Best use of miles/points for newbie

Discussion in 'Newbies' started by efk22, May 10, 2011.  |  Print Topic

  1. efk22

    efk22 Member

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    Hello-

    I am new to this forum and would like some input regarding the best use of miles and strategies for obtaining more miles. I received my first miles point earning card last summer. It was the SPG personal card with the 30k bonus. I haven't used any of those points and now have about 61k. My wife and I have recently received and started using the AA Citi AmEx and Visa as well as the Chase BA card. So hopefully, we'll have "lots" of AA and BA miles.

    Now for further details. My wife and I have three kids. We have several trips on the horizon. They include a Nov./Dec. trip to Las Vegas/Grand Canyon/Sedona/and Phoenix. Spring of 2012, we would like to go to Denver/Boulder to visit friends. December 2012 we will be traveling to Disneyworld. Then in the next several years we would like to take the kids to Germany to visit relatives.

    I understand domestic flights are not the best use of points and the long haul international business and first class is. However, at this point in our lives, I don't see that being an option. I feel that we have these points via AA and BA and I feel that by using them, this will help me defray the costs of traveling with a family.

    I have flown out of BWI/PHL/MDT. I don't have a preference.

    My last question for the time being is the further accrual of points/cash back. If I don't anticipate using any of the points for international upper class travel, would I be better off using my Schwab 2%/Fidelity 2%/Costco AmEx and Penfed cash back cards, putting the cash in a travel account and buying my tickets/hotels with cash?

    Thank you
     
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  2. sobore
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    sobore Gold Member

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    Welcome to MP! :)
    With the points you have, see if there are any 'point and cash' options or 'point stretcher type awards'.
    These can help the points and miles you have go further and help reduce expenses. Another thought is to book one award night per trip to defray the total cost of each trip.
    Some airlines also offer the mile and cash option.
     
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  3. MSPeconomist
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    MSPeconomist Gold Member

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    Welcome to MP.

    You ask a complicated set of questions that are tough to answer in general for another person as they involve the value of money, miles, and points to you now (or, more precisely, during the next year or so) versus their values to you at some undetermined time several years in the future. At that point, you could decide that it would be better not to attempt to travel in business or first class with three kids to Germany--either to take the family in coach at that time or to postpone the trip until the kids are older or perhaps have studied German and European history in school.

    However, you should cautious about assuming that the miles required for the trip will be the same in several years as it is now. Moreover, your miles so far will be on oneworld, which has a decent but not overwhelming presence at PHL (which is a hub for USAir) and AFAIK not a lot of flights out of BWI (which has lots and lots of Southwest flights).

    To get the best value from SPG points, consider either cash and points redemptions or the stay five nights but pay miles for four awards. For example, five nights in a Category 5 property, which might be fancier than you want for the family, is 48,000 points, versus 5 nights times 12,000 points per night or 60,000 points, a saving of 20%. However, you should be aware that Starwood award rooms are for two people; the hotel might not permit cots or additional occupancy.

    ADDED: If you understand your options, please don't feel like you necessarily should follow the standard advice of others regarding how best to spend your miles. While you will see people here who are indeed enthusiastic about using miles for longhaul international trips in first or business class, this is not necessarily the best decision for you.
     
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  4. BurBunny
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    BurBunny Silver Member

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    Forgive my ignorance here, as I'm not a Oneworld person, so am not familiar with the terms of the AA vs BA cards, but something about what you wrote triggered a little warning voice. Do your AA/BA cards allow you to combine AA and BA points into single awards? If not, you might be spreading out your points a bit thin rather than combining them into a single earning account which would make redemptions easier for you to achieve when your ready, whatever those redemptions may be.
     
  5. dkelly1110
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    dkelly1110 Silver Member

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    Points from different programs cannot be combined into one (without steep devaluation). OP can figure out what kind of reward she wishes to attain and then switch spending to the other card when that target is hit.

    If you are going to be using your miles for domestic coach tickets, it is often a better overall value to earn cash back.
     
  6. MSPeconomist
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    MSPeconomist Gold Member

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    However, if you have miles in different airline accounts in the same alliance, they can be used to obtain multiple award tickets on the same flights. However, assuming that the kids are under 15, one parent would probably need to be ticketed together with each child to avoid unaccompanied minor fees.

    In this case, BA and AA are both in oneworld.
     
