Thanks to credit card points and miles we’ve been able to travel the world for pennies on the dollar. It has been life-changing! In this beginner’s guide, we’re going to go over all the basics you need to know so you can start working towards a nearly-free vacation!
When you sign up for a credit card they often come with a bonus or welcome offer. The welcome offer will usually be something like “earn 50,000 points after spending $3,000 in 3 months”. Those 50,000 points are usually worth at least $500 towards travel or sometimes closer to $1,000 or more!
The $3,000 you need to spend is called the minimum spending requirement. The idea is that you sign up for a credit card, complete the minimum spending requirement, get the points, redeem the points for flights and/or hotel nights, go on a nearly free vacation, and repeat! That’s how you travel for free! Sounds easy enough right?! Well, maybe it is a tad more complicated than that, but not much! Let us walk you through the basics.
Your minimum spend is the amount of money the credit card company states you must spend on the card in a given time period (usually three months) in order to be awarded the welcome bonus. You might be wondering how to meet that spending requirement, especially on cards that require a higher amount. First, pay for all your normal, everyday expenses (groceries, gas, internet, cable, etc.) with a credit card. I never use cash and it would pain me to do so. Why use cash when I can get 1.5-5% back on all my purchases if I use a card?! As a mom of three, it’s pretty easy to hit the $3,000 minimum spend. I’m looking at you Costco and Amazon!
I also plan my credit card applications around a big purchase. Planning on buying new furniture? Have a medical or dental procedure coming up? Going to be doing some Christmas shopping? Those are all great times to open a card because you know you will be spending more than normal. Check out this post for more ideas on how to meet minimum spending.
I’m a planner and typically like to plan my vacation and then get the cards I need to make that particular trip happen. First, I talk with my husband about where we’d like to go on vacation. Then I look into what airlines will get us to that destination and what hotels the area has to offer. Once I decide on a hotel and airline, I look into what cards will give me the points needed to cover those expenses. I open one card at a time. I put all the spending that I possibly can onto that card until I meet the minimum spending requirement. After I receive the bonus for the card then we move on to the next one to accumulate all the necessary points. Once I have all the points we book and then we are off!
I also keep my eye out for limited-time increased welcome offers. Airline and hotel cards, in particular, will increase their welcome offers every so often. When that happens it is a great opportunity to get more points! At those times I sometimes open a card and then plan my vacation around those specific points. In the case of airline points, I will open a card and keep those points handy for a rainy day. We always try to keep you in the know with those limited-time offers. Make sure you subscribe to our emails and follow us on Instagram or Facebook so you don’t miss out!
My mom is a little more OCD and her strategy is to get all the points! She gets all the points she can and typically signs up for one card after the other. In doing it this way she racked up over 3 million points in two years!! She does pay more in annual fees doing it like this but believes the benefits of her cards outweigh the annual fees. With as much as she travels, this has been well worth it for her!
The majority of the credit cards that will enable you to travel for free are travel reward credit cards. These include credit cards for specific hotels and airlines like the Marriott Bonvoy Credit Cards, Southwest Airlines Credit Cards, and more. Travel reward credit cards also include ones like the Chase Sapphire Preferred the American Express® Gold Card, and more. These are called transferable points cards because the points can be transferred to the bank’s hotel and airline partners to book directly. They are our favorites!
It is important to note that many of these cards include an annual fee. Luckily, many of them waive the annual fee for the first year. Annual fees can vary between $75-$100. Some of the luxury travel cards will have annual fees between $250-$695! I know, it seems crazy to pay that much just to hold a credit card! But, those expensive annual fee credit cards come with some amazing benefits like free hotel nights at luxury properties, lounge access at airports, airline credits, and much more! After you’ve had your card for the first year, it is important to evaluate if you want to keep that card or not. There are three options you have when that first year of card ownership comes to an end.
For more information on whether to keep, cancel, or downgrade your credit card, see this post.
Keep in mind, that you need to keep the card the entire first year. The credit card company won’t like it if you cancel your card right after you get your points. In fact, they can take away your points if you cancel before it has been 12 months.
