NerdWallet's Smart Money Podcast - How to Save Money on Holiday Travel Without Using Any Points

Starting point is 00:00:00 Over the river and through the woods to grandmother's house we go. And if you don't want that to break the bank, have we got an episode for you and grandma. Today, tips and tricks for saving money on holiday travel booking. Because changing and canceling flights for most airlines is a lot easier now than it used to be and there aren't as many change and cancellation fees, that actually is a pretty good strategy. Welcome to NerdWallet's Smart Money Podcast. I'm Sean Piles. And I'm Megan Coyle.

Starting point is 00:00:36 And this is episode two of our nerdy deep dive into holiday travel and the costs therein. And Megan, I know you and I are both in the camp of avoiding holiday travel, if at all possible. As much as we love our families, sometimes the hassle of getting to them just isn't worth a wing and a leg of, you know, turkey. Yeah, I heard what you did there, Sean. As we know, plenty of people do brave the crowds and the lines and the delays to see their loved ones over the holidays. So we are here to help smooth that process as best we can, especially when it comes to what you're spending on that travel. The holidays are infamous for higher prices, especially on airfares, and there are definitely ways to save money if you're willing to be a little flexible.

Starting point is 00:01:16 And when you know some of the secrets to booking ahead of time. Ooh, I love secrets, and we're going to share lots of them today. So, listener, perk up your ears like you're listening for sleigh bells in the distance, we're going to drop a lot of insider knowledge on you today it's our holiday gift to you that's right wrapped up all pretty and nice we want to hear what you think too listeners to share your ideas and experiences around holiday travel with us the good the bad and the insanity leave us a voicemail or text the nerd hotline at 901-730-6373. That's 901-730-NERD or email a voice memo to podcast at nerdwallet.com. So Megan, who are we hearing from today? Today, our guest is our nerdy colleague, Sam Chemis, and we're going to explore all the ways you can save yourself some cash when you're booking holiday travel. And you don't necessarily

Starting point is 00:02:02 need to redeem your points to do it. That's coming up in a moment. Stay with us. Hey, Sam, so great to have you back on the show. It's so great to be here. What are your travel plans for the holidays? They're not the most exciting, but I'm going to go home to Montana, where I'm from, with my kids to see family. Oh, that sounds really sweet. Is it going to be cold there or? Oh yeah, it's always cold. I always go for the cold snap. It's always like gets into the

Starting point is 00:02:35 negative temperatures while we're there. Oh my goodness. I don't know if I could handle that. What are some strategies you are using to save money on your holiday travel this year? This is always the question. And I wish I had that silver bullet where I'm like, here's the one weird trick to saving money on holiday travel. But the truth is, it's hard to do. But I do have a few tricks up my sleeve.

Starting point is 00:02:56 So one of them is using companion fares. My partner and I both have the Alaska companion fare, which is great because we have two kids. And it lets us book a second ticket for just a little over $100, no matter how much the first ticket costs. Because you're spending the same amount on that second ticket no matter what, the more expensive your first ticket is, the more value you're getting from it. Holiday travel tends to be pretty expensive. So I usually save that companion fare for the holiday so I can kind of maximize that difference between the $100 and whatever I end up paying for the actual fare. So it's kind of like you're almost using your companion fare as a kid discount,

Starting point is 00:03:36 a child discount on your airfare for the holidays. I wish my oldest was still young enough that I could put her on my lap. That's the real discount for the holidays. In a pinch, I use companion fares. And there's, you know, Alaska has a great one, but there's also one from Delta. There's also Southwest has its sort of famous one. There's some companion fare options out there. And tell us how Alaska's companion fare works. I believe you get that through a credit card. Is that right? Yes, you get it through its co-branded credit credit card and you get one of them to use every year. Is this an annual tradition of yours to use the companion fare on the holidays?