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  7. BurBunny
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    BurBunny Silver Member

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    Thanks for clarifying - I didn't want to give advice without being sure I was on solid ground since AA/BA are ever getting closer to one another. Was just wanting to point out to OP that sometimes multiple cards aren't the best optimization, especially since partner awards are possible. Perhaps combining spending into one card or having one points and one cash back card might be a better option.
     
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  8. dkelly1110
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    dkelly1110 Silver Member

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    Great point. Thanks.
     
  9. tom911
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    tom911 Gold Member

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    If you can plan that Germany trip between October 15 and May 15, and don't mind travel in economy, AA offers a 40K off peak award to Europe. I think it's one of the best values out there, particularly being that it covers travel after March 31 when cheaper winter fares usually end. That may be a goal within your reach. I used one myself to London just last month.
     
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  10. sargenet
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    sargenet Silver Member

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    My husband and I are in a similar boat. We don't acrue a lot of miles/points with travel. He may travel once or twice a year for business. And I don't always know what airline...his travel department decides that. But I try to get as many points as possible based on his travels and compliment them with credit cards from SPG and Hilton. We have also done the Citibank AA, Continental, Chase, Hyatt, Cap One...and now I am working on the 75k membership rewards miles from the Gold AmEx card....

    We travel as a family and I have found we seem to be better off using points/miles towards hotel costs versus airline tickets. I had a hard enough time this year finding milesaver awards for 3 people on American and United...I imagine 5 is even harder. And with kids you may get stuck traveling over holidays which makes it even worse ! To me it would be cheaper to buy the airline tickets than to spend the miles for anytime awards on American... that would be 250K miles for 5 tickets...

    We just transferred a bunch of miles over from SPG to American....but not for a flight. We actually used them to book 3 nights at the Hyatt in Maui for about 20K per night...on a limited offer. I have found that you can get some decent deals on hotels using your American miles....just be real careful as they are non-refundable... and they allow you to enter that you need a room for 2 adults and 3 kids and will give you available options. Or book two rooms...
     
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  11. viguera
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    viguera Gold Member

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    Award travel is iffy as it is for 2 people, let alone for 5. You have to contend with availability on the same flight, where you wanna go, at the time you want to go.

    My suggestion to someone starting out trying to book family award flights is to just keep banking miles. Concentrate your earnings into a single program and earn as much as you possibly can. Because if you did have 250k miles to spend on award flights but you have no easy way to replenish that, then you're going to do it once and probably never again.

    If you don't earn a lot of miles from flying and you don't have status to earn bonuses when you do, then you have to work hard at it. CC churning, coins or just plain old lucking out on a promo is the only thing you can do.
     
  12. yaychemistry

    yaychemistry Silver Member

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    You might also consider the "generic" miles card like the Capital One Venture Card, where you can use your points/miles for a statement credit for purchased tickets. That way you can pay for all 5 tickets, and then credit yourself back for however many points you have (you might want to split it into a couple transactions). It works for hotels too.

    It looks like you just missed the 100k Venture card Match promo, but the Chase Sapphire Preferred has a 50k point sign up bonus (after you spend $3k in 3 months on the card). The Sapphire Preferred also has the bonus of being able to transfer points 1:1 to CO/UA and BA if you want to combine the points with actual flown miles on those carriers.

    The other upside is that you also earn miles on the carrier for the flights if you purchase them this way.
     
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  13. MSPeconomist
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    MSPeconomist Gold Member

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    Welcome to MP. USBank has a Visa card that works this way. It was a NW WorldPerks affiliated card, but after the DL/NW merger, DL stayed with AmEx and USBank turned the card into a very nice one that can be used for get tickets on any airline. Also, as you point out, these tickets are treated by carriers as revenue tickets, so they earn miles.
     
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  14. yaychemistry

    yaychemistry Silver Member

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    Actually, this question seems to be valid for me too, and I'm guessing there might be a few people with similar situations....
    1) not likely to fly anywhere internationally, so the "best" value of international F or C awards is not available
    2) travel dates tend to be during holidays or otherwise not flexible so domestic awards aren't likely
    3) I travel roughly 20k BIS miles on *A each year, so if I get that extra trip I don't want to miss out on 2P because I booked an award ticket.

    Where I have been spending miles recently is domestic upgrades (NC on p.s. is pretty sweet) when they are available. But as mentioned in that thread, the new redemption levels don't seem to be such a sweet deal anymore (see this thread).

