I’ve decided to start a small series called “My Next Vacation” to outline a step by step process to get you on your next vacation for pennies on the dollar. You’ve heard it from me and probably from others that it is possible to take a once-in-a-lifetime trip for a mere fraction of what it would cost otherwise. And you want in.
How do we do it? Well, banks want customers. They want you to use their credit cards. And they’d prefer that you not pay them off every month so that they can reap huge profits from you through their outrageous interest rates. In return for signing up for said credit card(s), they’re willing to give you a bonus of sometimes cash, other times credit card points or airline miles. That’s where we can leverage our wonderful credit scores and smarts to never succumb to carrying a balance and make out like bandits!
One thing to keep in mind is that in order for this to work, you need to plan ahead. You can’t decide that you’d like to take a trip in 3 months (or even 6 months) and expect to have the points/miles in hand immediately to do so. But once you get into the rhythm of garnering points through credit cards, it is much easier to plan something closer to travel.
While I won’t delve too deeply into the foundation of pursuing this path, I’d be remiss if I did not mention that in pursuit of these miles and points, you MUST pay off your balance every month. You MUST have a great credit score. And you MUST not have a large purchase that you intend to finance in the next two years or so (think mortgage). If these apply to you, read on!
Hawaii is a dream destination for many and one that is often out of reach for retirees and families. But by signing up for 3 credit cards per person for a couple (4 cards each if you’re a family of 4), you can get a luxury 8 night vacation in Maui and Kauai (or other islands if you so choose). You’d not only get your roundtrip airfare covered from anywhere in the US, but you’d also stay 4 nights at the Fairmont Kea Lani in Maui and 4 nights at the Grand Hyatt in Kauai. Both amazing properties.
How do we do it?
Husband signs up for the Chase Hyatt credit card and the Citibank American Airlines Platinum Select Mastercard. The Hyatt card gives him 2 free nights at any Hyatt around the world after spending $1,000 on the card within the first 3 months of opening the card. The American Airlines card gives him 53,000 AA miles (assuming he spends exactly $3,000 on the card) after spending $3,000 on the card within the first 3 months of opening the card. As you can see, this will require this family to spend about $1,334 per month on one of these two cards over this 3 month timeframe. Husband makes sure he adds wife as an authorized user to his card(s) so that she can help him meet the spending.
Two to three months later (two months if you can spend $2,000 on a card per month), wife signs up for the Chase Hyatt credit card and the United MileagePlus Explorer Business card. Wife sells used items from around her home on Ebay on the side as a sole proprietor and therefore qualifies for the business card (almost everyone qualifies since most everyone has a side hustle. Even yard sales qualify!). She then gets 2 free nights at any Hyatt around the world after spending $1,000 on the card within the first 3 months of opening the card. And she gets 52,000 United miles (assuming she spends exactly $2,000 on the card) after spending $2,000 on the card within the first 3 months of opening the card.
Two to three months later (or once reaching the spending for wife’s cards is on the horizon), husband applies for the Chase Fairmont credit card which will give him 2 free nights at any Fairmont around the world after spending $3,000 on the card within three months (it used to be only $1,000 which was an awesome deal!). And then wife proceeds to apply for the same card once husband has met the $3,000 on his card. Please note that all of these cards have annual fees that are waived for the first year. So, you’ll want to cancel the cards before your one year anniversary (although the Hyatt can be beneficial to hold onto).
If you’re a family of 4, you simply need to have wife also sign up for the AA card and husband also sign up for the United card to get enough miles for 4. But for simplicity sake, I’m going to assume just two travelers. So, to add it up, after meeting this spending, we now have:
AA Miles = 53,000
United Miles = 52,000
Hyatt Free Nights = 4
Fairmont Free Nights = 4
American Airlines requires 17,500 miles per passenger each way from the continental US to Hawaii. So, assuming we use the miles from Boston to Maui for two passengers, we now still have 18,000 AA miles left (husband uses his miles for both himself and wife on the outbound). United charges 22,500 miles between Hawaii and the continental US. So, assuming we use the miles from Kauai to Boston for two passengers, we now still have 7,000 miles left. Then we use the 4 free Fairmont nights in Maui and the 4 free Hyatt nights in Kauai. Lastly, we use 10,000 of our remaining AA miles to transfer between Maui and Kauai on Hawaiian Airlines (5,000 AA miles per passenger).
What’s left? Oh, yeah, a rental car! There are several options to offset the cost of this one too, but given the savings already reaped, we have chosen to just pay for our rental car on our past 3 Hawaii trips. We’ve had great luck with Discount Hawaii Car Rental. They’ve found us rates with the standard rental car companies that we weren’t able to replicate on our own.
A couple of things to note. American Airlines award availability to Hawaii can be spotty. You do need to book at least 6 months in advance to get what you want. United is usually better, but with both airlines, availability will be tight during the peak season, even if you book well in advance (summer months and Christmas holiday season).
And the great thing about using miles and points is that so much is possible. Say you don’t want to go to Maui at all and just want to stay in Kauai. It’s possible to swap out the Fairmont card for the Chase Sapphire Preferred card and do just that.
Also, there are other ways to meet the spending requirement for these cards more expeditiously than simply putting everyday expenses on the credit card, but that’s a post for another day.
I hope that this is helpful in putting together a trip of a lifetime with very little out of pocket and as always, please let me know if you have any questions!