It’s normal to feel jealous while scrolling through Instagram. The photos of your friends’ jaunts to Morocco or Thailand always seem to linger long after the trip has ended. Seeing these pictures may spark an interest in your own vacation.
The only problem is, traveling is expensive. If you daydream about going overseas, but there is little room in your budget, it’s time to get creative. Travel hacking is one way to make your dreams a reality.
We tapped an expert to learn the ins and outs of this addictive hobby—and how to avoid getting burned.
What is travel hacking?
Travel hacking is when you gather points and miles to save money on future trips. If you are a road warrior at work, you may already be stockpiling rewards on the company’s dime.
It’s also possible to travel hack with credit cards—and their generous sign-up bonuses—without ever leaving town.
Scoring elite status with your favorite airline or hotel chain may be easier than you expect. According to a 2017 study from MagnifyMoney, credit card rewards have more than doubled since The Great Recession. That’s over $22.6 billion in free flights, hotel stays, cash back, and more.
The bottom line: if you are disciplined with credit cards, there are endless opportunities to travel hack.
“It’s all about creating special memories,” says Lee Huffman, a travel blogger at Bald Thoughts and podcast host at We Travel There. Working long hours makes it difficult to spend time with his family. For Huffman, travel hacking is a way to bond with his kids.
He estimates his family of four has saved more than $100,000 over the past seven years.
How to get started with travel hacking
Once you learn about travel hacking, you may be eager to dive in immediately, but Huffman says to pump the breaks. By starting with these steps, you will increase your chances of long-term success.
Check your credit score
Before applying for a stack of credit cards, it’s critical to know your credit history. Start by checking all three credit reports—Experian, Equifax, and TransUnion. This is free once per year through AnnualCreditReport.com.
By pulling complete reports from each bureau, you can make sure there are no errors hurting your FICO score. According to the FTC, one in five Americans has a mistake. If you discover any, send a dispute directly to the bureau. “There’s nothing worse than getting denied for something you could have cleaned up ahead of time,” Huffman warns.
Once your credit history is clear, there are many places to check your FICO score for free. It’s possible you have access through one of your credit cards.
The higher your score, the better your odds of approval with the most lucrative travel rewards cards.
Pick your location
If you think about travel a lot, the next step could be easy. For starters, where do you most want to go? Are you dreaming of a beach trip to Los Angeles? Or are the northern lights in Iceland at the top your wishlist?
“Start with the end destination in mind and choose a card that will get you there,” says Huffman. Some credit cards earn points for a specific airline or hotel chain. Others offer an online portal to redeem points with travel partners.
The sea of travel rewards offers can be overwhelming.
But if you know where you want to go, it’s easy to narrow down the list. For example, if your heart is set on going to Paris, Southwest Airlines—which only flies in the U.S. and to the Caribbean—isn’t the right pick.
How do you like to travel?
As a travel hacker, you may be looking for more than free or inexpensive travel. Your goal may be travel experiences you otherwise couldn’t afford like flying first class to your dream destination. “Being pampered in the air is a priority for some folks,” Huffman adds.
If you are an airline credit card holder, you may have access to perks like free checked bags, priority boarding, cheaper in-flight food and drinks, or free wifi.
When it comes to redeeming hotel points, there is a wide spectrum of redemption options.
You can stay at the Motel 6 or The Waldorf. It depends on your preferences and how many points you are willing to spend.
Huffman suggests focusing on one hotel chain. If you have that company’s card, you can rack up points more quickly. These cards make it easier to get upgraded status in their loyalty program. This means access to perks like free wifi, early check-in, or free breakfast.
Airport lounges are another popular perk.
“Access before and after your flight is one of the best ways to improve your travel experience,” says Huffman. You can charge your phone, access free wifi, and relax in a comfortable chair—with free drinks and snacks.
Avoid these mistakes
Protect your credit score
Big sign-up bonuses are alluring but don’t try to earn too many at once. You may waste a lot of time, money, or end up overspending.
It’s never a good idea to spend more than you can afford. “Paying interest on a rewards card is the number one cardinal sin of travel hacking,” warns Huffman. Any interest you have to pay quickly outweighs the rewards.
Spending too much can also cause a dip in your credit score if your total balance—called “utilization”—is more than 20 percent of your limit across all cards.
Missed payments are another thing to avoid. Huffman suggests signing up for automatic minimum payments. It’s the best way to avoid getting dinged unintentionally.
Once you start juggling rewards from multiple programs, it can be difficult to keep track of all the expiration dates. There is no worse feeling than jumping through hoops, only to have your rewards slip away.
“Sometimes you have to learn those hard lessons. You touch the stove and know not to do it again,” Huffman laughs. He recommends the paid versions of apps like AwardWallet or Tripit to stay on top of these deadlines.
Don’t sacrifice your other financial goals
Earning free travel is great, but not at the expense of your other financial goals. This is especially true if it blocks priorities like buying a home.
“It’s great to get a lot of miles. A lower interest rate on your mortgage is even better,” Huffman says. A lot of new inquiries on your credit report could be a red flag to your lender.
Start travel hacking slowly
There’s no doubt about it—travel hacking can be addicting. While it may be tempting to jump on offers quickly, it’s better to get comfortable first. Once you learn the ropes, you can get more aggressive.
By avoiding rookie mistakes, you won’t get burned early on and can benefit for many years to come.
Kate Dore is a freelance personal finance writer based in Nashville, TN. She is a Candidate for CERTIFIED FINANCIAL PLANNER™ Certification and serves as the Director of Public Relations for the Financial Planning Association of Middle Tennessee.