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Over the past year, my cousin studied abroad in Ireland. During the time that she was in Ireland, she took advantage of her proximity to the rest of Europe by traveling to Prague, Italy, London, Switzerland, and Spain.
While we were talking about her trip at a family gathering, my mom mentioned that she had never been to Europe. I knew this, but it got me thinking ….
- Travel is expensive. Not only do you have to pay for a place to stay, but you also have to spend hundreds or thousands of dollars to get to your destination.
- Travel can be much cheaper or … free? This is where reward credit cards come in handy.
- Many people don’t know about getting free travel! Most people (to be honest … almost everyone) that I know has never really taken advantage of this.
My mom could afford to go to Europe, but round-trip tickets from the United States typically cost over $1,000 and then it costs $100-200 per night for her to stay in a hotel room. With other trip expenses, a trip for 2 people could easily cost $5,000 or more.
So, what’s the better way? For me, it’s using rewards credit cards.
I have always been kind of skeptical of rewards credit cards. I always thought that the possibility of going into debt isn’t really worth the 1% reward that I would get cash back or towards a hotel room.
And I might have been right except …
I got much more than 1% back!
I spent…
- $5000 and got $550 back in travel expenses
- $2000 and got two nights at a (super-fancy) hotel that costs $900 per night
- $3000 and got a plane ticket worth $1100
- $3000 and got $500 worth of gift cards to Walmart
- $500 and got $250 cash back
Overall, my best guess is that I have received $23,477 in travel rewards, gift cards, and cash over the last three years!!!
However, before I recommend them to my family, I want to make sure that they are safe. In other words, what will they do to my credit score?
The short answer is … absolutely nothing. The slightly longer answer is that my credit score has stayed in the high 700 to low 800 range during the past three years. When I started this, my score was 814. Currently, it is 818.
So I have recommended reward credit cards to my family and I will also recommend them to YOU! As a matter of fact, you can click on this link to compare the benefits of various travel cards.
Of course, some caveats and warnings need to be stated first.
- Never carry a credit card balance. If we get 10% back in the form of gift cards, but then pay 19.9% interest, we lose money. I actually pay my credit cards online weekly instead of monthly to make sure I will never carry a balance.
- Don’t start this right before getting a mortgage. Even though my credit score wasn’t affected, I would still be nervous about getting a great interest rate on a mortgage if I had a large number of credit cards.
- Keep track of each of the credit cards that are signed up for. Most credit cards require us to spend a certain amount of money in 2-3 months to get the sign-up bonus. They also may waive the annual fee for the first year, but charge the fee during the second year. I keep a spreadsheet to know the exact date that I should spend the money by to get the bonus.
- Don’t spend more money just trying to get the bonus. Just like carrying a balance on the credit card, this would defeat the purpose of the sign-up bonus.
I love credit card rewards and I will also be doing some future posts on some of the cool rewards I have received with them.
Have you tried rewards credit cards? What are some of the bonuses that you have received?
And thanks for reading!
~Nathan
Let’s keep living a great life … with the help of money. So what’s next?
- You can travel for free by using rewards credit cards.
- You can get motivated and get out of debt.
- You can check out the next post or the previous post and continue to learn.
But no matter what you decide to do, let’s leave the ordinary behind and take action today!
