When is it Worth It to Redeem Miles for Domestic First Class?

There is a lot of talk in the online points and miles blogosphere about redeeming points and miles for high value tickets.  Especially international first class that have lie flat seats.  Or hotels that go for $700+ per night.  And, it makes sense.  Use those miles to redeem a ticket costs $10,000 instead of a ticket that costs $500.  

But, what if flying international first class isn’t part of your “routine” travel pattern?  Sure, I love traveling internationally, and I love international first class and business class.  But frankly, it’s difficult for us to travel like that very frequently thanks to limited amounts of vacation time.  We might do one international trip per year.  The rest of our trips are usually domestic, whether for vacation or to visit family.

So, why am I considering this issue now? This upcoming summer, Ken and I (along with the rest of my family) are going on an Alaskan cruise out of Seattle.  I’ve already booked our flights to the West Coast.  We’ll fly business class on Cathay Pacific from JFK to Vancouver a few days prior to the cruise departure date (and we’ll just drive from Vancouver to Seattle, perhaps even stopping at a few places along the way).

We used British Airways Avios to book the ticket on Cathay Pacific.  It was 25,000 Avios each for a great business class product.  In fact, as the trip approaches, I may see if first class seats open up (it currently shows 0 availability, but the consensus is that Cathay Pacific may not generally release first class seats until one or two weeks prior to departure).  it would be an additional 12,500 Avios each for first class, so I’m not sure if it’s worth it.  But we’ll see.

So, the flight going out to the west coast was a no brainer.

The issue is with the return flight.  When a vacation is over, I usually like to get home as soon as possible.  Meaning no connections, no driving farther to get to an airport.  So, I don’t want to drive up to Vancouver from Seattle after our cruise disembarks to fly back on Cathay Pacific.  I also don’t want to fly Seattle > LAX > JFK > DCA just to try out some decent first class options, like American’s new transcontinental first class with lie flat seats.

Our best bet would be to fly Seattle to Washington DCA on Alaska Airlines.  It’s a nonstop flight, and is just shy of five hours.  Last year, I travelled to Seattle for work, and flew Alaska Airlines coach, both ways.  I don’t want to sound like a brat, but it was torture, especially the six-hour flight going westbound.  I had to book my flight last minute, so I was stuck in a middle seat both ways.  Plus, the flight was turbulent for a long duration, and I can’t stand turbulence.  It would’ve been nice to have access to free booze to help calm my nerves.

Anyway, here’s the deal.  On the day we would need to travel, flights are more than $300 each ONE WAY on that Alaska Airlines flight.  There are AAdvantage mile points redemptions available at 12,500 miles each for economy class.  But, there are also Alaska Airlines first class seats available for 25,000 miles each.  Is it really worth it to pay 50,000 AAdvantage miles for two first class seats on Alaska Airlines, especially when the seats are nothing special?  Especially when those miles could be redeemed for much more valuable seats?  The seats aren’t lie flat, but they are wider and have more legroom than economy, obviously, but should I really “waste” an extra 25,000 AAdvantage miles for such a marginally better benefit?

Anyway, I’m not sure yet what decision we’ll end up making. I’m pretty sure that, barring any significant sales, we definitely won’t be paying more than $600 cash for two one way seats, even if it is the most convenient flight option. So the question at this points seems to be whether we redeem points for economy or first class on Alaska Airlines.

What would you do in this situation?

Results of Ken’s Recent Credit Card App-o-Rama

We haven’t applied for any new credit cards since my app-o-rama back in late May.  This time, it was Ken’s turn to apply!

I had Ken apply for three cards, each with $3000 minimum spending required within three months.  Typically $9000 minimum spend in three months would be a bit aggressive for my tastes (since I’ve always been a bit hesitant to try manufactured spending), but I figured with the holidays coming up, it shouldn’t be that much of a stretch.

So, what cards did we opt for this time?

Chase Sapphire Preferred

Bonus: 40,000 Chase Ultimate Rewards Points after spending $3000 in three months.

