Supersaver Travel Hacks From the Financial Independence Movement

On this episode of The Long View, Brad Barrett discusses credit card reward points, hotel reward programs, resources to optimize your travel expenses, and more.

Here are a few excerpts from Barrett’s conversation with Morningstar’s Christine Benz and Jeff Ptak.

Finding Good Travel Deals and Organization

Ptak: One of your personal passions is scoring great deals on travel. One key element you say is staying organized. Can you give us an example of how being organized has made a difference for you personally and why you found that so important?

Barrett: Just taking a step back—when we are pursuing credit card travel rewards points, you’re opening up very targeted credit cards and using those cards and earning these sign-up bonuses that are really extremely, extremely lucrative, and you see them all the time, of course: earn 50,000 miles or 60,000 Chase Ultimate Rewards points or something. They all have some different flavor to it. Then there are always some stipulations of, OK, spend $4,000 in the first four months, or in the first three months, is usually what you’ll see. I think really the key, Jeff, to your question is, OK, you need to not lose sight of that, because it would be pretty catastrophic to open up a credit card expecting to get a 60,000-point bonus that you believe you could earn, let’s say, even $0.02 per point, so $1,200 worth of free travel, in essence, and let’s say, you miss that because you didn’t hit that spending requirement, that minimum spending requirement.

d when I say organization, this is not like some crazy fanatical, like CPA-type thing where we’re creating wacky spreadsheets. It’s just really very simple. Everything I do with my finances at its heart is simplicity. So, just in that case, the organization of how much have I spent the first two months, so then I know what I need to spend in that third month and literally down to having your logins or having your account numbers. Again, the organization of, let’s say I have Chase Ultimate Rewards points and I want to transfer them to Hyatt to book a hotel. Well, I need my Hyatt account number. So, just something as simple as that. Just having this data at hand makes it so that you don’t potentially lose a reward redemption because of a couple minutes or because somebody else booked it. As we all know, when you go to book frequent flyer flights, sometimes they’re gone. They’re gone real quick because there are a finite number of these seats on every single plane, and people book these things. So, you don’t want, as I see it, to let lack of organization or some silliness make you lose out either on earning the bonus or potentially getting that reward that you searched long and hard for and just then needlessly miss, basically.

Ptak: Reading some of your posts on how to save money on trips, it seems like it could be pretty time consuming to find good deals. Does it have to be time consuming?

Barrett: No. That’s a good one, Jeff. So, I think, it doesn’t have to be, and that’s hopefully what I’ve tried to paint the picture here in the last five or 10 minutes is that everything I do when it comes to travel rewards is based around simplicity. I’ve hopefully given our listeners a toolbox for, if you want it to be easy, build in some flexibility, but then go for programs that are just, you can’t help but succeed. So, again, using points like those Ultimate Rewards to transfer to Hyatt, you can’t help but succeed basically if you’re going to any city that has a Hyatt. It’s incredibly easy. And I would make the same argument for Marriott and Hilton, though those points have a little less value. So, that’s why I don’t talk them up quite as much, but they’re so, so, so easy. Again, Southwest, could not be easier. And I know there’s the Southwest meltdown and maybe Southwest is at the lowest point now. But people have loved Southwest for its entire existence, and it’s been a wonderful airline and really just so easy to use with their points. And yeah, those offsetting cards like the Venture and there used to be a Barclay card that was similar. I suspect at some point in the future, there will be another similar card.

If you’re worried about, is this doable, start there and then prove to yourself that it’s doable. I think that again is just another aspect of how we look at ChooseFI in general is take that one little action and just keep taking small actions that make your life better and you’re going to wake up and your life is going to be dramatically changed. And I think you can see that with this. Start with a small win. You might be hearing this random guy Brad talk about travel rewards and it sounds impossible to believe. That’s what I thought. I’m a skeptical CPA. That is exactly what I thought 10 years ago, and I dipped my toe in and there was no downside, and I tried it, and from that very first British Airways credit card that I opened, I was able to get—again, we used to live in New York—I was able to get something like 11 round-trip flights from Richmond, VA, to LaGuardia on, at that point, it was US Airways. So, that’s another cool aspect. And Jeff, it’s the opposite of your question of simplicity, but you can use airline alliance. So, you can go as deep as you want. But at its heart you can start and just get a win and prove to yourself this works, and then listen to some of our podcasts on travel rewards or go to thepointsguy.com and learn all about it. You can go as deep as you want, but you can also succeed really, really easily.

Credit Card Rewards for Travel

Benz: It sounds like the right card is really important and that getting these signing bonuses is important too. So, how should people shop for these things, shop for the best card? What are they looking for? And also, how often are you supposed to be switching this up? Should you be changing credit cards frequently to take advantage of these bonuses? Can you talk us through that?

Barrett: I think in terms of finding a card, it’s not terribly complex. But, of course, I can’t give specific advice to every single person out there, because it’s going to differ on where do you live, what are your travel goals, do you have kids, and you can only travel during certain school breaks. So, there is some aspect of nuance in this. But I think for me, I would just find out, what flight options do I have from my local airport or local airports if you’re lucky enough to live near a couple of major airports. So, it would just simply be, in my case, Richmond VA Airport Wiki. No joke. Go to the Wikipedia page, and at every airport Wikipedia page, you scroll down and it’s airlines and destinations, and it shows you all of the airlines and their direct flights at that airport. So, very simple. You can see really visually when you scroll down. And let’s say, you’re at Baltimore and you scroll down, and you see this massive number for Southwest. Well, that’s you’re aha moment of, oh, OK, maybe I need to find a way to get Southwest points. So, that would be, in this case, Southwest credit cards or transfers from Chase Ultimate Rewards, so that you would pick up along the way.

But it would start with, what are even my options? I think that is a decent starting point that might even frankly, Christine, being a little more nuanced than our listeners are looking for, like, I would in very, very broad terms say you want the most broadly useful points that you can find. So, something like the Capital One Venture is a card or the Venture X card, those are as stupid simple as you can possibly come up with in the sense that you don’t even at the end of the day have rewards points. They are now transferable, but that’s nuance that we don’t need to dive into. But you basically just use your credit card to pay for travel. Nobody knows or cares that you have rewards points. And then, you log in to your Capital One card and just offset that expense with your points. That is as easy as it comes.

And then, you look at points where I really would start is the Chase Ultimate Rewards and Amex Membership Rewards points, because those points, while they sit in your bank or in your credit card account, they are there. But let’s use Chase, for instance. There are, I think, somewhere right around 13 travel partners. Don’t quote me on that because it does change from time to time. But four of them are just extraordinarily useful. So, you have Southwest, United, Hyatt, and British Airways. British Airways is a little nuanced. But those four, you can basically get hotels with Hyatt in hundreds of cities across the world, and those are the easiest redemptions ever. Southwest is another one. You can tell I focus on ease and simplicity. So, Southwest, there aren’t any of those limitations of frequent flyer seats. It’s just simply, do they have a flight that you can pay for? If so, then you can use your miles. So, that makes it easy.

Now, again, going back to—and I could touch on United and British Airways, but we’ll get too much into detail here—but what the starting point was by having Chase Ultimate Rewards points, which you get from, let’s say, Sapphire Preferred, Sapphire Reserve, Ink Business Preferred, those are the transferable cards for Chase Ultimate Rewards. And when you have one of those cards, then having those points sitting in your credit card account means at any given moment, you can transfer them and they become Hyatt miles, they become United miles. That’s the critical part. And I hope that makes sense because you then just have so much flexibility and flexibility—along with organization—flexibility is really the name of the game. Because in travel rewards, as we know, when you hear people complain all the time about, oh, it’s impossible to use miles, or there are blackout dates. Yeah, there’s some shred of truth to that, but what it really means is the people who are saying that don’t understand the game. The game is: Can you be flexible? Any ability to add flexibility into your travel plans will give you a higher likelihood of success. And that’s how I look at this, is what is my highest likelihood of success? If I am dead-set on using this for a wedding that I have to go to in Jamaica on July 7 through July 12, that’s going to be pretty hard because there are finite number of flights, there are finite number of hotels. But if I said, hey, I want to go to Europe next fall, well, going to Europe next fall is really, really, really easy. That’s incredibly easy because you just need to get the miles. You have then dozens of airports to fly into. You can use your points. Like I said, you could use Hyatt points easily, Marriott, Hilton are fantastically easy to come across and there are thousands of those hotels. A trip like that, I think, for anybody listening, if they said, hey, I want to go to Europe next fall on points and get it for free or close to free, I think virtually every single one of them could do that.

Ptak: Some of the highest inflation we’ve seen over the past few years has come in the realm of travel costs—hotels, rental cars, and until pretty recently, airfares. Has it gotten harder to game the system for good deals?

Barrett: It’s a good question, Jeff. And I realized that I didn’t fully answer Christine’s prior question in talking about the sign-up bonus, and I think that’s actually part and parcel of your question as well. I think in terms of how to get the most value from travel rewards, it’s clearly from these sign-up bonuses. So, you could just look very simply at something like, again, that Sapphire Preferred, so the Chase Sapphire Preferred right now at time of recording, it’s a 60,000-point bonus I think when you spend $4,000 in the first three months. So, I think roughly you could get $1,200, again $0.02 per point, $1,200 worth of travel from that. And that’s from just putting $4,000 of your regular spending on that credit card. Again, you’re paying it off on time, in full every single month, so it doesn’t cost you anything. There’s no interest expense. You don’t have to hold that as a balance. You’re paying it off on time and in full. And that’s $1,200 for a $4,000 worth of spent. If you had done that on a normal credit card, you would have gotten 1%. So, $40 as opposed to this, you’re getting 30%—$1,200 out of $4,000. So, you can see why the sign-up bonuses are fantastic.

And obviously, if you can put a couple of those sign-up bonuses together over a year or two period, then you’re going to start amassing a significant number of points that can turn into some type of travel and some significant travel. Like I said, that trip to Europe or a trip to Disney World is something that I put together for my family. If you have a spouse, significant other, each adult can open up every single one of these credit cards, which is nice. So, it doesn’t preclude you; you’re allowed to open it in your name and social.

And getting into your question, Jeff, is where the intersection here is, I think it’s all gotten harder. When I first started this travel rewards hobby, which probably 10 years ago now, it was incredibly easy to open these cards and amass really dozens of these bonuses. And the credit card companies, to their great credit, cracked down on that, and they have these bonuses for customer acquisition and when people are gaming them needlessly and egregiously, of course they’re going to crack down on it. It’s just the way it’s going to work. So, I think they very smartly did that. And I think there’s some balancing act between customer acquisition and watching out for this gaming. My wife and I have been very, very measured, certainly over the last five-plus years in terms of these credit cards and only opened a few of them at this point. But still, that’s a nice number of points and miles that we would not have had. I think that aspect has gotten harder.

In terms of the actual redemption, I haven’t anecdotally noticed that it’s that much harder to redeem, but I think it’s also self-selection in terms of, like I mentioned to you both, really, simplicity is at the heart of everything I do. I’m not looking to redeem for absurdly difficult routes. I’m trying to build flexibility in. I am going for hotels because hotels are the absolute easiest aspect of travel rewards to book and to get free travel from. Because most of the hotel chains, everyone has their own different fine print. But if they have a standard room available for cash, it’s similar to what I described about Southwest. If the hotel, let’s say, Hyatt, they have a standard hotel room available to pay with cash, you can use your miles. And the beautiful thing is, they still have an award chart, which is very simple. If it’s a category one hotel, it’s 5,000 points a night. If it’s category two, it’s 8,000. It is clear as day. That certainty and that simplicity makes it just really, really easy to use hotel points. So, that’s why I like that.

But in terms of flights, flights have certainly gotten dramatically more expensive. Maybe when I talked about the Capital One Venture, there’s probably less value to that because you’re not literally getting as far, but it still is the dollar-for-dollar saving. So, let’s be clear on that. If you were going to pay for it in cash, it’s still that dollar-for-dollar saving. So, there’s that. And then, in terms of the actual quantity of award seats from miles on, let’s say, American, United, and Delta, I haven’t anecdotally noticed a dramatic drop, but I suspect there have been some studies done on ThePointsGuide.com or sites like that that we could dive into. But yeah, honestly, I don’t have that data in front of me.

Tips for Saving on Hotels

Benz: Wanted to ask about lodging. You mentioned that you really like some of the hotel programs. But seems like some of the most budget-conscious travelers I know use Vrbo or Airbnb for their trips versus hotels. Do you agree that that can be some of the most economical lodging, especially it seems like if you’ve got a family? And do you have any tips to share on getting the best deals for people who choose to go that route?

Barrett: Yeah, definitely. That’s certainly what my family has been using, Airbnb, the last couple of years, certainly much more than we have in the past. But I think there has been some pushback, and you see a lot of this on Twitter and places like that of people complaining about just all of these fees and the meme of getting the 50 pages of instructions on what you have to clean and then paying a $200 cleaning fee on top of it. So, I think there is some frustration with Airbnb at this point.

Airbnb for very short-term stays doesn’t seem overly economical to me. And I know it’s hard to quantify this specifically, because yeah, you generally have to pay that cleaning fee regardless of whether you stay there for one night or X number of nights because it’s just the turnover cleaning fee. So, if you can amortize that over a greater number of days, it makes it slightly more economical. It’s hard to justify, I think, depending on what the situation is, Airbnb for a day or two—that’s where my family has come down on this a little bit. But again, what type of travel are you doing? Which is why it’s hard to give advice for one particular person when we’re talking to, obviously, many, many, many thousands of people.

I think depending on your situation, if you’re going with multiple families, if you’re going for a long time, yeah, Airbnb and Vrbo can be fantastic. The only way that I’ve found to really offset those expenses with travel rewards are—and I hate to keep repeating this like a broken record—but that Capital One Venture card and the Venture X, those are just really broadly valuable points, because anything that codes on Capital One side using a merchant category code for basically how would that expense code in their system. If it codes as a travel expense, then you can use your miles for full value, which is $0.01 per point, so 10,000 points would, I guess, be $100 in that case. So, a Capital One Venture sign-up bonus for 60,000 miles, for instance, would be at $600 of offsetting expenses just to set it up more rationally there. But yeah, at last check, Airbnb can be offset with Venture miles. I am not 100% sure about Vrbo. That would be a very quick Google search that we could do here. But I believe that it is, but don’t quote me on that certainly.

Resources to Optimize Your Travel Expenses

Benz: I’m feeling like kind of a slacker as I’m listening to this. I have not done a good job of optimizing my travel expenses. I wanted to ask about resources. There are all sorts of websites and other services that purport to help people sort through this and flag good deals. Are there any that you think are really good that people should bookmark and refer to?

Barrett: I would certainly stay away from any if there are paid services like this. I think you can get most of this information for free. That said, just like anything in life, when we’re talking about any aspect of personal finance, if you get value from what you’re paying, then great, go for it. If you don’t want to do it, if that’s going to make the difference, then I get it. There are also people who can actually—and Christine, this might answer your question better than I was going to is—who can actually book the trips for you. They have specialized knowledge. You have the miles and a little bit of money. There’s a guy that I’m good friends with who helps me with my Travel Miles 101 site, which is actually a resource that people could get started with. We have a free course that’s right there just getting started. But he has a website called BoundlessMiles.com, and he has a service—there are many of these services—that you pay them a fairly nominal fee. You tell them what miles and points you have and where you want to go. And they find out if it’s possible and the best way possible to do it and on the cheapest number of miles. That’s a great way to do this. Nobody would begrudge you for one second getting a $6,000 free trip and paying $100 or $200 for somebody to help you actually do this when you weren’t going to do it. So, I think that’s a great resource. Again, this is but one person. There are many of these.

I think “award-booking services” is what you’d Google, and you can find a whole list of them. I’ve personally used that guy, Dominic. But, yeah, I mentioned The Points Guy. There are all of these websites: viewfromthewing.com and Million Mile Secrets. There are tons of these sites that you can go as deep as you want. I think thepointsguy.com is really the industry centerpiece, I would say. But websites like ours, Travel Miles 101, or choosefi.com. If you go to choosefi.com/travel, we have all of our travel resources. We have a “getting started” series of five posts. We have, I think, probably 10 or 15 podcasts that are on travel rewards. So, you could do a lot worse than starting there for sure.