How do you want to think about budgeting for your hotel stays?

I've written a series of posts about my preferred metric for evaluating hotel loyalty programs, which I call imputed redemption values. This is a straightforward metric that tells you if redeeming hotel rewards points gives you a better or worse deal than paying cash that you've manufactured on your most lucrative cashback-earning credit card.

For example, a 95,000-point Hilton Honors redemption would require $15,833 in bonused spend on a Surpass American Express card. If your most lucrative cashback card earns 2%, that gives you a breakeven point of $316 (since for prices above that, a points redemption will require less manufactured spend), if it's 2.105% cashback you have an imputed redemption value of $333, and if it's 2.625% your IRV is $415. 

This metric doesn't tell you what you should do with points you've already earned — I always prefer to redeem points before spending cash. But if your points redemptions come in consistently above your imputed redemption values (95,000 points for a $2,000 night), then you are well-advised to continue earning those points, while if you fall consistently short (95,000 points for a $95 night), you might consider moving away from those loyalty currencies and towards additional cashback, instead.

Yesterday Frequent Miler posted an interesting analysis of some data (with a followup here) from the Hilton Honors program showing, as I'd hypothesized last month, that the new program would see redemptions bunched more tightly around the 0.4 cent per point redemption level. He provides some important insight on different factors that might affect the ultimate value you receive; read the whole thing.

Such analyses are very useful, but it's also helpful to pull back occasionally and give some thought to more basic questions: what's the best way to save money on your hotel stays?

What programs allow you to earn the stays you want as cheaply as possible?

Bottom-tier stays

There are phenomenal values at the very bottom of several hotel loyalty charts:

• If you have a US Bank Club Carlson credit card earning 5 points per dollar on all spend, you can earn a free night at any Category 1 property every time you spend $1,800. Even if your backup card earns 2.625% on unbonused spend, you're exceedingly unlikely to find a room for less than $47.25 per night — taxes alone are likely to be that much!
• With an American Express Hilton Honors Surpass card you can earn 5,000 Honors points, which is, I believe, still technically the fewest points required for a Hilton award stay, after spending $833 at a bonused merchant. That's not a value that any other hotel loyalty program currently offers.

Mid-tier stays

If you're staying in a more expensive market, for example mid-sized or larger cities, there are a few options for getting reliably outsized value:

• If you signed up for a Barclaycard Wyndham Rewards credit card back when the card still earned 2 Wyndham Rewards points for each dollar you spend, you can earn a free night at any of Wyndham's properties for every $7,500 you spend on the card — and Wyndham has a LOT of properties!
• In my experience Hyatt offers consistently reasonable pricing for mid-tier stays. For example, while the Chase Marriott credit card's Category 1-5 annual award certificate has become worthless as desirable properties migrate up and out of Category 5, most of Hyatt's centrally located city properties still top out at Category 3 or 4, costing 12,000 to 15,000 points per night, and are eligible for the Chase Hyatt credit card's annual free night certificate. If you have a Chase Freedom Unlimited credit card earning 1.5 Ultimate Rewards point per dollar, and a premium Ultimate Rewards card that lets you transfer those points to World of Hyatt, these mid-tier properties have an imputed redemption value between $160 and $200, while nightly rates can be substantially higher.

Top-tier stays

At the most expensive properties, a travel hacker has a few options:

• Hilton Honors currently tops out at 95,000 points per night (when standard room awards are available), allowing you to earn a free standard room award night for $15,833 in spend, or $12,667 on stays of exactly 5 nights, since the fifth night is still free on award stays;
• World of Hyatt standard room redemptions top out at 30,000 points per night. If you choose to manufacture unbonused spend on a Chase Freedom Unlimited in order to transfer Ultimate Rewards points to World of Hyatt, such a top-tier redemption would require $20,000 in spend, with an imputed redemption value of between $400 and $525 per night, depending on your best cash back alternative.
• Starwood Preferred Guest, and their new owner Marriott Rewards, seem like they should potentially offer some value, and indeed if you're committed to visiting one of their top-tier properties you should certainly redeem points instead of paying cash. If you're committed to visiting a top-tier, 45,000-point Marriott Rewards property, then manufacturing $15,000 in spend on a Starwood Preferred Guest American Express card and transferring the points to Marriott Rewards at a 1-to-3 ratio is clearly the cheapest way to pay for such a stay. However, for stay categories below top-tier Marriott Rewards stays I believe most travel hackers are likely to find more value elsewhere.

Conclusion

I have always thought it was a curious fact about travel that, when you do enough of it, transportation itself consumes a smaller and smaller portion of your travel budget. Of course you can make it more expensive by traveling in more expensive cabins, but the fact is a single night in a hotel can easily cost as much as a plane ticket!

I've never had any trouble finding miles, points, or cash to pay for flights; I spend much more time calibrating the points I earn for hotel stays than I do for my air travel.

