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As you may have noticed from my previous posts, I was able to pay for two-thirds of our honeymoon last year with points from my credit card churning. More importantly, I don’t wait for cash back points: 90% of the points I receive come directly from credit card sign up bonuses.
You may be wondering how I’m able to save money and still go on luxurious vacations. By carefully paying attention to credit card sign up bonuses, applying for the right credit cards, and keeping a high credit score, this is how I save.
But Keep In Mind
The most important thing to keep in mind when credit card churning is being able to pay off your balance every month. I don’t sign up for any cards if I know I can’t pay off the balance and not get charged high interest rates. Some cards have very high spending thresholds in order to get points, but if you can’t meet those thresholds, it’s not worth it to sign up for the card. Stick to applying for cards you know you can meet the spending requirement of.
Keep Your Score In Check
In order to take advantage of the best credit card reward offers, and therefore save money on travel, you’ll also want to have a stellar credit score. You’ll want to have a solid credit history before you apply for rewards cards, as companies will look at your score to determine if you’re a valid candidate.
Applying for a new card actually affects three parts of your score: the average age of your accounts, the number of inquires and the total credit limit. When you open a new card, the total credit limit portion of your score will get a boost since you’re increasing your total limit (thus decreasing your credit utilization rate). But a new inquiry will generally ding your score by a few points and since the card has zero age, it will also negatively impact the average age of your accounts.
You can mitigate the latter effect though by having several very old cards. If you have three cards with an average age of 10 years, introducing a 0 year card will only reduce your average age to 7.5. An average age of a few years or more is good for your score so you can see why it’s a good idea to never close out your oldest cards (as long as there are no annual fees).
Finding The Best Sign-up Bonuses
From there, you will want to do a little homework to determine the best cards for you. As I mentioned in my previous App-O-Rama post, I plan my strategy ahead of time to get information on the best cards out there. I stay abreast of all the latest and greatest offers by reading The Points Guy and following the forums on Flyer Talk. You can get everything from frequent flier miles, hotel stays, elite status, lounge passes, cash back and more just by signing up for a credit card and spending money that you would normally spend anyways.
Once I’ve applied and been approved for cards, I make sure to meet the spending requirements for each card. Then I let the travel rewards roll in!
Travel can be very expensive, but I couldn’t imagine my life without some travel in it. I’ve had great, luxurious experiences all for a fraction of the cost. In addition to enjoying unforgettable getaways, I spend very little of my own money. By saving money on travel, I’m able to save for even more important goals, like maxing out my retirement and investment accounts.
By being a savvy credit card churner, I enjoy traveling at a discounted rate, and I still meet my savings goals. If you’re looking to save money too, enter the giveaway below to win one of 10 TaxACT 2014 Deluxe bundles!
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Hi, Harry! Nice post! May I ask you how do you keep organized with several credit cards? I am starting to use this strategy and I am thinking about attaching stickers to my cards to remind me where and when I should use them (one for groceries, another one for US shopping, etc).
How do you do?
Thank you very much!
I have 31 (between my wife and I) so I keep a spreadsheet and really only use 1-2 at a time though. Cash back pales in comparison to sign-up bonuses 🙂
Wow! 31?? Do you close them after getting the sign-up bonuses, or do you keep them active for a certain amount of time?
Haha it does sound like a lot. The best sign-up bonus cards have annual fees (usually waived first year though) so after a year I call in and cancel or about 50% of the time they credit the AF or give me pts to make me stay. Some hotel cards will give a free night on your anniversary so those can be worth it to keep too.
There is no shortage of cards and unless you travel an insane amount you will bank up points faster than you can spend them. I’ve been trying (European honeymoon, trip to Hawaii, upcoming trip to Bos/DUB) but still have a ton. Here are my other articles on travel hacking: https://yourpfpro.com/category/miles-points/
Haha, and I was worring about 3 or 4 cards 🙂
Thanks for the tips!!
I am working on using points for my vacation to Paris and Italy with my mom and daughter this summer. It looks like I am getting a free round trip ticket, 2 free hotel nights in Paris, 2 free nights in Milan and $1,000 in travel credits that I will use toward cost of other hotels.
I am so happy that I stumbled upon this travel hacking with credit card points!
Wow that’s awesome. Sounds like a great trip, I love the Musee D’Orsay next to the Louvre (art museum in an old train station) and if you make it down to Carcassonne I had one of the best meals of my life there in the castle 🙂