American Express paid for my son's vacation. Seriously? Yes, the focused and frugal can manipulate credit card rewards to their benefit. Of course, without dedication and restraint you'll fall into the trap that the credit companies created.
For the first year I had the card, we had no finance charge on our purchases. This could spell disaster, but I took it as a temporary reprieve, watching my total balance carefully as we moved throughout the year. For each dollar purchased I received a "mile". As I reached milestones of accumulated miles I could cash them out for credits.
The benefits of American Express miles are that they can be cashed out for non-travel credits. However, if you cash them towards a travel purchase, you get more for your mile. I was well aware of this when I started to plan our next vacation.
To combat this, I left small purchases for my debit card, and I only put the larger purchases on my American Express card. Things like my oil delivery, our new sofa, and a pair of eye glasses all found their way onto my card. My rule of thumb was anything over $200 would earn a nice handful of points.
Some temptations are strong, but they are poison no matter how you look at them. Unless you are the most meticulous accountant, putting everything on your AmEx card won't get you ahead. At the end of the month, you'll see an enormous total bill, and the extra money in your bank account probably went towards other purchases, leaving you in debt. The other temptation is to put revolving bills such as car payments and utilities on the card. Again, a meticulous bookkeeper can do this, but for the average household accountant the bill overwhelms the planning.
To reap the most from your rewards, book your vacation on the same card that you earn the miles. Then, wait for the miles to post to you account and cash them out for credit towards your card, lessening the total balance of the vacation. For most vacation plans, you must put down a deposit then pay the balance just before your departure date. Put the deposit on the card, cashing out your points as soon as possible, and then pay the balance with the card as well. You will most likely accumulate enough to add another credit to your bill.
In the end, I had a small lingering balance on my bill after my year of free financing was over, but even the two months of interest I paid was a pittance next to the credits I had received from my earned miles. By tallying the two credits I received, we came to the realization that my son's vacation was free. The hotel we had reserved didn't charge for guests under 17, and the cost of his airfare equaled $100 less than the credits I'd received. All in all, it was worth the homework and planning.
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Hotel rooms and holiday chalets often have very few plug points, one or two if you're lucky. So pack with you a plug extension before travelling.
This tip is something we do when we are catching a flight home and don't have much time to eat before heading to the airport. Airport food is expensive as we all know, and even more expensive on flights.
Call your credit card company before you leave. Let them know where you're headed and what kind of purchases you are likely to be making outside your normal spending pattern.
I hate having to remember everything that we have to take on vacation! So, my best tip is to go thru my daily routine in my head all the way thru till bedtime and make a list.
Notify your credit card company when you are going on vacation. Charges from strange areas may make them think your card was stolen and reject a charge you may want to make.
