Budget travelers who know how to make the most of their credit card rewards programs can save on outdoor excursions, get free stays in hostels while in Europe or score free gear for their Appalachian Trail hiking trip.
No matter how you travel, understanding how to use credit card rewards programs can get you farther on a smaller budget. Points and miles can do more for world travelers than upgrades to first-class tickets or high-end hotel stays. Budget travelers who know how to make the most of their credit card rewards programs can save on outdoor excursions, get free stays in hostels while in Europe or score free gear for their Appalachian Trail hiking trip.
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For travelers more concerned about getting to their destination than having extra legroom during the flight, the benefits of using a travel rewards card may not be immediately obvious. If you know how to maximize your points and miles, you can use them to save money and extend your backpacking trip.
- Free flights
Although many people use this type of credit card rewards program to upgrade from business class to first class or access swanky lounges, you can also use points and miles to get free or heavily discounted flights.
You can also use points or miles to get a free second seat in economy class, giving you twice as much space to spread out. For especially long or overnight flights, this form of “poor man’s business class” seating can help you rest during the flight and hit the ground running at your destination.
- Free accommodations
A free five-star hotel stay may not be at the top of your wish list when talking about a backpacking trip across Europe, but utilizing free accommodation perks can be beneficial for long trips.
If you’ve ever spent more than a week in and out of hostels with zero privacy and communal bathrooms, a one-night hotel stay can be a lifesaver for your sanity (and personal hygiene). You can take advantage of the occasional free or discounted hotel stay to help you stay refreshed on longer trips.
Depending on which rewards credit card you have, you can also use rewards to pay for your hostel stays. The Citi Prestige 4th Night Free benefit gives cardholders a statement credit for their fourth night’s stay at hotels and hostels, worldwide. All you need to do is book your stay through Citi’s concierge service and charge the stay to your Citi Prestige card. (Be advised that the Citi Prestige is currently not available to new applicants.)
While this card has a steep $450 annual fee, for urban backpackers spending a lot of time on the road, the 4th Night Free benefit could easily cancel out the annual fee. This card also has no foreign transaction fees and you’ll get all the benefits you expect from a travel rewards card, like travel accident insurance, emergency assistance, medical evacuation, trip cancellation and interruption benefits and trip delay reimbursement. You’ll also receive a $100 reimbursement from Citi once every five years for the TSA Precheck or Global Entry application fee.
- Lounge access
After weeks of “roughing it,” a hot meal and a relaxing place to stay between travel destinations can be a lifesaver. Many travel rewards credit cards offer access to premium lounges around the world. Most lounges offer food options, so you can relax and fuel up for a few hours before hopping on a flight to your next travel destination.
Travel rewards cards often come with a host of benefits that the budget traveler may overlook. If you plan to travel overseas, look for a card with zero foreign transaction fees. Even after you’ve used your credit cards rewards to get to your next destination, don’t underestimate the value of a nice relaxing layover in a fancy hotel lounge, compliments of your travel rewards card.
Start earning points with a travel rewards credit card
- Sign up for loyalty programs
Make sure that you sign up for loyalty programs with major airlines and hotel chains. Just about every major airline and hotel chain is going to have a free loyalty program that benefits frequent customers. While you don’t need to sign up for every single program, it’s important to take a look at the programs you will benefit from. Almost all programs are free to use, so it’s worth creating an account with every airline and hotel you use.
- Find a points and miles manager
If you are juggling multiple loyalty programs, check out a few online mileage managers like Award Wallet and Points.com to help you see all your rewards in one place. Staying organized is key when using points and miles to reduce your travel budget.
- Utilize large sign-up bonuses
If you plan to use just one or two travel rewards credit cards, make sure you open accounts with significant intro bonuses to get the most out of the experience. For example, the Platinum Card® from American Express offers 60,000 bonus points when you spend $5,000 within the first three months of owning the card. The Chase Sapphire Preferred Card awards 60,000 bonus points after new users spend $4,000 with the card in the first three months.
Making those minimum purchase requirements to get the bonus on a new credit card is crucial. Put as many expenses as possible on the card and then pay the balance in full each month to avoid paying high-interest fees.
Also look at the card features. You’ll want a card with no foreign transaction fees and travel perks that allow you the most freedom while you’re on the road. Taking a look at credit card reviews can help you determine which cards (and which sign-up bonuses) are worth applying for.
- Spend smarter
Be sure to investigate other ways to earn points and miles as well.