Approval Details:  Received a “pending decision” message.  Ken called the reconsideration line later that evening.  Ken was approved for the Chase Sapphire Preferred after moving $12,000 worth of credit from a Chase Freedom card that had a $31,000 limit.  I must say it was one of the lengthiest reconsideration calls I’ve experienced in some time.  They verified pretty much every element of his application, and then put him on hold for probably 5-7 minutes on two separate occasions.  No big deal, though, it’s all worth it!

 

Citi AAdvantage Platinum Select Mastercard

Bonus: 50,000 AAdvantage miles after spending $3000 in three months.

Approval Details: Instantly approved with a $15,500 credit limit

 

American Express Hilton HHonors Surpass Card

Bonus: 60,000 Hilton HHonors points after spending $3000 in three months.

Approval Details: Received a “pending decision” message.  However, within moments, I checked the application status page, and it stated the application had been approved with a $17,000 credit limit.  So there was no need to call the reconsideration line!

 

So, what do we plan on using these miles and points for?  No particular plans yet, but travel opportunities always arise to use them!  We’ll probably use many of the AAdvantage miles  (along with my AAdvantage balances) for first class or business class to Japan in the Spring of 2016.  Time to book those flights will be here before we know it!  

Hilton points are always valuable to me since there are so many Hilton’s all over the world, and they give out points like candy.  We’re staying at two Hilton properties (5 nights total) in the Florida Keys soon. It’s all free thanks to points.

And it’s always valuable to have Chase Ultimate Rewards points in the bank!  I’m thinking of a long weekend trip to Chicago in the spring or next fall, and there are several lovely Hyatt properties that we can stay at by transferring some Chase Ultimate Rewards points.

Have you applied for any new cards recently?

Am I a Victim of the Home Depot Data Breach?

Yesterday I stopped at our local butchershop here in Northern Virginia, which is where I buy all our meats these days. I usually just go there once a month and stock up on meat for the rest of the month.

Last night the grand total at the Butcher came to $160.85. The employee swiped my Chase Ink Bold card and handed it back to me. Then he said he need to try again and asked me for the card again. Then, as discreetly as possible, he said, “Um, do you have another card, this one has been declined twice.”

First thing, “Do I have another card?” I’m a points-obsessed credit card collector. Of COURSE I have another card. (I didn’t actually say that, but I was thinking it).

And second thing, “Oh great, now the local family-owned butcher I go to every month thinks I’m a deadbeat with maxed out credit cards.”

But I didn’t think too much of it. I just figured that the amount at the butcher triggered some sort of potential fraud alert algorithm and that I’d be getting a phone call from Chase any moment to verify the charges (like has happened in the past). I paid with another card and had a few more errands to run. By the time I got home, Ken and I chatted for a bit, then we ate dinner, and it was time to go to bed! I pretty much forgot about checking on my Chase Ink Bold card.

Yep, those aren’t my charges

When I woke up this morning, I remembered about the declined card, and logged into my Chase account. And sure enough, there were three charges that I didn’t recognize. After a quick Googling, it looked like two of the merchants were based in Brazil and one was in Iowa. The charges were not excessive ($7.28, $16.32, and $3.55).

I called Chase, and I told them I thought my card had been compromised. The agent said that yes, there had been a fraud alert put on my card, and that she was going to transfer me to the fraud department.

We went through the recent charges, and the agent said, “Did you use your Chase Ink Bold card at a gas station in Brazil yesterday?” Nope, I didn’t.

I confirmed which ones I did not recognize. With that, my Chase Ink Bold card was closed, and they’re shipping me a replacement card overnight.

I guess it’s impossible to tell exactly how my card information got to Brazil and Iowa, but I did use my Chase Ink Bold card at least three times this past June and July at Home Depot. Considering all the news surrounding their data breach, I wonder if that’s how my number was compromised.

