Beginner’s Guide to Free Travel
So, you want to travel for free with credit card points
This started as a short guide to free travel requested by a few friends but it just kept getting longer. This is as brief as I could keep it, I promise. Here is everything you need to get started with credit card churning.
First of all, you very likely do not spend enough organically to build up significant points/miles to earn free travel. Every little bit helps, but credit card signup bonuses will help you build up points much faster than your regular spending. Getting a new credit card just for the signup bonus is called “churning” and it’s the quickest and easiest way to earn free trips.
Prerequisites
- Do you carry a balance on any credit cards? Do you have less than $5k in your checking account? Is your credit score below 720? If you answer yes to any of these, this is not a hobby for you.
- Get the Credit Karma app and check your credit score (TransUnion and Equifax) for free.
- Check your credit score with Chase. This will give you your 5/24 status (more on that later).
Churning will have an effect on your credit score. Opening a new card adds a hard pull and lowers your Average Age of Accounts (which lower your score) but it also increases your overall credit limit, which in turn lowers your credit utilization (which is positive for your score). If you plan your new cards with care, your score will dip short term but should increase over time as your utilization goes down.
Cards to Consider
Chase has the most versatile rewards points, Universal Rewards (UR), which can be used on almost all airlines and many hotels globally. However, Chase also has restrictive application policies.
Chase’s 5/24 rule: you must have fewer than 5 new credit cards (from any bank) in the last 24 months to be approved for a new Chase card.
If you have opened 5 or more new credit cards in the last 24 month, then you are at/over 5/24, and this guide is not for you. Get better advice from /r/churning and check out their Credit Card Recommendation Flowchart.
If you are under 5/24, I strongly recommend that you start with Chase cards.
Chase has a variety of UR earning travel cards: Chase Sapphire Reserve (CSR), Chase Sapphire Preferred (CSP) and the business credit card Chase Ink Preferred (CIP) are the best ones.
Chase travel cards have some unique benefits. Don’t be put off by the $450 annual fee on the CSR. You will get $300 of it back with the travel statement credit which includes things like Uber and AirBnB. CSR also comes with Priority Pass airport lounge access, a $100 global entry credit every 4 years and a 1.5x point bonus on travel redemptions through the Chase portal. CIP offers $600 in cell phone protection. Both CSP and CIP redeem points and 1.25x in the Chase portal. These cards also allow you to transfer points to travel partners at 1:1 ratio.
Where to begin
Start with CIP. Chase business cards are meant for small businesses, which can be very small. My “business” is freelance web consulting which I have been doing for 6 years with $2k annual revenue. Have you ever sold anything on Ebay? That counts. Chase does not require proof. Fill in your business type as Sole Proprietor and use your SSN as your EIN. Best part about business cards is they do not add to your 5/24 status (though you need to be below 5/24 to apply), which is another reason to start with business cards. They also do not show on your credit report or lower your Average Age of Credit (AAoC) but do not add to your total credit limit either so their credit score effect is fairly neutral. A hard pull will still show on your credit report. You must be 0/30 (0 card apps in the last 30 days) to apply for a Chase business card.
More info about Business Credit Cards.
Do you regularly fly Southwest with a friend? If not, skip this paragraph. If so, you should target the Southwest Companion Pass. If you earn 110k Southwest miles in one year you qualify for the companion pass. Usually this would require MANY individual flights or you could just open a Southwest business card (60k miles) and Southwest personal card (40k miles) to get most of the way there. These cards are through Chase and fall under the 5/24 rule. You do not cash in your miles to get the companion pass and can use the miles to book a single flight, then add your free companion to your trip. The companion pass is good for the rest of the calendar year and the following year, so try to earn your bonuses as early in the year as possible to get 2 years out of the pass.
