So you’re beginning to think that maybe Travel Hacking with points and miles might be just the thing to save you some money on your future travels. Maybe you’re wondering what the miles and points you earn could be worth to you. I’ll start by saying that since everyone has different travel goals, the value of points will vary. A little later, I’ll tell you about the trip that got me hooked on travel hacking.
A Few Points and Miles Redemptions
Here are some examples to help you see where this hobby can take you. Let’s start with domestic travel in the US. If you sign up for a Chase Sapphire Preferred Credit Card, the current signup bonus is 60,000 Chase Ultimate Rewards points. At a minimum, these points are worth 1.25 cents/point if used to purchase travel in the Chase Ultimate Rewards online portal.
That means 60,000 of these points is worth $750 in travel. That may sound pretty good to you and it certainly is a generous signup bonus. It’s especially great because this particular credit card has an annual fee of just $95.
However, what if you transferred these Chase points to one of Chase’s airline or hotel partners? Here’s the information on the trip that I just took to Phoenix in April.
I transferred 34,008 Chase Ultimate Rewards Points to Southwest Airlines to book a round trip flight. It cost me only $11.20 in taxes and fees. If I paid for the flights, it would have cost me $505.98.
The Value of the Points Used
To determine that value I got out of using the Chase points, I deducted $11.20 from $505.98 giving me a cost of $494.78 which I divided by the 34,008 points. This gave me $1.05 cents per point which is a better value than if I had booked the flight through the Chase Ultimate Rewards Portal. For me, it’s not always about maximizing the value of each point, but getting a flight practically for free!
The Actual Trip That Got Me Hooked
This past August, I realized just how valuable credit card points can be. In fact, I was so excited by how much money I saved on my trip to Norway that I told my story to Money Magazine. This was the trip that got me hooked on this incredible travel hacking hobby.
Check out the article here: This 54-Year-Old Mom Used Credit Card Points to Take a $12,000 Dream Vacation to Norway for Only $217
For my trip to Oslo and Bergen last summer, I transferred 70,000 Chase Ultimate Rewards points to United Airlines and was able to book a business class one way flight on Lufthansa, a partner airline to United.
Yes, I booked it right from the United Airlines website. The taxes on that flight totaled $41.60. The price of that business class ticket would have been $7,334.50 less the taxes. Again, by dividing by the 70,000 points I got a tremendous value of 10.48 cents per point!
Getting Back Home
My business class return flight on British Airways was booked with 57,500 American Airlines miles which I accumulated with signup bonuses from American Airlines credit cards. Again, I booked the British Airways flight on the American Airlines website because the airlines art part of the same alliance.
Taxes and Fees
Due to my flying through London, my taxes and fees of $248.81 were much higher on my return flight. Any time you fly through London, you are charged hefty taxes. On my outbound flight which stopped in Frankfurt the fees were much less. I was willing to pay to fly through London because I couldn’t find availability on Lufthansa. My dates were set which limited my flexibility. I had plenty of American Airline miles to use those this worked out well.
The price of this business class flight less taxes would have been $4,458.70. By dividing by the 57,500 points I got a value of 7.75 cents per point another fabulous value.
Even if you are dizzy from the mathematical calculations, I think you would agree that the value of those points and miles for those business class tickets was pretty great. The cost of Business class flights was never a part of my travel plans until I got into this hobby. I would have made do in coach like most travelers.
Another Financial Windfall
One thing not mentioned in the Money Magazine article is that I found a 500 Norwegian Krone note on the cobblestone sidewalk as I was leaving my hotel in Bergen. It was worth $60! Another financial win on that trip!!
These examples are why I got into this hobby. Credit card companies are offering generous signup bonuses just for opening their cards. Making a minimum spend in a 90 day period and then utilizing the points to “buy” travel makes sense to me
Please note that this travel hacking hobby is only for those people who use credit cards responsibly by paying off the balance each month.The hobby doesn’t work if you spend money you wouldn’t have spent had you not gotten the credit cards. I do advocate putting all of your available everyday/week/month spending on whatever card you sign up for in order to maximize the points you can earn. Just don’t overspend.
So tell me by commenting below, where would you like to travel with credit card sign up bonus points? What’s a trip that will get you hooked on travel hacking?