There are a lot of variables that determine how many cards it will take to get you your nearly free vacation but just to give you an idea – you could plan a trip for 2 to Hawaii using 3-4 cards, a trip to NYC to meet up with your girlfriends for one card, and a roundtrip flight to Europe with one card.
Just like saving up money for a trip, it takes a little time to save up your points. Depending on your spending habits you could expect it to take around 6-9 months to have the points to book a Hawaii trip. If you are like me, you will find that once you get into this, the points start coming in and that timeline will go down.
Two-player mode is when you and your spouse are both signing up for cards in your own name. By doing this you are able to get a lot more points and each gets the same welcome offer. You are also able to refer each other to cards to get more points.
This is what it looks like; You sign up for a card and earn 50,000 points after meeting the minimum spend. Once you are close to meeting the minimum spend you refer your spouse/partner to the same card. They apply and are approved, which earns you a referral bonus. They meet the spend on their card and earn 50,000 points. Now instead of just 50,000 points, you have 100,00 points plus the referral bonus!
In short, the Chase 5/24 rule says if you have opened 5 or more new credit cards in the past 24 months, from any bank, you will not be approved for a new credit card from Chase. This is important because Chase issues many of the best travel reward credit cards available. These include cards from United, Southwest, Hyatt, and the Chase Ultimate Reward cards. If you are an authorized user on a card that can sometimes count against your five cards (we recommend not making each other authorized users). Because of this rule, we recommend starting with Chase cards.
Another thing to keep in mind is that most business cards don’t count towards your 5/24 count, however, if you are over 5/24 you won’t be approved for Chase business cards.
Check out this post for more information on the Chase 5/24 rule.
This depends on your travel goals, where you want to go, what type of hotel you want to stay at etc. Our favorite personal travel rewards credit card is the Chase Sapphire Preferred. We love this card because the points it earns (called Ultimate Rewards) are so flexible. You can transfer points to various airline and hotel partners (United, Southwest, Hyatt, and much more) and you can also use the points to book flights, hotels, cruises, and rental cars in the Chase Ultimate Rewards travel portal.
Our favorite small business card is the Chase Ink Business Cash. This card also earns Ultimate Rewards.
There are many great personal credit cards available to help you travel for free but there are also some awesome business cards as well. We love business credit cards! If you are only signing up for personal cards, you are leaving a ton of points on the table. You may be thinking, well I don’t own my own business. You may be surprised to find out what is actually considered a business. If you are involved in networking marketing (MLM), nanny, sell on eBay, have any side gig, etc. then you can apply for a business credit card. To learn more about business cards, what counts as a business, and how you can apply for one, check out this post.
It is critical that you only get into this hobby if you can pay off your card in full each month. If you are paying interest then you really aren’t getting a free vacation but are getting into debt instead. You also want to have a credit score of 700+.
Speaking of being organized, one of the questions we get the most is, “How do you keep everything organized?!” Believe it or not, it is pretty easy. The biggest tip we have for organization is the Travel Freely app. This is a free app that keeps track of your credit cards. It keeps you up to date on your Chase 5/24 status, annual fees, bonus deadlines, and more! We also recommend putting your cards on autopay so that you don’t forget to pay any of your bills.
This is a common concern and we get it. Credit is an important thing! The following five things each make up a portion of your credit score.
We feel like the positives outweigh the negatives on this. That being said we are not financial advisors. But we can tell you that since we started doing this our credit scores have gone up and we are both over 800.
Earning and using credit card points and miles can seem overwhelming and confusing. We know, we were once beginners. We have spent HOURS and HOURS learning everything we know. As we taught ourselves through blogs and message boards we realized there wasn’t much out there geared towards beginners and that most blogs focus on advanced travel hackers.
Our goal is to simplify travel hacking in the hopes that you don’t have to spend the hours and hours that we spent. Let us help you. Together we can teach you how to travel for free and get you to places you never dreamed you could travel to. Travel for nearly free is a real thing. If we can do it, you can too!