Every once in a while I’ll be on a tour or staying at a hotel where I can’t help but hear the conversations around me. Sometimes I hear something that makes me stop what I’m doing and listen. The latest happened on a trip to Peru recently when one traveler asked, in amazement, “Why would you use a debit card to pay for an $8,000 tour? Are you out of your mind?!”
The recipient of this question mumbled something about responsible spending and not going into debt, but the others at the table hit him with a barrage of arguments that had him saying, “Okay, OKAY—I get it. So what card should I get?”
On the one hand, you’ve got to admire a guy who got to retirement age without putting things on a credit card. That restraint and fiscal responsibility are admirable. On the other hand, half the people at that table I was eavesdropping on had not paid for their flight—they cashed in miles to get to Peru. This guy, on the other hand, had laid out plenty of real money to get there. They paid the same amount for the tour upon arrival, but they certainly did not pay the same amount for transportation.
Travel Hacking Vs. Leaving Money on the Table
As it came out in the conversation I was eavesdropping on, there are those who exploit the opportunities and those who don’t even know they exist. The former are showered with perks, the latter–responsible as they may be with their money—end up looking like schmucks. “Do you have to pay to check a bag?” one asked. “Do you have Global Entry and TSA Pre-check?” asked another. “Do you get a room upgrade when you check into a hotel?” a third chimed in.
The point they were making—and it wasn’t hard to make—was that getting the right credit cards can make your travel life a lot more pleasant. If you charge things and never pay any interest, then you’re only out the annual fee. Unless you never go anywhere after getting the card, it’s almost impossible that even a leisure traveler who takes two or three trips a year won’t come out ahead.
The hotel and airline loyalty programs are a game. Those who play the game can win big and the game is actually pretty hard to lose. The only people who really lose badly are the ones that don’t play at all. You can grab some of the money on the table or you can leave the cash sitting there.
Airline Credit Card Perks and Convertible Points
If you fly a certain airline (or their alliance) a lot, it’s a no-brainer to get one of that airline’s credit cards. If there’s a juicy sign-up bonus being offered, then you could end up with a free international flight without even earning a single mile from flying. And these days, you don’t earn much by flying, so getting the right card will earn you more anyway just from putting bills and gas pump charges on the card.
If you get this Amex Gold Delta Sky card, for instance, you can get 60,000 miles after meeting the minimum spend in three months. That’s enough to fly to Easter Island and back if you’re flexible, or to get to Asia.
American Airlines once offered me a deal like that from Barclay while I was on the plane. “This one has no minimum spend” she said in the cabin mic. “Buy a cup of coffee and you’re getting the 60,000 miles.” She whispered when she handed the application to me that the interest rate was really high, “So don’t ever use this thing if you’re not going to pay it off right away. ” I liked the deal and I liked her honestly, so I took the deal and I’m currently sitting on 100K miles. Plus I never pay to check a bag and I board the plane earlier.
While the bonus may not be as high, you can also get a free flight to Central America or Mexico with the Southwest Chase card or the United Explorer card. The latter is tied in with Avianca and Copa too, which opens up loads of options in Latin America. When you renew, the former gives you drink tickets plus bonus miles you can use to get to Los Cabos, the latter gives you two lounge passes for that long layover somewhere on your way to fun.
There’s also an advantage to having an Amex card with Membership Rewards or, even better, a Chase Sapphire Rewards card. With those you’ll pay more, but you can transfer your miles to multiple programs, giving you the ability to “top off” your account to get to an award tier you need for a trip. The highest level of those cards also get you lots of perks like reimbursement for Global Entry, reimbursement for bag fees, Priority Pass membership, and in the case of Amex, access to their own Centurion lounges.
If you only fly business class or above, that’s okay. Use these points to top off your total and you’ll have enough to upgrade or bring a spouse. Plus you’ll earn huge bonuses when you charge flights to this card. Even if you don’t have status on a particular airline, you’ll get some credit card perks that save you money or speed up your journey.
The Joy of Having a Hotel Branded Credit Card
While an economy seat on an airline might not get you very excited, how about automatic room upgrades and free hotel nights at a luxury property?
Not all hotel loyalty program cards are created equal because the programs aren’t as comparable as the airline ones. Some may have easy redemption at 15,000 points, while on others that might not even get you into a motel. I have cards from Hilton and IHG personally. The first I got because the sign-up bonus was huge and I ended up getting three nights on three occasions just from the sign-up bonus.
Well that offer is open again: 100,000 miles for signing up now and you only have to spend $1,000 on it to get this. That’s a fantastic deal as it’s enough for a couple nights at, say, Waldorf-Astoria Panama City.
I am also a big fan of the IHG Rewards card from Chase. Not because their hotels are all that luxurious–though they did add Kimpton to the mix if you’re in the USA—but because the point cash-in levels are quite reasonable. You can often get into an Intercontinental or Crowne Plaza for a point total that’s often half what you see for a comparable property at Marriott. Plus every year upon renewal they give you a free night, which is great to cash in when you need an airport hotel or a road trip stop and don’t feel like laying out the money for that. I’ve cashed in points with them in Mexico, Nicaragua, Costa Rica, and Colombia.
Which card should you get? Well if that man had posed the question to me, I would have asked him where he lives, what airline he flies the most, and what kind of hotels he stays in. As I noted in this earlier post, you may have access to Thompson Hotels or Design Hotels with some of these cards. But a card for an airline you never fly isn’t of much use.
I would also tell him, however, to forget just getting one. Ideally, you should at least have one airline card, one hotel card, and one credit card that allows you to move points to different accounts as needed. This way you’ve got the best chance of getting all the credit card perks available.
Then instead of spending $20,000 on a debit card that earns absolutely nothing, you could be getting comped flights, free hotel rooms, and perks that the regular customers never see. Just float that spending for a month and the travel hacking rewards can be huge, even for luxury travelers.
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