Air Travel Tips: Book Flights without Breaking the Bank
Air travel tips for calculating out the value of frequent flier miles and other smart ways to save.
[On-screen text] Be Penny Wise, Not Pound Foolish: Saving Money When You Travel
[Narrator] When you’re a Penny Wise you know a debt-free vacation, is a stress-free vacation. Smart vacation planning starts with wise air travel.
[On-screen text] Tips for Saving on Air Travel
[Narrator] When you’re a Pound Foolish, you use frequent flier miles without considering the actual cost. But Penny Wise does the math – frequent flier miles have a value of 1-2 cents and most programs require 25,000 miles as a minimum to purchase a basic ticket. So, you’d have to be Pound Foolish to use flier miles for a $100 ticket. Penny Wise only uses miles when the ticket value is more than $250, so it’s worth it.
[On-screen text] Tickets over $250-$500 are worth the miles!
[Narrator] Penny Wise also shops smart for travel credit cards and uses one with few restrictions and limitations. Pound Foolish has cards with so many restrictions that they HAVE to use their miles, even when it’s not worth the cost.
[Narrator] Pound Foolish also books the first flight they find because it’s the EXACT date and time that they want. But Penny Wise knows a flexible schedule can lead to big savings. They shop online, using aggregate sites to save money and avoid booking fees. They also check departure airport website to find airlines with discounts that need be booked directly with them. And they use consolidator websites that sell last-minute seats, too.
[On-screen text] airtech.com / airhitch.com
[Narrator] Pound Foolish misses these big discounts because they don’t like to leave at an odd date or time. Pound Foolish only flies out of the biggest, best airports like Chicago’s O’Hare or DFW in Dallas. Penny Wise uses smaller airports, like Midway and Love Field. And if they’re not familiar with an area, they search for alternate airports.
[Narrator] For more Penny Wise travel tips, visit consolidatedcredit.org.
[On-screen text] Consolidated Credit: When debt is the problem, we are the solution. Call 1-888-995-0737.
Tip No. 1: Know your travel credit card policy
One of the biggest mistakes that people make when booking flights is not understanding policies on their travel rewards credit card. If you really want to save strategically on air travel, the first thing you should do is take a few minutes to read the fine print on your credit card statement. You can also look at your online account or contact customer service to answer all your questions.
Here’s what you need to know:
- What’s the cent value of a frequent flyer mile on your card?
- What’s the base number of miles that you must use to purchase a ticket?
- Are there date, time or seat restrictions on booking tickets?
- Are there limited or extra perks for booking a specific airline (i.e. is your travel rewards card co-branded with an airline)?
- If you have a co-branded card, what are the extra perks you can use to your advantage, such as free checked bags.
All this information will help you book flights effectively without running into restrictions.
Tip No. 2: Now calculate the value of your current miles
Once you know the specific cent value of your miles, you can calculate the base price of an earned ticket. There are two helpful calculations you can run before you start looking up tickets to your destination.
- Minimum ticket purchase: multiply the value of a mile by the minimum mile limit for the card.
- Maximum ticket value: Simply multiply the value of the mile by the number of miles that you have on the account; this is the most you can purchase with your miles.
So, let’s say that you have a good travel rewards credit card that offers a 2-cent value for frequent flier miles; it has a minimum mile purchase of 25,000 miles. You currently have 45,000 miles.
The lowest ticket price you would need to effectively use your miles would be $500. The biggest ticket you could purchase with the miles you have would be $900. Now you have a price range of what you can practically use your card to book. You can be informed before you begin searching for flights.
Tip No. 3: If you’re booking with credit, don’t wait to pay it off
So, the tip above teaches you how to calculate the value of using your miles. But let’s say you don’t have the miles for it yet. Instead, you want to book the tickets with your travel rewards credit card to earn miles.
In this case, make sure to pay off the debt as quickly as possible once you book your flight. If you plan carefully you can even book the flights interest-free. Here’s how:
- Your credit card must have a zero balance at the start of the billing cycle before you book.
- Book your tickets with the credit card.
- Pay off the balance in-full within that billing cycle (i.e. don’t let any balance carry over)
That’s the simple 3-step process to book flights without interest charges. This way, you aren’t offsetting the value of the miles that you earn with interest charges. Since travel rewards credit cards tend to have higher interest rates, this happens relatively quickly.
For example, let’s say you fly from LAX to JFK. That’s about 2,475 miles that you earn. You have that sweet 2-cent value card, so the value of the miles you earn is $49.50. But that ticket cost you about $300 and your credit card has 20% APR on a standard 2% minimum payment schedule.
If you pay off this debt with standard $15 minimum payments, interest charges accrue each month. They eat up about $5 of each payment you make. So, if you let this debt linger for anything longer ten months, you just completely offset the value of the miles you earned. Even though you feel like you got a benefit from using the card, to your wallet the whole exercise was pointless.
You can calculate time to payoff and interest charges using a debt calculator: