How to Master Travel Hacking Without Racking Up Credit Card Debt

travel hacking

The idea of travel hacking sounds awesome. Who wouldn’t want to jet around the world for practically nothing, all by strategically using credit card rewards?

However, credit cards can also be dangerous. If you use them correctly, the rewards you earn can lead to all kinds of great things. But use them improperly and you could drown in a sea of debt.

That’s why it’s important to learn how to become a travel hacker while also making sure you don’t go into credit card debt. Read on to learn how.

What is travel hacking?

If you’ve never heard of travel hacking before, it’s pretty simple. In short, travel hacking is using credit card rewards to go on trips for free or cheap.

To get more rewards, a lot of travel hackers utilize the practice of credit card churning. This is the act of frequently applying for multiple credit cards to obtain their signup bonuses, closing the cards after using the rewards, then becoming a new customer again later on. Someone who churns credit cards might hold ten or more cards at one time.

If that sounds complicated or risky, don’t worry. It’s not totally necessary. Here’s what travel rewards and credit card expert Jason Steele has to say about travel hacking.

“I’ve always shied away from the term ‘travel hacker’ as it seems to imply that we’re doing something illegal, which certainly isn’t true,” Steele said. “But whether you call me a travel hacker or an award travel enthusiast, it means that I try to gain the maximum value from the loyalty program offered by the travel and credit card industries.”

And for Steele, it’s not only about how many points you get but also how you use them:

“This involves both earning as many points and miles as possible but also spending these rewards as efficiently as possible,” explained Steele. “I also try to do it in creative ways that aren’t obvious to the vast majority of travelers.”

You don’t have to open and close ten credit cards a year to get the best rewards. You simply have to find the cards that will give you the best rewards – and then spend them properly.

Become a travel hacker in three steps

There’s no easy way to become a travel rewards expert overnight. Steele offers a few words of wisdom to help the beginning travel hacker.

1. Set reasonable expectations

As fun as it sounds to book a European vacation tomorrow, it’s much better to start small.

According to Steele, you should begin with a modest goal, such as a vacation in the U.S. during an “off-peak travel period” – avoid the holidays and summer vacation.

“You can’t earn 100,000 miles and then decide that you are going to redeem those miles for four tickets to Florida for winter break,” said Steele. “It’s very hard to find airline award availability at the lowest mileage levels, especially in business or first class.”

Starting small enables you to book travel with rewards you might already have. And you can dip your toes in the waters of reward travel to gain some experience before you go for the really big rewards.

2. Compare card options

If you haven’t earned rewards yet but you have rewards cards, familiarize yourself with the terms your cards came with. You can find this information online or in your statements. And if you don’t have any rewards credit cards, start reviewing some beginner options.

“Look at the points and miles that you have with airlines, hotels, and credit cards and see what the difference is between what you have and what you need,” Steele explained. “Do a deep dive on just one or two programs to find out all of the ways that you can earn additional rewards that you need.”

And yes, there are many ways to earn more rewards. Some credit cards offer a signup bonus with spending requirements. Others give bonus points for purchases on particular items or at particular retailers.

The terms and conditions of rewards credit cards change all the time, so stay on top of what your cards are offering.

What’s more, Steele said, “Once you’ve booked your first award trip, you’ll probably be hooked on paying with points and miles, not dollars.”

And Steele would know. He’s regaled bloggers and friends alike on trips he taken for almost nothing – and always while flying first class. But if this is something you want to try, be very careful about the goals you set.

3. Spend wisely

The danger with travel hacking is how exciting it is to book free or cheap travel – and how it can make you want to do whatever possible to do it more.

But if you don’t spend wisely and pace yourself, you could end up in a load of debt. And that’s far more expensive than the money you’ll save on travel.

“You don’t want to try too hard to chase points and miles, such as making unnecessary purchases to earn rewards,” Steele cautioned.” And if you don’t already have your credit cards under control, you shouldn’t use them to earn rewards.”

Take advantage of travel hacks without attracting debt

Now for the most important piece of advice about travel hacking: how to do it without falling into debt. Here are a few practices to follow:

  • Choose one or two cards for the majority of your spending.
  • Don’t spend more than you can afford to do in cash.
  • Go online and pay off purchases the same day they happen.
  • Don’t use your credit cards for unplanned purchases.
  • Avoid carrying a balance over from month to month.
  • Don’t get so many credit cards that they become too difficult to manage.

One of Steele’s favorite tips is to treat his credit cards like debit cards. By doing that, he can only purchase with credit that which he can afford to pay in cash. Sticking to this practice can help you prevent racking up a balance you can’t pay in full at the end of the month.

Steele also suggested keeping your spending simple. “Even though I have many credit card accounts open, I use just two or three for 99 percent of my spending. The rest exist for the sign-up bonuses I earned or for specific benefits they offer.”

The only real way to use any credit card without falling into debt is to make sure you have a handle on it. Creating a situation that makes this easy for you is the best thing you can do.

And if you find out that you did let it get out of hand – or if that’s already happened – stop travel hacking immediately. Then, get a balance transfer credit card so you can pay the balance off at no interest for at least a few months. And pay the card off before the promotional interest rate expires.

At the end of the day, if travel hacking is costing you more money than it’s saving you, step away from the credit cards. Start a good old-fashioned travel fund instead. Your wallet will thank you in the long-run.

