Introduction
The truth is, the majority of Americans are paying way more than they need to for travel. By simply selecting the right credit cards, spending on everyday purchases with them, you can cover nearly all of your travel costs for free, using just your points. If it sounds too good to be true, I can assure you that it’s not, but it will take some research, time, and a helpful guide like BryGuides :) to help you unlock the value of Credit Card spend.
You’ve probably seen it on instagram – Your twenty something friend who seems to be in a new country every few months, despite having an average (or no!) job, flying business class and having the time of their lives. How on earth do they afford this? Well it’s probably family money, a sugar daddy, or they’ve figured out how to use the tips I’ll walk you through below.
I’ve always been passionate about travel, but on a starting salary living in NYC it was tough to save enough to have these incredible travel experiences everyone says to “do when you’re young”. Once I started to crack this code, trips that once felt entirely out of reach - all became not only affordable, but basically free leveraging credit cards and these strategies. Bucket List items like dancing through the streets of Rio for Carneval or watching the sunset on the cliffs of the Mediterranean went from dreams to dates on my calendar.
Please note: This article does not contain financial advice, and it’s important to be aware of the risks of credit cards, including high interest rates. To be blunt, if you’re struggling financially to make ends meet and having trouble paying off your current card balances, this might not be the right time to explore the tools in this article.
If you’re already stressed, or simply don’t have the time to self-educate, try using the Points Hacking tool - where you just tell us where you want to go and let us do the heavy lifting.
If you’re eager to learn and ready to unlock the power of these tools, let’s jump in!
Credit vs. Debit
The answer is ALWAYS CREDIT. If you are paying with a debit card for everyday purchase, you are simply leaving hundreds to thousands of dollars in free rewards on the table, depending on your spending habits. By paying with a credit card, you are literally being paid to spend money on everyday purchases.
How this works: Each time you tap or swipe your card, the credit card companies receive 2-4% of the transaction. They pass back some of this to the user, via points, to encourage folks to use their cards more – the more you spend with their cards, the more they make in fees.
Credit Card Companies and Banks like Chase, Capital One, and Amex are competing to have YOU, the consumer, spend more money on their cards. The best cards will offer even more points per dollar spent on certain categories but more on this later.
Where you need to be mindful about interest payments - the way Credit Card companies and banks make most of their money is through interest , which can be very high (often higher than 20%). Fortunately, there’s a way around this.
My approach to avoid Interest Fees: I spend all of my money on Credit Cards, but TREAT it like a debit card, by paying off my balance in FULL every month. Let’s say I spent $1000 in a month. When I pay it off in full, I only need to pay $1,000, or $0 in interest payments.
If I were to only make a minimum payment of $25, then the remaining $975 will be charged a 20% interest rate, and I would end up owing an additional $200, bringing the total owed to $1,200. You can see how this can be dangerous if I would continue to pay the minimum and this balance would grow.
While these companies make a lot of money on interest payments, they also run the risk of a consumer not being able to pay this amount back. So how do credit card companies decide who and how much they will lend money to?
Credit Scores
Credit Score Breakdown
As you can see the biggest drivers are:
35% - Payment History (On time Payments)
30% - Amounts Owed
15% - Credit History
10% - Credit Mix
10% - New Credit (i.e. impact from opening new credit cards/lines)
The key takeaway from this chart is that new credit only accounts for 10% of your overall credit score. People often hesitate to open new cards due to negatively impacting their credit score. While opening a credit card will be a hard pull that will impact your score, if your other categories are sound, the impact will often be far less than the benefit of the sign up bonuses, often valued at over $1,000 toward travel
That said, it’s extremely important to be responsible with credit, as debt can rack up quickly with interest payments. Most of the Premium Travel Credit cards in the following section will require credit scores in the good to excellent range. If you’re interested in further reading, more info on credit scores and methodology can be found from the links on the images above.
Credit Techniques I deploy:
Myth: If I open too many cards, it’ll tank my credit score.
While opening a credit card does generate a “hard pull” which will show up on your credit score, it has a relatively low impact on the credit score overall, as shown above. Most people that significantly overestimate the impact opening a new card will have an underestimate the impact of sign up bonuses.
What are the Best Credit Cards for Travel Rewards?
I do a deep dive into the best Credit Cards for Travel Rewards in this article, which digs into the specifics of each of my recommended cards, and some of the transfer bonuses. For this next section – I’ll focus on which cards offer the best Travel Rewards and Transfer Partners. There are a ton of cards out there - and please sign up for my newsletter as I’ll be posting and sending a ton of additional resources in the coming months in this space!
The Travel Trifecta
The Travel Trifecta are the 3 companies that are really driving the travel rewards. If you’re just getting started, I’d pick a credit card from one of these companies, and if you want to really get serious in the points and miles game, I’d open one up from all three.
Why these three?
High Sign up bonuses for cards
Some of the best rewards for travel related spend
Strong Transfer Partners to unlock point value (more on this here)
A relatively new entrant is the BILT Mastercard - which I’ll cover more on in a separate article coming soon.
BryGuides Recommended (What I carry)
Below are my go to cards, and why. I have a deep dive on the best travel cards to fly for free if you’re interested in learning more!
Chase Sapphire Reserve - My go to everyday card with 3x on Travel, Restaurants, and Bars. Quickly rack up a ton of points, especially if you live in a city.
With a 1.5x points when you redeem in the Chase Travel portal, it’s my go to card for booking domestic flights, where the point per cent ratio is not as favorable as some of the deals you get with international flights.
Amex Platinum - Best for Transfer Partners & booking International / Business Class Flights
I leverage the Amex Platinum for booking directly with Hotels, Airlines, and mostly, for the luxury perks (Lounge Access, Elite Status, etc.)
Capital One Venture - With 2x points on every purchase, I use it for all other purchases (online shopping, medical, gifts and miscellaneaous) - It’s a great utility card with strong redemptions, and great for those who value simplicity with points.
The Capital one Venture X is also a phenomenal card with 2x on everything and more premium perks
What Cards are Right for Me?
A simple question with a not so simple answer – It really depends on where and how you spend. You can find more information on the specifics here, which digs into the specifics of each of my recommended cards, and some of the transfer bonuses.
Questions to ask:
What are your top 3 Spending Categories each month?
What Cards do you already Have? What are their rewards?
How involved do you want to get?
As I mentioned above – I have all three of these card in my wallet. While that might feel like a lot, especially if you’re just starting out, it’s quite advantageous to have cards across banks & platforms. Here’s a few reasons why:
Optimize spending across cards to get the most points per dollar spent
Grocery spend on Amex Gold is 4x vs. only 1x on the Chase Sapphire
Chase Sapphire spend on Restaurants is 3x vs. only 2x on Capital one Venture
Medical Bills are 2x on Capital one Venture vs. 1x on Amex Platinum
Holding Cards in multiple financial institutions helps increase your overall credit limit, which will impact credit utilization, a high factor in your overall credit score (much higher than if you, say open a new card for a 100K point bonus :)
Credit Usage Example
Let’s walk through an example where a person spends $2K per month in expenses on credit cards.
One Card Open with one Bank - $10K credit limit
Utilization = 20% ($2K/ $10K)
Two Cards Open with two banks ($10K credit limit each – $20K
Utilization = 10% ($2K/ $20K)
Three Cards Open with three banks ($10K credit limit each – $30K
Utilization = 7% ($2K/ $30K)
In this example, where the three individuals above had hypothetical credit histories, the person with 3 cards open and the 7% utilization would have the highest credit score. The reason for this is it’s a red flag if a consumer is using a large amount or percentage of the credit they have been granted by the bank.
Maximizing Transfer Potential - Another benefit of holding multiple cards across the Trifecta. Sales and transfer bonus will pop up throughout the year across different carriers, with as much as 30-50% additional point bonuses when you shift points during this time. It helps to have points across multiple financial institutions in order to maximize this benefits of this. More info on this can be found here.
Please note: It’s important that you balance – it would be rash and frankly foolish to just go out and open a bunch of cards – like anything in life, approach this strategically, and with a long range view.
What I tend to do is open a new card every few months, or once or twice a year if you’re just getting started. Opening too many at once will not only negatively impact your credit score, but make it much harder to hit the spending bonuses that most of the more premium cards have, which are one of the most powerful benefits and tools you can use to stockpile a ton of points in a relatively short time.
Sign up Bonuses
Sign up bonuses are large, lump sums of points and miles that are used as an incentive to get consumers to sign up for credit cards. These bonuses usually have stipulations, such as a minimum spend over the first few months.