Doubt, skepticism, and risk management

Late last week there was a widely-publicized deal allowing you to earn 150 Avios per dollar spent at Match.com (with follow-up here). I had an exchange on Twitter with Ralph at PointsCentric that got me thinking about an issue that comes up fairly regularly in any travel hacking practice: the intersection of doubt, skepticism, and risk aversion.

I doubt nothing

Every travel hacker knows the feeling early on when they say to themself, "there is no possible way this will work," only to discover that it does. Doubt gets pounded out of you fast when you're regularly being paid by banks and merchants to shuffle money in, around and through them.

That's why I doubt nothing, and am willing to evaluate any deal at face value: what's the out-of-pocket cost, how much will I earn in rewards, what's the potential upside of the deal compared to other opportunities?

I'm skeptical of everything

In this case, the best case scenario was purchasing roughly 82,000 British Airways Avios for roughly $550, or 0.67 cents each, a 33% discount compared to transferring Ultimate Rewards points (worth one cent each) to British Airways.

Next, you can start considering the risks:

• The purchase won't track properly;
• The purchase won't track at all;
• The deal will be retroactively changed or revoked;
• Your account will be closed for abuse.

It turns out that what appears to have happened so far is that points were only awarded for "base" subscription amounts, not any additional features added to the subscription, meaning people who "maxed out" the deal earned 30,500 Avios for $550, paying roughly 1.8 cents per Avios.

Let me be clear: I did not predict this in any way, and am not taking credit for being prescient. I stated clearly in the Twitter exchange I linked to that I expected they would honor the deal (as they partially did). What I did say was that "you can buy Avios for one cent each year-round. The extent of the discount is the extent of your confidence." While I thought they would honor the deal, my level of confidence was extremely low, far too low to commit $550 to finding out whether my prediction was right or not.

It does sound like people are being refunded their Match.com subscription fees upon request, so those folks who jumped on the deal will, fortunately, be made whole.

Risk management is the intersection of belief and skepticism

There are two rules that are as true in travel hacking as they are in virtually any other field of human endeavor:

• The majority of gains accrue to those willing to take the most risk, and;
• The majority of losses accrue to those willing to take the most risk.

While I'm willing to take unlimited risk in my investment portfolio, I'm willing to take virtually no risk in my travel hacking portfolio. For me, travel hacking is about easy, consistent wins: I can calculate my profit on manufactured spend down to the penny, and I can fully comprehend the (not inconsiderable) risks.

I wrote back in January about a relatively speculative play I made, counting on an increased portal payout that never arrived. For that play I managed my risk in several ways:

• I made the purchase on a card the statement closing date of which had just passed, giving me the benefit of a full statement cycle and grace period to determine if the purchase would track and post properly;
• I made the purchase from a merchant with a generous, extended return period, ensuring that if the purchase failed to track properly (as it ultimately didn't) I wouldn't have to resell the merchandise at a loss.

As I explained in a recent subscribers-only Newsletter, I ended up making a small profit on the deal anyway, but I was only willing to pursue the deal in the first place due to the risk-management I had available.

Conclusion

When these time-limited deals come along, the fear of missing out that is the object of much popular fascination swings into action.

My basic view is that people should have a perfectly rational fear of missing out on the experiences they want to have, while trying to assuage that fear with respect to a particular deal or particular opportunity is far more likely to lead to expensive (or at least time-consuming) errors.

It's perfectly reasonable to relentlessly chase every deal that helps you achieve your goals, while only pursuing the fashionable deal of the moment after the most careful consideration.

Rebook your Hilton award reservations, but carefully

Some friends recently told me that since the latest changes to Hilton Honors went into effect they'd seen prices go down at some properties where they had existing reservations. I hopped online and saw that, indeed, the pricing on one of my upcoming reservations had dropped from 50,000 points to 46,000 points per night, and another had dropped from 60,000 to 57,000 per night.

Since both reservations were for 3 nights, that's 21,000 in found points, or $3,500 in American Express Hilton Honors Surpass grocery store spend. In other words, not that much, but not nothing either, and worth a few clicks in order to rebook at the lower rate.

Hilton is not good at stuff

First I attempted to change a 150,000-point redemption into a 138,000-point redemption. After completely the change, I was expecting to see my available Honors point balance increase by 12,000 points. Instead, it went down by 138,000.

In other words, instead of either calculating the difference in points required or redepositing the entire award amount and then deducting the new cost, the Hilton website simply deducted the new total points required.

That's not great. Today I called in and got a Diamond agent who, after I carefully explained what had happened 3 times, was able to figure it out and told me, "you should have cancelled the reservation and rebooked, or called in." She then proceeded to cancel my second, correct reservation and make me another, correct reservation, "explaining" that "the old reservation still has your certificate attached."

Also surprisingly rude!

Since I had her on the line, I also asked her to change my second reservation to reclaim another 9,000 miles. I was booked into an accessible room that had dropped in price, and the agent started interrogating me about whether I really needed an accessible room, and scolding me that they had a very limited number of accessible rooms, "like handicapped parking spaces."

