• Skip to primary navigation
  • Skip to main content
  • Skip to primary sidebar
  • Skip to footer

The Globetrotting Teacher

Experience the World Point by Point

  • Destinations
  • Miles and Points
    • Miles & Points Guides
    • Travel Hacking Basics
    • Student Course Log-In
  • Credit Cards
    • Travel Rewards Credit Cards
    • Airline Credit Cards
    • Hotel Credit Cards
    • Business Credit Cards
  • New York City
  • Travel Tips
    • Travel Resources
    • Travel Gear
  • About
    • Work With Us
    • Blogging Tools I Use

Updated on July 12, 2019 By Jackie Sills-Dellegrazie 22 Comments
This post contains affiliate links which earn a small commission at no extra cost to you. Please read my Disclosure and Privacy pages for more info. Additionally, The Globetrotting Teacher has partnered with CardRatings for our coverage of credit card products. The Globetrotting Teacher and CardRatings may receive a commission from card issuers.

coins budget

3 Ways Cash and Debit Cards Make Reaching Travel Goals a Challenge

Disclosure: This post contains affiliate links that earn a small commission at no extra cost to you. The Globetrotting Teacher has also partnered with CardRatings for our coverage of credit card products. The Globetrotting Teacher and CardRatings may receive a commission from card issuers. Please read my Disclosure to learn more.

Updated on July 12, 2019

This is going to sound melodramatic but whenever I see someone use cash or a debit card to pay for something, I instantly feel queasy and panicked. I go between lamenting over the lost travel rewards and biting my cheek to stop an on-the-spot travel rewards consultation.

I warned you it was dramatic.

But, in all seriousness, my practical thoughts (usually) win out. Everyone likes to get the most from their money. No one would choose to spend more for the same exact thing they could get elsewhere for cheaper. Nor would someone throw away pennies on the dollar just for the sake of tossing money out.

My point is people are or at least try to be sensible with their money.

Well, if you’re one of these people and you’re someone who wants to travel more, I’m here to tell you your cash and debit card habits make reaching your travel goals even harder. If you’re a responsible spender and pay your bills on time, you can absolutely get more travel rewards from your money.

So, put your cash and your debit card back in your wallet and get yourself on a path to smarter spending combined with earning travel rewards.

3 Ways Cash & Debit Cards Make Reaching Travel Goals a Challenge | Frequent Flyer Miles | Credit Cards
Pin this post to your Pinterest travel board!

3 Ways Cash and Debit Cards Make Reaching
Travel Goals a Challenge

1. Paying with cash or a debit card does not build any credit history.

Credit Score Stock
Building a solid credit score makes you eligible for potential travel rewards down the road. Photo by LendingMemo

Your credit score is determined by many factors like paying your bills on time, the age of your credit accounts, and how much of your available credit is actually in use. Your credit score is not at all connected to the amount of money in your checking or savings accounts. It has nothing to do with how much money you make or if you’re paid by cash or check.

When you use and pay off a credit card responsibly, you build trust with that bank. Also, it’s a signal to other banks that you’re a reliable person.

What does this have to do with your travel goals?

Credit Cards
You want to take advantage of travel rewards offered by credit cards. Photo by frankieleon

As you build your credit score, you’ll be eligible to apply for credit cards with lucrative travel rewards sign-up bonuses. The bonuses are usually valuable frequent flyer miles or hotel and credit card points. These can be used for earning free flights and hotel nights.

These credit cards also come with additional travel benefits like elite status at hotels, airport lounge memberships, primary insurance on car rentals, and/or a fixed travel credit to offset other travel expenses.

When you pay with cash or a debit card, there’s little if any record of your spending or repayment habits for banks to see. Most banks will want to see a credit score of at least 700 to get approved for the better travel rewards credit cards.

A thin credit history can mean a lower credit score which limits your ability to be approved for travel rewards credit cards.

2. You get no return value on the money leaving your wallet or bank account.

When you use cash or your debit card for your bills and everyday spending, the money simply leaves never to be heard from again. Heck, you don’t even get a goodbye or pat on the back for being so financially responsible!

