The Only Guide You'll Need for your First Free Flight (+ increase your credit score)
There are a lot of complicated, long winded websites and strategies out there promoting “travel hacking”.
This 7 minute read will tell you everything you need to know about how to earn your first free flight while avoiding the black hole of travel hacking blog posts, youtube videos, and e-books.
And if 7 minutes is too much for you...
Here’s the 7 second takeaway:
- Get the Chase Sapphire Prefered Card
- Hit the minimum spend within 3 months
- In return for hitting the minimum spend you’ll get a 50,000 point sign-up bonus.
- Use the 50,000 miles you just earned and treat yo' self to a free flight around the world
Now for a little more detail...
Chase Sapphire Preferred is always the first card I recommend to anyone who is interesting in getting their feet wet in the world of travel hacking (and no they are not paying me to write this).
If your primary goal is to travel (ideally for free) this card is the best and easiest first step because:
- No foreign transaction fees -- these fees will add up quickly when you’re traveling abroad. Each time you swipe your card an additional 3-5% can be charged on your card if you’re not covered.
- 50,000 point signup bonus is the equivalent of $625 in flights.
- You’re essentially getting $625 for continuing your normal spending habits .
- Spending $4000 within 3 months is not very difficult for most middle class Americans. Put all your rent, car payments, everyday purchases, on the card and you’ll easily hit this minimum spend.
- Best part? There’s a 0$ annual fee for the first year.
- Keep reading, and I’ll also teach you how to avoid the fee after the first year.
Step 1: Apply for the Chase Sapphire Preferred Card
I’m assuming if you’re reading this you have decent credit. If you don’t, start off with a more obtainable card for your credit score, make your payments on time, increase your credit score, and work your way up to this one.
If you're not sure if you will qualify for the Chase Sapphire Preferred card, start a free account with Credit Karma and get your credit score. There's a section within the site that will tell you your chances of qualifying for a specific credit card based on your score.
Step 2: Begin spending (responsibly)
There is a $4,000 minimum spend you have to hit within 3 months to obtain your 50,000 point bonus. Again, if you’re a middle class American, living and working for yourself, this should not be a difficult task.
Put your rent, car payments, happy hours, everything on this card and you should be able to hit this minimum.
And if you’re approaching 3 months and you’re still short, you can use these quick hacks to hit that magic $4k:
- Tie your credit card to Pay-Pal, pay a trusted friend via Pay-Pal and have them pay you right back.
- Buy some of those American Express/Visa/Mastercard gift cards, and use those for spending at your own pace.
- Buy your parents something nice (they deserve it)
Step 3: Pay off your damn credit card bill!
If you’re irresponsible with your money or bills, this may not work for you. Seriously, exit this blog post now. The last thing I want is more people falling into debt because of irresponsible spending.
As you might know, credit card companies make their money from charging you interest on the money you borrow and haven’t paid off.
That being said…pay your bill IN FULL at the end of every month.
This post is about helping you beat the credit card companies at their own game.
If you don’t pay off your credit card bill at the end of the month, THEY win.
A common myth I hear about this topic is: “if I open a new credit card account, my credit score will be damaged”. In reality the exact OPPOSITE is true, but ONLY if you are responsible and pay off the credit card bill!
I debunk this myth at step 5.
Step 4: Lift off!
Fast forward 3 months...
- You spend $4,000 by not changing many of your spending habits.
- You paid off your credit card bill in full at the end of the month.
- 50,000 points were just deposited in your account… essentially for free.
Time to fly!
Another reason I love the Chase Sapphire Preferred card is because they have an intuitive portal that makes using your points as easy as possible.
Simply login to your Chase account, go to the rewards portal, and you can buy airfare, hotels, or even get cash-back with the 50,000 miles you just received directly from the portal.
Step 5: Watch your credit score go up
As I mentioned earlier, the most common excuse I hear about travel hacking is “it will damage my credit score”.
In the last year, I’ve completed the process I just outlined multiple times, racked up hundreds of thousands of free miles, and my credit score has only gone UP!
Yes, it’s true that every time there is a “hard inquiry” (credit card application, loan application, etc.) your credit score will see a temporary (as in a couple months temporary) dip. However, hard inquiries account for 10% of what determines your credit score.
What is far more important to your credit score is your Credit Utilization Ratio. Or in other words...
The amount of credit available on all your accounts VS. the amount of credit you are currently using.
Credit Utilization Ratio accounts for 35% of your credit score. By paying off your credit card bill every month, you’re taking care of your Credit Utilization Ratio. And by having more credit cards you’re also improving this ratio!
Here's an example:
Let’s say you have a credit line of $10,000 with 1 credit card. By paying the bill at the end of the month your ratio is $10,000/$0
More cards will only increase your score as long as you’re responsible and pay off your bill (have I mentioned this enough yet?).
The more credit cards you have, the more credit you have, the better your Credit Utilization Ratio (35% of your credit score) becomes…
A $20,000/$0 ratio with 2 credit cards is better than a $10,000/$0 ratio with 1 credit card in the eyes of credit agencies. It shows that you are more responsible with the increased credit.
Step 6: Avoid the annual fee
Some of you will say those 50,000 miles aren’t really free because you’ll end up paying the annual fee after the first year.
If you want to avoid that annual fee, its easy!
- Set a calendar reminder for a few weeks before your first free year with the card is up.
- Call chase and ask them to “kindly downgrade your card to a card that has less benefits and no annual fee”
- Most banks don’t advertise these cards but they all have them.
- For Chase Sapphire Preferred, the downgraded card is, you guessed it, Chase Sapphire.
The downgraded card comes with less benefits and a foreign transaction fee but there is no annual fee and you get to keep any and all of the points you haven’t used.
Ultimately you get the most bang for your buck within those first 3 months with the 50,000 bonus miles but every situation is different.
So if you believe you will get at least $95 worth of rewards from Chase Sapphire Preferred in a year you can skip this step.
Step 7: Repeat
I’ve completed this process many times, with numerous credit cards, racked up hundreds of thousands of free miles, used them for free flights and free hotel rooms, and have watched my credit score consistently increase.
Now you can do the same, if you have any questions...shoot me an email.
Good luck and I’ll see ya around the world!
Interested in saving more? Check out my book on living a minimalist lifestyle.