You painstakingly saved airline miles or credit card rewards, travel hacking at every turn until you FINALLY had enough to spend only to find there were no available reward flights to the places you wanted to go at a time when you wanted to travel. So you continued to squirrel them away, hoping to make use of them eventually. That was until… they expired! Now you have to start all over again. Can you tell this has happened to me more than once?
Travel hacking is great for those who have a lot of flexibility in their schedule and can travel when and where reward flights/hotel stays are available. However, for the rest of us it can be a frustrating waste of time. Here is another, simpler way to save money on and for travel that offers you a lot more control.
What is travel hacking?
Travel hacking is a term that describes collecting frequent flyer miles, hotel rewards, credit card points and other rewards, with the aim of travelling much cheaper, or even for free.
Who should travel hack?
Don’t get me wrong, travel hacking can get you some sweet deals, however, you need to have the time to do a lot of research; plan and book your own travel; and fly/stay when and where reward redemptions are available. You might save a bundle, but first ask yourself, what is your time worth? Do you have the ability to get time off work at the drop of a hat if a great deal comes up? Do your family commitments allow for that kind of spontaneous travel?
Footloose & commitment free
The frequent flyers out there touting the benefits of travel hacking as a way to “travel for free” tend to be people who have a lot of flexibility in their calendar. Young singles, digital nomads, freelancers and bloggers are prime suspects. This is because although you can earn points on most flights/stays/purchases, you cannot redeem points on all flights/stays/purchases. So, you have to be prepared to travel when and where the reward redemptions are available. You need to be footloose and (almost) commitment free.
Business travellers
Travel hacking can also be great for those who do a lot of work travel. Earning points on the company’s dime is the best way to earn free travel and status. When my husband reached gold status on Krisflyer due to regular business trips, we could check bags for free, get priority boarding and had lounge access. Ahhhh… those were the days. However, we still had trouble spending his mountain of points before they expired. Because, like many people, we would travel on public holidays and at other peak times that are blackout dates for reward travel.
Who shouldn’t bother with travel hacking?
Travel hacking enthusiasts will focus on how easy it is to earn miles using a credit card for everyday purchases, however they neglect to talk so much about the difficulty of redeeming points and the hours of research it takes to get the full benefit out of the process. In addition, many of the best deals are USA-centric and we aren’t all in the United States.
If you have a fulltime job, kids in school, are a primary carer or have other limitations on your time, collecting airline miles or hotel points can be a disappointing waste of effort. Now, I’m not telling you to forgo signing up to rewards programs and earning the points on your travel, they can come in handy. I’ve had more than one greatly discounted flight and free hotel night doing just that.
However, I don’t spend a lot of energy working my travel around earning these rewards. I also don’t bother with trying to earn miles or travel-specific rewards points. That is because there is another, much simpler and more flexible way than carrying around a dozen credit cards and turning them over every time an annual fee comes up, or a better sign up bonus is offered.
Another reason not to travel hack is if you have a specific destination in mind. Those working systematically through a bucket list, won’t be able to take advantage of reward redemptions in the same way as someone who goes where the wind blows.
The answer is a “cashback” credit card
Cashback credit cards offer you a percentage cash return on your spending each month. They may offer a general cashback amount, or reward certain purchases such as dining out, groceries, petrol (gas), travel etc. Best of all, that cash is yours to spend however you choose–not just travel. You can fly to your chosen destination in peak season if you want to, and you’ve already saved the cash to do so! No more sifting through rewards redemptions and being beholden to hotel and airline loyalty programs.
For example, our current credit card gives us 1-4% cashback on all purchases (including flights and hotels), so we earn hundreds of dollars back for our everyday spend including our travel, then use the saved cash however and whenever we choose.
(Not) travel hacking tips
A few things to be conscious of when shopping for a cashback credit card…
Match your spending habits – Shop around to find a credit card that offers cash backs that best match your daily spending habits, to get the most out of this system. For instance, if you do a lot of driving (or like to go on road trips), you might look for a card that has higher cashback on gas purchases. If you like to eat out, look for a card that rewards diners.
Watch the annual fees – Some of the top-performing cards will charge fees that may eat up all those savings. Ensure that the cashback you earn on a card will surpass any fees.
Don’t rack up interest – Pay your credit card bill off in full every month because none of this is any good if you are offsetting your savings by racking up interest.
Be wary of international fees – If you want to completely streamline things and use the same credit card when you’re out travelling internationally, look for minimal foreign transaction and foreign exchange fees.
Prioritise and save – Yep, that old chestnut. Here’s a few ways we save for travel by being conscious about our everyday spend.
Best credit cards for “travel hacking” the better way
- See this NerdWallet comparison of the best cashback credit cards as of February 2021 if you are Stateside.
- Here are some UK options summarised by Money Saving Expert.
- Aussies should check out this list of cashback credit cards.
- Our Singaporean readers can review their local options on Money Smart.
Tell us about your travel hacking experiences/challenges below in the comments. Has it worked for you? Do you have a favourite cashback credit card? We’d love to hear your take on this.
Peace, love & inspiring travel,
Madam ZoZo
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