 

Past Fraud Alerts I’ve Experienced

So, I’m really happy that credit card companies disable new purchases if they suspect fraud. That has happened to me at least three times in recent memory:

1) Almost two years ago, I spent about $200 at a WalMart, a place I hadn’t shopped at in years. My Chase card was declined, and I just used a different one. By the time I was walking out the door at WalMart, my cell phone was ringing and an 800 number was showing up on the caller ID. It was Chase’s fraud department and I just had to go through an automated process to confirm my charges. Easy Peasy.

2) Last June, my card was declined after my third of six $50 transactions at a Safeway. (I was buying gift cards to leverage some extreme savings at Lowes). I was using my American Express card, and, like the WalMart issue, my phone rang almost immediately after. Once again, I just had to go through an automated process to confirm the charge, and then I was able to use my card again.

3) My Chase Sapphire Preferred card was declined a few weeks ago after attempting to make a relatively large purchase at ModCloth (an online clothing retailer). Within moments, I had an email from Chase and I was able to go through an online process this time to confirm my recent charges.

So, all that being said … Why didn’t Chase call me this time? I’m glad they put a hold on my account in an attempt to prevent additional fraudulent charges, but calling me could’ve saved me the embarrassment of getting my card declined.

 

A few final thoughts on the entire situation

  • I’m not even mad. These things happen. I’m not going to stop using my credit card for purchases. (Like some random internet commenters always seem to mention in news stories about data breaches … “I’m going back to using all cash!” or “I’m never shopping there again!”) This literally took about 7 minutes of my time to take care of.

 

  • I love credit cards for their consumer protections. Once upon a time, way back when, I used my debit card for everyday purchases. If a debit card card gets compromised, essentially your entire checking account gets compromised! Credit cards have zero links to my “real” money except when I pay my bill! I remember one time (around 2006, 2007) I had a double charge on my debit card for a fast food restaurant You know what the bank’s solution was for that? “Go back to the restaurant and show them your statement and your receipt and ask for a refund.” Umm, what? And that’s what I had to do. The bank wouldn’t refund it directly, I had to take time out of my day to go back to the restauant. I wondered if it was even worth the $7.00 charge, but it was the principle!

 

  • It’s a little more difficult to track unusual purchases if you use 20 different credit cards in a given year. Ken and I always seem to be applying for new cards to maximize points and miles bonuses, so sometimes I can’t even remember what card I used where. Ken likes to track everything through Mint, but I’ve always had a lot of trouble using Mint (they don’t support my one student loan lender, and one time a Citi credit card I was using regularly didn’t update for MONTHS despite having correct login information, and a few other issues as well). I am very diligent about logging into each credit card account each month (usually on the last day of the month), so I know I’d catch any suspicious charges then, but still, it’s not like I have just one credit card to monitor for fraudulent charges! But it does make me more confident in my decision to routinely review my wallet contents and close out cards.

 

  • I am very excited about ApplePay. If it works the way I understand it, merchants will no longer be receiving any specific data, like the credit card numbers, about your credit card. Hopefully this will help prevent large scale data breaches like this in the future!

 

  • Similarly, I’m happy to see that chip-and-pin enabled cards are becoming more common, because they are considered more secure than chip-less cards that just rely on the magnetic stripe. I’m sure that anybody who has traveled to Europe in the past 10–15 years has lamented how difficult it can be to use a US-issued credit card in Europe because US-issued cards are usually not chip-enabled. It appears that many banks should be adopted chip-and-pin cards by October 2015. Just in the past year, my Barclays Arrival Plus and several Citi products (such as my HHonors Reserve) have been issued with chips. It was so much easier to use my cards during our trip to Russia than it had been using credit cards on previous trips to Europe!

So folks, keep an eye on your cards!

Have you ever had a fraudulent charge on your credit card or debit card? How did you get it taken care of?

Earning Miles and Points for Free Travel – Beginner’s Series (Part 1)

Complete Beginner's Guide to Travel Miles and Points to Earn Free Flights and Hotel Stays

I still consider myself relatively new to the points and miles world.  When I first applied for the 100,000 sign up bonus for the British Airways Chase Visa card in early 2011, I wasn’t entirely sure what I was doing.  I just knew that 100,000 miles sounded like a lot, and I applied.

