Welcome to the Travel for Free series on TMBtent.com! If you are anything like us, one of your biggest hurdles to traveling more is the cost of the trip. Flights, hotels, dining out, and all the other expenses that come with a big trip add up fast and can quickly make that dream vacation seem unattainable. We had always dreamed of hiking the Tour du Mont Blanc and camping along the way, but when we would add up the cost of two round-trip flights from the U.S., lodging, food, and transportation it seemed like a price tag that was out of reach. This all changed when we discovered the world of travel hacking, which ultimately let us make our TMB dream a reality for under $500 per person, including round-trip international airfare!
If getting free flights and learning how to travel for less is appealing to you, then the Travel is Free series is for you! We’ll share all of the details on how we collect points and miles through specific credit card offers, get great deals on Airbnb’s, save on dining out, and find ways to take incredible trips for nearly free. Let’s get started.
You can check out the entire series to date here:
What is travel hacking?
Travel hacking, as it is commonly referred to, is the process of opening credit cards that offer large sign-up bonuses and then using these points and miles to travel the world. Here in the U.S. credit cards are a billion-dollar industry and competition for new customers is fierce among the various banks. In order to attract these new customers, card issuers will offer huge sign-up bonuses that they hope will entice profitable customers to choose their card above the others. For example, a typical credit card sign-up bonus will offer 50,000 miles for spending $3,000 in 3 months on that specific card. Most people will open that card, spend the money, earn the bonus and then go on to hold the card for many years, paying hundreds in annual fees to the bank and maybe even some interest on top of that. In this situation the bank wins, and it is a big reason credit card companies are some of the largest companies in the world.
Travel hacking is all about flipping this narrative on its head. We open these same credit cards when they are offering a huge sign-up bonus, earn the bonus, and then cancel the card prior to paying the annual fee. Once we’ve gotten the bonus, we simply move on to the next card. This simple process has resulted in us earning hundreds of thousands of frequent flier miles, and saving thousands of dollars on our travels.
Is travel hacking for everyone?
Absolutely not. If you have any issue paying off your credit card balance in full and on-time every single month this is not for you. If you currently have any credit card debt, this is not for you. If your credit score is low (anything below about 725), this is not for you. If you are considering applying for a major loan within the next few years, such as a mortgage or car loan, this is not for you.
To truly succeed at travel hacking you have to be organized, have no problem paying off your credit card bill every month, and have a good credit score that indicates to banks that you are a responsible borrower. If any of these aren’t true for you, travel hacking won’t be a good fit.
Will this ruin my credit score?
We have both opened several credit cards over the past few years and can tell you that from our experience the answer has been no, this strategy has not ruined our credit score. What we have typically seen is a small dip in our credit score immediately after opening a new card, but the long-term trend has been a consistently high credit score. It is important to understand the factors that contribute to your credit score. They include:
- Payment history
- Age of your credit history
- Percent of your total available credit that you are using
- Total number of accounts
- Total number of recent credit inquiries
Out of all of these factors, the most important are your payment history (are you paying your balance on-time and in full every single month?), the length of your credit history (how long have your accounts been open?) and your credit utilization (what percentage of all available credit are you using at any given time?) Travel hacking affects each of these items uniquely, some positive and some negative. When you open new credit cards several times per year the average age of your accounts is going to go down, so this is a negative effect. However, as you open more cards the total available credit will increase thus lowering the percentage you are using, resulting in a positive effect. Finally, since you will only get into this hobby if you are paying your bill on-time and in full every single month you will have a great payment history.
Ultimately, this is a very personal decision and your experience could be different than ours. It is up to you to monitor your credit score and decide if the potential risks are worth the rewards.
Are there other ways to save if credit cards aren’t for me?
Yes! While they are not nearly as lucrative as credit card bonuses, there are many other ways to save on your travel expenses. We’ll walk through all of these in future posts, but it is possible to save hundreds of dollars on your travel expenses without ever opening a single credit card. These strategies include finding great deals on Airbnbs, using cash back portals to book hotels, and using gift card re-sellers to save on airfare and hotel stays, among others.
We’ll cover this more in-depth in a future post, but thought it would be helpful to give an overview of our approach. We have what many would consider a conservative approach to travel hacking. Every few months we’ll sit down together and look at our travel goals over the next 18 – 24 months. This includes trips we know we’ll take, such as spending Thanksgiving with family, as well as much broader ideas, like “we want to go to South America sometime in the next two years.” Once we have an idea of the trips we’d like to take, we then strategically open credit cards that we know will help us get there. One of us will then open a new card, put all of our spending on it until we meet the bonus requirement (this typically takes 2-3 months), then set that card aside. Then the other person will open the next card, we’ll take a couple of months to meet the bonus, and then its set that card aside for a new one. Round and round we go. This typically results in each of us opening 2-3 credit cards per year, which we can usually turn into $5,000 – $6,000 in free travel. Incredible!
Many folks who are more into this hobby have complicated strategies involving opening 10+ credit cards per year. You can definitely earn a HUGE amount of miles this way, but it is too complicated and cumbersome for us. We find our approach to be the perfect balance of simplicity and effectiveness.
Want to follow along as we share more details about how we’ve saved thousands on our travels? In the coming months we’ll be adding trip reports, a step-by-step guide to how we travel hack as well as other content on how you can save money while seeing the world!
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