Money Down the Drain
Paying in cash or with a debit card = money down the drain! Photo by Images_of_Money

Let’s be clear. I’m not talking about spending more than you’re able to spend and winding up in a black hole of debt. I’m referring to the money you already spend every day on everything from gas to groceries, cell phone costs to insurance, birthday gifts to movie tickets.

The key is to squeeze more from the money you already spend to get value back in return.

What does this have to do with your travel goals?

Whether you’re saving for a family vacation to the Caribbean, a romantic European escape, or an epic solo adventure in Southeast Asia, you’ll reach your travel goal faster when you make your money work harder for you.

paris, france Louvre
Is a visit to Paris one of your travel goals?

Use a travel rewards credit card to pay for everything from auto insurance to medical expenses, gym memberships to vet costs and earn miles and points you can redeem for travel later on.

Do you know how much your bills and expenses add up to over the course of 3 months?

If you’re like most people, that dollar amount is in the thousands. Why not use that money to meet a minimum spend and earn a travel rewards credit card sign-up bonus?

These bonuses are oftentimes already enough for at least 1 round-trip domestic flight! After you earn the bonus, continue to use the credit card for your regular bills and expenses to earn even more miles and points.

United Airplane
It’s only 25k for a domestic round trip flight on United. A United sign-up bonus could be 50k miles!

Even if you’re skeptical about the value of frequent flyer miles and hotel points, there are plenty of credit cards that offer cash back rewards you can use towards your travel goals.

The point is when you use cash or a debit card, you’re not earning anything in return. You’re sending your money off into the world while you stay at home still wondering how you’ll ever afford that pristine beach or iconic European city.

3. You miss out on added value with bonus categories.

To make matters worse, paying by cash or with a debit card does nothing to maximize your spending. On the other hand, travel rewards credit cards often have spending bonuses. You can earn 2x-5x more for every dollar you spend in specific categories like gas, dining, or drug stores.

What does this have to do with your travel goals?

Grocery Store Stock
You’re going to spend $$ on groceries. Why not maximize your travel rewards at the same time?

You can earn even more miles, points and cash back rewards when you maximize bonus categories and redeem for award travel even faster.

Let’s imagine you spend $100 on groceries every week.

When you pay cash or with a debit card, that $100 gets the food you bought and nothing else. Use a travel rewards credit card offering 5x the points on grocery store purchases and get the food you bought plus 500 miles or points for travel or cash-back rewards.

As a one-off, it may seem like a drop in the bucket, but over time, the value adds up.

You don’t have to pay your monthly expenses and save for travel separately. Use a travel rewards credit card for everything and you’ll simultaneously be showing your credit trustworthiness, earning miles, points or cash-back, and maximizing your spending for added value that can be redeemed for travel rewards.

coins budget
Travel coin jars are a fun way to save a little extra spending money. Earning miles and points for your everyday purchases is a lot more efficient!

It all makes sense but….

  • Won’t too many credit cards hurt my credit score?
  • I’m afraid using a credit card for all my spending will only land me in a load of debt.
  • Airline, hotel, and credit card miles and points are so confusing and overwhelming. They’re just not worth my time!

Start slowly and get yourself organized.

As with anything new, you want to organize and learn as much as you can. But, don’t let overwhelm, confusion and myths about travel rewards credit cards keep you from realizing your travel goals.

   Join the FREE 10-Day Get Organized for         Travel Hacking Challenge!

  • You’ll get 1 email a day for 10 days. Each email will have step-by-step information, free resources, and a completely doable 30 minutes or less action. You will be organized and on the path to reaching your travel goals with miles and points.
  • You’ll get invited to join my closed travel hacking Facebook Group. You can take part in beginner miles and points discussions and get your questions answered in a super supportive community. No impatient, high and mighty travel hackers to make you feel silly for asking such a basic question!
  • By the end of the Challenge, you’ll be organized and ready to take your first steps into the world of airline, hotel, and credit card miles and points.

*While some of the budget and organization tips are useful for everyone, the miles and points advice will apply to readers in the U.S.

Like this post? Please share it on social media using the share buttons below!

3 Ways Cash and Debit Cards make reaching your travel goals a challenge
Save this guide for later! Pin it.

Other Posts You're Sure to Love

  • Which Travel Rewards Credit Cards to Look at Right Now (February 2021)Which Travel Rewards Credit Cards to Look at Right Now (February 2021)
  • 15 Mistakes You Don’t Want to Make as a Points and Miles Beginner15 Mistakes You Don’t Want to Make as a Points and Miles Beginner
  • United Basic Economy: How to Overcome It (and Even Benefit!)United Basic Economy: How to Overcome It (and Even Benefit!)
  • How to Get to South Africa with Points and MilesHow to Get to South Africa with Points and Miles
  • 231shares
  • Facebook7
  • Twitter2
  • Pinterest222
  • LinkedIn0
  • Reddit0
  • Flipboard

Filed Under: Miles and Points Tagged With: miles, points, travel hacking

Affiliate Disclosure

The Globetrotting Teacher is a participant in the Amazon Services LLC Associates Program. As an Amazon Associate I earn from qualifying purchases.

Additionally, The Globetrotting Teacher has partnered with CardRatings for our coverage of credit card products. The Globetrotting Teacher and CardRatings may receive a commission from card issuers.

Comments & responses below are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser’s responsibility to ensure all posts and/or questions are answered.

Reader Interactions

Comments

  1. Tamara Elliott says

    February 18, 2017 at 2:48 pm

    Haha so true! I bust out my credit card at every opportunity, even if I”m only buying a couple dollars worth of stuff. It all adds up!

    Reply
    • Jackie Sills-Dellegrazie says

      February 19, 2017 at 7:20 pm

      A girl after my own heart, Tamara! 😉

  2. Kavey at Kavey Eats says

    February 19, 2017 at 2:54 am

    For us, I think it’s a balancing act. We use credit cards a fair bit, partly in order to maximise rewards, and partly because they confer a protection that debit cards do not – there are various legal obligations on the bank to cover the amount should the merchant prove to be fraudulent, or the goods don’t arrive, or are faulty. We do have some cards that reward us in travel miles, but we have some others that give a supermarket cash back service – where the value of cashback is higher than the nominal value of the reward miles, we’ll use those cards over the travel reward ones. But we do also make sure to keep out eyes open for the special offers that new cards sometimes offer, as you mentioned, and where we can earn a great benefit, and there are no charges on the card to balance that gain away, we’ll apply for that new card. Your tip for younger travellers about building up their credit rating is a good one, not one I’ve seen mentioned before.

    Reply
    • Jackie Sills-Dellegrazie says

      February 19, 2017 at 7:19 pm

      It sounds like you have a plan that works for you, Kavey, which is key to being comfortable with credit cards. Keep in mind the value of frequent flyer miles varies depending on the loyalty program and the type of redemption you use them for.

  3. Jenna says

    February 19, 2017 at 4:26 am

    I completely agree with you! Using cards that earn you travel bonuses is so helpful in saving for trips. We are big fans of getting those sign up bonuses too 🙂 We do need to work on the category bonuses though–I always seem to forget about checking that! Thanks for the great tips!

    Reply
    • Jackie Sills-Dellegrazie says

      February 19, 2017 at 7:15 pm

      One tip for remembering, Jenna, is to only keep certain credit cards in your wallet to take advantage of time-sensitive bonuses, like those with Chase Freedom.

  4. Nat Deduck says

    February 19, 2017 at 4:27 am

    Travel hacking seems to become more and more popular! We still have so much to learn about it! :O Thanks for your tips!

    Reply
    • Jackie Sills-Dellegrazie says

      February 19, 2017 at 7:14 pm

      Keep learning, Nat! There are so many advantages to gain.

  5. Nancy says

    February 19, 2017 at 12:17 pm

    Great article, using reward cards are the way to go. There are so many bonus that people are not aware of which you brought up. We have a few different airline cards just for that reason. We have been upgraded to Pre TSA check-in which is worth the yearly fees in itself. But also the free upgrades when you reach a certain mileage limit is huge. We almost hate to cash in our points because the other perks are so good.

