Pursuing credit card rewards can be a smart move if your goal is saving money. With airline miles, hotel points, fixed-value travel credit and flexible rewards, you can pay for the bulk of your expenses with points and tremendously expand your travel possibilities.
Still, there's a learning curve to this hobby. Most who have been travel hacking for long enough have made some mistakes along the way, but also learned to maximize their efforts over time.
If your goal is scoring as much free travel as possible with as little effort as you can get away with, there are certain things you should know:
You don't need to sign up for all the cards this year.
A lot of newbies figure out they can get free stuff and sign up for a gazillion cards their first year. This can lead to myriad consequences, mostly because huge signup bonuses require you to meet a minimum spending requirement within the first few months. If you overextend yourself, you could wind up spending more than you would otherwise, thus wiping out your rewards.
The best way to pursue rewards is to pace yourself. Sign up for only the cards you can handle through everyday spending. Then, create a simple spreadsheet to keep track of all the details. If you try to do too much too soon, you're destined to fail.
You should try to get your spouse involved.
One of the easiest ways to earn outsized rewards is to get your spouse involved in the game early on. Even if your spouse is an authorized user on your rewards cards, they can sign up for their own and earn their own signup bonuses, too.
With double the rewards, you can stay longer, fly further and score more free travel for the long haul.
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New credit can impact your credit score.
Because of the way FICO scores are determined, too much credit isn't always a good thing.
"New credit" makes up 10 percent of your score, which means opening too many new cards at once can have a negative impact. If you want to make sure travel hacking doesn't hurt your score, try opening new cards as infrequently as you can.
Sign up for your favorite Chase credit cards first.
While all rewards cards have their own rules as to who can qualify, the new 5/24 rule from Chase can make getting certain Chase cards more difficult down the line.
Basically, the rule says you can't get certain Chase cards if you have had more than 5 new credit card accounts across all brands within the last 24 months. To bypass this rule, it helps to get core Chase rewards cards like the Chase Sapphire Preferred, Chase Sapphire Reserve, and Chase Freedom first.
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Even "free travel" isn't free.
Even if your hotel and airfare are paid for with rewards, you'll still need to fork over money for travel. You have to eat, right? You'll also have to pay for attractions, entry to museums, transportation and more.
Nothing annoys me more than someone who brags about their "free trip." No matter what, travel is never free.
To avoid overspending, you should create a budget for all components of your trip not covered by rewards.
Deals always come back around.
Popular points and miles blogs sell cards by creating a sense of urgency for every offer they see. They'll count down the days until each offer expires, explain why you have to sign up today and make it seem like you're really missing out.
No matter what anyone says, the best deals really do come back around. You don't have to jeopardize your finances or your credit to take advantage of a "once-in-a-lifetime offer". If you wait long enough, the same offer (or better) will reappear.
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