The Bridge

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Travel hacking can add value to your life in so many ways. That’s what keeps it so interesting, the insatiable drive to find the next clever way to leverage creative thinking into tangible rewards.

From simply saving money that you would’ve otherwise spent, to making exotic award bookings, to testing out first-class products that you would’ve never paid for with your own money, The miles game delivers terrific rewards at little cost.

One surprising benefit of travel hacking for me, personally, has been that the pursuit of travel value has bled over into the pursuit of value in other areas of my life that are perhaps even more important, like planning for retirement.

To delve into this connection I’d like to walk through a simple cycle of travel hacking, examining every step of the process, in order to expose the connections between the skills of travel hacking and those of pursuing financial independence (early retirement.)

Step one: Search for a better way to book travel.

This is the most elemental and probably the most important step of both endeavors. By looking for ways to buy plane tickets and hotel rooms without spending hard earned money, you’re already thinking outside of the box.

In the rest of our lives, thinking conventionally usually means entering the workforce between age 18 and 22 and working, and consuming continually until you’re at least 65.

Thinking outside the box means that you’ve opened your mind to other alternatives.

What if you could retire in 10-20 years instead, simply by living a little bit more efficiently? What if you could do so without sacrificing any happiness – or travel? (Spoiler alert: you can.)

These questions only pop up if you can think creatively. And by looking for a better way to travel you’ve demonstrated the propensity to do just that.

Step two: evaluate your own credit worthiness.

Credit scores have a huge impact on travel hacking opportunities and our financial lives in general. They determine our ability to purchase homes or cars, and to finance new business ventures.

Before you embark on your first credit card application, you really must check your own credit score.

If your score is low, you should be motivated to actively work on your credit rating in order to allow you to travel for free in the near future.

If your score is above 700, you’ll be motivated to keep it that way so that you can keep on playing the miles game.

Once you start churning cards you will likely find yourself obsessively following your own FAKO score on creditsesame.com and creditkarma.com, (which is a good thing.)

Either way your chance of improving your credit score certainly goes up with mindfulness of it’s importance, and with it’s continued monitoring.

Actively maintaining an excellent credit score has profound implications far beyond travel hacking.

It opens up new doors for saving money (think home refi at a lower rate,) and thus kicking up your savings rate. If your savings are then invested in a well diversified portfolio of passive index funds, your time to retirement can shrink dramatically.

Step three: research and execute your first credit card churn.

This step teaches you the valuable lesson of having the goal first and working backwards from it.

Do you want a first-class honeymoon in Europe? Do you want to get your family of 5 to Asia in economy? Or maybe you just want to fly frequently to visit your family in a nearby state?

Knowing your goal will determine which miles currencies are the most valuable for your goal, and which 4 to 8 credit cards to apply for.

Once your strategy has been defined, applying for and then keeping track of multiple cards will require tremendous organization.

You’ll need to design a system for yourself so that you’re never late with a payment, you always pay your credit card bills in full, your spending remains under control, you hit your minimum spending requirements, and you cancel your cards before their annual fees come due.

Working backwards from a goal (such as achieving early retirement,) and developing organizational skills that allow you to successfully pursue your goal (saving and investing,) are also crucial to developing a cohesive financial plan, and executing it.

Step four: manufactured spending.

Step four really combines the requirements of step one and step three, namely thinking outside of the box and organization.

The additional skill that is gained from manufactured spending is that of a good work ethic. In order to minimize the risks and costs of manufactured spending you must be detail oriented, and willing to do The necessary tasks in order to achieve your goals.

I had never been in a Walmart before starting to play the miles game. Now I go at least three times a month to load my trusty bluebird and GoBank cards.

I wouldn’t say I enjoy it, but it’s definitely worth it to me because of the added value that it brings to my life ( free travel.)

This is analogous to performing the mundane tasks required to execute a powerful financial plan.

For example filling out the paperwork required for a yearly backdoor Roth IRA contribution is not exactly enjoyable, but it will pay off in spades in the future. (Small pain, large gain.)

Step five: book your dream trip.

This is the culmination of all of your hard work.

Unsurprisingly it requires most of the above skills.

You must think outside of the box. (Free one ways, open jaws?)

You must be detail oriented.
(Performing your due diligence in order to know which flavor of miles will give you the most bang for the buck on this specific redemption.)

You must work hard.

(If the perfect award is not immediately available you must have the perseverance to check back day after day until the right award opens up.)

And most importantly you must know when to pull the trigger.

This is analogous to knowing when you’ve achieved financial independence. It’s a number that you should calculate before you even take your first step towards retirement. If you don’t know your destination before you leave, how will you recognize it when you’ve arrived?

I would even make the argument that if you have the skills to be a successful travel hacker, you also have the skills necessary to be financially independent within the next 15 years.

It’s just a question of motivation, hard work, and open-mindedness.

Do you think you have what it takes?

If you are hesitating, what if anything is holding you back from traveling the world for free, and retiring at a nice young age?

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