All posts by jfoo

Are you in the 1%??

No, I’m not referring to the Occupy movement.  You’ll have to go somewhere else to read about them (they can’t really earn you free travel, so I don’t know why you’d bother :)).

I’m referring to a recent post by Rick @ Frugal Travel Guy.  Flyertalk recently held a seminar over a weekend in Chicago, organized by Rick and a few others, where we all heard various presentations about a wide variety of reward and loyalty programs, as well as some of the more famous exploits of certain members.

Anyway, Nightline did a story on frequent flier miles and the “hacking” we do (see the full video at the link).  The report features Rick from Frugal Travel Guy, so after the story aired just before Thanksgiving, Rick tracked how the traffic changed after the Nightline report.  In the post linked above, he estimates (not with the most scientific methods, but close enough) that about 1% of the people that visited his site after the story aired actually reading the blog.  The common held belief in the frequent flyer collecting / travel hacking community is that maybe 1% of people are actually willing to invest the time and effort and dedication to this game.

So are you in the 1%? 🙂

Earning Miles with Credit Cards

A step back to a few basics, from all the various deals that have been posted lately.  In this post, I want to go more in-depth into one of the best tools at your disposal for accumulating miles quickly.  Credit cards and their signup bonuses.   We’ve previous covered some of the basics of credit card churning, but I’d like to go into more detail.  Most of you have probably encountered airline specific credit cards.  They usually come with an annual fee between $60-$100, and typically net you 1 mile per dollar on most purchases, and bonus miles on purchases with the airline.  While this is a way to build up airline miles, I don’t think it’s necessarily the best way.

In my previous post, I discussed rough valuations of miles based on what type of flights you take.  Let’s say you value your miles at 1-2 cents apiece. If you are earning one miles per dollar on say, the United Mileage Plus Explorer card, you’re getting roughly a 1-2% return on your card.  But to have this card, you pay an annual fee of $90 (check?).  While it’s nice that you’re getting miles and traveling for free, you could honestly find a cash back card that gives you better values.  Most cash back cards offer 1% on general purchase, but have categories where you could be earning 3-5% cash back per dollar, with no annual fee.

However, the United Mileage Plus Explorer card comes with a bonus of 40,000 (or 60,000 miles, if you are a Mileage Plus elite member (see end of post) ).  If you take that account, you are earning miles for as low as fractions of a cent.  At that rate, it is definitely worth getting the card, AND paying the annual fee (if it isn’t waived the first year, which a lot of cards do).

I would like to digress a moment, regarding credit card annual fees.  Yes, I agree that annual fees are terrible, a seemingly unnecessary expense, and if you get a card with an annual fee purely for the signup bonus, you have to somehow remember to cancel your card before the fee comes up again or else you’ll get charged again.

However, consider what you’re getting out of the annual fee…at least one free domestic trip that is generally worth much more than the annual fee (maybe even the annual fee twice over).  It’s hard to dispute the value there.  Yes you will have to remember to cancel the card if you don’t want to pay the annual feed again, but I think with today’s technology, you can set your self email, calendar reminders, etc., there’s really no excuse.  Personally, I keep a spreadsheet where I keep track of all the cards I’ve applied for, the dates I applied for each, the amount I’ve spent on each, and a few other things (if there is enough demand, I’d be willing to post a blank version of that for people to use themselves).

Another point on canceling cards with annual fees, despite how easy it makes things to just cancel the card after the bonus miles post, you should avoid doing this.  It does not look good to the bank issuing your credit card if it looks like you just opened a card for the bonus, particularly if you develop a pattern of this.  Banks may blacklist you if you do that too much.  In fact, some cards or banks explicitly prohibit doing this in the terms of their condition.  Generally, it’s best to keep a card open for at least 6 months before canceling, and when you do call to cancel, it’s not uncommon for the bank to offer you retention bonuses to keep you as a customer (sometimes including thousands of bonus miles on the spot).

So whether or not using a card such as the United Explorer card is worth it in your situation, there are several programs out there that allow you to earn points that are transferable to a wide variety of programs that are much better options than confining yourself to a single mileage or hotel program.  These programs are the Starwood Preferred Guest (SPG) program, the American Express (AMEX) Membership Rewards (MR) program, and the Chase Ultimate Rewards (UR) program (covered by Mommy Points).  Stay tuned for upcoming posts on all of these programs!  That’s all for now….