    Reply
    • Jackie Sills-Dellegrazie says

      February 19, 2017 at 7:07 pm

      Thanks, Nancy. That’s exactly it. So many people don’t realize the travel rewards out there. Glad you’ve been able to score some great perks!

  6. Annie says

    February 19, 2017 at 5:45 pm

    I recently met a couple in Belize who paid $15 dollars total for 3 nights stay in a resort, plus airfare! When I asked them how, they said it had everything to do with using their credit cards wisely and collecting rewards. This was really interesting to read, and now I have a better idea on how to go about it, thanks!

    Reply
    • Jackie Sills-Dellegrazie says

      February 19, 2017 at 7:05 pm

      That’s a perfect example, Annie, of the travel rewards that are out there. Glad the read was helpful.

  7. Julie says

    February 19, 2017 at 7:16 pm

    I booked two flights today using points and they are amazing and such a great value. I can’t speak highly enough about how much my credit card hacking has allowed me to take great vacations and venture to further flung destinations than I would have otherwise.

    Reply
    • Jackie Sills-Dellegrazie says

      February 19, 2017 at 7:26 pm

      I’m so excited for you, Julie! It’s such a rush to book award travel. Well-done and happy travels!

  8. Chrysoula says

    February 20, 2017 at 5:10 am

    I totally agree with you I always try to use my credit card when I can earn travel points and I am always on the look out for any bonuses offered.

    Reply
    • Jackie Sills-Dellegrazie says

      February 20, 2017 at 9:19 am

      That’s really all it takes, Chrysoula. Once your aware of how to make your money work for you, the more rewards you’ll earn.

  9. Mansoureh says

    February 20, 2017 at 6:29 pm

    I usually send everything by debit card, but once when I wanted to rent a car for a road trip. I couldn’t because the company accepted only credit card not a deposit. I was so ready for the trip but due to lack of credit card I cancelled my trip 🙁 The week after I applied for a credit card and since then I try to use it on;y to build up some score

    Reply
    • Jackie Sills-Dellegrazie says

      February 21, 2017 at 11:13 am

      Not surprising, Mansoureh. Most car rental companies don’t accept debit because there isn’t enough of a guarantee you will cover damages. Keep building that credit score. It’ll make a big difference in the long run.

  10. Anita Hendrieka says

    February 21, 2017 at 6:38 am

    Really great tips here! I only started using credit cards to book trips about a year ago and love the airpoints I collect. I just wish NZ had better reward programmes!

    Reply
    • Jackie Sills-Dellegrazie says

      February 21, 2017 at 11:08 am

      Thanks, Anita! Every last airpoint helps! Keep earning. 🙂

  11. Eric || The Bucket List Project says

    February 27, 2017 at 4:21 pm

    I want to say that I love your blog and usually love your posts but with this one, I have to DISAGREE with everything you posted here!

    lets start with #1: My Credit score is over 750 and I haven’t owned a credit card in over 10 years! I also paid off all student debts over 8 years ago. I just have a mortgage and regular utilities & cell bill that is it!

    As for your justification of using your card to earn points? Maybe but the ROI on points vs dollars spent is ridiculous. I guarantee I fly tons cheaper and far more than 75% of americans with credit cards by just using good research platforms than trying to redeem credit while amassing debts.

    Cash is still king! I have been blessed to meet 5 millionaires and none of them had credit cards and they all said that was the 1st thing they got rid of on their roads to individual success!

    I appreciate what you posted. I guess if you are going to follow along on the typical credit debt lifestyle that many americans live by, then you might as well get something out of it. But I did that dance and to live hand to mouth with the slight good feeling of once a year redeeming points for a small trip on southwest that would have costed $180 round trip seems hardly a good ROI for the $850 in interest you amassed over the year.

    For those who are playing the travel hacking game, fine. If you will spend the time and research to play it properly and get your ROI then awesome. But most people don’t or wont therefore in my humble opinion to promote it to the random 9-5 people with hopes of free travel whenever they want seems a bit irresponsible.