I’ve learned so much in the past 3.5 years. And even though I’m still a relative beginner, I’m always a bit perplexed when I read “beginner’s guides” to points and miles.  The information they convey is important and usually cover things like “Consider your travel goals and bucket list destinations,” and “Sign up for all frequent flyer mile programs.”  Some even go into “why” airlines and banks offer credit card miles.

When I tell friends and family that our airfare and hotels are free for about 90% of our travel, they always ask, “How does that work!”  And let me tell you, saying things like, “Well, I consider my travel goals and sign up for frequent flyer mile programs and earn miles,” does not cut it as a good explanation.  And certainly nobody has ever given a crap about “why” airlines do this.

They want to know the nitty gritty.  So I’m here to explain.

 

Complete Beginner's Guide to Travel Miles and Points to Earn Free Flights and Hotel Stays

 

First things first!  Start reading miles and points earning blogs.  When I first started reading these blogs, I was pretty confused by the terminology.  Membership Rewards, transfer bonuses, mileage runs, etc.  But, wouldn’t you know it, simply by reading every day, I was able to make links and connections to other things I read.  Slowly, the terms started to make sense!  Just do it!

 

How can you earn miles and points?

Here are the basics:

  • By flying
  • By staying in hotels
  • By applying (and getting approved) for credit card sign up bonuses
  • By spending money on the credit cards that you sign up for
  • By doing your online shopping through “portals.”

There are several more advanced techniques (like manufactured spending), as well as techniques that can provide “mini” points (points that are earned in like 50-250 mile increments) but since this is assuming you’re a beginner, there’s no need to worry about that.

But, let’s start with the biggie.  Applying for credit cards.

 

Understanding the differences among miles and points-earning credit cards

 

There are a few different categories of points-earning cards.

1.  Airline or Hotel-specific cards. These cards earn you points that are specific to certain airlines or hotels. For example, the Citi AAdvantage card earns you AAdvantage (American Airline’s frequent flyer program) points, which are redeemable through American Airlines (and therefore American Airline’s partner airlines).  The Chase United Mileage Plus credit card earns you points redeemable on United Airlines (and therefore United Airlines partners). The Citi HHonors (HHonors is Hilton’s loyalty program), earns you points for Hilton hotel stays. And so on!

Real World Example #1:  In the past three years, I’ve applied for several (five to be exact!) 75,000 or 50,000 mile Citi AAdvantage credit card bonuses, which gave me a large balance of AAdvantage miles.  I redeemed 100,000 of those AAdvantage miles for two business class tickets on Air Berlin (a partner of American Airlines) from St. Petersburg, Russia to Washington, DC.

Real World Example #2: In 2012, Ken and I did a big Southwest USA road trip, but first we had to fly to Albuquerque, which was the origination point for our road trip.  We redeemed Southwest Rapid Rewards points that we had earned through Chase Southwest Rapid Rewards sign up bonuses on our flight from Baltimore to Albuquerque, and then on our return flight from Las Vegas to Baltimore.

2.  “Bank points” cards.   This is not a formal term, but just how I’m categorizing it for the purposes of this post.  These cards earn you a certain bank points “currency,” which you can then transfer to certain hotel or airline partners. (You can also redeem these points in another way, but it’s not as valuable, so I won’t mention it here). Examples of these bank points programs are Chase Ultimate Rewards, American Express Membership Rewards, and (only very recently, and not nearly as valuable), Citi Thank You points. Here are Membership Rewards transfer partners and Here are Ultimate Rewards transfer partners

Real World Example #1:  I have applied for both the Chase Sapphire Preferred and the Chase Ink Bold cards, both of which earn Chase Ultimate Rewards points.  From those two credit card applications, I netted 100,000 Chase Ultimate Rewards points.  Hyatt is a transfer partner of Chase Ultimate Rewards points.  Last year, Ken and I went to New York City and stayed at a Hyatt property called the Andaz Fifth Avenue.  I transferred the amount of points I needed for three nights (then 66,000) from my Chase Ultimate Rewards account to my Hyatt account.  The transfer was instantaneous, and I was able to book my stay right after initiating the transfer.

