The Ultimate Guide To Credit Card Travel Hacking

Mar 30, 2023

Riley and I love to travel, but traveling is expensive. Cost has always been the limiting factor in how often we travel. Recently I dove into the world of credit card rewards and we have been able to do a lot of free traveling since!

We’ve used credit card points to pay for our flight and hotel stay in Lisbon, Portugal. We also used credit card points to pay for our flight to Puerto Escondido, Mexico. Our next adventure is planned for summer 2023. We’re spending 2 weeks in Norway and Denmark. Flights and hotels are 100% covered by credit card points. We’re renting a converted sprinter van for 10 days in Norway, and credit card points are covering that too. Our goal is to only have to pay for gas and food! We would not have been able to afford most of these trips if it hadn’t been for credit card points covering most of the cost.

I’ve found that almost everyone is interested in credit card travel hacking, but often struggle to know where to start. I wanted to create an easy guide that anyone can follow to get started in credit card travel hacking and get their first 500k+ credit card points.

Here is my basic strategy:

  1. Get a travel credit card and earn the spending bonus

  2. Refer the same card to your spouse or partner with your specific referral link

  3. Repeat

By doing this with each new travel card you end up with 2 spending bonuses and a referral bonus. Do this with enough credit cards and you have a boatload of points. Pretty simple.

A couple things to note before we dive into exactly what I did and what cards I’d recommend.

What if I don’t have a spouse or partner?

The strategy I’ve used to maximize our credit card points involves referring your credit card to someone you share your finances with, so you get a referral bonus and another spending bonus. That obviously requires actually having someone you share your finances with that you can refer to. If you’re not married or don’t share your finances with someone, unfortunately you won’t be able to take advantage of referring your partner to get a referral bonus and another spending bonus. That being said, you can still accumulate a fair amount of points just by opening cards in your own name! And you can take advantage of referring friends and family.

What about my credit score?

It’s worth noting that my credit score has increased by a decent amount since I've started doing this. Some people are concerned about having an inquiry on your credit score every 3-6 months, which was an initial concern of mine too. At least in my case, the benefit of a lower credit utilization score outweighed the negative of new inquiries. Credit utilization is the amount of spending compared to your overall credit limit across all your cards. More cards = higher available credit limit = lower credit utilization ratio.

I'm certainly not an expert on credit scores, so I can't tell you exactly how it will affect yours, but that has been my experience. Most bank and credit card companies have credit score tools too that you can use to simulate something like opening a new card and seeing how it will affect your credit score. I usually do that before opening a new card just to make sure it won’t affect my credit score too much. 

Authorized users

Most credit cards allow for free authorized users, so if you want to have you and your partner both use the same card (important for getting the spending bonus) you can set them up as an authorized user. Even if someone is an authorized user, they can get the card in their own name too after you get the spending bonus on the first partner’s card.

A note on spending

You should not spend more money than you normally would just to get a spending bonus for a credit card. This is a terrible idea and poor money management. Using a credit card should not affect the overall amount of money you spend. Follow a budget and take advantage of credit card rewards for the spending you do, but don’t increase your spending just to get more points.

How to avoid needing to change all your auto pays and easily meet the spending bonus

No one likes changing all of their credit card auto payments when they get a new credit card. But in order to make sure you meet the spending bonus, this is often necessary. If you’re committed to getting as many credit card points as possible, you would need to do this every time you get a new credit card, which could be as often as 4 times per year. This is feasible, but a big hassle.

There is a little known hack that allows you to get the full spending bonus in one purchase and never need to change the auto pay details on the rest of your credit cards.

To take advantage of this, you need to make estimated payments for taxes. This is most common if you’re self-employed and have no withholding from a regular W-2 job. Even if you’re not self-employed, you could still do this by decreasing your withholding at your employer and making up for the lower withholding by making estimated tax payments. This requires you to know how much you should be withholding, so don’t stop your W-2 withholding unless you know how to estimate your taxes and withhold the appropriate amount.

The way to get the spending bonus in one purchase is to pay your federal estimated taxes with a credit card. It’s a little known fact that you can pay federal estimates with a credit card. While there’s a processing fee (1.87%), as long as the points you earn are more than that, you still benefit from paying with a credit card. For example, if your credit card offers 2X points or 2% on purchases, you earn more in points than you lose to the processing fee, so you still benefit from using a credit card. Not to mention that this also allows you to get the spending bonus in a single purchase.

