Air Travel Tips: Book Flights without Breaking the Bank

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[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.

Air travel tips for calculating out the value of frequent flier miles and other smart ways to save.

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:

Calculate the Cost of Paying Off Your Tickets

Credit Card Information

*Current Balance:

*APR (annual percentage rate):

Payment Option #1: Minimum Payment Only

This option estimates how long it will take to pay off your credit card balance if you plan to make the minimum monthly payments only:

Minimum monthly payment calculation:

Based on the information provided, your first minimum monthly payment is $0.00. Note your minimum payment decreases as you pay down your credit card balance.

Payment Option #2: Minimum Payment Plus

This option estimates how long it takes to pay off your credit card if you commit to paying a set amount in addition to the minimum payment. With this option you commit to paying the minimum monthly payment due plus a set amount extra each month.

For example: minimum payment + twenty dollars

Additional monthly payment:

First minimum monthly payment:

Total first monthly payment:

Payment Option #3: Fixed Payment

This option estimates how long it takes to pay off the credit card balance if you commit to paying a fixed amount each month. This means you set the amount you pay and do not change the amount as you pay your bill down.

For example: pay $300 each month

*Your fixed payment must be greater than or equal to your first minimum monthly payment.*

*Fixed monthly payment:

Note: Federal regulations require credit card issuers to disclose on your credit card statement how long it will take to pay off your estimated balance if you make minimum monthly payments. Estimates may be rounded up to the next $100. This debt calculator uses your actual credit card balance, so the results may vary from the estimate shown in your credit card statement.

Tip No 5: Flexibility equals cost savings on air travel

If you are married to the idea of taking a specific airline on a set date and time, you’re probably going to pay for it. The more flexibility that you can have about taking alternate airlines, landing at an alternate airport, or catching a red-eye in the middle of the week will ensure you get your tickets for as little as possible.

This also means that you need to look around before you book your tickets. Don’t just check the first booking website that you remember. Check a few and also check:

Websites for specific airlines (sometimes they have on-site only exclusive offers)
The website of major and alternate airports in your area (you’re looking for discount airlines)
Both aggregator and consolidator booking sites.

The difference between the two is that aggregators just list available flights; consolidators have special relationships for selling at bigger discounts. Aggregator websites tend to be better for booking flights far in advance. Consolidator websites are better if your departure date is closer, because the airline is trying to fill empty seats.

Tip No. 6: If you’re not flexible, then you should book accordingly

Look, if you are the kind of person that’s loyal to a certain airline and you don’t want to leave at 6AM on a Tuesday, that’s okay. You can still take steps to avoiding being Pound Foolish when booking air travel.

If you love a specific airline, consider a co-branded travel credit card instead of a general card. They offer special exclusives, like free checked bags and priority seating. These are limited because they’re airline specific, but if you’re completely loyal to that brand then it won’t matter.

If you can’t break from traveling at peak times, then book your tickets as early as possible. Not a few weeks before or even a month before… plan ahead! Earlier booking will ensure you get the seats you want even at peak travel times, plus they’ll be cheaper.

For more tips on how to save money on travel expenses, download Consolidated Credit’s free budgeting guide:

Vacation Budgeting Guide

Everyone needs a break now and then. But when your vacation leaves you with a stack of bills you can’t pay, it’s hardly relaxing! Next time plan a vacation that will leave you with good memories instead of debt. This guide gives you our roadmap to plan a vacation that won’t break the budget.

Open Booklet

Download Booklet

If you need help paying off travel debt because you’re still paying off your last vacation, talk to a certified credit counselor to craft a customized debt elimination plan.

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