As I mentioned in this post, I have been thinking off and on for a while about trying travel hacking. Now that Mrs. Dragon and I are officially done with the mortgage process, I feel like the time is finally right to try it out.
Actually, I made the decision to try this out before we closed on the house, so on our closing date I was ready to swoop in and attempt to scoop up some sign-up bonuses.
As I mentioned in the first travel hacking post, you generally want to apply for all the cards you’re going to get on the same day. This is because each credit card application affects your credit score, but your score isn’t updated instantaneously. So if you get all the applications submitted in a short time window, the credit card companies won’t know you’re applying for a lot of cards.
I figured the same rationale should hold for any new debt. That is, I didn’t want my new mortgage to affect whether or not I got approved for the credit cards. So the day we closed on our house, I also applied for 5 new credit cards.
There are hundreds of credit cards out there, but the purpose of travel hacking is to get the biggest sign-up bonuses you can with companies that you use. For example, the closest airport to us has a lot of American Airlines flights, but I’m not near a city that has Southwest flights. So it doesn’t matter if there’s a huge bonus for Southwest miles because I can’t reasonably use them.
I decided to concentrate my efforts on airline miles that could be redeemed for American Airlines flights, and Hilton HHonors points. The airline points were my main focus, and AAdvantage miles were the easy choice for us.
Choosing HHonors was a little more random. I had it narrowed down to either Marriott points or HHonors, but it seemed like there was more opportunity to earn HHonors points, so I went with them. According to the internet, a lot of travel hackers like SPG points (Starwood properties), but HHonors and Marriott seemed more familiar feeling for me.
After deciding which rewards programs I wanted to focus on, I had to go looking for cards. With HHonors it was easy. There are a few HHonors rewards cards, and a simple google search will tell you all you need to know.
It was a little more complex, but not bad, with the airline miles. It’s easy to find AAdvantage branded cards. The tricky part is that there are a lot of airlines that are partners with American Airlines, and you can use their points to book AA flights.
Luckily, the internet is a magical place that can answer all your questions. American Airlines is part of the OneWorld alliance, which includes 15 airlines total that have flights all over the world. After looking around at the credit cards on offer, I decided to apply for three different airline cards. All three airlines are part of the OneWorld alliance. Without further ado..
The cards I applied for (in order):
- Citi AAdvantage Visa – Sign up bonus of 50,000 AAdvantage points after spending $3000 in the first 3 months. The $95 yearly fee is waived for the first year.
- British Airways Visa – Sign up bonus of 50,000 Avios points after spending $2000 in the first 3 months. The $95 yearly fee is waived for the first year.
- American Express HHonors Card – Sign up bonus of 50,000 HHonors points after spending $750 in the first 3 months. No yearly fee.
- Citi Hilton HHonors Visa Signature Card – Sign up bonus of 40,000 HHonors points after spending $1000 in the first 4 months. No yearly fee.
- US Airways Premier World Mastercard – Sign up bonus of 50,000 Dividend Miles after your first purchase and paying the $89 yearly fee.
Note that the above list is only cards I APPLIED for, not cards I was APPROVED for. Here’s the approval list:
- Citi AAdvantage Visa – Approved immediately.
- British Airways Visa – Approved immediately.
- Amex HHonors card – Approved immediately.
- Citi HHonors card – Rejected immediately.
- US Airways card – Application to be reviewed for approval.
Immediately after applying for the cards I had learned two lessons about applying for a big batch of credit cards.
- Applying for two cards at the same bank defeats the purpose of applying all at once.
- You shouldn’t apply for your cards after business hours on a Friday evening.
After being immediately approved for the first three, I thought I was just going to breeze through my five selected cards with no trouble. However, in retrospect, I should have known that I wouldn’t be able to get two Citi cards.
The whole point of doing your applications close together is that the credit card companies don’t know that you are applying for so many new lines of credit. But if you apply for two cards at the same bank, like Citi, then of course the jig is up.
I got a letter in the mail a few days after applying that said I was rejected because I had “multiple new applications on file.” Good thing I applied for the AAdvantage card first, since airline miles were priority number one. Be sure to keep this in mind if you are planning on trying travel hacking yourself.
As for the US Airways card, I’m not sure my situation is what many other people will encounter. After applying I was told that “my application needed further review” and that they would contact me within 10 business days. I’ve read on other travel hacking posts that when this happens, you should immediately call the credit card customer service line to see if you can give them the info they need to approve your application.
However, I applied for the cards on a Friday evening. So, of course, when I called the company a recording told me to call back during regular business hours. I figured that the delay meant that there was no way I was going to get approved.
Funnily enough, I got a call from a representative over the weekend about my application. It turns out that the US Airways card is offered through Barclaycard. I happen to already own a Barclaycard. The representative told me that they couldn’t give me more credit, but they could approve the new application if I was willing to transfer some of the credit from my existing card to the new one.
I already had a card with them with a credit limit of $10,000. They told me I could get the new card if I was willing to lower that limit dollar for dollar with the credit limit on the new card. Score!
I split the difference. Now I have my original Barclaycard with a credit limit of $5000, and the new US Airways card with a credit limit of $5000.
If all goes according to plan, after 3-4 months I should have
- 50,000 American Airlines AAdvantage miles
- 50,000 British Airways Avios points
- 50,000 US Airways Dividend miles
- 50,000 Hilton HHonors points
- Plus a thousand or two in each category as rewards for spending on each card
I’m also going to be keeping track of how my credit score changes throughout this process.
My FICO score, according to Discover, was 796 before the mortgage was finalized and these card applications were submitted.
Stay tuned for the next installment to see how the manufactured spending part of this experiment goes.
What do you think of my choice of cards? Anyone have advice to give about manufactured spending?
Other posts in this series: