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Is "Free" Travel Really Free?

Sept. 16, 2014
9 min read
Is "Free" Travel Really Free?
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When I first got heavily into the miles and points hobby several years ago, many rewards credit cards had offers that awarded a bucket of miles, points, or free hotel nights after you used the card just one time. You could simply buy a cup of coffee on the card and tens of thousands of miles and points would fall out of the sky and into your account...a billing cycle or so later. Oh, and the annual fee was often $0 the first year. Pretty great, huh? That's pretty stinkin' close to free travel, or at least free airfare and hotel nights.

When is "free" really free?

Then as the years passed more and more cards required you to buy more than a cup of coffee to trigger the confetti of miles falling from the sky into your account. Now most require anywhere from $1,000 - $3,000 in charges in the first three months or so before the initial sign-up bonus can be yours, though there are a few notable exceptions to that rule that still award the miles on the first purchase, like the US Airways card.

So, is it still nearly free travel if you have use the card for your daily expenses for a while to trigger the sign-up bonus? Let's take the Hyatt Visa as our example. This card has a $0 introductory annual fee the first year and awards two nights at any Hyatt in the world after you spend $1,000 on the card in the first 3 months. Sometimes the card even comes with a $50 statement credit after the first purchase...

Those hotel nights could easily be used at a hotel where the going rate is $500+ per night. Of course that doesn't mean you have to value those nights at $500+ each if you wouldn't have paid that much to being with (and most of us wouldn't have), but they are clearly valuable however you want to slice it.

Those who argue this isn't really like getting travel nearly for free rightfully argue the point that when you put spending on a card to earn travel rewards you are giving up putting that spending on a credit card that earns up to 2% cash back that you could use however you wish. That is true. In this case, the $1,000 you put on that card to trigger the sign-up bonus of two free Hyatt nights means that you missed out on earning $20 cash back on a 2% cash back card. You could have used that $20 cash back for travel, savings, or however you wish.

I still think that passing up on $20 in cash back in order to earn two free hotel nights at any Hyatt qualifies as nearly free travel, but you may or may not agree. Assuming you got the offer with the $50 statement credit it is really hard to argue that the nights aren't free, but it is just semantics in my book as I think everyone can agree that is a heck of a deal.

What about the on-the-ground activities?

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There are other parts of travel that really can be free or nearly free, too. For example, if a credit card you have gives you one-time passes or ongoing access into an airport lounge and you are able to use that to eat/drink things you would have otherwise bought on your journey, that can result in real savings or even free meals. They may not be award winning meals, but they can be free or close to it. Same story if you have used hotel points or elite status you got by having a co-branded hotel credit card and landed yourself into a hotel that provides complimentary breakfast or access to a club lounge where you can have breakfast or snacks, that is a free meal and real savings.

If you do a little bit of internet research into free activities at your destination you will often be surprised what is out there. It's well known that the Smithsonian Museums are complimentary for visits to places like Washington DC, but many, many museums have days or evenings that are free or "pay what you wish" all over the world. If you already have a zoo or children's museum membership from home you can often use that on your travels to access other reciprocal museums for no additional charge. If you have a Bank of America card then on the first weekend of each month you can access a host of quality zoos, museums, etc. for free. This is something you can take advantage of at home or on the road.

On our recent trip to Beaver Creek I searched for free activities online the way I normally do and was shocked to find that even horse rides for young children were free. There is also a guided complimentary hike daily that we took advantage of that was led by a fantastic guide. Since they are a sponsor, there were even free Nature's Valley granola bars which we stashed for later. Evening s'mores were also free at the Park Hyatt Beaver Creek, as was room service breakfast thanks to having Hyatt Diamond status. We didn't have to pay for very many meals on that trip out of pocket because so many were free for us.

"Free" as a result of previous investment or strategy:

Now you can get Hyatt Diamond elite status "for free" by participating in the Hyatt Diamond challenge, but that does start to take us to the next type of "free". You really can get Hyatt status for a while basically for free for a while, but to keep it you need a hefty number of qualifying stays each year devoted to Hyatt, 25 to be exact. If you aren't spending any extra to hit that threshold, but instead are just being strategic about the travel you have, then that really can be something you obtain for no additional outlay just by being strategic.

If you are having to invest some extra to hit that threshold then it isn't exactly free, but rather those breakfasts you enjoy as a result of your status are just your investment paying off. If the additional investment was small, then they may well be nearly free. The more you spent to get it, the further they are from free. The same thing holds true with airline elite status and upgrades, fee waivers, meals in first class etc. They may be "free" on that given day you enjoy them - and boy does that feel good! However, they are likely the result of either strategy, previous investment, or both. That can be virtually free or pretty darn expensive depending on your situation.

Is "free" still possible?

Those newer to this hobby who haven't yet taken advantage of the multitude of offers out there absolutely can piece together a trip (or really more than one trip) that can be nearly free. Your airfare, hotel nights, and even some incidentals can be covered easily by the sign-up bonuses that rewards credit cards have readily available. The elite status levels you can get by virtue of having some co-branded cards, or even what you can get via a challenge can also be free or nearly free. As I have covered, some quality activities along the way can also be free or darn close (don't be a total cheapo and "forget" to tip) with a little bit of research.

So is there such thing as free travel? Sometimes. Absolutely. Less so than perhaps there was a few years ago, but it is still totally possible and not that hard.

Is it something that is sustainable for the long haul? For some people who really push the limits, yes. However, for most of us the longer we are in this hobby the more we are supplementing pieces of the trip that are nearly free with pieces that aren't. Even on the recent trip we took to Beaver Creek, Colorado, that was featured on Nightline, our flights weren't free. They could have been close to free if we had used miles, but that wasn't a good choice given our overall strategy of earning miles and elite status. It probably would have made for better TV to have our flights be free, but it wouldn't have been better for what we do and our approach to travel these days.

We paid about $190 each for our round trip flights as all three of us needed those miles to hit status for next year, and burning 25,000 United miles or 15,000 British Airways Avios to save $190 wasn't a good strategy for us. We certainly could have used miles from the Barclaycard Arrival to offset the amount we paid for the tickets, but we didn't. The deal did get better for us when our paid tickets scored us complimentary space available first class upgrades. $190 first class tickets to Denver were even better than $190 coach tickets to Denver and did result in the real savings of not having to buy lunch.

Clearly buying airline tickets means they aren't free, but the upgrades were a result of a previous investment in status paying off, and the tickets themselves were an investment toward next year's status....and in earning redeemable miles to use on future trips. Our flights weren't free on that trip, but there were elements of that trip that were 100% free, such as hotel suite we won, and those are the sort of things that make trip possible and very affordable.

Free is now a part of our strategy, but we simply travel too frequently (in part because this is my "job") for everything to be free or nearly free. If we wanted just one or two trips a year they could still be nearly free when it comes to flights and hotels, and that is amazing and attainable for many families who have good credit and the discipline to not rack up debt or spend money on things they otherwise wouldn't just because they are using credit.

Some travel really can be free. The rest can cost much less.

Editorial disclaimer: Opinions expressed here are the author’s alone, not those of any bank, credit card issuer, airline or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.