-ffc

A few good deals (and credit cards!)…

Got a quick post on a few good deals…

Million Miles Secrets posts about getting 500 free Hawaiian Airline miles for connecting your Twitter account to your Hawaiian Airlines account.

Also, you can currently get 1,500 United for a (now $25 minimum) purchase at Gilt Groupe.  It’s only for new members though.  However, I’m sure most of us also have multiple email accounts that have not registered on Gilt yet.

Also, this a little bit older, but Million Mile Secrets had a post on a couple of good credit card deals

From Mommy Points: Chase Ultimate Rewards 101

Hey everyone,

I’ve had a couple of long days at work, so I haven’t had time to post.  However, I am still keeping tabs on my blogs 🙂  Mommy Points wrote a through primer post about the Chase Ultimate Rewards Program.  Acknowledgements to her for creating this resource for us all.  I’ll summarize the main points below:

  • Ultimate Rewards points are the points earned by certain Chase credit cards.  These points can be redeemed for gift cards, merchandise, or travel at a value of about $.01 per point (more on certain things, less on certain things).  However, the maximal value of these points lies in their ability to be transferred at a 1:1 ratio into Continenal OnePass/United Mileage Plus, British Airways, Korean Air, Amtrak, Hyatt, Marriott, and Priority Club miles/points.  The best values in that list are generally considered to be transfers to United or Hyatt…but it’s nice to have the flexibility of transferring to any of those programs, depending on your particular needs at a given time.  Transfers are instant into the award program of your choice.
  • The cards that earn Ultimate Rewards points are the Chase Sapphire Preferred, Chase Ink Bold (business card), and the Chase Freedom.  Get one of these cards!  I have links for the Chase Sapphire Preferred on the Credit Card Offers page.
  • The Chase Sapphire Preferred and Ink Bold both currently offer a 50k Ultimate Rewards points sign-up bonus, while the Chase Freedom offers a 30k bonus.  The Chase Sapphire Preferred earns 2 points per dollar on dining and travel (their definition of travel is very broad, including but not limited to airlines, hotels, rental cars, taxis, buses, and subways).  The Ink Bold earns five points per dollar at office supply stores, on cable and wireless service, and landline communications.  It also earns 2 points on hotel and gas expenses.  The Chase Freedom has quarterly rotating 5x points categories (limited to $1500).  On all other purchases, these cards earn 1 point per $.
  • When buying stuff online, check if the store you’re buying from is on the Ultimate Rewards Mall.  if it is, you can generally earn an extra 2 to 20 points per dollar by using the Ultimate Reward Mall’s link.
  • Do click on the link above to Mommy Points’ post  and read it through when you have a chance!

The value of miles

In this post, I’d like to discuss how you should value your miles.  Miles ARE a currency, but it can be hard to peg values on them because it depends on where you are going, which cabin (class) you want to fly in, and how you value each of these.  But it’s important to consider how you personally value miles, because that really determines to what extent and expense you would be willing to go to while accumulating miles.

 

Valuing Miles for Domestic vs International Award Redemptions

Let’s start by looking at the cost of domestic coach class tickets vs. a domestic coach miles award.  Note that there are many exceptions and variables in this, but I’ll try to make some generalizations for the sake of discussion.  Whenever booking an award, it’s good to compare the price of the award ticket you’re booking vs. the number of miles that it costs, and make your decision based on that.

Let’s estimate that a domestic ticket typically costs $250-$500.  It also normally costs roughly 25k to 50k miles to book a domestic ticket using miles. At this rate, I would say you can value miles at approximate 1 to 2 cents each for domestic ticket redemptions.  Now, lets consider valuing miles for international flights.  International coach class tickets range probably from $700-$2000.  I am really generalizing on this one, because it obviously depends where you are, where you want to go, the dates you choose, etc., but let’s say it would be about 60-100k for a coach class international award.  If you have the miles, I think you’re doing a bit better with international coach class tickets, but it can sometimes still work out to 1-2 cents a mile.  However, consider business class or even first class redemptions.  For these prices, you’re talking several thousand dollars and ranging up to tens of thousands.  Yet, if you do your homework and pick the right redemptions, you generally never exceed about 150k miles for a one way ticket.  In this case, your miles could be worth up to 10 cents apiece.

 

How should YOU value miles?

Obviously accumulating larger amounts of miles and putting it into upper class redemptions can you a lot of value in normally expensive seats.  However, should you say your miles are all worth 10 cents apiece?  No, for a couple of reasons.

The first is mainly that you don’t know if you’ll always be able to get an award ticket which values it at that level.  It’s subject to availability, and you generally have to be pretty flexible if you want the best award redemption values.

The second, is more my personal take, but I think my perspective would apply to most people.  Generally, if I travel out of pocket, I can only afford to (or at least choose) to travel coach.  Yes the miles make upper class redemptions possible at fairly reasonable cost, but I would probably never ever purchase a $10,000 business class ticket, when I could fly in coach for $1500.  That’s not to say I don’t enjoy business class and would never fly it with miles, but I don’t believe I can realistically say I value at miles at 10 cents per, because I would just choose not to fly business class otherwise.  I think there’s some happy medium in there, and I believe that I can fairly value my miles in the neighborhood of 5 to 6 cents, balancing out the notion that I would not actually have booked business class tickets at the price they’re sold at, but I do enjoy the experience and comfort of getting to fly in it.

 

Use Your Miles and Points for Your Greatest Benefit

I would like to make one final point on this topic, which has been a hot topic of late in the frequent flyer community (most of the blogs in my blogroll have made posts about this topic in the past month).  Ultimately, the most important thing is that you use your miles to do the things you value most.  Yes, I and other bloggers will post about great business and first class experiences and such, and I generally pay for my domestic trips and save the miles for international trips.  However, for some people they may not travel internationally, and/or they can’t afford to pay for domestic trips.  For some people, having free domestic flights allows them to see family, relatives, and friends, that they might not otherwise be able to do.  And using your miles for that is a perfectly legitimate use (not to insinuate that I had a right to tell anyone how to use them to begin with).  The only caveat is to try and optimize the cost of your miles based on what you do with them.

We’ve put up an introductory post about churning credit cards, which is a way to generate miles for fractions of a cent (less than $0.01).  Do check out this post, but consider that if you are able to generate RDM (redeemable miles) at such low cost, all your travel is essentially at little to no cost, whether you choose to book all your domestic travel with miles, or you book pricy premium class seats.  Until next time!

An award trip booked with AA miles

Frugal Travel Guy’s, Sunday Success Stories series has an article today about a trip that someone was able to book with a relatively small amount of AAdvantage Miles.  Check out the story here!

Considering how easy it is to earn 150,000 AA miles with 3 credit card sign up bonuses (acknowledgment to Daraius at Million Mile Secrets for the post about signing up for AA cards), booking a trip like the one above is well within anyone’s reach!

TopGuest – Earn points for checking in on social networking websites

This morning, I learned about a service that I had never heard of, through Gary at View From The Wing.  TopGuest is a website that allows you to earn points and miles with various loyalty programs, including Hilton HHonors, Priority Club (Holday Inn), MLife (MGM hotel properties), Virgin America, and according to today’s post at View From The Wing, you will now be able to earn miles on United/Continental for airport check-ins.  If you use any social networking check-in service, or are willing to do so to earn miles, and you are ever near any of the properties on the list, I recommend signing up for TopGuest.

A Bit of Inspiration

Hello everyone,

I’m actually in Las Vegas this weekend, celebrating a friend’s birthday…I made it here earlier today after a long day of travel (it’s much more effort getting here from the east coast, especially for someone used to making the journey from SoCal).

Gary Leff of View From the Wing recently wrote a post titled “Using Credit Card Offers to Construct a Free Dream Trip Quickly”.  I just remembered a little while ago, and I think it is a good overview of where collecting frequently flyer miles and take you.  Enjoy!

I was also able to draft a few more posts during my flight over here, so I will be posting more content soon, but I hope this can tide you over for now 🙂

-ffc

What are frequent flyer miles?

All right, I’m gonna start with the basics.  Note that I have included this article in the Beginner’s Guide section if you ever need to refer back to it. I apologize in advance for the long post, but there’s so much information to share!  Before I start, I would like to provide this glossary of frequent flyer/traveler terms: http://www.flyertalk.com/glossary/

I actually just discovered this glossary, but it is pretty useful and complete, in case you ever need to look up a term or acronym.

