So i was on a fantastic blog last night, "Spartan Traveler", when something caught my eye. "How I flew around the world for less than $220"
here is the link to the blogpost
Naturally, this sparked my interest. Since I began this blog, everyone has been giving me "practical" advice about how i might travel the world with no money. Nobody really thinks that I'll be able to crowd source this, but to them I say:
Hope is the thing with feathers that perches in the soul-
and sings the tunes without the words-
and never stops at all.
Well, Emily Dickinson, I probably will give up one day, but this is not that day!
SPAAARRRRRRTAAAAAAAARRRRR!
Anyway, it got me to thinking, can we do that in Australia?
We've been coming up in the world, Australia has. We used to be the weird cousins nobody wanted to sit next to at Christmas but now we're the rich uncle everyone has to be nice to! We've been wined and dined by the likes of P!nk and even Kim Kardashian, all traveling down here to try to pocket some quick cash. Whilst we never used to be cool enough to warrant excessive things that they get in the states, now all their weird and wondrous goodies are slowly making the way to our backwaters.
And one of those weird things is: Churning!
What is churning, you ask?
Its kind of hard to explain, but in short its where you apply for a credit card based on the "points" they offer just for signing up. In the states they use this term because they open up the credit card, use it for a very short while, pay it off on time, collect the rewards, close it down and then repeat. Different credit cards have different periods of time for when you might be considered a "new customer".
Here's an article about churning to help you get reassured of the risks vs. rewards
Now it might sound a little daunting and I'm sure we have all heard the warnings about credit card rewards programs and how they are designed to gouge you. And whilst that IS incredibly, scarily true, this has also been a criticism that many seem to have taken on board and have used the feedback to change their behavior (presumably to get more customers).
Whilst this may sound like cheating, something underhanded that you dont want to be caught doing, its actually not. This is exactly what they want you to do. Be enticed by the offer of rewards, sign up with their credit card, spend way more than you can afford and pay them interest. But all it takes is a little savvy and its all good :)
TOP TIPS:
1. Dont do this if you are bad with credit cards. The whole point of it is for you to get something for nothing, don't ruin it by spending more on your credit card than you can afford to IMMEDIATELY pay off.
2. Some credit cards DO have a minimum amount to use on the card,so make sure this isn't what you wouldn't otherwise be spending. If its $6,000 for 3 months, and you just dont have the money, DO NOT GET THAT CARD. Simples.
4. Applying for lots of credit cards at once lowers your credit rating and makes you look like a risky borrower. Keep that in mind. Don't do this if you are paying off a mortgage. The difference between a good and bad credit score can mean thousands of dollars.
5. Almost all of these cards have an annual fee. Keep an eye on the card. I suggest attaching a post-it note to the card and put it in your wallet. On the post-it, write:
-when you should call to cancel
-how long you have to spend the minimum
-how much the minimum is
-how much you have spent on it, and the date
6. Make 200% sure that the points are actually worth something. Qantas Frequent Flyer points are great, Flybuys points are not. Make sure you know what your points can buy. For instance, American Express Velocity Platinum Card offers 50,000 velocity points just for singing up link here. That's roughly $373 worth of David Jones Gift Card. You also get one complimentary domestic flight a year. BUT it costs $349 to sign up. So basically you are getting $24 and a free flight. velocity rewards
Having said that, to fly to Mexico City from Melbourne costs 62,500 points! So 50,000 points gets you pretty damn close to a free one way flight :) Thats pretty awesome! Most points programs are the best to use on flights rather than gift cards or home wares, where they tend to gouge you.
7. If you do go ahead and get a credit card, taking it with you when traveling can mean that you earn even more rewards, as most cards will offer extra points if the money is spent on car hire, flights or hotel rooms. You've already paid the annual fee, so as long as you can afford to pay the money off STRAIGHT AWAY using the card can work for you, and you could keep earning rewards.
8. Sometimes, companies will let you swap your points ie. from Velocity to Frequent Flyer. Make sure if you are planning on doing this that you triple check a) the ratio of conversion and b)that it can actually be done.
That might sound like a lot of things to keep in mind, and it probably is, but the rewards can be worth it! Just make sure you do your research.
Here's some credit card options that I've already sussed out (for Australians only):
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| Okay, so to start with the CC costs a whopping $900 p.a. That's HUGE. But, you do get 80,000 points and only have to spend $500 on your card (within the first 2 months). You also have to be earning OVER $100,000 big ones a year. So this ones out for me (obviously) but you might be able to move the points around. Ill call them later (have to run to the loo right now!) Ratio of $ to Points is about 1:88 |
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| At $249 a year, this baby doesn't come cheap. $: P is 1:30 |
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| $199 gets you more bang for your buck, so to speak. You also get interest free for 6 months, which could be handy. After that its interest free for 55 days. You have to be earning over 60,000 dollars a year, which is quite reasonable for those in full time employment. $:P is 1:100 |
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| $0 to sign up AND 7,500 points? Why not? You just have to earn over $35,000 a year. This is the best money to points ratio of them all! (My computer tells me I can divide by 0 but Ive never been one to play by the rules) AND you also get an extra 5,000 points when you spend $300 on purchases in the first 3 months! So as long as you are going to be spending that money anyway, its basically 12,500 points for free! The is my pick, and you can apply here american express |
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| No foreign exchange fees on this one! The initial points are pretty low, but then so is the fee :) $:P is 1:57 |
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| This is very good! $:P is 1:179! You do have to use your card to get that, but it didn't say how much for or what is considered an "eligible purchase" You also have to be earning more than $50,000 a year. link here |
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| $:P is 1:160! You do have to be an existing member with Qantas Frequent Flyer program tho (see note at end of post!) link here |
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| $:P is 1:104 which is pretty good. They have a deal going at the moment where you get complimentary travel insurance for you and a spouse (plus dependent children) for return trips of up to 3 months. If you have a Commonwealth Bank account or loan when you apply for the card you get $30 off the annual fee (making the ratio more like 1:131). For an additional annual fee of $10, you can opt-in to the Qantas Frequent Flyer Rewards program where your rewards points are transferred directly to the Qantas Frequent Flyer program each month. |
To give you an idea of how far your points could take you:
If you use your points for a flight, for example Sydney to LAX, you need 48,000 points (plus $192.48 in fees and taxes)
So theoretically if you open the Woolworths Everyday Card link here and the american express card (and spend $300 in 3 months) then you already have 28,500 points. If you also applied for Westpac Earth Platinum Credit Card here you would have 48,500! For about $214 you can fly to Vancouver or Los Angeles or Mexico City! Thats pretty cheap when you consider that a Qantas flight (or affiliated airline) to LAX costs about $1500, thats a saving of over a THOUSAND dollars!
Frequent Flyer Shop
Please leave comments so I know who's reading my posts- or if you have any questions or suggestions! Thanks guys
Some credit card companies who offer Frequent Flyer points require that you already be a member. Normally that costs money, but for readers of my blog i have a sneaky link you can use to get it for free. That's a saving of $82.50! All you have to do is make a nominal donation to my travel efforts, leave a comment with your email address, and ill send it right out :)
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