As many of you guys know, I’ve been backpacking for several months now. In that time I’ve been able to hone my travel hacking skills to a good degree. Looking back it’s actually surprising to me how much money I did manage to spend, but hey, I’m older and wiser now. And of course there were many cases in which staying for free was not available.
To my knowledge no one has ever written a post about this technique before. I think that’s because the type of people to use this sort of thing are less budget travelers than me. They’d use the technique as a coupon, not as a way to travel for free or even profit.
Aaaaaargh, you’re asking! What is it already?
It’s called cashback, baby.
The technique is fairly simple, and doesn’t involve much more than what you do already to book hotels, guesthouses, hostels, or the like.
There are sites on the web that are called cashback sites. They want you to go to their site, and click through to make a purchase. You get a certain amount of your purchase back, and the cashback website takes a small commission. I honestly am not sure how they make money with this, but I guess the idea is that the sites are enticing you to buy something with them maybe you wouldn’t have without the cashback. Kind of like offering a coupon, except the discount isn’t immediate.
Now the amount you get back is typically very small, to the order of 2%, 3%, 5%, 7%. Sometimes you’ll get lucky and score something like 10 or even 20 percent back. But this isn’t a lot when you’re staying at hostels or cheap guesthouses (still better than nothing though).
I realized after some research there was a hack to this. SOME merchants offer a flat dollar amount back rather than a percentage. So far on my trip this has ranged from $6 – $14 back. I wonder if you can see the implications of this?
I thought, welllllllllll, the places I tend to stay are really cheap. Why don’t I apply this and see what happens? Voila, free stays, or even a profit!
Now there are some caveats to this, and you need to read carefully when booking. Many of these sites say that you can only get the cashback once per stay, not per night. What’s a stay? It’s a set of one or more nights in a row that you stay at a hotel. So even if you book nights separately, trying to get the cashback, it won’t work. This meant that in the beginning of my trip, I’d book hostels one night at a time nearby each other, and then keep moving. It was worth it for me to get the $14 cashback/night that only one site was offering. That doesn’t work for everyone obviously. You also could just book every other night on the same website, or alternate websites. It’s what the WEBSITE thinks is a booking, not the hotel.
HOWEVER, I’m currently using a site with no restrictions whatsoever. I can book every night separately and there’s no problem. I’m not going to list it publicly but you can message me if you want the one I’m using now. In the .00000000000001 % chance this page is read or scraped or something, I don’t want the merchants to change their policy.
Sooooo, maybe you’re thinking, a few smackers doesn’t amount to too much. It’s not even worth the bother. I admit, this hack becomes more awesome when travelling on a backpacker budget (ie, as cheap as possible) but it’s still awesome because you can use it anytime, anywhere (ok, well, maybe not Mars or Antartica. The last time I checked, anyway).
Here’s some stats from my trip in India so far, 18 nights booked.
Hotels/guesthouses cost (including ones where I was lazy and just booked something on the spot rather than at CB site)
$75.68 + 15,000 IHG points (I stayed in a Holiday Inn on points my first day in Delhi)
Amount I will receive in cashback: $89
Um, yes, you read that right. I will actually be PROFITING from my accomodations. That’s crazy!
There are many countries that have cheap places like India (hostel/cheap guesthouse range: $3-8/night). Nepal (cheapest booked: $2.71), Thailand ($2.22), Hungary ($5.00), Kyrgyzstan ($8), China ($4.50). Heck, I found cashback hotels between $10-20 in Japan for Chrissakes (note: if you are going to Hokkaido, which you should, and specifically to Furano, which you should, please please PLEASE stay at Log Yukari – yes that’s the name. It’s eccentric, awesome, less than $12 a night to stay in these strange DIY log cabins in the middle of a pine forest, and eligible for cashback).
Food in many places is cheap. I’m looking at you, Southeast Asia, China, and Eastern Europe. Your cashback can easily get you a couple of meals if you get a good deal.
Finding cashback sites
There is a great little site called cashbackholic.com. You navigate to the site, enter what site you’d like to buy from (booking.com, hotels.com, etc) and it tells you which cashback site is offering the most back. Make sure you scroll down all the way through the list, as the ones with flat dollar amount are usually at the bottom.
Some merchants that consistently have good, flat dollar amount cashback offers are booking.com, venere.com, and agoda.com. I prefer the latter two since there is more chance you can use a credit card to pay directly instead of having to use cash at the hotel.
Which brings me to my next subject
If you’re a real hacker, you want extra bang for your buck. So I started to wonder at some point, how can I max this out? Simple- book through a site that lets you pay for the hotel immediately, and use a cashback card.
Even people with low credit or just starting out with credit (I apparently qualify for this, because when I got started again the lenders all said they couldn’t approve me for lack of credit history) can qualify for a cashback card these days. I’m currently using Capital One Journey most of the time, as it’s a student card available for those building history. You get a flat 1% back, 1.25% if you pay in full each month. They are pretty generous with limits and approvals. The Quicksilver is a better card if you qualify, as it offers a flat 1.5% back, and also isn’t super hard to get approved for.
Another good, easy to get approved for option is DiscoverIt. I have the student version of this as well. The limit isn’t super high, but in addition to 1% cashback on everything, you also get rotating categories where you get 5%. There also is (was?) an offer to double all the cashback the first year. So, essentially 2% or more.
Finally Chase Freedom is a very similar product to the DiscoverIt, with flat cashback and 5% categories. It has the additional advantage of getting points back instead of cashback, which you can redeem for even more value. I haven’t been able to get approved though. For me they say they want a longer history, but I’ve read accounts of people getting approved just a couple months after getting a secured card. Your mileage may vary 🙂
Still starting out, and don’t even have this available? Apply for a Discover checking account, and use your debit card for the first 100 debit transactions (or billpay for that matter) each month. If you don’t have a Discover credit card, you can apply by depositing $5000 into a savings account and then applying. The money can be withdrawn the next day.
Caveats with cashback
So there is an issue with the cashback sites, and that is that most of them take a long time to pay back. As in, I just got paid a month ago for stays in April through one site, and some of them STILL haven’t posted. Again, the cashback site I’m using currently (msg me 😉 starts tracking within a day. I just got my first check mailed (hi mom, can you deposit it when it arrives?) and then after that you can deposit electronically with paypal, you won’t need to worry when abroad. So a pretty solid bet for $7-10 back per night. This does, mean, however you will have to float some money for a while. Buuuut, you were going to pay for a hotel/hostel/tepee/spacepod anyway, right? Seems like a no brainer to me.
Aiiight yo, I’m out. Heading to Tushita (I couldn’t hack a meditation retreat unfortunately, but it’s still awesome, and cheap too!) See ya on the other side of enlightenment (haha)