Best Travel Hacks to Save Money Earn Points and Improve Credit Score
Is it possible that having four credit cards can actually improve your credit score? Bridget Todd, COO and trainer at The Financial Gym, says yes!
Why should I travel hack?
Why should I travel hack?
Save money. You may not have to pay full price for your flights, hotels or car rentals.
Earn points for the future. Using the right credit card to pay for your travel purchases can help you earn more travel perks on other vacations.
Improve your credit score. Using less than 30% utilization on multiple credit cards and paying on time with automatic payments can boost your score.
Great, how do I start?
Focus on your goals. Are you planning for domestic travel or international travel? Are you flexible on dates or are you committed to a friend’s wedding date? How do you feel about connecting flights that save money but elongate your time in the air? These are all factors that affect your points decisions.
Look for travel credit card sign-up bonuses. Bridget recommends the Chase Sapphire Reserve with the $50K point sign-up bonus.
Know what the points are worth. You know how when you see the “Terms of Agreement” on an iPhone update and automatically click “Agree”? Don’t do that for a new credit card. Control+F on “Points Redemption” and find out what each dollar you spend on the card is worth when converted to points. For example, one point for each dollar you spend.
Know your spending habits. Don’t manufacture spending just to get the bonus. Spend an amount that you can afford to pay.
Stay organized. Make it easy on yourself to stay on top of payment deadlines by consolidating your due dates. Call each credit card company and ask for the payment reminder to be on one day for all cards, such as the 20th of each month.
Am I a good candidate to start travel hacking / maintain multiple credit cards?
Credit score needs to be 720+.
Responsible credit user (No debt, no missed payments).
Monthly spending consistent with bonus card requirements. For example, a sign-up bonus could mean you get $50K points if you spend $3,000 in three months.
*If you’re not quite there yet, no worries! Stick with ONE travel card until you can meet the above requirements.
What if I can’t reach the spending requirements?
Choose a card with a lower requirement.
Foot the bill for dinner (and get your friends to Venmo you).
Open your new card during high spending seasons (Black Friday, Christmas).
Any last hot tips?
Bridget recommends signing up for as many free loyalty programs as you can! Every time you book a flight with a different airline, you get a frequent flyer number. As you accumulate points, it’s possible to get a free checked bag, early boarding, ability to earn double points, etc. These can be used in conjunction with branded credit cards. For example, if you fly majority Delta flights, get the Delta Sky Miles card and use it to book with Delta Airlines. A few loyalty programs for hotels are Hilton, Hyatt, IHG and SPG.
Bridget says that Starwood Preferred Guest (SPG) is a good card since its points are worth more than any other points in the point system. Starwood and Marriot recently merged so the Starwood points are good for Marriott too.
Happy travel hacking! If you use any of these tips to book your future vacations, make sure to tag #financialgym in those upcoming social posts.
Interested in working out your money? Find time to speak with a Financial Gym trainer, check out our Wine & Learns programming and learn about how to make membership work for you.