Every quarter I pay our federal estimates with a new credit card. This allows us to get a new spending bonus 4 times per year! And half the time I also earn a referral bonus for referring Riley. And I never have to update the auto pays or change the credit card we use for our regular purchases.

You can certainly still do effective credit card travel hacking even if you don’t do this, but this is a huge advantage for those who happen to pay estimated tax payments.

The Guide

A basic outline of what I've done is below. I'm sure there are better ways to do things, but this has worked for us and gotten us a boatload of points.

First, I opened Chase Sapphire Preferred (the Chase Sapphire Reserve is not worth the annual fee IMO) and got the bonus points (currently 60k).

Next, I referred Riley the Chase Sapphire Preferred (make sure you use your specific referral link), and she got the bonus points (60k bonus points, plus I got 15k referral points).

In as little as a few months we had 135k Chase points, worth a minimum of $1,687.50 of travel when booked through the Chase Travel Portal (points are worth 1.25x if booked through Chase travel portal vs just reimbursing yourself). If you transfer to certain Chase travel parters you can get much more than that in value out of your Chase points. You also get a $50 annual hotel credit with each Chase Sapphire Preferred card, so we have $100 in hotel credits through Chase each year.

Then I did the same things with Capital One's travel credit cards:

Capital One Venture X 

Spending bonus = 75,000 x 2 = 150,000

Referral bonus = 25,000

Total points earned = 175,000

Notable additional card benefits:

  • $300 annual travel credit

  • 10,000 annual anniversary miles

  • Global Entry/TSA PreCheck

  • Priority Pass Membership

  • See all card benefits here

Annual fee: $395

Capital One Venture

Spending bonus = 75,000 x 2 = 150,000

Referral bonus = 20,000

Total points earned = 170,000

Notable additional card benefits:

Annual fee: $95

Capital One Venture One

Spending bonus = 20,000 x 2 = 40,000

Referral bonus = 10,000

Total points earned = 50,000

See all card benefits here

Annual fee: $0

After you get the bonus points for the Capital One Venture, you can cancel that card to avoid the annual $95 fee. Plus I read that you can only get approved for 2 Capital One personal credit cards at the same time, so you'll need to cancel the Venture to get approved for the Venture One (at least as far as I'm aware, I could be wrong).

The Capital One Venture One is their no-fee card. The Venture X has a higher fee ($395 per year), but it's by far the best card I currently have and is totally worth it. You get a $300 travel credit each year and 10,000 anniversary points, which is the equivalent of $400 in travel (booked through the Capital One Travel Portal), so as long as you're actually traveling it pays for itself. 

I like Capital One better than Chase, but I started with Chase because of the 5/24 rule and wanted to make sure I got approved and could get the bonus points. If you only want one travel credit card and don’t want to go through the hassle of opening multiple cards to maximize your points, I’d go with the Capital One Venture X. It has a higher fee than some of the lower tier travel cards, but like I said before if you’re actually traveling it pays for itself.

End result

The end result of following this strategy is 135,000 Chase points (worth a minimum of $1,687.50 in travel) and 395,000 Capital One points (worth a minimum of $3,950 in travel). That’s a total of $5,637.50 in travel! This is also only from the spending bonuses and referral bonuses and does not include the points you earn on your everyday purchases which can add up too over time.

Points can be worth decently more if you redeem them wisely and transfer to the appropriate travel partners that Capital One and Chase have.

Eventually I'll work my way into the American Express world but I'm not quite there yet. I'm not sold yet that some of their massive credit card fees are worth it.

One last thing to mention that you should know (which I didn't know until recently) is that sometimes a credit card company will issue you a 1099 making some of your points taxable income. From my research, credit card points are almost always tax free. In some cases, if you didn't have to actually do anything to earn the points (like spend a certain amount of money or something) they may be considered taxable income. I got a 1099-NEC in 2022 from Capital One for $752. To be honest, I have no idea how they calculated that amount. It’s still worth it for the amount of traveling we're able to do from it, but you should know that it's a possibility. 

I hope this guide helps you get started in credit card travel hacking and allows you to travel more than you would have otherwise!

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