If you shop for gear or clothes online, you can score more rewards by doing your online shopping through a hotel or airline portal after you sign up for its loyalty program. You can also sign up for dining programs to “double dip” your rewards earnings by earning points through the program and through using your credit card to pay the bill.
These rewards add up faster than you think, making it easier for you to take more trips without breaking the bank.
Swiping abroad: When to use cash and when to use a credit card
In most of the world, it’s important to always have some cash in a local currency. When it comes to deciding whether to use cash or your rewards credit card, it’s important to understand the value of your rewards. Many places overseas charge a fee for using a credit card, so if the fee is higher than the reward, pay with cash.
Of course, there are fees associated with purchasing currency abroad, as well. One option is to open a no-fee brokerage account with Charles Schwab to get the Charles Schwab Visa Platinum Debit Card. You can withdraw funds from the account in the local currency without ATM fees worldwide. There are also no foreign transaction fees. The daily limit is $1,000 USD.
Protecting yourself while traveling abroad
While being robbed is the last thing anyone wants to think about while on an urban backpacking adventure, there are a few things you should do to protect yourself during your travels.
Use a low-profile RFID-blocking money belt to conceal your valuables. Keep your personal identification, cash and emergency contact phone numbers in it at all times. Don’t display your valuables and be sure to keep your phone out of sight as much as possible, as well.
Take photos of all your credit cards, debit cards and personal identification. Keep copies on your phone and share them with an emergency contact back at home.
When you need to use an ATM, choose a bank instead of a third-party machine. Bank ATMs are more likely to be in a secure lobby. Think ahead and get any cash you may need for the evening during daylight hours.
Don’t forget to let your bank and credit card issuer know about your travel plans. This can help you make a case if your cards are lost or stolen. It also prevents unnecessary actions taken against any actual purchases you make on your trip.
Daypack? Check. Water bottle? Check. Protective clothing? Check. Credit card?
You may not think a rewards credit card is useful when you’re planning a wilderness trek, but they can actually help you save money on camping gear while opening up many budget travel options.
- Free flights
The best hiking and camping destinations often require expensive airfare, but a great rewards credit card can help you get there without breaking the bank.
Smart credit card usage with a card like the Chase Sapphire Preferred or the Platinum Card from American Express can help you rack up enough rewards points and miles to pay for trips to Kilimanjaro, Patagonia or the Great Himalaya Trail.
- Free accommodations
If you’ve ever taken an extended hiking trip where you’re trekking through the wilderness for months on end, you know how valuable a night in a hotel can be. Every few weeks, you’ll want to wash clothes, have a home-cooked meal and get a good night’s sleep without worrying about getting rained on.
A rewards credit card can offer a free night’s stay on a longer camping trip, giving you a day to relax and recharge before heading back out to continue your wilderness hike.
Even if you are determined to make it through an entire trail without breaking for a hotel stay, you can use the rewards to pay for a victory night in a hotel after you’re done before you head back home.
Credit cards can help you get the gear you need for your hiking trip
Purchasing high-quality gear is a necessity for most wilderness trekkers, and the best brands are almost never cheap. No one wants to hike the Appalachian Trail in cheaply made boots. Investing in good gear isn’t a frivolous or vain endeavor. Purchasing high-quality gear can be the difference between making it to the peak of the Matterhorn or having to turn back early because of broken equipment or a nasty bout of frostbite.
If you spend $2,000 on hiking gear each year with a credit card, you can earn significant rewards that you can put towards your statement balance or use on future travel expenses.
Which credit cards to use when planning your hiking trip
If buying gear is your primary goal, check out the REI co-branded credit card, which offers 5 percent back at REI and 1 percent back on everyday purchases. Each year, cardholders also receive an REI member dividend of 10 percent back on all eligible purchases.
For people who plan to purchase a large amount of camping gear, this card is a great option. New cardholders who make a purchase with their new REI Co-op Mastercard within 60 days of opening the account even get a $100 REI gift card.
For those who need to save up for a big hiking trip, the Discover it® Cash Back card is a great choice for everyday spending. Cardholders get 5 percent cash back in quarterly rotating spending categories like groceries, gasoline and online shopping on up to $1,500 in purchases after activation. All other spending earns 1 percent cash back. At the end of the first year, Discover matches all cash back rewards earned during the first 12 months. This could amount to a nice boost in your travel savings account.
Be sure to read credit card reviews written by other travelers to learn about their successes and failures. Finding the right rewards credit card to facilitate your travel plans, no matter how rustic or challenging, is crucial.