Why Travel Hacking Isn’t “Stupid Credit Card Tricks” for Poor People
Ariana Arghandewal January 08, 2019
The other day, I came across a tweet by Dave Ramsey, self-professed “America’s trusted voice on money.” I don’t know about you all, but this is the first time I’ve heard of him. Anyway, he tweeted something about miles and credit cards that’s pretty typical of those who haven’t mastered the art of travel hacking:
I never met a millionaire who said, “I made all my money with airline miles.”
Rich people don’t fall for stupid credit card tricks.— Dave Ramsey (@DaveRamsey) December 28, 2018
“I never met a millionaire who said, ‘I made all my money with airline miles.’”
My first reaction was, “What a random thought.” Perhaps he’d watched an episode of Adam Ruins airline miles and felt the need to share his thoughts on the theory that frequent flier miles are a scam. Motive aside, Dave Ramsey has clearly never heard of The Points Guy, Million Mile Secrets, or the dozen other blogs that not only rake in over seven figures in affiliate revenue, but employ dozens of writers, editors, videographers, and social media coordinators, to name a few. So to rebuff Dave Ramsey’s assertion:
Credit card millionaires are like aliens. You may not have met one before, but that doesn’t mean they don’t exist. ;)
Take me for example. I’m not going to be on the cover of Forbes any time soon, but for several years I used manufactured spending to not only earn tons of frequent flier miles, but cash back too. I was able to earn tens of thousands of dollars through a 5% cash back hack, among other methods, to not only pay off my student loans but also create a rainy day fund. So no, I have not “made all my money with airline miles” (whatever that means), but I have made money earning them,
“Rich people don’t fall for stupid credit card tricks”
I’m not sure what a “stupid credit card trick” is. Is it using a large sign-up bonus to book thousands of dollars worth of premium travel? Somehow I doubt that, but it was definitely the most baffling part of that tweet and one I’d like more context for. It simply doesn’t make sense.
Credit cards are pretty straightforward: If you don’t pay them off on time, you incur massive interest charges. Is that supposed to be the “trick” part? And is that why “rich people” are willing to pay a $7500 credit card “initiation fee”? I get it, the wealthy generally have their financial house in order and we can learn a thing or two from them. But to assert that they don’t use credit cards, or that they’re always doing so responsibly is absurd. And if Ramsey isn’t referring to credit card use, then I’d really like to know what “tricks” he’s referring to that the rest of us are falling for.
This isn’t to say credit cards aren’t harmful. Millions of people are in debt because of irresponsible use. But that goes for everything: Millions of Americans are sick and overweight because of poor food choices. And let’s face it, there are plenty of tricks in the food industry causing this health epidemic. But I digress.
My point is, Ramsey’s tweet was vague and baseless. Airline miles and credit cards aren’t “tricks” or “stupid”. Nor are they exclusively used by “poor” people who don’t have their financial house in order. Like anything, they can be abused and wasted by irresponsible people. But to write them off completely is absurd.
What are your thoughts on Dave Ramsey’s tweet?
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Ridiculing Dave Ramsey without doing your due diligence is just as bad as DR putting out a blanket tweet. I've read his book and listened to his show. Ramsey's sound financial advice has helped many people get out of debt. For those of us who can manage our credit cards without falling into the ditch of debt, his advice doesn't apply.
If someone tells the public that travel hacks are a waste of time, the most you do is to nod and to move on. What you definitely don't do is to argue against his position! People who do would probably also shoot themselves into their feet just to prove a point... HTB.
Rich people don't bother with Dave Ramsey's BS either
Dave Ramsey has been spouting that line, “I never met a millionaire who said, ‘I made all my money with airline miles.’” FOR YEARS. Literally. BTW, the context is: becoming a millionaire, which is what he is. No jealousy here. But, beating a cheap throwaway line like that is about judging, not intellectual debate with details why travel rewards can be helpful. The best thing DR ever did was not write a NYT best seller. The best idea he has had is addressing one's debt with the "snowball" payment plan for those who are, even though it's not perfect, either. But, it is effective for the determined. He does live in a simplified universe as ML posted earlier. Cornbread radio and debt is dumb...over and over AND over. There will always be those that praise him. I remember distinctly him raising his voice against a caller who sincerely wanted to work toward addressing her debt and low income ways, but because her situation did not match the template he expected as he questioned her, he got rid of her off the air, launching into a tirade. I doubt his sincerity, frankly. He also brags about his tithing. The Bible says that when giving, don't let your right hand know what your left hand IS doing. There are pastors who don't believe that borrowing is particularly wrong. Not paying your bills is wrong. As far as his judgement, well, think about the plank in the eye.
@brianguy - Dave Ramsey DOES NOT think investing is a foreign concept. He HIGHLY recommends, once all your consumer debt is paid off, investing a minimum of 15% of your gross income in a well-balanced investment portfolio. It's obvious you've never read Dave Ramsey's books or listened to his show for more than 5 minutes. @jsintexas - So, you reported gross expenses to your employer for reimbursement but received "cash back" from your credit card issuer for all the purchases you were being reimbursed for... How is that not stealing? No wonder companies are beginning to require employees use company sponsored credit cards for all reimbursable expenses... @Majuki - Very well said. To All - When the average airline loyalty mile is worth a whopping 1.3 cents, it takes almost $80 million in spending to amass $1 million worth of miles (at a $1 to 1 mile rate). For 99.99% of us, wealth can only be secured through hard work, saving/investing and staying out of debt.