    So what do I do with my miles? I'm racking them up, but I've got nothing to do with them. I'd prefer to have a "stable" way to spend them... just banking them seems like a good way to lose value due to "mile inflation" or worse yet, risk a "change you would like" to a revenue-based mileage program akin to VX (not saying it will happen - knock on wood - but its not impossible)

    Changing my c.c. earning to the Chase Sapphire Preffered Card (or perhaps another generic miles card) seems like a decent deal. I can use the points to buy tickets and still earn EQM on the flights. And if I want to get a international award I can switch the points to miles 1:1 (if that feature sticks around).

    Alternatively, I can burn them on an RCC membership. It sounds like a waste, but compare:
    40k miles + $125 for 1 r.t. in domestic F vs 69.5k miles for a year-long RCC membership (although, with only 10-15 visits likely in a year). This topic has been touched on in a thread where I'm trying to rationalize a lounge membership for my expected flying for the rest of the year (this thread).

    Any other ideas for how to spend miles?
     
  15. MSPeconomist
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    MSPeconomist Gold Member

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    You're asking a lot of complicated questions.

    First of all, I wouldn't use 69,500 UA miles for RCC for one year. At a penny a mile, that's $695. Look at Priority Pass or AmEx Plat (regular charge card) or the fancy CO card that included lounge access. Think carefully about which lounges are at airports you use and whether you can get to those lounges and whether they're convenient for gates your carrier is likely to use. $695 buys a lot of drinks and snacks in airport bars/restaurants to get a quiet good place to sit.

    Why not plan to use your miles for some splurge foreign trip that you otherwise wouldn't take? There are interesting places that are easy for one's first time abroad. You just need a passport and a tiny sense of adventure. It can be surprisingly easy to get business class upgrades or award tickets around major holidays. Just be careful about hotel prices around New Year's Eve.

    I agree with your instinct to purchase a ticket rather than get an award ticket if it makes the difference in getting elite status or not. Depending on your cost/benefit calculation, think of even adding a trip (not necessarily a pure MR, maybe just a fun weekend someplace far away) to ensure elite status. If you check bags regularly, this can save a lot of money.
     
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  16. yaychemistry

    yaychemistry Silver Member

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    Thanks for the comments, MSPeconomist. They are certainly helpful. I agree that the miles for RCC is not a great valuation, and I would more likely buy Priority Pass... Sorry for the battery of complicated questions.

    However with my work situation, taking a week or two off to go to South America or New Zealand (where I definitely want to go) is probably out of the question for the next couple of years. I'm just afraid of some kind of devaluation in the coming years (maybe I'm a little too paranoid) before I get a chance to go.

    I just remembered the Mileage Plus Choices program, which essentially works the same as a "generic miles" program, where flights are redeemed at 1cpm via a statement credit. That might not be a bad idea if I use it to purchase MRs.
     
  17. MSPeconomist
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    MSPeconomist Gold Member

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    Are you sure that tickets acquired this way earn miles? For the equivalent program with DL (Pay with Miles), they do not. Even if you just use miles to pay $10 of an expensive ticket, the entire ticket earns absolutely no miles.
     
  18. yaychemistry

    yaychemistry Silver Member

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    I'm not sure. This is through the Chase UA Visa, not MP itself. (Is the DL program through the Amex card?)

    It doesn't say anywhere in the terms and conditions: http://www.united.com/page/article/1,,51667,00.html
    I would think that the tickets paid in this way are mileage earning for two reasons:
    1) Only miles earned with a Chase UA Visa can be used to pay for the ticket
    and
    2) And the ticket is "paid" with a statement credit to the Chase Visa that can be requested after the flight (up 90 days after purchase), so then Chase would have to get UA to claw back those miles after they've posted to your MP account... I'm not sure they would do that.

    Thanks so much for the help, MSPeconomist. After sleeping on it, I think its best just to save the miles for my next vacation - whenever that may be. I'm on track to hit 2P this year based on paid flying, so a MR won't be necessary. Even if the miles get devalued again before then, the 70k miles for an RCC would still probably be worth more for international travel than for club access.

    Oh, by the way... maybe MP is tracking my recent RCC fixation because they're sending me emails about buying a membership with miles (http://p.p0.com/YesConnect/HtmlMessagePreview?a=0ClheesapRmpiURNqt-IsAvp&msgVersion=web)
     
  19. MSPeconomist
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    MSPeconomist Gold Member

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    MP might spit out ads based on what webpages you visit, but you should not be getting spam email as a result of signing up for MP or your use patterns here. Look at the MP privacy statement. You're probably getting the emails as a mass mailing from UA, especially during the merger.
     

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