    Reply
    • Jackie Sills-Dellegrazie says

      February 27, 2017 at 11:49 pm

      Hey Eric,
      Thanks so much for reading and sharing your opinion. It really adds to the value of this post. I agree with you about amassing debt. Anyone who can’t spend responsibly or who can’t pay off their credit card balances in full at the end of every month should absolutely stick with cash or no/lower interest credit cards. The interest costs will outweigh the value of the miles and points earned over time.

      Where I have to disagree is the ROI. Certainly, travel hackers who play the game (me) get a ton of value. I have not paid for a flight in years and have visited everything from popular European destinations to far-flung Patagonia. Yes, I am maximizing stopovers and open-jaws and squeezing every last bit of value from my miles and points. I am not a luxury traveler, but there’s no way I could have taken the trips I have taken solely on what I make.

      But, even those people who work a typical 9-5 and only travel 1-2x a year can benefit from a travel rewards card. Not everyone can pay their bills and save for travel simultaneously. They have to make their money work harder for them. So why not get some value back from the money spent on everyday costs like groceries and gas, even if the choice is to have a cashback rewards card. Consider using 1 debit card for what you would normally spend vs. 1 travel rewards card that is paid off every month. Sure, you might not cover RT airfare for your family of 4 but if 2 of the 4 can fly on miles, that makes a big difference in the bottom line. In a lot of cases, it means taking the trip or not. The same spending on a debit card yields no value back unless, of course, you’re financially able to set additional money aside to plan and pay for your travels.

      I hope you’ll continue to read the blog and offer your views. They’re insightful for everyone who reads. 🙂

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Primary Sidebar

About Me

Hi, I'm Jackie, the Globetrotting Teacher. Travel has been life-changing for me whether I'm traveling solo or with my favorite travel partner, Peter my husband! Learn more about my travels and how I use miles and points to travel around the globe. About Me

  • Facebook
  • Instagram
  • Pinterest
  • RSS
  • Twitter

Planning a Road Trip in 2021?

planning-a-road-trip

Search the Site

Get Started with Points and Miles!

12-must-have-gifts-sidebar

American Express Gold Card

Earn 60k Membership Rewards points after spending $4,000 in 6 months!
Earn 4x at U.S. Supermarkets  (up to $25k each year)
Earn 4x at Restaurants Globally
Earn 3x on Flights (booked directly or through Amex Travel)
1 $10 statement credit each month on Food Delivery services like Seamless & GrubHub

This is an excellent offer(!)
for anyone wanting to earn travel rewards points from their everyday spending!

Learn more about the
Gold Card!

Footer

Disclosure

As an Amazon Associate, The Globetrotting Teacher earns from qualifying purchases.

The Globetrotting Teacher has partnered with CardRatings for our coverage of credit card products. The Globetrotting Teacher and CardRatings may receive a commission from card issuers.

[Disclosure]

[Privacy Policy]

Copyright

All photos & content are copyrighted & belong to Jackie Sills-Dellegrazie at The Globetrotting Teacher unless otherwise cited and may not be reproduced or used elsewhere without permission. DMCA.com Protection Status
  • Facebook
  • Instagram
  • Twitter
  • Pinterest

Like every website with social media buttons, commenting, affiliates, and analytics embedded, The Globetrotting Teacher uses cookies. Please click ok to accept and/or visit my Privacy Policy to learn more. OK Privacy Policy
Privacy & Cookies Policy

Privacy Overview

This website uses cookies to improve your experience while you navigate through the website. Out of these cookies, the cookies that are categorized as necessary are stored on your browser as they are essential for the working of basic functionalities of the website. We also use third-party cookies that help us analyze and understand how you use this website. These cookies will be stored in your browser only with your consent. You also have the option to opt-out of these cookies. But opting out of some of these cookies may have an effect on your browsing experience.
Necessary
Always Enabled

Necessary cookies are absolutely essential for the website to function properly. This category only includes cookies that ensures basic functionalities and security features of the website. These cookies do not store any personal information.

Non-necessary

Any cookies that may not be particularly necessary for the website to function and is used specifically to collect user personal data via analytics, ads, other embedded contents are termed as non-necessary cookies. It is mandatory to procure user consent prior to running these cookies on your website.

SAVE & ACCEPT