Travel Hacking. Beat credit card companies and banks at their own games. Banks and credit card companies make money through debt and the inability of households to manage it correctly.
Three basic rules of Travel Hacking:
1. Earn at many points and miles as possible.
2. Redeem points in the most effective way possible.
3. Don’t want to fall into travel of debt or spending more, just for points, you’ll eat up your gains.
1. Earning as many points and miles as possible.
usually a point equals a penny, so 50,000 points = $500. This is a rule of thumb, and not always the same.
He does 20-25 Cards a year that he opens. Can earn more than 1,000,000 points a year just on arbitrage without having to rack up frequent flyer points.
Manufactured spending: Buy cash equivalents and then give it back to yourself, it’s arbitrage. How can you do this?
Buy $5,000 in US coins, then go deposit to the bank. This apparently doesn’t work anymore.
In the comments of the video Bryce talks about this strategy:
Buy Visa Gift cards using your credit card, take said Visa Gift Cards and use them to buy a money order. Deposit money order in the bank. Use it to pay off your credit card. Simple.
*I just looked online and Wal-Mart charges about $0.70 per money order up to $1,000. You can also purchase at the USPS $1.65 up to $1,000 and Western Union Charges $1.00 per $1,000.
Sign up for a credit card with a bonus of 50,000 travel points if you spend $3,000 in the first three months. You could then purchase $3,000 in pre-paid visa cards from Wal-Mart for $3103.20, convert that to Money Orders for $3 (three $1,000 money orders) then put those money orders back into your bank account where you’ll pay off the credit card on the first statement. You’ll then get 50,000 points ($500 in travel value), for a total investment of $106.20. Pretty easy way to turn about $100 into $500!
You could also possibly find creative ways to pay rent or mortgage. Still haven’t found anything that works, but here’s an idea:
2. Redeem Points in the Most Effective Way Possible.
He recently went to Thailand, and would’ve spent $28,000 and spent $326 total. In the video he doesn’t touch on how to do this, only to do this.
This is also a useful link about black-out dates from creditcards.com.
3. You have to accomplish goals one and two without falling into trap.
Three rules within this category
-Zero dollar increase in organic spending. Do not spend more than you were spending before.
-No negative impact to your credit score. Having 20 cards won’t kill your credit score.
-Only pay fees that make sense. Avoid annual fees or other fees on cards.
Why do all this?
The more you travel the more your world expands and you start to realize there are tons of things in the world you don’t know. It makes a person modest and makes you change as a human. Until you really see the world you cannot understand it.
Bryce runs a blog over at 10xtravel.com.