How to Use Credit Card Rewards to Save Money for Travel
One Cornell University study revealed that the people interviewed often regret not traveling more. So whatâ€™s getting in the way of our travel dreams?
For many of us, the answer might be money. Weâ€™d love to travel, but weâ€™re concerned about the cost. To help reduce some of those costs, this Discover guide will review the following:
- Choose the Right Travel Rewards Card
- Know the Best Time to Book Your Trip
- Research Popular Destinations
- Consider Other Local Airports
- Create a Travel Fund
- Ask About Additional Perks
- Book Your Trip
According to data from the Bureau of Labor Statistics, the average American spends 54 percent of their vacation budget on transportation.
What if you could save money on vacation transportation costs using miles or rewards? Or even cut them out of your budget altogether? (Hint: You could.) How might it change your attitude toward vacationing?
Choose the Right Travel Rewards Card
As we just learned, transportation can make up over half the cost of a vacation â€“ this means if you can score a free plane ticket, you may end up with extra money for fun excursions or experiences.
Of course, the big question is: How can you get free airline tickets?
First, youâ€™ll want to choose a credit card with a miles reward. The ideal cards are those:
- Without blackout dates: This means you can use your miles to travel anytime or redeem your miles to credit toward travel purchases you’ve made â€“ not just on undesirable days or during slow times of the year for the airlines.
- With higher mile earnings: Instead of one mile for each dollar spent, look for cards with 1.5 or more.
Once you have your travel rewards card, make sure youâ€™re paying the statement balance in full each month to avoid unnecessary interest on purchases and fees.
Know the Best Time to Book Your Trip
Once youâ€™ve earned some miles to offset the cost of your dream trip, itâ€™s time to book your trip using rewards. But donâ€™t just book any time â€“ make sure you plan ahead to get the best deals.
According to Afar, the two best times to book award tickets are about 330 days before travel (when the airlines first release their reward seats) and 30 to 60 days before your trip.
Itâ€™s also important to be aware of fees. Each airline may charge differently â€“ and sometimes choosing a lower fee airline can end up saving you even more.
Research Popular Destinations
As we learned in the previous section, seasonality can play a significant role in price when booking travel, but what about some of the most popular destinations? Visiting certain parts of the world can be affordable with a little budgeting and planning.
According to the Bureau of Transportation Statistics, the Middle East has seen a huge growth in visitors since 2000, which could be largely attributed to the development of Dubai, in the United Arab Emirates, which has been named one of the fastest-growing cities in the world.
Other regions gaining popularity, according to the BTS, include Africa. Visiting the pyramids might be the first thing you think of when considering Egypt, but Morocco and Kenya are popular tourist destinations as well.
Consider Other Local Airports
When it comes to transportation costs, where youâ€™re going is only half the battle. Where youâ€™re leaving from can also make an impact on your costs. With transportation being such a large portion of your vacation spending, it could make sense to consider departing from an airport other than your preferred location.
For example, according to the Bureau of Transportation Statistics (BTS), in the New York metropolitan area, the average fare in 2017 skews from $312, $383, and $391 at LaGuardia, John F. Kennedy International Airport, and Newark Liberty International Airport respectively. In other words, a family of four could potentially save $316 by simply flying out of another area airport.
The data from the BTS also shows a similar trend in the South Florida region with Miami International Airport, Fort Lauderdale-Hollywood International Airport, and Palm Beach International Airport with prices ranging from $314, $238, and $322. A family of four could potentially save $336 by flying out of Fort Lauderdaleâ€™s airport rather than Palm Beach International.
Create a Travel Fund
Part of what makes travel so expensive is that on top of budgeting for your trip, you still have to factor in your day-to-day expenses at home, such as your mortgage and car payment.
There are some additional ways you can plan ahead and save money:
- Set up automatic savings for a travel fund. Even saving $20 a week can amount to $1,040 you could use toward travel annually
- Set up automatic payment for bills when possible on your credit card to earn extra rewards
Ask About Additional Perks
When youâ€™re traveling, additional perks like first class may not be in the budget. Keep in mind that it never hurts to ask about freebies, upgrades, or discounts.
You never know when a hotel, restaurant, rental car agency or airline might have a special upgrade or discount that youâ€™ve yet to hear about. Asking, â€śDo you have any specials or upgrades going on at the moment?â€ť or â€śDo you have any better rates if I plan my trip a few days earlier or later?â€ť may yield surprising results.
If you already have a Discover card, youâ€™ll benefit from Discover Travel Deals, where youâ€™ll gain access to:
- Hotel and cruise discounts
- Access to Discover Deals for travel purchases including rental cars, hotels, cruises, and more.
Book Your Trip
Hereâ€™s the truth: Saving money on travel isnâ€™t as hard as you think if you arm yourself with information.
So whatâ€™s holding you back?
It just takes a little research about your ideal miles cards and an application or two to get started. Take a look at the perks, miles, and reviews of the Discover itâ„˘ Miles Travel Credit Card to begin your next journey.