Starting point is 00:04:12 Yeah, I guess it is becoming one as my kids get older. It used to be I would try to just book the most ludicrous flight that would still qualify with stopovers and multi-cities and going to Costa Rica and whatever I could do. But for one thing, Alaska has sort of changed the terms of it. So it's not so easy to do that. And now, yeah, I'm not as excited. And my most expensive trip is usually home for the holidays. Makes sense. Yeah. And I know some of the other companion fares have different terms and things like that. But Southwest Companion Pass lets you get flights for a discount for the entire year. So the holidays are also a great time to use that for a really high value.

Starting point is 00:04:52 Just no blackout dates on those as far as I know. That's what we're looking for for holiday travel because the travel companies know that these are such high demand times. You have to be really careful with the deals. Let's talk about when you book your holiday travel. Have you done that already? I have not. I have learned from covering this beat for so long that it's actually usually better to wait until the fall to book and maybe even a little later in the fall. So that's easy for me because I'm a procrastinator, but I know there are a lot of people who want to book as early as possible. But the data show that booking months in advance doesn't actually save you money. One piece of data I got from Google Flights that they shared with me showed that the lowest prices for the holidays usually happen between 80 and 20 days

Starting point is 00:05:39 before departure. So about one to two months before departure and that's true for both thanksgiving and the december holidays if i'm booking for christmas that will put it somewhere in october likely that i'm booking that's a rule of thumb but every year is different it could be that if you wait until that 20-day cutoff that prices will actually go up or that may be when prices are actually lowest just like anything that revolves around supply and demand, there's no way to really play the market. Booking way in advance is usually not a great idea. Okay, that makes me feel a lot better because I haven't even started thinking about it yet.

Starting point is 00:06:15 I know. It's like 95 degrees here. It's hard to imagine. I know we're talking a bit early about holiday plans. And one thing I wanted to float out there is that you could book something now and lock in a lower rate. And then you might be able to rebook it or change it or cancel it if something happens, your travel plans change, or even the price goes down. Can you talk a little bit about that and why that might be a good option for the holiday travel. Yeah, because changing and canceling flights for most airlines is a lot easier now than it used to be. And there aren't as many change and cancellation fees. That actually is a pretty good strategy that if you're just one of those people that doesn't want to wait and you see a decent price right now,

Starting point is 00:07:00 you can always book it now. And like you you said either change the ticket when you see a better price and you might get a refund on that difference or just cancel your ticket outright and rebook the lower price so that's not a bad idea you want to be a little careful though to make sure that you're actually booking refundable flight and that doesn't mean a fully refundable fare but usually basic economy flights and flights with budget airlines like Spirit and Frontier do not have full cancelability. They don't offer a full refund, especially those basic economy tickets. You want to watch out booking those probably won't be able to get your money back. The same thing applies for hotels. Hotels

Starting point is 00:07:42 are usually a lot easier. They're usually much more flexible in terms of letting you rebook and even cancel last minute. You can always book some hotel rooms in advance as long as you're checking that fine print and making sure that you can cancel it later. Something I used to do in college as well was I would take advantage of same day changes and like standby to help save a bit of money on holiday travel. I'll tell you how this worked. And then you can tell me if that was a good strategy or not to use. Yeah, I want to hear about this. I went to school out of state, so I had to fly home for the holidays. The cheapest flights were usually these like super early morning, you know, like 6am flights, or maybe they would have some stops, or I would take the red eye. And I mean,

Starting point is 00:08:28 these were just awful flights I was booking. But if you look into some of the same day change policies and standby policies, you might actually be able to sometimes call your airline ahead of time, like the day before, or even look in the app and see if there was any availability on a better flight as long as your departure airport and your arrival airport didn't change and you were still taking off on the same calendar day you can save a lot of money by just taking any of those extra seats on a better timed flight something i would do is i would book maybe the earliest flight back on the Friday after Thanksgiving. And then I wouldn't actually get up at 6am after

