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You’ve probably seen pictures of people lounging in over-the-water bungalows sipping tropical drinks while claiming they’re traveling to expensive vacation destinations for little to no money.

At first, you might’ve thought it was a scam. Then you heard about using credit cards to do something called travel hacking.

Unless money is not a consideration when you book travel or you travel for business and don’t have to pick up the tab, you’ve probably already figured out how to save money where you can.

But what is travel hacking and can it help you save money on your vacations?

What is Travel Hacking?

There are many ways to “travel hack,” but one of the most popular is to earn points and miles from credit card promotions.

You accumulate reward points through credit card usage to earn free or discounted flights, hotel stays, upgrades, car rentals, and more.

These points and miles can then be strategically redeemed to provide you a free or reduced cost vacation.

Is It as Easy as Signing Up for a New Credit Card?

No. It’s definitely not that easy.

Have you ever been offered a credit card promotion during the middle of a flight? Or as you enter an event like a concert?

Airlines and event managers have a captive audience to promote sign-up bonuses to people who may have just shelled out hundreds of dollars for a ticket. And people sign-up thinking their next trip, concert, or the game will be free.

But it’s important to understand the terms of the promotion agreement.

Most promotions require a minimum amount of spending in a set period to earn the bonus. The 50,000 points offered in the promotion might require you to spend thousands of dollars within three months of the approval of your card.

Do you typically put that much spending on your credit card?

Or is there a significant purchase you know you’ll need to make soon?

Will you be able to pay the card off in full and not incur any interest?

Some credit cards with promotions have an annual fee not waived the first year. If it isn’t waived, how does the annual fee affect the value of the points?

If it’s waived, will you be able to spend the points before the year is up and a fee is due?

Be aware, if you cancel the card to avoid the fee, you may lose any points you haven’t redeemed, losing potential savings on future travel.

Is It Easy to Redeem the Points or Miles I Earn?

Well, that depends.

Sometimes it’s as easy as logging in and redeeming points to get free or lower-cost travel.

But if you are traveling during peak times, you might not even be able to use the points or miles because of black-outs or limited award travel already booked by other people.

And if you can use your points or miles, you might have to spend double or triple what you would be required during off-peak times.

Who Shouldn’t Travel Hack?

Travel hacking is not for everyone. It’s important to avoid applying for credit cards for many reasons – even if they offer big perks and promotions.

You may not even qualify for a credit card if your credit score is poor. Or if you have too many open accounts or recent credit inquiries.

(If you don’t know your credit score or need to work on improving it, you can use free credit score and managing tools like those offered by CreditSesame.)

If you can’t pay off your credit card balances each month, travel hacking to save money probably won’t make sense. Because when paying high-interest rates you’ll negate the rewards you receive.

Make sure you understand the math behind the rewards and their value. And the interest and fees you pay for having and using the credit cards. If you don’t understand them, there’s a chance you’ll lose money rather than reap any travel benefits.

If you aren’t great at organizing your bills and have trouble keeping track of due dates, you might also think twice about travel hacking with credit cards.

Missing the required spend by even one day or miscalculating how much you’ve spent may void your bonus. Credit card companies are not likely to award points when you’ve made mistakes and not followed promotional offer terms.

Anyone preparing to buy a house soon or needing to maintain a high credit score should also avoid applying for too many credit cards.

Even though your score may go up over time by having more credit available, credit inquiries negatively impact your score to a small degree to start with.

Banks and mortgage companies are not excited about you having thousands of dollars of credit available when they plan to extend you a significant loan you’ll be responsible for paying.

Can Travel Hacking Ever Save You Money?

Yes, travel hacking definitely can save you money. Sometimes it can save you thousands of dollars on a vacation. But more often, it can save you paying for a night in a hotel or reduce the cost of air travel or car rentals.

The key is to taking time to learn about how credit card incentives work, which promotions align best with your travel needs, and how to optimize the use of the points and miles you earn.

Consider the learning process to be a part-time job where your payment will be the savings you get from using the promotions.

You’ll need to stay organized

You’ll have to account for spending on the promotional cards

You might move points and miles to various accounts.

You need a plan to cancel the cards before future annual fees post if there’s no benefit in keeping the card

Is it worth your time? Perhaps.

Once you learn the basics, you can apply what you know to various offers and see what will work with your travel plans to save you the most money.

For some, getting a short-term, part-time job, freelancing, or working some overtime hours to pay for travel might make more sense, though.

To Travel Hack or Not?

If your credit is poor or if you carry balances, it makes much more sense to focus on paying off your debt.

If you have an interest in using travel hacking to save money, invest time in learning about it before signing up for a bunch of credit cards to try to earn a dream vacation for free.

Without putting in some effort, you could end up in a financial mess – paying more for your trip than you would have without travel hacking in the first place.

Or you could do everything right to earn the points and then not be able to use them for the travel you want to plan.

To learn more about travel hacking, search “travel hacking blogs” or “best ways to hack travel.” This will lead you to numerous blogs and articles written by people with experience saving money on travel.

You can also search “travel hacking failures” or similar terms to learn how people thought they’d save money, only to make mistakes or find out it was more work than they were interested in doing.

Keep in mind there are also many ways to save money on travel without credit card promotional bonuses.

Book vacation rentals with other families to cut down on costs, avoid eating all meals out while traveling, choose less popular destinations and travel during off-peak seasons when possible.

Seek out free activities in new places you visit rather than typical tourist attractions to cut costs.

Lastly, try a staycation sometime. You might find there are more benefits to enjoying a vacation close to home than you realize!

By Women Who Money Co-Founders, Vicki Cook and Amy Blacklock