Chances are, if you’ve flown or stayed in hotels before, you’ve earned some amount of points or miles just from setting up an account. In the past this earned me a few measly points but nothing significant – I think after a couple of international trips that I paid for I had enough for a one-way economy ticket in the U.S. – yay!
But now I’m leveraging my good financial habits and the relationships the banks have with the airlines and hotels to get more miles and points than I had previously thought possible.
And the best part is – both the airlines and the banks are happy to let me do this. The airlines make money selling billions of frequent flyer miles to the banks each year, many of which go unredeemed or are redeemed for poor value. After purchasing the miles at a steep discount the banks then hand out these miles to get new customers. The banks then make money every time you swipe your credit card or earn money on the money you have sitting in their bank.
My wife and I started earning miles through credit card sign-ups and strategic spending in August 2014 and since then have earned over 5,000,000 miles and points.
And as I mentioned before, we haven’t earned our miles by traveling for work or paying to fly around the world. We earned these points by ignoring the myths surrounding credit scores and learning how to use our good (not great) credit to our benefit.
The best way to leverage your financial position into miles and points is to sign-up for new credit cards. Let me run you through a quick scenario and hopefully you’ll see why.
If you’re like most people, you probably have a couple of credit cards that you previously applied for and use. You may have earned an initial sign-up bonus at the beginning, but now your spending comes entirely from spending on the credit card. So let’s say that this year you planned on spending $1,000 per month on your credit card (paying it off each month). This would typically net you at least 12,000 miles or points. Some cards also have various category spend bonus likes gas and supermarkets, so let’s assume you get extra points and you earn 20,000 points for that $12k of spending over the year. Depending on the program, that 20,000 could be enough for a really nice hotel night or a one-way ticket to the Caribbean in economy class. It’s definitely not nothing, but it’s also nothing exciting.
Now, under the scenario I propose, I’d recommend that you instead get one new credit card every three months. Many of the credit cards give you sign-up bonuses that require some initial spending, and $3k in 3 months is the most common (but there are certainly ones with lower spending thresholds). Just to put some names and point values together, an example haul for these sign-up bonuses could be:
- American Airlines: 50,000 miles
- Marriott: 80,000 points
- Hyatt: 2 free nights in any property
- IHG: 80,000 points
With these points you could go to Paris for an entire week, with some of those nights being in the Park Hyatt Paris-Vendome which often runs $900/night or more.
As you can see, with a few credit card sign-ups and the same normal sending habits you already have, you can really put together some miles and points balances to make your travel dreams a reality.
But at this points I imagine you have a lot of questions, not just about travel, but also about your credit. Let’s take a quick step back and discuss credit scores and clear up any misinformation that you may have picked up over time.