 

What ARE frequent flyer miles?

Frequent flyer miles are points that are awarded by nearly (if not every) airline on the planet, in some form or another.  With most of the major airlines (also known as legacy airlines, including Delta, United, Continental, American), for every flight you take, if you provide your frequent flyer number (or a frequent flyer number for an airline in the same alliance or in a partnership, more on this later), the airline will credit to your frequent flyer account the number of miles that your flight was.  Some airlines, such as Southwest, JetBlue, and Virgin America, don’t credit you based on mileage, but they use a system know as a “revenue based” system, which means that the number of miles/point/credits you earn is based on how much you spent for your flight.  By and large, these revenue based systems are not as lucrative for the frequent flyer mile collector seeking to redeem for premium class travel.  There are exceptions, and these airlines have some partnerships with certain legacy airlines that are sometimes good redemptions, but we’ll save that discussion for another day.

 

So, what is the point of accumulating these frequent flyer miles?

These miles are loyalty programs, intended to get you to always fly the same airline.  OK, that’s more for the airlines’ benefit, but what’s in it for you?  Generally, these miles can be redeemed for award tickets.  Generally, on the US legacy airlines, a domestic, coach class award ticket can start as low as the 15,000 range, and more typically will cost you 25,000-50,000 miles.  Therefore, you could have all your domestic flights for free if you were able to collect enough miles.  A United States transcontinental flight (sometimes you’ll see this abbreviated as transcon) will generally generate just shy of 5000 miles, so if you are avidly collecting miles, you could in theory fly across the country for free roughly every 6 trips (of course, subject to travel dates, award availability, etc. etc.).

 

But what if I want to fly elsewhere?

You’re in luck, miles can be used also to travel internationally.  Each airline has its own award chart, which dictates how many miles it costs to fly from each location to another.  For example, see this page for links to the United Mileage Plus award chart for United and to the United Star Alliance (partner) Award Chart (that’s the award chart for using United Miles on other alliance members).  You’ll notice the award charts also include booking fares for international and first class seats for miles.  This is where, if you are interested in traveling in style in premium class, you can get the most bang for your mile.  Typically, international business and first class seats are in the 100-150k mile range, of course depending on which airlines’ award chart you’re looking at and what your origin and destination are.

 

Well, how will I possibly ever accumulate 150,000 miles?

Most people do not fly anywhere close to 150,000 miles in 5 years, let alone a single year.  However, there are many ways to earn miles. with the biggest one being credit card signup bonuses.  I’ll have a future post about this, but basically, many airlines offer co-branded credit cards with the major banks (Chase United and Continental, Citi AAdvantage, AMEX Delta, etc.), and when you sign up for these, you generally can earn at least 25k bonus miles (ranging up to 50k and sometimes even 100k!).  There are also several credit card affinity programs that allow you to earn points that can be converted to miles or allow you to spend the points for travel (usually valuing the points at $0.01 each).  I’ll be writing about this very soon, because there are currently several excellent offers on American Express card that are available for only a limited time.

Before you get carried away with applying for credit cards, I would like to add a caveat.  Playing the credit card side of the miles requires you to have a good credit score (at least 700, or close to that), and to be able to maintain that score (i.e.always paying your bills off on time, in full).  IF you have trouble with either one of these, and/or you are planning, in the next two years, to make a major purchase involving a credit check, DO NOT dabble with credit cards.  It’s more important that you be able to secure the best rate for your car loan, home mortgage, or whatever else you may be buying.

And even if you do play the credit card game, don’t go off applying for everything…generally, each bank will only allow you 3-4 credit cards a year, and they will not accept more than 1 application ever 30 days (sometimes 60).  Therefore you have to be a bit selective on which offers you jump on, and go for the ones that present the best value in your particular situation.

 

Anyway, back to Frequent Flyer miles…

So one question that I have heard several times, is people lamenting the fact that they can’t earn useful miles on their flight because they collect United Mileage Plus miles, but they’re flying US Airways (or Continental).  However, you CAN earn miles (even elite qualifying miles, or EQM, more on that in a moment) by flying on carriers in the same alliance.  I’m only going to scratch the surface on this topic, but there are three major alliances operating in the US (actually, probably the world too):

  • Star Alliance (sometimes abbreviated as *A, not to be confused for A* search) – includes United, Continental, US Airways, Singapore Airlines, Thai Airways, ANA, Lufthansa, and more.  This is the largest alliance in the world.
  • OneWorld (creatively abbreviated as OW) – includes American Airlines, British Airways, Cathay Pacific, and more.
  • SkyTeam – Includes Delta, AirFrance/KLM, and other airlines, but this is generally considered the weakest alliance.

