It was a life-changing moment. And I recognized it as such while it was happening. It was early 2011 and I sat in my car finishing up a Planet Money podcast before going in the house. It was a story about people buying dollar coins from the US Mint with credit cards, depositing the coins, and paying off the card with the coins in order to rack up credit card points. Then this happened:
“My husband and I are travel hackers.”
The idea of buying dollar coins with a credit card and depositing them at the bank to pay off the credit card in order to stockpile frequent flyer miles made sense to me, but when Jane Liaw said, “I’m a travel hacker,” the cartoon light bulb went off over my head. I knew there was more to it than just this dollar coin business. There was a whole world out there. For there to even be a term like “travel hacker” meant that people were turning saving money on travel into a hobby, and I knew I had to get in on it.
Truthfully, I should’ve figured this out much earlier. One of my favorite movies, Punch Drunk Love, came out in the spring of 2003. For those who don’t remember, Adam Sandler played Barry Egan, a toilet plunger salesman who exploits a loophole in a Healthy Choice promotion involving American Airlines miles. This part of the movie is based on David Phillips, a real guy who exploited the same loophole, and bought thousands of pudding cups, each worth hundreds of frequent flyer miles. I was aware of the pudding story even before the movie was made, so why didn’t I look into it then?
Barry Egan stockpiling miles
I wish I knew, because this kind of scheme is right in my wheelhouse. In college I signed up offers through some weird promotional website in order to gain points to buy a first generation iPod. I’ve earned hundreds of dollars and even household appliances for taking surveys online. I’ve always understood the lop-sided tradeoff companies will sometimes make to market products to you. So why didn’t I glom onto the burgeoning travel hacker movement, the biggest get-something-for-nothing scheme around? Maybe there was a lack of information on the internet. Maybe I thought the airlines put the kibosh on those kinds of promotions after the Pudding Cup Incident. I probably missed out on millions of miles by not looking into it in 2003.
Well, after that Planet Money story aired, I was onboard. I started researching and found that most frequent flyer mile junkies earned their miles by signing up for reams of credit cards. As a 29 year old who had never had a credit card, that led to more researching about credit scores, how to get approved for a credit card, and all the possible dangers associated with this hobby. For those who don’t know the travel hacking approach to credit cards, it basically goes like this.
- Research cards and find the ones with sign up bonuses that you want. Usually these are around 40-50,000 points or miles.
- Apply and get approved for the card.
- Complete the minimum spending requirement on the card. This is anywhere between $1 and $5,000, but is usually $2,000 or $3,000 to be completed within 3 months of approval.
- Wait 11 months and cancel the card before the annual fee is billed so that you truly are getting something for nothing. The annual fee is usually waived for the first year.
Greenhouse at the Schoenbrunn Palace in Vienna, Austria. Free flight with United miles, free hotel with HIlton points.
There are many more tips that go into this. Don’t get involved without reading up on it much, much more. If you’re bad with credit cards, don’t even think about it. There are strategies for when to apply, getting approved, deciding on the cards, and of course you should never carry a balance. It’s a very strict regimen. But I have to say, once you get the hang of it, it’s very little work. I read a few blogs which compile the best credit card offers, Marge and I both apply for new cards every three months, we use them, and without purchasing anything more than we normally would, the miles deposit, and that’s it.
Most normal people out there are getting one mile or point per dollar spent on their rewards card, or maybe up to 5 points during promotions. But by always using a card with a bonus attached, we’re usually earning 16 points or more per dollar spent (50k points/$3,000).
Palm Beach, Aruba. Flights paid for with Delta and Citi points.
In 2011, after some debate, I took the plunge and applied for my first credit card, a US Airways card from Barclays bank. Luckily, I was approved, despite never having a credit card before. It was another five or six months before I applied for my second credit card.
Since 2011, and over 50 cards later, we’ve earned over 2.5 million miles and points. We’ve got enough cancelled credit cards to make Halloween costumes out of them! (We went as Black Friday and Cyber Monday) And our credit scores have never been higher. Don’t ask me why this is. Talk to somebody in the credit industry because it doesn’t make much sense to me either.
In just three short years, here’s where those miles have gotten us:
Aruba – Two round trip tickets. (Free hotel timeshare week from a generous relative)
Toronto – Three hotel nights for the Canadian National Exhibition.
Long Island – Three hotel nights for a wedding.
Vancouver and Vancouver Island – Two round trip tickets, return flight in business class.
Germany and Switzerland – Two round tickets in business class. Five nights in very expensive hotels.
Clearwater Beach, Florida – Two round trip tickets. Two nights at a hotel on the beach.
Annapolis, Maryland – Two round trip tickets. One night at a hotel.
Macedonia and Vienna, Austria – One round trip ticket (That’s me!). Three nights at the Hilton in Vienna.
Orlando – Two round trip tickets. Two nights at the Waldorf-Astoria.
New York City – One night at the Four Points in Soho.
And here’s what we have planned next:
Naples, Florida – January 2015 – Two round trip tickets. Two nights at the Hilton.
Peru – March 2015 – Two round trip business class tickets.
Japan – October 2015 – Two round trip FIRST CLASS tickets. At least four hotel nights.
I’ll be outlining most of these trips later, showing off photos and calculating the retail price vs. what we paid for everything, down to a Per Day vacation cost.