Travel Hacking Using Credit Card Rewards

A plan for how to travel for (almost) free with travel rewards by taking advantage of credit card bonuses and incentives

We’re trying something new this year – Travel Hacking! Using credit card travel reward programs, we’re going to harness the power of our controlled finances. As a result, we should be able to take a really nice vacation for very little out of pocket expenses. How will this work? Keep reading!

Wait – Free Travel? Really?

Practically nothing is free, of course, hence my use of the word “almost”. But we’re going to use the money we would be spending normally (on food, gas, household supplies, etc.) to receive rewards back in the form of travel points. This is finally something we feel comfortable enough to keep under control, now that we have a clear budget.

Credit Card Rewards We’re Using to Travel for Free

We did a lot of searching around and decided the first card we’re using is Capital One’s Venture Card. A few reasons went into this choice.

• I already had a Capital One credit card and was familiar with their platform, so having it all in the same place was a plus
• The points don’t expire
• They are offering a 50,000 point bonus when you spend $3,000 in your first 3 months. Despite our efforts to cut expenses, this will still be easy to do between the two of us.
• The annual fee is $95, waived for the first year. Which means we’ll have a long time to not only accumulate the points but also spend them and then decide if it’s worth it to keep the card.
• Their program gives a respectable 2x the points for every dollar you spend.
• Currently they have a partnership with Hotels.com where if you book through Venture’s link, you’ll earn 10x the points per dollar.

All of these were enough of an incentive that we felt pretty good about getting started with this one. There are tons of programs out there, but this one seems to meet our needs best for now.

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How Travel Hacking Works

These first three months we are being diligent in using the card for every purchase we can in order to hit the $3000 spend minimum. I track how much we’ve spent in a spreadsheet to make sure we’ll reach it in the required timeframe. We can’t pay our mortgage with it (though some do allow it so you should always check!) and most of our bills like utilities and insurance don’t accept it.

But, that still leaves plenty of other areas that will work just fine. It also happens that I have to take one of my cats to the vet this month so that will go on there. And I’m going to see if my car’s annual state registration will accept it as well. There’s always something!

Each payday (every two weeks), I’m making a payment to clear the balance. Since it’s everything I would have budgeted for anyway, there should always be enough to cover it. That’s the key reason why you need to be able to stick to a budget, because if you overspend consistently you can easily go down a slippery slope.

Really you only need to pay off the balance once a month to avoid the interest but I’m one of those weirdos who hates seeing a balance. Plus it’s easier for me to keep track and make sure I’ve still got a handle on everything if it’s smaller balances paid more frequently.

Once the first three months are over, we will still use it for all of the spending we can. I just won’t keep an overall total of how much we’ve spent since that won’t be relevant after we receive the bonus. We’ll continue to accumulate the points, paying the balance off each month to avoid interest.

After we’ve reached enough to cover our hotel stay we’ll open up a new card. I’m choosing to have it cover hotels because the deal with hotels.com will probably get us the most value here.

Take Advantage of Credit Card Rewards Programs with Each New Card

When we’ve got the hotel covered (estimated, we probably won’t book it yet) which I’m thinking will most likely take 6-8 months, it’s time to move on to a new different card. While the Venture program is great, it can’t beat a new card’s incentive bonus.

Since the last card was in my name, this new one will be in my husband’s in order to space out the impact to our credit. But even without a spouse, 6-8 months between opening a new card shouldn’t impact your credit history too negatively.

Remember you usually want to avoid opening (or closing!) a lot of cards close together because that moves up the average age of your accounts which looks bad to creditors.

This new card will be the Chase Sapphire Preferred. Chase has an excellent rewards program. This is mainly due to the fact that they have many cards that all contribute to the same points bank. So you could really play the long game here and go through each of them one by one, collecting one incentive bonus after another.

Sapphire Preferred specifically is great to start because their current deal is 60,000 points for spending $4000 in the first 3 months. Since it will be the holidays by then, this will work out particularly well for us. We also happen to have a lot of birthdays during that time of the year. And this year my best friend is getting married around then too! Sheesh maybe I should open two cards…. >.< just kidding!

Continuing Travel Hacking with More Rewards

So the CSP incentive period will take us into the new year. Then I may open a new Chase card in my name so we can repeat the bonus. But we’ll check in to see where we are at that point.

We’ll either open the new one if we need a lot more, or continue using the current one to collect points until we have enough to mostly cover our flights. Chase is partnered with some big airlines, and when you book through their rewards portal Chase Ultimate Rewards they’re worth 25% more. So I don’t think it will take that long to reach what we need.

It’s important to note here that Chase has a 5/24 rule. This means you can’t have opened more than 5 of their cards in a rolling 24 month period. So you can’t continuously open them back to back forever. But it’s still a great long term plan as the points never expire.

Get Free Travel Rewards with the Right Credit Card Programs

If all goes according to plan, sometime mid-next year I’ll be beach sitting, drinking a fruity drink. Enjoying the island breeze. Ahh. And it will be all the sweeter knowing I didn’t really have to fork over any extra cash for it.

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Travel Hacking Using Credit Card Rewards