So, next time you’re not flying you’re usual carrier, do check if you can possibly credit your miles to another carrier’s account in the same alliance.  And if you don’t have any miles with that alliance, you should consider opening an account with one of the carriers.  One of the key tenets to follow is to always collect miles, and to accumulate miles in as many brands/alliances/chains as possible, because you never know when they’ll come in handy.

 

Last but not least…elite status?

So generally, as you accumulate EQM with a single frequent flyer program, you can earn elite status if you earn enough miles in a single year.  Most of the airlines have elite levels at 25k miles, 50k miles, and 75k/100k/125k (top levels vary by program). You can also earn elite status through segments, which involves counting every flight you take.  This might be the way you qualify if say you take many short trips within or near California or Texas.  You generally don’t fly much more than 500 miles on these trips, but you can qualify for low-level elite status at less 50 segments.

The benefits of elite status generally include waived baggage fees on at least one bag, priority lines for check-in and sometimes security, and the potential to get free domestic upgrades to first class (I believe AA is an exception on this one).  Note that ONLY elite qualifying miles (EQM) earn elite status and these are generally miles flown butt-in-seat (BIS).  Most of the time, credit cards and other methods of earning or purchasing miles will not qualify you for elite status (though there are some exceptions).  Airlines also sometimes run promotions where you can earn additional EQM on flights, usually it will be flight on certain routes that allow you to earn double or even triple EQM than normal.

Anyway, I think I’ve bombarded you all with enough words and acronyms for one sitting.  Thank you for reading, to everyone that made it this far.  And please feel free to post any questions in the comment section, or email them to questions@frequentflyercollector.com.

Until next time!

-ffc

 

Chase Credit Card Reconsideration line

This post jumps ahead a bit for all the beginners, but I’d like to go ahead and cover it.  The Chase reconsideration line has been thoroughly blogged about in the miles community, but I figured I would share my experiences.  All the major credit card companies have reconsideration lines you can call if you ever have a credit card application denied.  I recently applied for the Chase Ink Bold Business card which is a charge card.  It features a 50,000 Ultimate Rewards bonus for spending $5000 on it in 3 months.  The offer on this card has actually just been refreshed on Monday November 28.  It still offers the same bonus as before, but now also offers 5X points on certain types of business spending (office supplies, wireless, cable, telecommunications, among others), and 2X on gas and hotel purchases.

Anyway, when you call the business reconsideration line, they will generally ask you for details about your business (it can be a business you’re trying to start), and if you already have a lot of credit with Chase they will either ask (or you can suggest) taking some credit off your other credit lines and reallocating it to opening a new credit card.  For example my application for the Ink Bold was deferred (the actually message I got when I applied said something about processing).   I had a Chase BA Visa card that I wasn’t really using anymore, so I asked them to take some of the credit line from that and open an Ink Bold account.

Chase tends to be very flexible with these things so it’s always worth following up with them on your applications.  The number for the Chase reconsideration line is below, courtesy of Darius at Million Mile Secrets, who has a very thorough post about the Chase reconsideration line.

Chase Credit Card Reconsideration

  • 888–245–0625 connects directly to a personal card credit analyst
  • 800–453–9719 connects directly to a business card credit analyst
  • 888–609–7805 connects to the application status department

 

You can find a link for the Chase Ink Bold application as well as other great offers on the Credit Card Offers page

UPDATE:  Thanks to Chris for also sharing his experiences in the comments:

“I recently was declined for the Chase Southwest Visa.  The rejection letter said that I had two many accounts open with Chase.  (I have three other Chase credit cards.)  I called the reconsideration line and offered to cancel one of the other cards.  The Chase Customer Service rep said she would reopen my application and take a look at it.  She asked a few questions about my income, then said she could approve me if we reduced the size of the credit lines on my other cards.  I was happy to do that, and I got approved.  The whole process was easy and painless.”