Update: no longer works as of September 2018. Chase also changed the lookback period for the CSR to 48 months, so it’s best to get that card before any other card that reports to your personal credit report. A̶p̶p̶l̶y̶ ̶f̶o̶r̶ ̶b̶o̶t̶h̶ ̶S̶a̶p̶p̶h̶i̶r̶e̶ ̶c̶a̶r̶d̶s̶ ̶a̶t̶ ̶o̶n̶c̶e̶.̶ ̶C̶h̶a̶s̶e̶ ̶r̶e̶c̶e̶n̶t̶l̶y̶ ̶c̶h̶a̶n̶g̶e̶d̶ ̶i̶t̶s̶ ̶r̶u̶l̶e̶s̶ ̶f̶o̶r̶ ̶S̶a̶p̶p̶h̶i̶r̶e̶ ̶c̶a̶r̶d̶s̶ ̶s̶o̶ ̶y̶o̶u̶ ̶c̶a̶n̶ ̶o̶n̶l̶y̶ ̶h̶a̶v̶e̶ ̶o̶n̶e̶ ̶a̶t̶ ̶a̶ ̶t̶i̶m̶e̶.̶ ̶B̶u̶t̶ ̶y̶o̶u̶ ̶c̶a̶n̶ ̶g̶e̶t̶ ̶a̶r̶o̶u̶n̶d̶ ̶t̶h̶a̶t̶ ̶i̶f̶ ̶y̶o̶u̶ ̶a̶p̶p̶l̶y̶ ̶a̶n̶d̶ ̶a̶r̶e̶ ̶a̶p̶p̶r̶o̶v̶e̶d̶ ̶f̶o̶r̶ ̶b̶o̶t̶h̶ ̶o̶n̶ ̶t̶h̶e̶ ̶s̶a̶m̶e̶ ̶d̶a̶y̶.̶ ̶D̶e̶f̶i̶n̶i̶t̶e̶l̶y̶ ̶d̶o̶ ̶t̶h̶i̶s̶ ̶o̶n̶ ̶a̶ ̶w̶e̶e̶k̶d̶a̶y̶ ̶i̶n̶ ̶c̶a̶s̶e̶ ̶y̶o̶u̶ ̶a̶r̶e̶ ̶n̶o̶t̶ ̶i̶n̶s̶t̶a̶n̶t̶l̶y̶ ̶a̶p̶p̶r̶o̶v̶e̶d̶ ̶a̶n̶d̶ ̶n̶e̶e̶d̶ ̶t̶o̶ ̶c̶a̶l̶l̶ ̶C̶h̶a̶s̶e̶.̶ ̶A̶p̶p̶l̶y̶i̶n̶g̶ ̶f̶o̶r̶ ̶2̶ ̶c̶a̶r̶d̶s̶ ̶i̶n̶ ̶t̶h̶e̶ ̶s̶a̶m̶e̶ ̶d̶a̶y̶ ̶(̶d̶o̶u̶b̶l̶e̶ ̶d̶i̶p̶p̶i̶n̶g̶)̶ ̶i̶s̶ ̶a̶ ̶g̶o̶o̶d̶ ̶w̶a̶y̶ ̶t̶o̶ ̶o̶n̶l̶y̶ ̶u̶s̶e̶ ̶o̶n̶e̶ ̶h̶a̶r̶d̶ ̶p̶u̶l̶l̶ ̶t̶o̶ ̶g̶e̶t̶ ̶2̶ ̶c̶a̶r̶d̶s̶.̶ ̶B̶e̶f̶o̶r̶e̶ ̶t̶h̶e̶ ̶r̶u̶l̶e̶ ̶c̶h̶a̶n̶g̶e̶ ̶I̶ ̶s̶t̶a̶r̶t̶e̶d̶ ̶w̶i̶t̶h̶ ̶t̶h̶e̶ ̶C̶S̶P̶ ̶o̶n̶l̶y̶,̶ ̶p̶l̶a̶n̶n̶i̶n̶g̶ ̶t̶o̶ ̶a̶p̶p̶l̶y̶ ̶f̶o̶r̶ ̶C̶S̶R̶ ̶l̶a̶t̶e̶r̶ ̶b̶u̶t̶ ̶n̶o̶w̶ ̶I̶ ̶h̶a̶v̶e̶ ̶t̶o̶ ̶w̶a̶i̶t̶ ̶(̶a̶n̶d̶ ̶s̶t̶a̶y̶ ̶u̶n̶d̶e̶r̶ ̶5̶/̶2̶5̶)̶ ̶f̶o̶r̶ ̶2̶ ̶y̶e̶a̶r̶s̶ ̶i̶f̶ ̶I̶ ̶w̶a̶n̶t̶ ̶t̶h̶e̶ ̶C̶S̶R̶.̶
Getting these 2 UR cards will net you 130k points in bonuses alone which can be redeemed for $1950 in travel using the CSR or $1625 with CSP/CIP when booking through the chase portal. That should cover most international flights or hotel stays.
