Travel Hacking – An Easy First Step

How can I reduce our travel budget?

Venturing into the world of travel hacking, my goal is to stretch out the time we can live on the road. But what I’ve learned applies to folks who are firmly rooted and just want to spend their vacation budgets wisely.  

Arriving in Red Valley at dusk

This summer we are touring western National Parks

I stepped into travel hacking not wanting to invest a lot of time playing credit card app-o-rama – churning through credit cards to rack up points then close the account before the second annual fee is due. A couple of credit card sign up bonuses would work wonders for us and my time wouldn’t be consumed chasing points.

Free Flights Through 2016

My first target was to earn the Southwest Airlines companion pass. Hit 110,000 points in a calendar year and the companion pass lasts through the following year. Meaning, if we could earn the pass in 2015 then we can use it through the end of 2016!

Based in Texas, we can fly Southwest Airlines on a regular basis – so far, the first 2 checked bags are free and there are no cancellation fees. These two Southwest benefits alone have saved us hundreds of dollars on domestic travel compared to flying American which is the other convenient carrier. 

We applied for two different Southwest credit cards – the first is a personal account and the second is for business use. Both Joel and I work as contractors so the business card will actually help for tracking expenses. (Even a part-time hobby that earns you money is a legitimate business.)

Joel hard at work in his "office"

Joel hard at work in his “office”

Each card required a “minimum spend” of $3000 within 3 months to hit the 50,000 point bonus. Earning the two bonuses also means thanks to the minimum spends, the account point balance is now at 106,000. (3,000 spend + 50,000 bonus on each card) Extra points came on with a business flight on Southwest (dollars spent on the card for Southwest travel get twice the points plus points for the flight itself) 

Not For Those That Carry a Balance

Our cards are paid off in total every month! And each card has a $99 annual fee paid on the first month’s bill. Do not try this unless you can work within these constraints!

Being on the road, it was fairly easy for us to make the bonuses so we are now enjoying the benefits of a high balance of Southwest miles (110,000 through the credit card plus whatever balance we each had earned via flights previously). 

Domestic flights and time in the Caribbean are high on the agenda through next year!

We could snorkel right off the boat at Cooper's Island

We could snorkel right off the boat at Cooper’s Island

We recently returned from 10 days in the British Virgin Islands. It was a test to see if I’d enjoy sailing so Joel followed some sage advice and we went during the calm weather season. It just so happens that the calm weather makes it low season (and a bit hot) so we saved on the boat rental.

Using the companion pass and miles, we paid $24 in taxes plus $25 each for early boarding (guaranteeing that we would sit together) to reach Puerto Rico. Island hopper flights, ferries and taxis were about $450 – definitely an area that I could cut even more if we weren’t so specific on the final destination on this trip.

 

International flights are the next prize. 

A few years back we searched for an American “chip and pin” card compatible with the European card systems after having some minor problems with automated kiosks in Europe.

The only cards we could get with a chip (at least that’s halfway there) was the British Airways card. Train ticket dispensers would now recognize our card while restaurants and shops swipe it just like any other American card. The BA card also included no foreign transaction fee – yay! A bit cheaper and more convenient for us in Europe.

Over the last three years we have banked a large mileage balance and a one time companion pass on British Airways. Problem is that their “free” trips are very expensive with a “fuel surcharge” of close to $800 for a flight to Europe – for each passenger. That’s close to bargain fare prices so I’ll be looking to use our remaining miles as supplements on partner airlines and shelving the card for the time being.

Same flight to Spain using miles cost Jeanna less than $100 while I paid nearly $800

Same flight to Spain using miles cost Jeanna less than $100 while I paid nearly $800

The Chase Sapphire card earns Ultimate Reward points that can be transferred to several frequent flyer programs so we recently applied for that card. A 50,000 point bonus accrues after reaching the minimum spend. At the moment, we don’t have plans for these miles but are banking them in anticipation for international travel in 2016.

It pays to rethink your credit cards every few years as the banking industry changes. As I found, a little bit of hacking can bring some great travel benefits!

 

Watch for next week’s post on my Mid-life Credit Crisis detailing the initial rejection on the Sapphire card. This application revealed some nasty impacts of new banking laws on MY credit history but not Joel’s.

 

 

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