Here is a list of common questions that my friends, family, and fellow travelers ask me regarding points, miles, and traveling smarter:
Which loyalty program should I join?
The answer is all of them. Join all of the airline frequent flier, hotel, rental car, etc. programs that you think you will eventually use. Each and every single one of them are free to join. You need to take advantage of every point opportunity–especially in the beginning. I recommend using a free management system like AwardWallet.com. This helps to keep everything straight and available in one location.
How do I find “cheap flights?”
How do I determine which credit card is best for me?
First, that largely depends on your own travel priorities and the current bonus offers at the time you decide to apply. Bonus offers are key to jump starting any travel strategy. You must also determine which type of rewards you want to earn. Set goals and prioritize. Would you rather work toward free flights or free hotels? Would you like to have flexibility to do either through transfer partners? Those are key aspects to keep in mind when researching credit cards.
What is the recommended minimum credit score before applying for credit cards?
Your credit score indicates whether or not you have utilized credit responsibly and managed your debts well. Typically any score above 700 is acceptable in order to get approved for many of the premium rewards cards out there. I recommend excellent credit ratings because this requires discipline and strategy. However, it is widely accepted that a credit score of 650 is okay as well.
Does applying for credit cards damage my credit score?
This all leads back to strategy. When you apply for a new credit card the issuer runs a hard credit inquiry. This does slightly decrease your score with each sign up, but only by 3-5 points. Over time the long-term impact of opening a new credit card account is actually beneficial.
What determines my credit score?
Your credit score is based on a combination of factors–not just one single variable. The biggest contributing factor is your payment history. This makes up about 35% of your overall score. Next is the amounts that you owe or your credit utilization ratio (30%). This means you usually want to maintain an overall credit utilization of 1 – 20% of your total available credit. About 15% of your credit score is attributed to the age of your credit history. I still maintain an old MasterCard that I got when I was 18-years-old for this very reason. New credit is responsible for about 10% of your score. So this is why if you have recently opened a credit card or gained approval for a loan, you will see a decrease in your score. Lastly, another 10% is determined by the types of credit you have (loan, mortgage, retail, credit cards, etc.) and your total accounts.