Starting point is 00:09:11 eating tons of turkey the day before. I would just check on Thanksgiving and change it for sometimes for free if you have elite status or there's some type of policy that'll let you change for free. Or I would pay a pretty nominal fee like $75 and fly back at a much more normal time. What do you think about that strategy? That's not bad. And I've definitely done things like that. I think it's for sure a good college student strategy because it works as long as you're pretty flexible on what actually ends up happening. You can have this great plan and I'm going to change it to a better flight. And there may just not be better flights available. Or you could sort of go on standby that fills up and then you've got

Starting point is 00:09:59 to get over to your actual flight or onto another standby, you could kind of end up in this purgatory where you're not on any flight. Oh, I'm speaking in generalities because every airline is going to have different policies for this. Right. I love it. I love that kind of thing. I've done that with Red Eyes where I've booked a Red Eye that's way cheaper and then just said, oh, actually, could I just fly a normal flight? And it works out. Totally a possibility if you're willing to put in a little extra uncertainty work. That's a good call out. And probably wouldn't work if you have like multiple people traveling like your family.

Starting point is 00:10:33 So that would be make it a bit more difficult. Yeah, I think my kids would break up with me. So where should people look for deals, whether on hotels or airlines for holiday travel? Airline deals themselves can be tough for the holidays. You might see airlines promote different sales, but usually those have blackout dates that are actually around the holidays. And so unless you're willing to fly quite far off from the holiday itself, that's probably not going to apply. That said, it might be worth subscribing to some flight deal newsletters or social media accounts. You can find those on Instagram or TikTok and email newsletters are all over the place.

Starting point is 00:11:12 And every once in a while, those will have deals around the holidays, especially internationally, especially around Thanksgiving, because other places don't celebrate our Thanksgiving. You can find deals around then for sure. Hotels also might have some deals around the holidays, depending on how popular that particular property is around that particular holiday. So it's worth going to the hotel's website to see if they have any packages that might be a good deal. I know we talked about this earlier in the episode, your credit card can come in handy for saving cash on travel purchases. Yours was through a companion fare through your Alaska co-branded card. What are some other situations where you should maybe look at your credit card

Starting point is 00:11:52 and see how it can save you cash for holiday travel? There's a few options. One is using your credit card points. The most obvious way to do that is through the booking portal that the credit card has. So Chase Travel or Amex Travel, whatever it is, then you're basically using the points for a fixed value. So you're essentially buying cash tickets and using the points to pay for those cash tickets. If you've got a big pile of points and you want to use them up and you're going to book a flight anyway, that's not a bad way to do it.

Starting point is 00:12:22 But there is another way to do it, which is to transfer those credit card points to a partner airline, and then book award travel through the partner airline. For instance, you might transfer them to American Airlines, and then book using miles through American. So I say that's another option. We've looked into the data and have seen that those bookings don't usually offer a better cent per point value than booking at any other time, but they're also not much worse. If a flight is twice as expensive as it normally is around the holidays, it will probably be about twice as expensive using miles. So again, there's no free lunch here.

Starting point is 00:13:02 There's no way to game the system. But you might be able to find a little bit more value by transferring those credit card points to an airline and then booking through the airline. Okay. Yeah, that makes sense. And like you could also do half points, half cash in a lot of cases if you're booking through the portal, right? So that might be a way to save some cash as well. Yeah, it's all relative. Do we call our credit card points cash? Are they our own thing? What is it? Now we're getting super nerdy. Are they cash? Sometimes also your credit card might have cash back offers on certain hotels or other travel opportunities. Chase offers or Amex offers might give you 10% back on a statement credit.

Starting point is 00:13:44 So you could add that offer to your travel card before you book. Some travel credit cards offer statement credits on travel purchases, either booked through the issuer's travel portal or booked directly with a certain airline or hotel. That's a way to offset both the airline cost and the hotel cost. Okay, now let's make it a little bit spicy. Let's say you don't have to go home for the holidays. You want to use that time off to go somewhere else. What are some good ways to save money on this type of holiday travel that's more like a vacation? One option is to go international.

