.
- Are you willing to commit to taking breaks from the credit cards anytime your finances feel messy? I'll be honest: having a budget and exclusively using a debit card is WAY easier than monitoring multiple credit cards on top of your bank account and budget. The extra work put into monitoring is what we do to earn those rewards. They don't come completely free - they cost some time!
The Cards I Opened in Order:
Chase Sapphire Preferred
I opened this card in the fall of 2021 when we were planning our anniversary trip to Puerto Rico. After we met my sign on bonus ($4,000 in 3 months) we then opened the same card for Kyle and earned the sign on bonus a second time. This gave us points worth over $2,000 when used in the Chase Portal redeemed for travel and paid for a few hotel nights in local hotels and then half of our Airbnb in Puerto Rico!
If you're living at the same address, you and a second adult can each open their own cards and receive the bonus then combine your points. Wait to sign the second person up until after you've completed the required spending for the first person because the clock starts ticking as soon as you open the card.
As of January 2023, the current sign on bonus is 60,000 points after spending $4,000 within your first 3 months (please always pay that month's balance in full! If you get charged interest it completely removes the incentives of the reward!). 60,000 points is worth $750 when redeemed for travel inside the Chase Portal for flights, hotels, rental cars. They also allow a "pay yourself back" option to pay for eligible purchases then receive a statement credit. This is how we covered over half of our Airbnb.
Annual Fee: $95
Key highlights of this card: 1 point earned per dollar spent, 5x points on travel booked inside the portal, 2x points on other travel, 3x points on restaurants, streaming services, and online grocery orders, and a $50 statement credit at your annual renewal if you booked a hotel through Ultimate Rewards during the year.
Southwest Rapid Rewards
I opened this card in December 2021 but didn't start spending on it until January 2022 because they were running a massive promotion at the time: 50,000 points after only spending $1,000 in the first 3 months. Then another 50,000 points after spending $12,000 on the card in the first year. This combined with my normal spending, gave me enough rapid rewards points to earn 125,000 points during 2022 which is the requirement for earning a companion pass. A companion pass means one other person can fly free with me anytime I buy a ticket! WILD and it's good from the time you earn it through the end of the following calendar year. So I earned it in October 2022 and it is now active through the end of 2023.
So when Kyle and I went to NYC last week, I used points to purchase a ticket for myself then added him to my ticket for free (just pay $5.60 per person per flight for tax).
50,000 points is roughly equivalent to $750 - the exact value fluctuates depending on the flight.
Current Sign on Bonus as of Jan. 2023: 50,000 points after spending $1,000 in the first 3 months
Annual Fee: $69
Perks: 2 earlybird check-ins per year! 2x points for every $1 spent at Southwest, 2x points on local transit/commuting/ridesharing, 2x points on internet/cable/streaming, and 1x points on everything else. 3,000 bonus points at each anniversary renewal.
Capital One Venture Card
I opened this card in October 2022 - almost a full year after I had opened any other card. We were planning a trip to Colorado to visit family. I had covered all our flights using the Southwest rapid rewards card and was looking to earn a sign on bonus in order to cover a minivan rental for 5 days.
At the time I signed up, the bonus was (and still is) 75,000 bonus miles after spending $4,000 in the first 3 months.
This can be used to book travel directly in their capital one portal (this is how I booked our NYC trip). It can also be used to cover eligible travel purchases. Any purchase that gets categorized as Travel can use miles to reimburse yourself for that purchase (this is how I covered a hotel stay in Colorado when we needed to stay close to the airport last minute due to a snowstorm. I paid for the hotel, then when I got home used points to get a statement credit back).
Sign on Bonus: 75,000 miles when you spend $4,000 in the first 3 months.
Perks: this card defaults to earning 2 miles per dollar on everything! the other cards listed only earn 1 point/mile per dollar spent as the base rate. The other big thing I like about this card compared to the other one is that you get access to your miles as soon as you earn them! The 2 other cards listed above credit your account with points at the end of each billing cycle once per month. With capital one, as soon as you earn the sign on bonus or any other purchases, the points are available to you!
Annual Fee: $95
At BEST, the highest earning rate of anything I listed here is 6.25% (chase travel earns 5% and the points can be worth up to 25% more when redeemed for travel).
The interest rates on these cards currently run between 20-28%.
Do the basic math: if you do NOT pay every purchase off in full every month (preferably every pay period!) then for every dollar you spend at best, you will earn 6.25 cents in rewards and be charged 28 cents in interest for every month that the dollar is not paid off.
I cannot emphasize this enough: if you do not have a clear track record of responsible credit card use in a way that adds to your financial health, do not be enticed by these rewards. The net effect will be backwards momentum if you earn the rewards then get slapped with a monthly interest charge.
If you're tempted to overspend and pay slowly, you are much better off paying for your expenses with a debit card and saving up cash for travel. That will have a higher net effect positive on your finances than earning rewards while paying interest.
Mom Math #2: Yes, annual fees are "annoying" (and get charged right away when you open the card!). But remember to ask yourself "what do I get in exchange for paying this fee?" If the sign on bonus is going to be worth $750 towards your next trip, would you pay someone $95 in exchange for a few nights in a hotel? You betcha! So think of the annual fee as the discounted price of the travel you later cash in on!
-xoxo, happy budgeting, and responsible travel-hacking!
Debt Free Mom