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Free flights aren’t just for the wealthy and frequent flyers
Traveling is expensive. There is no way around it in most cases. The flights, hotels, restaurants, and excursions all add up, and it’s easy to break your budget. Meanwhile, you scour your social media and see influencers flying first class every two weeks. You might think they’re all rich, and they could be, but they’re more likely using credit card points.
I’m not rich at all, but I travel full time and haven’t paid full airfare in almost two years. It’s not the easiest process, but with a little work and a bit of patience, you could end up with a little extra pocket money to spend on your next vacation or, even better, flights and free accommodation.
Here are my top tips for getting started in the world of credit card points.
Don’t be afraid of credit cards
Before making the transition to the master of points, you must overcome the societal fear of credit cards. From an early age, we are taught to associate credit cards with debt. The uninitiated may have one for emergencies but will advise you to avoid opening too many. In fact, credit cards are one of the most useful tools and can save you thousands of dollars if used correctly.
Credit cards aren’t the problem; the temptation to overspend is. You can open twenty credit cards over the course of a year or two and never spend more than usual. Treat the card like a debit card. If you can’t afford it, you still can’t afford it. You just need to learn how to keep track of your debts and pay them off regularly.
2. Think about your lifestyle
Research is essential. Long before you open your first travel credit card, you consider your lifestyle. Different cards have different partners and are heavily geared towards different types of travel and offer a variety of benefits.
If you never fly but regularly frequent hotels, you shouldn’t take an airline credit card. If you’re saving points for a big international trip, don’t look at the maps of airlines that don’t fly there. Even everyday purchases have an impact. If you eat out a lot, an overnight menu with restaurant bonuses would be helpful. Make a list of your priorities.
Set a points goal
If you’re not a super regular traveler, setting a points goal is a good idea to stay focused on a strategy. Say, a big vacation to Europe in a year or a trip to South America in the summer.
Do some research and find out how much the flight costs, how much it costs in points with different airlines, and then your accommodation costs. Then you can set off, using the tips above, to find the cards that will get you there with the least amount of effort.
Look for welcome bonuses
Opening up maps is the biggest strategy for earning points, especially if you don’t travel regularly enough. Bonuses are designed to entice customers to open a card. Typically, they will offer a fixed amount of points in return for the cardholder spending a fixed amount.
For example, one could offer 50,000 points if the cardholder spends $4,000 within the first three months of opening the card. If your usual budget requires you to spend this amount, this card could be a good option. It is very important not to try to spend this amount just to earn the bonus. If you spend more than usual, you lose value.
Some of the biggest bonuses come from cards like Amex. His Platinum card, which I use, offers 100,000 points if you spend $6,000 in six months. 100,000 points could be worth over $2,000 if used to their full potential. That’s a really impressive return on your money. That said, don’t just apply based on the bonus; there are other factors at play.
Check the annual fees
Fees are never fun. But when you look at them in the context of opening a credit card, they could do even more harm than you think. Take the previously mentioned Amex Platinum card. It has one of the highest credit card fees in the industry at nearly $700. It is enormous. And if you’re not prepared to extract every dollar you can from the card, you lose money, regardless of the 100,000 points.
Before opening this card, I calculated everything I could use these points for, as well as the additional benefits the card gave me. When I was sure the value I would get out of it was greater than the fees, I bit the bullet. If your calculations are insufficient, it’s a miss on high-fee cards.
Maximize your points by transferring
When you see point ratings online, they are usually the most you can get. While companies like Capital One and American Express have their own travel portals where you can buy flights and hotels, the best way to use them is to transfer them to a partner.
Partners vary depending on the card you are using. For example, Capital One allows you to transfer your points to airlines such as British Airways, Singapore Airlines, Air France and many others; Amex also partners with Delta, JetBlue, British Airways and many more. Transferring points to these airlines gives you more direct value when booking a flight.
If you fly to Paris and have 60,000 points. Capital One could charge 100,000 for a round trip on its portal. British Airways may only charge 50,000 Avios, so it makes sense to send your points to your British Airways account.
Some won’t be able to transfer, like airline or hotel-specific cards, so make sure you use those companies enough to get the benefits.
Join loyalty programs
If you’re not at the point where you can pay for trips with points, make sure you get something back for the trip you pay for. Whichever hotel, airline or rental company you use, join their program before you pay.
You will earn points for each flight and stay, which will accumulate over time if you travel frequently.
Have different cards for different purposes
Different cards have different ways of building up points. Some put huge bonuses on travel, while others give you solid extra points for dining out. There are even some very specific ones, like making small purchases or paying for gas at certain types of stations.
If you have two or three cards, label each one (literally or mentally) as your restaurant card, your grocery card, and your big purchases or travel card. This way you maximize the number of points you can get from your daily life. Most of us don’t spend enough money to pay for an entire flight in a few months, but some smart decisions over the course of a year could pay big dividends.
Use large purchases effectively
You should never spend money that you wouldn’t normally spend on a credit card. It’s a surefire way to end up in a lot of debt. But once in a while, we all have big purchases. Maybe your laptop needs an upgrade or you’ve had sudden household repairs that cost a few thousand dollars.
Before paying cash or using another card, look for effective bonuses that might cost the same. My girlfriend has expensive laser treatment on her eyes coming up. Instead of throwing her on her usual card or paying with a debit card, I asked her to open a new card with a bonus of 75,000 points. She was going to pay no matter what, so why not make free flights out of it?
Quickfire Dos and Don’ts
- Use a credit card for everything
- Don’t buy things you wouldn’t normally buy
- Pay your balances
- Don’t forget to check the fees
- Check bonuses
- Don’t use cards for businesses you don’t use
- Transfer your points
This article originally appeared on Travel Off Path. For the latest breaking news that will affect your upcoming trip, please visit: Traveloffpath.com
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