Interested in a personal loan?

Here are the top personal loan lenders of 2018!
LenderRates (APR)Loan Amount 
1 Includes AutoPay discount. Important Disclosures for SoFi.

SoFi Disclosures

  1. Terms and Conditions Apply: SOFI RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE. To qualify, a borrower must be a U.S. citizen or permanent resident in an eligible state and meet SoFi’s underwriting requirements. Not all borrowers receive the lowest rate. To qualify for the lowest rate, you must have a responsible financial history and meet other conditions. If approved, your actual rate will be within the range of rates listed above and will depend on a variety of factors, including term of loan, a responsible financial history, years of experience, income and other factors. Rates and Terms are subject to change at anytime without notice and are subject to state restrictions. SoFi refinance loans are private loans and do not have the same repayment options that the federal loan program offers such as Income Based Repayment or Income Contingent Repayment or PAYE. Licensed by the Department of Business Oversight under the California Finance Lender Law License No. 6054612. SoFi loans are originated by SoFi Lending Corp., NMLS # 1121636. (
  2. Personal Loans: Fixed rates from 5.49% APR to 14.24% APR (with AutoPay). Variable rates from 5.29% APR to 11.44% APR (with AutoPay). SoFi rate ranges are current as of December 1, 2017 and are subject to change without notice. Not all rates and amounts available in all states. See Personal Loan eligibility details. Not all applicants qualify for the lowest rate. If approved for a loan, to qualify for the lowest rate, you must have a responsible financial history and meet other conditions. Your actual rate will be within the range of rates listed above and will depend on a variety of factors, including evaluation of your credit worthiness, years of professional experience, income and other factors. Interest rates on variable rate loans are capped at 14.95%. Lowest variable rate of 5.29% APR assumes current 1-month LIBOR rate of 1.34% plus 4.20% margin minus 0.25% AutoPay discount. For the SoFi variable rate loan, the 1-month LIBOR index will adjust monthly and the loan payment will be re-amortized and may change monthly. APRs for variable rate loans may increase after origination if the LIBOR index increases. The SoFi 0.25% AutoPay interest rate reduction requires you to agree to make monthly principal and interest payments by an automatic monthly deduction from a savings or checking account. The benefit will discontinue and be lost for periods in which you do not pay by automatic deduction from a savings or checking account.

2 Important Disclosures for Citizens Bank.

Citizens Bank Disclosures

  1. Personal Loan Rate Disclosure: Fixed interest rates range from 5.99% – 16.24% (5.99% – 16.24% APR) based on applicable terms and presence of a co-applicant. Lowest rates shown are for eligible applicants, require a 3-year repayment term, and include our Loyalty and Automatic Payment discounts of 0.25 percentage points each, as outlined in the Loyalty Discount and Automatic Payment Discount disclosures. Subject to additional terms and conditions, and rates are subject to change at any time without notice. Such changes will only apply to applications taken after the effective date of change.
  2. Loyalty Discount: The borrower will be eligible for a 0.25 percentage point interest rate reduction on their loan if the borrower has a qualifying account in existence with us at the time the borrower has submitted a completed application authorizing us to review their credit request for the loan. The following are qualifying accounts: any checking account, savings account, money market account, certificate of deposit, automobile loan, home equity loan, home equity line of credit, mortgage, credit card account, student loans or other personal loans owned by Citizens Bank, N.A. Please note, our checking and savings account options are only available in the following states: CT, DE, MA, MI, NH, NJ, NY, OH, PA, RI and VT. This discount will be reflected in the interest rate and Annual Percentage Rate (APR) disclosed in the Truth-In-Lending Disclosure that will be provided to the borrower once the loan is approved. Limit of one Loyalty Discount per loan, and discount will not be applied to prior loans. The Loyalty Discount will remain in effect for the life of the loan.
  3. Automatic Payment Benefit: Borrowers will be eligible to receive a 0.25 percentage point interest rate reduction on their Citizens Bank Personal Loan during such time as payments are required to be made and our loan servicer is authorized to automatically deduct payments each month from any bank account the borrower designates. If our loan servicer is unable to successfully withdraw the automatic deductions from the designated account two or more times within any 12-month period, the borrower will no longer be eligible for this discount.
7.39% - 29.99%$1,000 - $50,000Visit Upstart
5.29% - 14.24%1$5,000 - $100,000Visit SoFi
8.00% - 25.00%$5,000 - $35,000Visit Payoff
5.99% - 16.24%2$5,000 - $50,000Visit Citizens
5.99% - 35.89%$1,000 - $40,000Visit LendingClub
5.25% - 14.24%$2,000 - $50,000Visit Earnest
Advertiser Disclosure

Student Loan Hero Advertiser Disclosure

Our team at Student Loan Hero works hard to find and recommend products and services that we believe are of high quality and will make a positive impact in your life. We sometimes earn a sales commission or advertising fee when recommending various products and services to you. Similar to when you are being sold any product or service, be sure to read the fine print, understand what you are buying, and consult a licensed professional if you have any concerns. Student Loan Hero is not a lender or investment advisor. We are not involved in the loan approval or investment process, nor do we make credit or investment related decisions. The rates and terms listed on our website are estimates and are subject to change at any time. Please do your homework and let us know if you have any questions or concerns.