Real World Example #2:  United Airlines is also a transfer partner of Chase Ultimate Rewards.  Turkish Airlines is a United partner, and Turkish Airlines had the best options for getting to Sochi during the Olympics.  I needed 100,000 United Mileage Plus points to “pay” for two business class tickets on Turkish Airlines.  But I only had about 55,000 Mileage Plus points in my account!  So, I simply transferred 45,000 Chase Ultimate Rewards points to my United Mileage Plus account, which brought my balance of United Mileage Plus points to 100,000!  Like the Hyatt transfer, it was instantaneous and I was able to book my Turkish Airlines tickets (on United’s website) right away using my freshly topped-up United miles.

Real World Example #3:  We are planning a trip to the Florida Keys this fall.  I was just a few thousand points short in my Hilton HHonors account to book a several night stay at a Hilton property in Key Largo.  So, I logged into my American Express Membership Rewards account, and transferred points to my Hilton HHonors account.

 

3.  Outlier Cards.  There are a few very valuable cards that don’t fit precisely into one of the two categories above.

Free nights cards.  These are credit cards that you apply for that give you a set number of free nights in a hotel as your sign up bonus not a set amount of points.  Two examples of these cards are the Chase Hyatt Card and the Citi HHonors Reserve.  Both cards give you two free nights at their respective properties.  So, these cards are great to use if you plan on staying at a very expensive property that would normally require an excessive amount of points!

The Starwood Preferred Guest (SPG) American Express Card.  This card seems like it should be pretty straightforward, right?  When you sign up, it gives you usually 25,000 SPG bonus points, good to use at Starwood hotels.  But, in many ways, the SPG Amex is also like a “Bank Points” card, because you can transfer SPG points to many different airline partners, making it quite a valuable card!

The Barclays Arrival Plus Card.  This card currently offers a 40,000 point bonus sign-up offer.  But those points aren’t tied to any particular airline or hotel, or anything really!  This card is fantastic because you can redeem those points for nearly any travel-related expense.  So, if you’re staying at non-chain hotel that you can’t use any “normal” points for like a chain hotel, you can redeem your Barclays Arrival points for that purchase.  You simply “redeem” the points by going into your account and asking for a statement credit for the travel purchase.

Real World Example of Using Barclays Arrival Plus points:  During an upcoming stay in Miami, we wanted to stay at a Kimpton hotel.  Kimpton hotels do have a loyalty program, but pretty much the only way to earn points is to stay at their hotels.  So, I will pay for the hotel upfront using my Barclays Arrival Plus card.  Then, when the credit card statement arrives, I’ll request a statement credit for that hotel purchase.  So, if the hotel is $300, I’ll have to redeem 30,000 points.  But, you get a 10% bonus for redeeming the points, so really it’s only like I’m redeeming 27,000 points for the $300 statement credit for the travel-related purchase.

What is the best points earning credit card?

When I describe my miles and points hobby to friends and family, the question always inevitably comes up, “Okay, so there’s all these different types of cards.  But which one is the best one?”  Here’s what my answer to that always is:  While there are definitely bad credit cards (in terms of value), there is no single “best” points earning credit card.  Plus, my answer could change day-to-day based on the current sign up bonuses that are out there because they change fairly rapidly.  But if you REALLY want to know:

  • If you want the option to travel or stay anywhere, your best bet is to diversify.  Even if you don’t want to go fully hard core into credit card app-o-ramas (applying for multiple cards every few months), it would benefit your travel options by having at least one credit card for an airline in each of the major alliances (Star Alliance, OneWorld, and SkyTeam … more on alliances in future posts in this series), and credit cards for at least one or two major hotel chains.
  • If you travel to pretty much the same destination(s) and always from the same airport (like if you travel several times a year between Chicago and Los Angeles to visit family and are just looking for ways to save on those options), your best option might be to apply for the credit card of the major carrier at your airport.  So, since Charlotte, NC is a hub for US Airways, you’d probably want to apply for a US Airways Dividend Miles (or Citi AAdvantage now that US Airways and AA are merging).  If you live near Baltimore, where Southwest has a large presence, then the Southwest Rapid Rewards card would be a great option.
  • Whether you want to travel anywhere or just want points to visit mostly the same destinations, you also can’t go wrong with some of the Bank Points cards (like Chase Ultimate Rewards or Amex Membership Rewards) to fully maximize your options.

 

Okay, I think that’s enough for a first post, don’t you?

What do you think?  Do you have a better idea of how to use credit cards to earn free travel?

May Credit Card App-o-Rama (Chase Hyatt, Citi HHonors, Amex HHonors)

I hadn’t applied for any credit cards since November, so I was starting to get the itch for some new ones.  We’re planning a trip that will include stays at a few Hilton properties, so I was looking to boost my HHonors points balances.  And I looked around to see what other cards might be useful for some travels in the next year or two.  Here’s what I went with.

 

Citi Hilton HHonors Visa Signature.  This is the second open Citi HHonors Visa Signature Card I have open.  And the third time I’ve been approved for one.  So, even though it takes a lot of points to redeem at Hilton properties these days, Hilton seems to give out HHonors points like candy.

Bonus:  50,000 HHonors points after spending $1000 in the first four months.

Approval Details: Received a “pending decision” message after my application.  With seven open Citi cards and nearly $150,000 in credit available through Citi, I thought they were going to make me close some old cards, which I wouldn’t have minded.  When I called the reconsideration line, they just asked me to verify my address, my mother’s maiden name, and my annual income.  As soon as the friendly Citi rep entered that information, I was approved for the HHonors Visa Signature card with a $15,500 credit line.

 

Hilton HHonors American Express Card.  In line with my goal of shoring up my HHonors balances, I applied for another HHonors card.  I like this one because there is no annual fee, and such a low minimum spending requirement!

Bonus: 50,000 HHonors points after spending $750 in the first three months.

Approval Details: Immediately approved with a $17,000 credit line.

 

Chase Hyatt Card.  Now that Hyatts have increased the number of points needed for a nightly redemption, I definitely saw more value in this card since it gives a flat out two free nights, regardless of hotel category, and we don’t have to redeem any “points” for a stay at a Hyatt.  I’m thinking about a trip to France and Morocco in the next 18 months or so, and the two free nights would be great to use at the luxurious Park Hyatt Vendome in Paris.

Bonus: Two free nights at any Hyatt property

Approval Details: Received “pending decision” message after my application.  I called, and I agreed to shut down an old card that I no longer use (Chase Air Tran) and move that $23,000 limit to the new Chase Hyatt card.  I was approved by the end of the call.  For me, I have determined that Chase does not like me to have any more than $65,000 in open credit at any given moment.

 

Poor timing?

I was a little bummed because within a few days of submitting my application, I saw that the sign up bonus for the Citi HHonors Visa signature card had been increased to 60,000 points.  Then I saw that Amex had upped its bonus for its Starwood SPG card.  In previous years, this increased bonus always took place in August.  I definitely wanted to apply for this card come August, and I thought that would’ve given me plenty of buffer time in between Amex applications (May to August) to get approved for the SPG card.  But now that the SPG card bonus is running in June, it’s highly unlikely that I would get approved.  So, I’ll either have Ken apply for it, or maybe we can just wait until next year.  He already has the personal version of this card from his September AOR, but he can always apply for the business version.

Oh well!  I’ll call Citi to see if I can get my bonus bumped up to the 60,000 points, but if not, I’ll live!

 

Have you applied for any new credit cards recently?