Starting point is 00:14:17 Like I said, other countries aren't necessarily celebrating Thanksgiving. Some don't celebrate Christmas or the same holidays in December. It might be worth looking at some of those countries to see if there's some cheaper flight options. And then you can always check out Google Flights or Skyscanner search tools and put in the anywhere for the destination. Just be like, surprise me and just see what's cheap. I love that. You could end up literally anywhere for the holidays.

Starting point is 00:14:41 Any other tips for saving on holiday travel without using your points? I plug this all the time. I'm always promoting selling your family on doing Thanksgiving the week before or after actual Thanksgiving because... Oh yeah, I remember you wrote an article about this. I did and nobody ever cares and nobody ever bites, but I'm going to say it again. If you just convince your family to do it the week after, airfare will be like half as expensive. There'll be so much availability for vacation rentals, anything you need. And it still feels like the holiday. It doesn't really matter. As long as you all agree, you know, then you could extend that out to anything

Starting point is 00:15:20 and be like, is anything real? Is everything arbitrary? Is it all just in our minds? And with that, we'll leave everyone with a lot of existential questions. That's right. Well, Sam, I know it's a couple of months away, but I hope you have a great holiday season, or let's just say a great fall, autumn season. And thanks so much for helping us out today. My pleasure. As ever, I'm impressed by how far a little flexibility can go when it comes to saving money on travel. And I say that as someone who is totally inflexible with my travel plans and therefore will never

Starting point is 00:15:58 save money like you described doing in college, Megan. That might be another reason why traveling around the holidays is not my thing. I will say I did a lot of crazy things as a college student to save money. I remember going to these hour-long talks about the economy so I could get a free Chipotle burrito. And then it turned out it wasn't even a whole burrito. That tells you how much my time was worth back then. One hour equals half a Chipotle burrito. But back to holiday travel, flexibility is really the key to getting deals on travel at any time of the year. Yeah, this is really something that I've taken to heart, which is that if you're going to travel for the holidays, try to do it on the days

Starting point is 00:16:35 when other people don't. I mean, if you travel on the holiday itself, sure, you might miss out on some meal prep, and maybe some games in the backyard if it's not snowing where you are. But the hassles you'll avoid just might be worth it. Now, of course, that might not work if you have to deal with layovers or you're going, say, from the West Coast to the East Coast, and the time change makes it untenable. But if you don't have those factors, why not? I'm sure the captains and flight attendants would love to have your company on the actual holidays. Yes, and a hearty Happy Thanksgiving is always welcome when you have to work the holiday. And just think of the money and potential annoyances you're saving by traveling the day of.

Starting point is 00:17:12 If you can swing it, why not? All right, well, our series continues next week. Megan, what have you got in store for episode three? Well, Sean, I would venture a guess that the biggest worry people have about traveling for the holidays is probably a flight getting canceled, or maybe a road getting iced over so you can't get somewhere. But a close second would be your luggage. All your stuff, the stuff you'd need to look and feel great at your destination, not to mention the presents. You lose that and, well, sad face. We're going to have some tips and advice for getting your stuff from one place to another

Starting point is 00:17:45 without losing your mind or your money. Once you add on the cost of paying to have a carry-on bag on that basic economy ticket, you might as well just get an economy ticket and be able to be a little bit more flexible. I think that's the most important thing for me. Like if I did have to make a last minute change, I can do that penalty free. For now, that's all we have for this episode. Do you have a money question of your own? Turn to the nerds and call or text us your questions at 901-730-6373. That's 901-730-NERD. You can also email us at podcast at nerdwallet.com. And remember,

Starting point is 00:18:20 you can follow the show on your favorite podcast app, including Spotify, Apple Podcasts, and iHeart Radio to automatically download new episodes. This episode was produced by Tess Figlin. Sean helped with editing. Claire Soce helped with fact-checking. And a big thank you to NerdWallet's editors for all their help. Here's our brief disclaimer. We are not financial or investment advisors. This nerdy info is provided for general educational and entertainment purposes and may not apply to your specific circumstances. And with that said, until next time, turn to the nerds.

NerdWallet's Smart Money Podcast - How to Save Money on Holiday Travel Without Using Any Points

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