Let me be exceptionally clear - these sign up bonuses are one of the single largest drivers of value in the points and miles game, and optimizing and maximizing your sign up bonuses, with some as large as 100K points or more, can have dollar financial values of well over $1,000 in value, just for signing up and hitting the spend minimum.
For an extreme example of this - make sure you check out my article on how and what I was able to book with the 150K Sign on Bonus for the Amex Platinum (Article Link) (Card Link)
Tips for Sign up bonuses:
Make sure when you open a new card that you hit the minimum in order to get the points
Space out opening of cards so that you don’t overextend yourself trying to hit a sign up bonus
The best sign up bonuses can change month to month - Be sure to stay up to date on changes, and follow my social media pages and newsletter where I’ll call out when signup bonuses have extra rewards attached
Redeeming Points
So if you follow BryGuides on Instagram or TikTok, did the research, signed up for the right credit cards, and you’ve hit your sign up bonuses and have a massive point piggy bank for your next travels. Sounds great, right?
Unfortunately, this is where a lot of people go wrong. Credit card companies highly incentivize customers to book travel through their portals, offering extremely generous point redemptions sometimes as high as 5-10x per $ spent. The reason? Credit Card companies make money in booking fees when you book on their portal, regardless if you’re getting the best deal.
Spoiler alert: You’re almost never getting the best deal when booking directly with your card provider’s Tools. There are certainly use cases where it’s close, or the 10x point benefit will outweigh the higher cost, but in general, be wary of booking “blind”, meaning without logging in and checking the price with the hotel/airline directly.
Recommendation: Before you book through your card providers direct travel booking tool - do a quick search on Google Maps or Google Flights for the hotel or flight for the dates, and make sure you’re not getting a deal that is so much worse that even with the bonus points, it doesn't pay for itself.
If I’ve spurred your interest - I highly recommend reading my next article How to Book to maximize your Points and Miles which gets deep into the various strategies to leverage travel and transfer partners from your credit card points.
Alternatively, If you’re reading this and are thinking “This is great info, but I don’t have the time to do this myself” we are here to help! Use the points hacking tool and we’ll do the heavy lifting to optimize your points and travel experience.
Get Points on Everyday Spending - Linking Accounts
You can get extra points or cash back on nearly every online purchase by using an online shopping portal, such as Rakuten, my personal favorite. Rakuten is an incredible tool where you literally get paid in cash back to shop at your favorite retailers. What sets Rakuten apart, is rather than getting paid in cash, you can opt to link your Amex account and get paid in Amex points, which to me are much more valuable than cash due to the power of the rewards points shown above. If you use my link below, you’ll also get $30 free by signing up.
The deals here are quite significant - on Black Friday, they were offering up to 15-20% cash back for certain retailers, meaning that if you spend $100, you’d get $20 cash back, or 2000 Amex Points. 2000 Amex points is well on your way - so it’s more than possible for the average consumer to completely cover an entire flight in points by buying holiday gifts for family through Rakuten.
Additionally, you know that you can get points/miles for everyday spending, simply by linking your various accounts!
Starbucks - Link your Delta SkyMiles Account to earn Miles for spending at Starbucks
Uber & Uber Eats - Link your Marriott Bonvoy Account to earn points/miles for rides booked on Uber
Lyft - Link your Lyft Account with your Delta SkyMiles Account to earn Miles for every dollar spent on Lyft.
Conclusion
Hopefully, this article helped get you started to better understand the value of credit card spend, points, and what a powerful tool these strategies can be to unlock nearly free travel when combined and deployed in an optimal way.
Now that you’ve got the basics, you can go a little deeper to figure out
The Best Credit Cards to unlock Free Travel with Points
How to Book to maximize your Points and Miles
Follow BryGuides on Instagram and TikTok for latest guides, hacks, and deals
Again, if you’re already overwhelmed, I’m here to help! The points hacking tool takes less than 5 minutes to fill out, and we’ll do the heavy lifting to optimize your points and travel experience. I’ve spent a ton of time doing this, know the routes, rewards, and transfer partners.Whether you want to keep reading and empower yourself to maximize these strategies or 5 minutes filling out the form and let us do the heavy lifting.
I promise, that bucket list trip or adventure of a lifetime is within reach. We get one life to live, and there is a big, beautiful world out there to explore. Let’s go!