How to Hit Minimum Spends
You likely do not regularly spend $5k every three months but there are some ways to manufacture that spend to reach your Minimum Spend Requirement (MSR).
Update: as of 8/16/18 Plastiq payments with CIP no longer code at 3x. P̶a̶y̶ ̶r̶e̶n̶t̶ ̶w̶i̶t̶h̶ ̶y̶o̶u̶r̶ ̶c̶r̶e̶d̶i̶t̶ ̶c̶a̶r̶d̶s̶.̶ ̶C̶u̶r̶r̶e̶n̶t̶l̶y̶,̶ ̶r̶e̶n̶t̶ ̶p̶a̶y̶m̶e̶n̶t̶s̶ ̶t̶h̶r̶o̶u̶g̶h̶ ̶P̶l̶a̶s̶t̶i̶q̶ ̶(̶a̶n̶ ̶o̶n̶l̶i̶n̶e̶ ̶b̶i̶l̶l̶p̶a̶y̶ ̶s̶e̶r̶v̶i̶c̶e̶ ̶t̶h̶a̶t̶ ̶a̶l̶l̶o̶w̶s̶ ̶y̶o̶u̶ ̶t̶o̶ ̶p̶a̶y̶ ̶b̶i̶l̶l̶s̶ ̶w̶i̶t̶h̶ ̶c̶r̶e̶d̶i̶t̶ ̶c̶a̶r̶d̶s̶)̶ ̶c̶o̶d̶e̶s̶ ̶a̶s̶ ̶t̶r̶a̶v̶e̶l̶ ̶w̶i̶t̶h̶ ̶C̶I̶P̶.̶ ̶P̶l̶a̶s̶t̶i̶q̶ ̶c̶h̶a̶r̶g̶e̶s̶ ̶a̶ ̶2̶.̶5̶%̶ ̶f̶e̶e̶ ̶b̶u̶t̶ ̶e̶a̶r̶n̶s̶ ̶3̶%̶ ̶U̶R̶ ̶w̶i̶t̶h̶ ̶C̶I̶P̶ ̶s̶o̶ ̶y̶o̶u̶ ̶a̶r̶e̶ ̶m̶a̶k̶i̶n̶g̶ ̶a̶ ̶.̶5̶%̶ ̶p̶r̶o̶f̶i̶t̶ ̶e̶v̶e̶r̶y̶ ̶t̶i̶m̶e̶ ̶y̶o̶u̶ ̶p̶a̶y̶ ̶r̶e̶n̶t̶.̶
Venmo also codes at 3x on CIP but charges a 3% credit card fee. Only use if you have a friend you trust to pay you back. (Do not just venmo the money back! You run the risk of Venmo shutting you down).
Open a bank account. Many bank accounts will allow credit card funding when you open a new account! (Note: call the number on the back of your credit card first and set cash advance limit to zero or as low as they will allow)*. PNC will allow you to fund $2k with a credit card ($4k total when opening a checking and savings account). You can often find bank account bonuses that will pay you to open a new account so you can maximize your bonuses even further. Doctor of Credit outlines how to keep these accounts fee free and curates data points on how much you can fund with a credit card, if it codes as a cash advance, and what triggers direct deposits required for some bank account bonuses (often it just requires a transfer from another bank).
One year out
When your card anniversary comes and your second annual fee posts (not before) call Chase and ask for a retention offer. Your annual fee will be refunded if you call within one month of when the fee posts. Calling before the fee posts means you will not get a retention offer. If you do not get a retention offer, or it isn’t valuable enough, do not cancel the card. You can product change any of these cards to a fee free version. CSR/CSP can become a Freedom (5x UR rotating categories) or Freedom Unlimited (1.5x UR on all purchases). CIP can become Ink Cash (5x UR on Internet/phone bill and office supplies).
Further reading
Referral Links
*Cash advances on credit cards incur very high fees that accrue interest instantly. Occasionally, funding a bank account will code as a cash advance. Cash advances will be declined if they are higher than your cash advance limit and that is why you should lower that as much as possible. If you do get charged a cash advance fee, pay it off instantly and move on.
