I’m so excited you’ve decided to begin travel hacking! It has opened up a whole new way of traveling for me and my family, and I’m excited to share it with you. As with anything strategy-based, there are some general rules and best practices you need to understand and follow to set yourself up for success. So let’s dive in…
In a nutshell, it is the process of signing up for a new credit card, meeting the minimum spend within the required timeframe, obtaining the sign up bonus (SUB) points, and then redeeming those points for nearly free travel. Rinse and repeat with different cards to build a stash of points for all your bucket list trips! Once enough time expires after you receive your SUB (usually 24 months for most cards) you can downgrade or cancel and reapply for the SUB.
Whew! That’s a lot to unpack, so let’s break down a few things:
Minimum Spend: the amount of money you need to spend on the card in order to qualify for the promotional SUB, typically $3k to $4k.
Minimum Spend Period: the allowable timeframe in which to meet the minimum spend amount, which is typically 3 months.
Example: credit card XYZ will give you 60k points after you spend $3k in 3 months.
Sounds easy enough, right? Right!
Having a general strategy helps in a few ways:
1. Chase Bank is one of the most valuable points currencies, but they have some specific rules for opening personal and business cards. Understanding these rules, and those of the other major banks (AmEx, Capital One, and Citi), will help you prioritize the order in which you open new cards.
2. It ensures you understand the overall concept of travel hacking so you can set yourself up for long-term success.
3. It allows you to maximize the number of SUBs you receive each year, and therefore provides more travel opportunity.
Pronounced ‘five-twenty-four’, this is a term you will see A LOT in the travel hacking world! You may see people asking ‘what’s your 5/24 status?’ Remember when I said Chase Bank has some rules for credit card applications? Well, this is one of their biggest rules, so pay attention…
5/24 refers to the number of personal credit cards, across all banks, you have opened in the past 24 months. Chase will not approve you for a credit card if you have opened more than 5 personal cards in the past 24 months.
See where that strategy comes in?!
When starting out with travel hacking, it’s super important to know your 5/24 status so you can tailor your strategy to maximize your potential SUBs.
There are a few things to keep in mind regarding 5/24:
1. The only cards that count are personal cards, not business cards
2. This accounts for cards across ALL banks, not just Chase.
3. This is a rolling 24-month timeframe, so 24 months after you open a personal card it ‘falls off’ your 5/24 count.
4. Being an authorized user (AU) on someone’s account takes up a 5/24 spot, so it’s common practice to not add anyone or be added as an AU.
Make sense? Good! Time for a pop quiz!
Based on the following cards/opening dates, what is this person’s 5/24 count?
If you said 3/24, you’re correct! The AmEx Business Platinum does not count towards 5/24. This person will drop to 2/24 in November 2023 when the Chase Sapphire Preferred card ‘falls off’.
The 5/24 rule really sets the stage for your strategy and kind of forces you to prioritize applying for Chase cards first.
The lower your 5/24 count, the more options you have. But don’t worry if you’re at 3/24 or 4/24, there’s a strategy for you, too!
Now that we’ve explored some of the travel hacking basics, you’re ready for your first card! Given what you now know about Chase Bank and the 5/24 rule, your first step is to figure out your current 5/24 count.
If you are 3/24 or under, your best card is typically going to be the Chase Sapphire Preferred (CSP). This card is one of the most powerful cards in the travel hacking world and allows you to transfer your points to multiple travel partners such as United, Southwest, and Hyatt. It comes with a modest $95 annual fee, which is a small cost to play the travel hacking game.
If you are 4/24, you want to evaluate when you will drop down to 3/24. If it’s within the next 3-6 months, I would still recommend the CSP.
If you are 5/24 or more, you aren’t currently eligible to apply for a Chase card. Few people fall into this category when they begin, but don’t feel discouraged if this applies to you! I typically recommend waiting until you drop back under 5/24 or applying for a non-Chase business card (more on business cards in a related blog post!).
Are you ready to apply?! If so, I would greatly appreciate it if you used my referral link. If you have any questions, feel free to contact me!
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