Here’s the deal. My mom is awesome. Like super awesome. Like raised-two-daughters-as-a-single-mom-and-still-got-her-Ph.D.-in-the-middle level awesome. She’s always been supportive and wonderful, and I love her bunches. And she turned 60 this year, so I wanted to do something extra special to celebrate. For the past year and a half, I’ve been saving up credit card points to take her to Jordan (without spending a whole lot of money), and I figured I’d outline what I did here in case it’s of interest to others. I couldn’t write about this travel hacking strategy sooner because I didn’t give her the gift until last month, but we won’t be going until Spring 2020 (for her birthday I told her that we would be going, then we picked dates…).
Why Jordan?
Jordan is an amazing country. I’ve been before when I was in high school, but that was in the middle of the aforementioned Ph.D., when we definitely didn’t have any extra money for my mom to come visit (my way was paid already). And Petra has been at the top of her bucket list for ages, so she’s been bitter annoyed for ages that I’ve been and she hasn’t. It’s also a reasonably priced country to travel in, and I’m definitely looking forward to going back now that I have a legit DSLR camera–my high school point-and-shoot didn’t do the country justice.
What Is Travel Hacking?
“Travel Hacking” is the method of optimizing your credit card usage and points accumulation to travel with points (sometimes completely paid with points) in a way that gets you an outsized benefit for your points used. Some people may use their points on a vacation that has the highest monetary value–think specific first-class flight options, hotels that are excellent quality for their points tier, etc. In the points world, there are “sweet spots” where you’re maximizing your points redemption value, but they’re often to specific places.
My Strategy:
I have a lot of amazing places that I want to travel to. So I’m not particularly interested in using my points randomly; I’d rather save them and use them (even if I’m not “optimizing” their redemption) to get to the places I really want to go. An example? Last year, I went to Peru with my BFF Lyra. Peru has been at the very top of my travel wish list for years. I made the trip a little more affordable by completely covering my plane ticket with credit card points from my American Express Everyday Card ($0 annual fee, 15,000 point sign up bonus).
Another example is earlier in 2018 when I traveled to South Korea. I used Delta SkyMiles (from an excellent welcome bonus on the Delta Gold SkyMiles Card) to get that ticket for free. At the time, it was a 75,000 point bonus once you met the minimum spending requirements. It’s not as good now, but it does currently offer 60,000 miles, which is higher than the normal 50,000 bonus. There’s a $95 annual fee, waived the first year.
Those two examples combined total of $1750 in benefits, for spending I did anyway, and without paying 1 cent of credit card interest. Boom.
The Credit Cards I Opened
First, a few notes and caveats.
- This strategy is only useful if you PAY OFF YOUR CARDS IN FULL EVERY MONTH. If you carry a credit card balance, the interest you’re paying is higher than the value of the points you’re earning. Every time. That’s why credit card companies can afford to offer these awesome points deals. Focus on paying those suckers off, and then consider a “travel hacking” approach to credit card usage once you have a solid handle on your spending and can trust yourself not to go back into debt.
- The cards in this post are the ones I myself opened. The links are referral links, which means that if you sign up with them, you get your welcome bonus as usual, and I get a referral points bonus. It’s a win-win! If you find this post useful, please consider using one of those links to open a card you’re considering.
Why It’s Helpful to Open New Cards
As mentioned above, I already had a couple of cards that came with points bonuses that were useful. But the real key to the travel hacking strategy is to open new cards for the welcome bonuses. For example, the first card I opened for this Jordan trip was the Chase Business Ink Preferred. On regular purchases outside of the bonus categories, you earn 1 point per dollar spent on the card. But with the welcome bonus, I earned 80,000 points after spending $5,000 in the first 3 months.
Relax; I didn’t blow my budget to hit that threshold. Rather, I make sure to open cards like that one right before some planned higher spending, like when I have work trips come up. I hit my spending minimum and then get the expenses reimbursed anyway! Free points! Obviously, having a job that requires a decent amount of travel helps with this strategy, but we all have big purchases that come up. Those can be opportunities to hit a higher minimum spend than would otherwise be a good idea.
