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Introduction

You can do amazing things with points, credit cards and loyalty programs.

In my first full year of travel hacking, I got to experience:

• 120 nights of travel worth $40,000
• including over 150 free meals
• for $4,000 after points
• or $33 per day.

Aspirational trips often require knowledge, time and careful planning.

• Cruising for “Free” from Australia to Seattle
• 9 Nights in Maui for $16.80

But simple trips can actually be easier for novices to book on points than with cash.

• Conference in Pittsburgh
• Cleveland Arcade and the Rock and Roll Hall of Fame

The game is played in three ways.

1. Earning points from spend.
2. Redeeming points for travel.
3. Collecting capabilities.

Many sites cover earning and redeeming, and so do we, but our focus is more on the capabilities side, giving you knowledge and tools to make travel easier, cheaper and more flexible.

Always pay your credit cards off in full every month.

Earn Points from Spend

There are many, many ways to earn points from spend, but the two most common are:

• Collecting credit card signup bonuses.
• Using cards that provide bonus earnings on routine spend.

The best points to earn are transferable bank points which can be used for multiple hotels and airlines.

Signup Bonuses

Starter travel cards like the Chase Sapphire Preferred routinely offer new or returning cardholders a large signup bonus.

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75,000 transferable points for:

• Opening a card.
• Completing $4,000 in spend.

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At a conservative point valuation of 1.5 cents each when redeemed for travel, that’s a $1,125 (28%) rebate on your spend. This is only an example and travel card bonuses can range from 40k points all the way up to 200k.

There are dozens of cards out there with similar bonuses. Many people finance all their travel by applying for a new card every six months and periodically closing or downgrading accounts they no longer want.

Routine Spend

Even though opening cards is very, very profitable, you can do quite well keeping the same 2-3 cards, without opening anything new, as long as they are the right cards.

Most people earn 1% or less on their purchases.

• Cash and debit cards rarely earn any rewards.
• Most credit cards earn 1% back on most purchases.

But there are numerous credit cards out there with much better earn rates:

• 5x on utilities
• 4x on groceries and dining
• 3x on gas
• 2x everywhere

So given routine spend:

• $2,000 per month in expenses
• and the right 2-3 credit cards

You can easily average:

• 2.5x transferable points.
• 60,000 points per year.
• $900 in travel per year.

See our beginner’s guide for tips on picking your first 2-3 cards.

Redeem Points for Travel

Once you have transferable points, you need to spend them. This can get complicated, but there are really just a few rules.

1. Find what works for you and do it.
   A point spent is better than a point saved.
2. When in doubt, calculate your redemption’s cents per point (cpp).
   Compare to Frequent Miler’s Reasonable Redemption Values.
3. Realize it’s not all cpp, and everything has an opportunity cost.
   Two nights in a resort could cost you fourteen on a road trip.

I suggest beginners start by booking lodging as this tends to be easier than airfare. Once you find a few redemptions you like, it becomes very easy.

Most of this blog is about travel and travel redemptions so check out past trips for ideas or take a look at my favorite redemptions.

Collect Capabilities

This is an advanced topic, but I encourage all beginners to think beyond signup bonuses and redemptions, beyond cents per point, and approach things with an eye toward accruing capabilities that make your specific travel experience better, faster and cheaper.

Capabilities can take several forms.

The simplest include benefits of credit cards or loyalty programs.

You might also look at capabilities as a mixture of knowledge and point balances.

How would you efficiently find availability and book each of the following?

More advanced capabilities might involve the ability to leverage status within and across industries when opportunities arise.

• Matching airline status to hotel status.
• Hotel status to casino status.
• Casino status to free cruises.
• and everything in between.

I could go on, but the possibilities are infinite and their value highly subjective.

I’m not suggesting everyone run out and get a $695 premium travel card. Rather, when making decisions, take a moment to look at what capabilities each option provides and think about how you might use them. Over time, your toolkit will grow and one day you may find you have the ability to make the infeasible routine. That is the magic of travel hacking.

Continue onward. Choose your first two cards.