The value of the Sky Club (or other airline lounges)

When I first started flying regularly I thought people were crazy to pay $400 per year to have access to airport lounges. I used to go to restaurants, coffee shops, and bars at the airport before flying. Then I had the chance to go to the lounges for free or nearly free and saw the light. I now use them all the time!

I am trying to figure out how to value the visit. The quieter space and nicer bathrooms are a good perk but I need to justify the annual cost. I find I get this from the free wifi, free bar drinks, and snacks. My visit today to the Sky Club in Detroit I will use as an example:

• 2 Jack & Coke cocktails: average $8 each with tip at airport prices
• Snacks: $5 at airport prices
• Canned soda: $2 at airport prices
• Wifi: $10 for a day pass (where airports do not offer it for free)

Today's visit was an average one for me and I got $23 of value from it without wifi or $33 if you count it. In my case I don't count the wifi since I have a company 3G card and my iPhone. At an average of $23 per visit I need 20 visits to "break even" on my $450 AMEX annual fee. I can do this easily with my work and personal travels. 

This doesn't even factor in the other benefits of the AMEX Platinum card. They are:

• $200 per calendar year in Delta fees reimbursed
• $100 ($20 per year) for Global Entry
• Membership rewards points that I can transfer to several airlines
• AMEX Travel Insurance (hard to value that but VERY handy if hurt/sick abroad)
• Priority Pass lounge access abroad

When I run the numbers for 2012 so far, which is only halfway over, I have gotten WAY more than $450 value out of the card. Including bringing my girlfriend to the lounge I have done 21 visits. Add that to the above benefits and I am nearing $1000 in recuperation. That number will rise even more over the next 6 months!

Call about annual fees to get bonuses

My annual fee hit for my United Visa card this weekend. I decided to call Chase to see if they can give me some sort of incentive to keep the card. Otherwise I was going to close the account to avoid paying the fee.

It took them all of 5 minutes to offer me a credit to my account for the fee or 10,000 miles. I took the miles since I value them well above $60. I essentially just bought those 10,000 miles for $60. Under normal buy mile prices $60 would have gotten me 2,000.

So my cost is $0.006 per mile which is an excellent deal any time!

Never hurts to ask!

New credit card: 50,000 more points!

Today I was approved for another credit card to add to my nice collection of points/miles. This time around it is a business credit card that will yield me more very valuable Chase points that I can transfer to multiple hotels and airlines as I need them. I plan to use my work travel expenses to ramp this one up quickly and reap the benefits sooner than later!

I did have to call the Chase reconsideration line since I was not instantly approved. A little research has shown that no one who has published anything about this card has gotten an instant approval. It was not a big deal just to verify some information, ask questions about the business, and so on. It took about 15 minutes and now my new card is on the way.

I am running out of attractive credit card offers to apply for. This is a good thing as I don't want to get red flagged by the banks as an abuser of the system and get cut off. I am planning to take a 6 month break from new credit cards to let the dust settle and stay in good standing with the card issuers. Of course if some ridiculous offer appears I will go for it but for now I will take a break!

Credit Card for Student Loan Payments!

No I am not implying you would pay your student loans with a credit card. That is risky. Although getting the points for it would be good if you were responsible and paid off the card each month!

This time I am referring to the Citibank ThankYou credit card. You earn ThankYou points that can be spent on gift cards, cash back, and in my case student loan payments! It starts as low as 2500 points = $25 payment. In my case I am getting 50,000 bonus points for meeting $2500 in spending. That will give me a total of 52,500 points or a $525 student loan payment.

This is a good card for someone who is financially responsible and is still paying down their student loans. They get a 1% rebate on all of their normal spending to go towards their student loans. Not doing this (assuming they are responsible with credit cards) is literally leaving free money on the table! Get every penny you are due!

This will cost me $0 to achieve since I will be doing my normal spending and some business travel expenses on the card. This was a no-brainer in my case as one of my latest credit card churns. Knocking off a nice chunk of my student loans for something I have to do anyway for free is smart money! All I have to do is call Citibank when the points are posted and request a check be sent. Easy!

New Points Churn complete!

Today I applied for a few attractive points offers. In total I should get 30,000 Chase points, $500 from citibank, and 40,000 Hilton points (waiting approval on this one). They all have low spending requirements so it should be easy to meet. Only one of them has an annual fee which I will cancel before it is due next year.

This is certainly not as impressive as 2011 but it is a good start. I am trying to let my new account activity cool down so I don't get flagged by the various banks as being a greedy churner. I have read stories of people losing all of their points and relationship with the bank for doing it too much. Moderation is a key aspect of this game. Pick your battles and don't get carried away.

I also already have all the points I need this year to cover all of my travel until 2013. I of course will keep and eye out for great offers on certain cards. My goal this year is to learn more about hotel points and their programs so I can use those to my advantage also. Always learning new tricks is the key to maximizing points value!

US Airways: Grand Slam Promotion 2011

When I first heard of this I got excited. Due to a bad churn and my inexperience with it I ended up with 10,000 orphan US Air miles that I couldn't do anything with. Now I have a chance to bring that balance to 25,000 so I can eat least earn a free domestic flight on the cheap.

After sifting through the terms of the offer, a few other blogs, and forums I have formulated my plan to get enough "hits" to earn the bonus miles I need (15,000). A lot of the stuff I will do is free or something work would pay for anyway. I will have to make a few small purchases but should come in under $40. $40 is not bad for a free domestic flight!

I have learned to steer clear of Barclay's bank credit card offers. They are definitely bait and switch with their offer terms. I just lucked out that I found a way to not have it be a complete waste of time and energy. The promo starts tomorrow so I have some homework to do!

Bump the bonus: A great strategy for getting more out of bonus offers!

I go through a lot of credit card offers and rewards programs in my endless search to get my airfare and other travel needs for (nearly) free. They all offer varying degrees of bonus points and hurdles to jump through in order to get the extra points. I feel a great sense of achievement when I actually get the bonus. Then, two months later, they offer a higher bonus for the same thing--ugh. You feel robbed/cheated/stupid for not getting the extra points.

Then I learned of a method called "bumping the bonus" from other blogs I follow. The basic idea is that if a better offer comes along for the same thing you can contact customer service. I usually do this by email and it works well. You explain that you really like the program and the benefits. Ask for them to match the current offer as a measure of good will. I have about a 50% success rate on this as a lot of factors go into.

You will not always get the extra points but it costs nothing to ask except for a few minutes of time. This can really pay off if they have an offer twice as good as the one you got (such as 100,000 points instead of 50,000). This can go a long way to more free travel and rewards! Don't leave points (money) on the table!

Credit Card Churning Update

One of my new hobbies is racking up frequent flyer/hotel/other travel points with sign up bonuses. I go for waved annual fees or an extremely attractive deal in order to make this happen. The profits have been large for me and I thought I would share what I have earned in points and also what that means in terms of nearly free travel.

What I have earned so far:

• 100,000 British Airways Miles
• 75,000 American Airlines Miles
• 80,000 Continental/United Airlines Miles
• 65,000 Delta Airlines miles (bonus, not flying)

Great! I have a boatload of points earned over the past 6 months. Now what do I get from those? Here is what I am going to get:

• British Airways: Using miles to go to Easter Island in April 2012. Still enough left for domestic flight
• American: Used some to book one way Business Class from Singapore to Atlanta in December. Remainder is enough for a domestic flight plus some extra.
• Continental: Thanks to some other small bonuses and a couple mileage runs I am going first class, via Europe, from Atlanta to Bangkok. Now my primary program with about 40,000 left and climbing.
• Delta: Added to my current balance and scored a round trip business class for my girlfriend to Asia and back on Korean Air. 

My total out of pocket to make this happen is $125 plus some of my personal time. I get to take all of these awesome trips thanks to my good credit and research skills. I estimate the value of these trips and unused miles at around $10,000. Business class tickets are pricey but I get them for under $100 using miles to cover the fare.

This is a very lucrative hobby for me. I still have a lot to learn but am off to a great start so far. At this rate I can fly in style for most of my vacations for next to nothing. I should have started this years ago but better late than never. I now keep my ears to the wind for great deals!

Making the switch: Star Alliace!

As of today I have decided that I will officially divert my spend from my Delta AMEX card to my Continental Mastercard. See that I have a lot more travel options for the places I like to go abroad it makes the most sense to me. This will result in my earning on Delta coming from flying and bonus offers and the majority of my Star Alliance miles coming from spending.

It is also handy that Mastercard is practically taken everywhere so I don't have to worry about being AMEX centric with my choices. I am also going to consider flying Star Alliance if I can. Most of the time it makes the most sense to go Delta but if I can add a few more miles here and there I will. I will also keep an eye out for really good mileage run fares on Star Alliance to help as well.

I am going to try this out for a while and see if this is the best move. I am somewhat concerned that I will not be able to earn enough miles on Continental with only spending to cover my travel needs. I will see how it goes for now and evaluate again in a few months. Ideally I would like to earn enough to cover at least 1 yearly flight to Asia but that is a lofty goal at this point.

Long Term Travel: Ditch Delta Airlines?

Today was a day of thorough thinking about focusing my mileage earning on Delta. I cut a deal with a friend a while back to trade his United vouchers for a Delta award ticket. I got good use of the vouchers for my positioning flights for my recent mileage run to San Diego and back.

Today I booked the award flight for him. I had to fork over 40,000 skymiles to get the ticket. This also happens to be for an award ticket to San Diego from Atlanta. I have noticed recently that a LOT of award tickets are pricing for the medium and high tier of miles. It seems to be getting increasingly difficult to find the low level awards. The result: Delta Skymiles are worth a LOT less to me now.

I am a little back and forth since I more or less have to fly Delta for work out of Atlanta. I could do Airtran but they are horrible as an airline and even worse for award flights (no international to speak of). I will still be earning Delta miles from work flights. I will make the best use of them that I can.

If I did start diverting my credit card earnings I will go with United. I was surprised how easy it was to find low level award seats to Asia and Europe when planning ahead. It also helps that they are part of Star Alliance and have more options due to the sheer amount of airlines they can book with. They are not great out of Atlanta but I will take an extra layover if it takes half the miles to get me where I want to go. No matter who I earn with I get 1 mile per dollar spent. I need to maximize this!

I have not made my decision yet but I know my long term loyalty will shift to Star Alliance/United. As long as the award booking stays this plentiful and simple they will get my business. I am weighing the two options trying to balance long term versus short term needs. For now I may end up splitting it for flexibility. More on this when I finalize my strategy!

The Credit Card Game: Update!

As of today I hit my final spending threshold to get all of the credit card bonuses I have signed up for. It is very helpful when my boss lets me put large business expenses on the new cards to get me there quickly. I also make the "churn" card my primary card until the requirements are met.

Once all of this clears I will have earned:

• 50,000 Membership Rewards Points
• 55,000 Continental Miles
• 75,000 American Airlines Miles
• 100,000 British Airways Miles
• 10,000 US Airways Miles

All of this has allowed me to book 2 Business Class flights to SE Asia for myself and my girlfriend for this November. It is nice to be able to not slum it in Economy class for that long of a haul.  I am actually going literally around the world due to the routing if my ticket. I go through Europe on the way over and across the Pacific on the way back. All in First/Business class. Not bad for $160 in taxes!

Making My Credit Card Bonuses work: Business Class to Asia!

I have been focusing lately on some credit card bonus deals so I can get my flights to Asia this year in business class so I only have to pay taxes. I am working 2 deals where I will have enough miles for a one way on Star Alliance (Continental, United, etc) and the other way on One World (American, British, Cathay Pacifc, etc) in business class both ways!

I am doing my first mileage run in May that will boost me up to the miles I need to cover the Star Alliance half. Once I hit $4,000 in spending on my American Airlines card a big bonus should come in and I can star searching and booking both halves of my trip. It will be nice to fly in business for a 24+ hour journey and actually get some sleep.

It will be nice if I can work deals like this every year where I get enough points to keep going on my overseas extended vacations and not have to pay a lot out of pocket! Only time will tell if this will happen but I will take what I can get!

Travel Deals Blog: Frugal Travel Guy

I found a great blog and resource for travel deals and travel credit card bonus offers. This guy is the king of getting bonus points to obtain free hotels, airfare, car rentals, etc. He goes into the details of all the offers, analyzes them, and puts instructions on how to take advantage in plain English. Saves me leg work!

His title is similar to mine as a coincidence. Until a few days ago I had no idea his blog existed. While his site design is not the best the information is. He posts daily with deals he finds, tips from his readers, and anything else of interest to us travel lovers. He also posts on really low and "mistake" airfares which can be great for saving a lot on your next vacation.

His blog inspired me to take advantage of more of the bonus offers. I am going to attempt to use offers to get free airfare for myself in 2011 for my trips. With the offers that are out now this should not be an issue! Credit card companies want customers and are giving away a lot of points to do it. I need to jump on this boat and ride the wave!

Meeting Credit Card Bonus Thresholds

Many rewards credit cards, such as my Delta Skymiles Platinum American Express, have spending thresholds to get some great bonuses. In my case if I spend $25,000 in a calendar year I get 10,000 bonus miles. I sometimes fall a little short.

Here is what you can do to push yourself over with little to no cost:

• Plan large purchases: You plan and time large purchase to push you over the threshold so you can earn more rewards.
  
• Purchase for friends: A lot of people hate credit cards. Make a big purchase for your friends and have them give you the cash. I do this a lot!
• US Mint: You can buy up to $250.00 per year in $1 coins with no shipping charges. If you are really close to a threshold this can be very handy. Simply deposit or use the coins!
• Work Expenses: I get to travel for work and use my personal card and get reimbursed. This can add up fast with flights, meals, car rental, etc. Take Advantage!

Most of these things can be done by anyone. Keep and eye on your thresholds and if you are close and nearing the end of the year try to use these strategies to get your bonuses. They really add up over time!

Strategy: Using a credit card for rewards debit style!

Their is an never-ending debate on whether one should use cash or credit for monthly expenditures. There are good arguments for both sides and I recommend that you do what works for you. I have chosen rewards credit card (Delta Skymiles AMEX to be exact) since I love to travel.

The main argument against using a credit card for everyday purchases is that it affords you the ability to overspend since it does not come directly out of your bank account. Through some various reading online I have found a solution:

Pay off your credit card weekly!

This requires a little more manual work but you should be reviewing your accounts once a week anyway. By paying it weekly you have a little more cash flow control and you can still earn the rewards. It's as if you are turning your credit card into a debit card of sorts. You still earn the rewards and help to prevent overspending at the same time.

I really like the idea of this solution and plan to give it a try myself! The only catch I can see is that some credit card providers only allow you to make a certain number of payments within a given time period. The work around here is to set up your credit card on bill pay. Trust me the credit card companies will NOT refuse a payment!

The best method I can come up with is to pick a day, say Sunday, and log in and pay off the total balance at that time. You are forced to look at what you spend, pay for it only if you have the money now, earn your rewards, and avoid interest. Brilliant!

Don't forget your points!

These days their are rewards programs for just about anything you can imagine. Cash back, airline miles, hotel stays, coffee, gasoline, and the list goes on and on. The problem with having so many programs is that we get signed up and sometimes forget. They are very difficult to track!

I am writing this post to remind everyone to check on your points balances. A lot of them expire so we need to use them if we can to maximize what we get from them. A lot of programs offer great rewards such as American Express gift cards, restaurant gift cards, and even popular items such as iPods.

Make sure to check all of your balances and use them! Here is a quick list of what I got from points I had sitting around:

• $25 AMEX gift card (Chase Freedom)
  
• $25 paid toward my student loans (Citi ThankYou)
  
• $25 Home Depot gift card (Chase Freedom)
  
• A free flight home for a friend for Christmas (Delta Skymiles Amex)

As you can see this can really add up! Don't leave money on the table. Cash in your points!

Credit Card Balance Transfer Pitfalls

Credit card companies are currently slowing down on the balance transfer offers due to the high rate of default and the current economy. I have used them in the past to save me a lot of money in interest over the years. I was a fan of the 0% offers but they have now all but dried up.

I find that a lot people see a great rate advertised in balance transfer offers but fail to read the fine print. They then become victim of the change in terms and get hit with high rates, fees, and possibly end up worse off than they started. I personally believe this deceptive practice by the credit card companies is at least partially part of why they are in this mess to begin with!

What to look out for in a balance transfer offer:

• Teaser rates: This was big with the 0% offers. It would be 0% for 12 months and then jump to a much higher rate. As high as 25%! Make sure you don't do the transfer if you cannot pay it off within the allotted time. I call this the "bait and switch" method.
  
• Balance transfer fees: Most of the companies charge for doing the transfer. I have seen as high as 5% of the balance. I personally will not pay more than 3% (for a 0% rate). You are best doing a transfer that has no transfer fee attached but these are rare these days.
• Convenience Checks: A lot of the direct mail offers give you checks (if you already have an account open). SOME of them are for the rate offer. Others are for cash advances which charge the highest interest rates. Be sure you use the correct checks!
• Protection Plans: If you are not careful you will get signed up for the "protection plans" which cover your payments if you lose your job or some other financial disaster occurs. They charge a lot of money and are best avoided. This is typically offered over the phone by customer service reps at the company. "No" is your best word of choice!

Balance transfers can be useful, money-saving tools if utilized properly. As long as you do your homework and avoid the above pitfalls you will be on the road to becoming debt free. As with any other credit card offer you have to be sure to read the terms and understand them. If in doubt go without.

Credit Card Tip: Get your interest rate lowered

Today I decided to call about my oldest credit card account, a student card, to see if I could change to a type of card that would give me a better rewards program. I was unable to get better rewards but by changing to a different type of card they lowered my interest rate 5%! This is great!

I have always called and asked them to lower my rate when I had to carry a balance for a while. I did not realize that you can also get a lower rate by changing the type of card you have. It is worth your while to call and ask if you are carrying a balance. This can save you a lot of money in interest!

I usually do my research online first to see what types of cards are offered. Keep in mind that if you have a Visa you can only change to a different Visa card. You cannot change from a Visa to a Mastercard (or any other brand of card) as they all have different agreements and require a whole new application. Once you find one you like you may see that they are advertising a lower rate than yours. Chances are you could get your rate lowered and a better rewards program.

In my special case today I have a card that was owned by a company that was bought up by Citibank a few years back. For a long time I was stuck with the type of card I had. Today I was finally able to change over and at least get my rate lowered and gain a few other perks. Credit cards can be useful tools and it is important to get the most out of them.

New Credit Card Laws helping those who carry consumer debts!

I just got an email from Disover. They are changing their practices to be in line with the new laws under the CARD act. It is good that the government has taken a step to prevent banks from overcharging people and stop slamming people with fees and unreasonably high interest. I am pasting a summary from my message here:

SUMMARY OF CHANGES

INTEREST RATES

• Annual Percentage Rate (“APR”) increases for paying late or exceeding your credit limit. We will no longer increase your APRs on your existing credit card balances if you pay late or exceed your credit limit. Your APRs on new transactions may increase to a Default Rate only if you fail to make a payment when due. However, if we increase your APRs for new transactions to a Default Rate, we may, as described below, periodically review your Account to determine if your APRs should be reduced.
• Grace Period. Your grace period for new purchases is changing, which may help reduce your finance charges.

FEES

• Overlimit Fee. We will no longer charge an Overlimit Fee.
• Pay-by-Phone Fee. We will no longer charge a Pay-by-Phone Fee.
• Balance Transfer and Cash Advance Transaction Fees. If you make a balance transfer or take a cash advance, the maximum transaction fees will be increasing to 5% of the amount of each new balance transfer or cash advance, as applicable, with a minimum of $10.

PAYMENTS

• How Payments are Applied. Payments made in excess of the Minimum Payment Due will now generally be applied to high APR balances first. This may help you pay off your high APR balances sooner.
• Minimum Monthly Payment. The Minimum Payment Due calculation is changing, which may result in a higher required monthly payment. Making a higher monthly payment will help you pay down your balances faster.
• Payment Processing Time. Mailed payments received at our processing facility will be credited to your Account on the same day if received by 5PM local time, instead of the current 1PM cut-off time.

The only negatives I see is a much higher balance transfer fee and most likely higher minimum payments. Even though you do pay off your debt faster it does not mean everyone will have the ability to pay those higher payments. I have also read about banks, such as Citi, trying to push annual fees onto customers unless they spend a certain amount on their cards.

Only time will tell what credit card companies will do in the way of fees, interest, and what people will tolerate as a result of these new laws. I think it will be a positive outcome for the consumers in the long run but it may take some time to hammer out. We must all work to be free of consumer debt so things like this don't make a large impact on our financial lives!

Credit Card Review: Delta Skymiles Platinum American Express

I have been carrying this card for a long time and I love to travel. Getting 1 mile for each dollar spent allows me to use miles for my vacation airfare and save tons. I use miles for all of my vacation flights and still add to my balance. I take advantage of all of the bonus offers that come my way, too.

I decided to post this review as AMEX's site makes it fairly difficult to get all of the details on the benefits you get from the card. I have dug through it and highlighted the major benefits here. I am normally not a fan of annual fees but this card is the exception for me. It carries a fee of $150 per year which sounds steep until you add up the benefits you get.

The major benefits are:

• Earning Delta Skymiles - This is the most obvious but their are some details behind it. Any Delta purchase gets 2 miles per dollar spent. All others get 1 mile per dollar spent. There are bonus thresholds of $25k and $50k in spending where you get 10,000 bonus miles and elite qualifying miles for each milestone.
  
• Pay With Miles Option - Delta allows you to use your banked miles to pay for all or part of your purchase. This is handy because for each 10,000 miles you apply it is $100 off the ticket price. The minimum you can use is 10,000 and increments of 5,000 ($50) after that. This is only available to Delta AMEX Gold or higher cardholders.
• No Partner Airline Award Ticket Fee - Delta charges a $20 fee if you book an award ticket (using miles) if it is on another airline aside from Delta (for example Air France). As a cardholder this is waved! $20 per airline can add up!
• Fee-Free Amex Gift Cards - The usually carry a fee but are free to all AMEX cardholders most of the time.
• Fee-Free Traveler's Checks - I don't use these much but it can be handy if you are going somewhere that has little or no ATM access.
• Bonus Offers - Delta AMEX cardholders get constant bonus miles offers from Delta. Right now, for instance, you get double all miles flown through the end of the year.
• Fraud Protection - AMEX is one of the best companies when it comes to reversing charges with little hassle.
• Free overnight delivery if card is lost or stolen - I have used this a couple of times. They will overnight you a new card at no charge if needed (inside the USA).

This card has other smaller benefits that I don't utilize as much. The ones above I have found to be most important and well worth the $150 annual fee as an avid international traveler. I also travel for work so I earn even more miles and extras from Delta as well. Being based in Atlanta Delta is the best overall choice for me.

I am no longer immediately turned off by annual fee cards. I do my own analysis and see if I get more than the cost of the annual fee back in things that are actually useful to me. With so many different rewards cards out there you have endless options. Find a card that fits what you enjoy most and go for it. Just be sure to pay the balance every month!