The full card rundown:
- Chase Ink Business Preferred. $95 annual fee, $5,000 in 3 months minimum spend requirement. 80,000 bonus points. Achieved Fall 2018. Downgraded to Chase Ink Business Unlimited in Fall 2019, $0 annual fee. Total cost: $95. This one comes with a bonus of $500 after $3000 spent in the first 3 months (though since I switched an existing card, I don’t qualify for the bonus).
- Chase Sapphire Preferred. $95 annual fee (after first year), $4,000 in 3 months minimum spend. 50,000 bonus points. Achieved Winter 2018/19. I’ll maintain this as my normal default card. Total current cost: $0.
- Marriott Bonvoy Boundless. $95 annual fee, $5,000 in 3 months minimum spend. 100,000 bonus points. Achieved Spring 2019. I might downgrade in Spring 2020 to the Marriott Bonvoy Bold. Total current cost: $95.
I actually intended to open one more card in Summer/Fall 2019, but then I decided to move to Cleveland and buy a house…and when you’re trying to get a mortgage, opening lots of credit cards isn’t a good idea. Oops…so I took a break, and it doesn’t seem like these last three cards have hurt my credit all that much, so I should be okay. The other card I considered opening would have reimbursed travel expenses on the road, like food, rental cars, etc. But even without that, we’re pretty well set for this trip.
Chase Card Caveat
*A quick note on Chase cards. Chase is well known in the travel hacking world for having stricter than average criteria for credit card applications. Basically, to deter credit card “churning” (opening a bunch of cards and closing them as soon as you’ve earned and redeemed the bonus), they have a 5/24 rule. If you’ve opened 5 cards or more in the past 24 months, you won’t get approved. That goes for their co-branded cards too (like the Marriott Bonvoy Boundless). For this reason, it’s a good idea to keep a close eye on when you open cards. Also, from what I understand, business credit cards don’t count toward that limit in the same way, so the Chase Business Ink Preferred wouldn’t have been one of my five.
What Those Points Have Gotten Me
I combined the points from the Chase Business Ink Preferred and Chase Sapphire Preferred to purchase two round-trip tickets to Amman. 152,236 points, tickets valued at a total of $1,903. Total cost: $95 annual fee for Chase Business Ink Preferred. Tickets purchased through the Chase Sapphire Travel Portal.
The 100,000 Marriot points, along with 90,000 I had already saved and those I earned through regular spending on the card, got us a total of 9 hotel nights, split evenly between Amman, Petra, and the Dead Sea. 202,500 points. We also booked two nights in a Wadi Rum Bedouin camp through the Amex Travel Portal with points. Total hotel cost: $95 annual fee for Marriott Bonvoy Boundless.
The only things left to pay for are food, souvenirs, guides, and a rental car. And none of those should break the bank. So in total, we’ve booked all of our flights and hotels for this trip, and I spent a total of $190 on credit card fees. That sounds like a super reasonable trade to me.
Wow! That’s a Deal!
This is why I bother with opening new cards and taking advantage of bonus offers. You just can’t beat that value, especially if you love to travel like I do. Also, if you’re strategic about opening cards, and you keep your balances low (and paid off every month), there isn’t a real effect on your credit score. In fact, this has boosted my score because my credit utilization (the amount of my credit I’m using as a percent) is so low. Again, this isn’t going to be a good strategy if you have poor credit or already carry credit card debt, but if you’re good on those fronts, you’re leaving some serious money on the table by not using cards.
A Reminder that Finance is Personal
Even though you may not be currently taking advantage of these offers, that doesn’t mean you absolutely need to. None of this post (or my blog generally) should be taken as financial advice because everyone’s situation is unique. I have financial planning clients who don’t want to use credit cards because of their previous experiences with debt, and that’s okay. I wouldn’t pressure them into getting a card with points just to “optimize.” I didn’t even think about opening multiple cards for bonuses until some after I paid off my own credit card debt. And I only felt comfortable opening new cards once I had a solid budgeting system to make sure I stayed on track and didn’t overspend.
Use your best judgment. You can open one basic points card, open several (like I did), or go even further down the rabbit hole…there are entire blogs and websites devoted to credit card points strategies, both for earning and spending those points. Have fun, don’t take travel hacking too seriously, and hopefully your next fun adventure is a little cheaper. I’d love to hear about it!