Cutting expenses is just as good as finding new sources of income.
According to the U.S. Travel Association, direct spending on travel by resident and international travelers in the U.S. averaged $2.7 billion per day in 2016.
Thats a lot of dough. So, heres a roadmap to start saving lots of travel money…
You may know that many airlines partner with banks to create special rewards credit cards.
Maybe you even have one already. But unless youve spent a lot of time researching these programs, its quite likely that youre not getting the most out of them.
People typically think these cards are just good ways to earn airline points while making purchases. What they fail to realize is that the biggest windfalls come from signing up and those offers change all the time.
For example, I once signed up for a good deal on a U.S. Airways Mastercard. I immediately got 40,000 miles — which was enough for two round trip domestic flights. In addition, I received a companion pass that allowed me to take two people on any domestic flight for just $98 each.
Just using that companion pass saved my family $800 on a trip across the country. And then I used another 20,000 miles to take a free snowboard trip to Utah!
All told, signing up for that card was easily worth $1,200 in free travel.
Better yet, there was no annual fee during the first year of card ownership.
Okay, you say. But I dont want to wreck my credit score just for some free flights.
I used to think the same thing. However, my credit score actually went UP when I got that new Mastercard.
Although too many credit in a short period of time can ding your score, debt-to-available-credit is also a primary factor in how your score is determined. So a new card that has a lot of unused borrowing power improves your overall debt-to-available-credit ratio.
So unless youre planning on getting a major new loan, or your credit score is already low, this isnt a valid reason for worrying.
Of course, Ive also used an even better airline credit card reward program one you should definitely know about right away.
Its from Southwest Airlines and heres how it works
Southwest has a little-known perk for anyone who accrues 110,000 miles in a given calendar year: Its a special companion pass that allows you to take someone else with you on every flight for the rest of that calendar year PLUS the next one.
I repeat: If you manage to get a Southwest Companion pass, you can select someone to travel with you for the rest of that year AND the entire next year for free. All they pay are taxes and the minimal fees that always get tacked onto tickets.
Oh, and the companion pass even applies to free travel you book with your Rapid Rewards!
So lets say you earn 110,000 miles in a year. Well, youre pretty much travelling for free on a number of flights and your companion is also able to go with you for free as well.
At this point, youre probably thinking it requires an awful lot of flying to EARN 110,000 miles in a given year and youre right.
However, if you sign up for the Southwest Rapid Rewards credit card from Chase, youll get 50,000 miles for doing so. (The link I just provided could potentially get ME some miles if you do, too.)
If you also sign up for the Premier Business version of the Southwest Card, youll get another 60,000.
Add those two bonuses together and youve immediately earned your Companion Pass. That means your companion gets free flights for roughly 21 months.
I think this is one of the best deals going right now, especially if you travel domestically a lot.
There are just a few caveats:
1. The details and availability of these offers can change at any time. But as of this writing, its still possible.
2. There are some initial spending requirements, but if you put all your monthly expenditures on the cards, its not hard to meet them.
3. Each card does have an annual fee ($69 and $99, respectively) but given the magnitude of this deal, I think its worth it.
4. Youll need to have a business to get the business card, but even a side gig should allow you to qualify. (If you dont get the business card, it might still be possible to get the additional miles needed for the companion pass through spending and travelling.)
Alternatively, you might also consider other highly-regarded rewards cards, some of which offer very generous sign-on bonuses good at a number of different hotels and airlines. It really depends where you typically travel, how you typically travel, and where you like to stay.
At the very least, please realize that it IS entirely possible to take luxurious trips every year on someone elses dime.
So I encourage you to do a quick web search youll be amazed at all the information and strategies available out there!
To a richer life,
Editor The Rich Life Roadmap