This was so obviously inappropriate I don't have much to say about it, except to pass along what the Hilton booking engine itself says about the issue:

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If Hilton thinks there is a problem with people booking accessible rooms in order to save points they can address the problem by not charging more for non-accessible rooms. Instead they chose to go the opposite direction, fine-tuning to an ever-increasing degree the number of points they charge for different room types, dates, and properties.

I'm reminded of the study made famous by Freakonomics, in which charging parents fines for picking up their children from daycare late increased parental tardiness, since it swapped a monetary incentive for an ethical incentive. The price mechanism is marvelously effective, but one of the things it's effective at is swapping financial calculations for moral calculations.

Conclusion

Naturally the reason I was trying to change my reservations was to ensure that space wouldn't disappear between cancelling a reservation and trying to rebook. That turned out to be a mistake! If you're worried about award space disappearing, your best bet is to call in.

Otherwise, just cancel your reservation and use the redeposited points to make your new reservation — that's what they'll do over the phone anyway.

Blending earning and redemption rates

When an affiliate blogger is trying to sell you a credit card that allows you to redeem bank points against a travel purchase, they sometimes pull this fairly ingenious, if transparent, sleight of hand:

• When you earn airline miles for a purchase, then redeem those miles for travel, the value you get per dollar spent depends on the value you get per airline mile.
• When you earn bank points and redeem them against a paid flight purchase, you don't just get the value of your bank points, you also get the value of any airline miles earned for your paid flight.
• Therefore you should value a dollar spent with, for example, a BankAmericard Travel Rewards card not as the 1.5 cents in travel you get, but as 1.5 cents plus the airline miles those 1.5 cents in airfare will earn.

Did you catch the switch? All the work here is being done by the value of a dollar, a value which the blogger then assigns to whichever credit card has the highest signup bonus this week.

I thought of this yesterday because I'm in the process of booking a couple of spring and summer trips, and found myself in a somewhat related situation.

A Southwest Business Select fare buys a lot of Wanna Get Away fare

When I was booking my Southwest ticket to Montego Bay using US Bank Flexpoints, I booked a Business Select fare since Wanna Get Away fares weren't available and the difference in cost between Business Select and Anytime didn't move my fare into a higher Flexperks redemption band.

This creates the somewhat interesting situation wherein I redeemed 50,000 Flexpoints, worth $500 in cash, for a ticket worth $953.61, and earned 9,336 Rapid Rewards points, worth roughly $93 in Ultimate Rewards points I wouldn't have to transfer to Southwest in the future.

That future turned out to be yesterday, when I booked a ticket to Las Vegas for dates when Wanna Get Away fares are available. Since my ticket cost about 16,000 Rapid Rewards points, I only had to transfer 7,000 Ultimate Rewards points, worth $70, to Southwest to buy my ticket.

Now, it's worth saying that actual Southwest Airlines enthusiasts don't run into this situation: they book Wanna Get Away fares on every flight they're even remotely considering taking as soon as the schedule opens up, knowing they can cancel all their unwanted flights up to 10 minutes before departure.

But since I'm not a Southwest enthusiast, I was pleasantly surprised to see my best, cheapest choice for one flight earn over half the cost of my next flight on Southwest, which was also my best, cheapest option.

My first Delta Pay with Miles redemption

As long-time readers know, I earn 1.4 miles per dollar spent on my Platinum Delta SkyMiles American Express card by spending $50,000 each calendar year (or sometimes slightly more for technical reasons).

In order to break even against a 2.105% cash back credit card, my overall objective is to get about 1.5 cents per SkyMile on my award redemptions. If I can break even on my spend in that way, then I'll end up paying a $195 annual fee for 20,000 Medallion Qualification Miles and a domestic economy companion ticket.

Meanwhile, Delta-operated flights have a kind of "floor" on redemptions of 1 cent per SkyMile, since you can use Delta's Pay with Miles feature to reduce the price of revenue tickets by that amount: 10,000 SkyMiles reduces the cost of your ticket by $100, for example.

With all that said, today I made two Delta SkyMiles redemptions, both below my target threshold of 1.5 cents each!

I needed to book two one-way tickets, with a retail price of $362.80 and a SkyMiles award ticket price of 32,500 SkyMiles and $5.60 in fees. That produces a redemption rate of 1.1 cents per SkyMile for an award ticket, or just 1.54% cash back for purchases with my American Express card. Since I had the SkyMiles in my account, and I know my miles are worth nothing until they're redeemed, I booked my partner's ticket that way.

For my own ticket, I used the Pay with Miles option to redeem 35,000 SkyMiles against $350 of the fare, and pay $12.80 in cash for the remainder, getting exactly 1 cent per SkyMile in value. However, since Pay with Miles tickets now earn Medallion Qualification Miles, I'll also earn 2,663 Medallion Qualification Miles for the ticket. Compared to the award ticket redemption I booked for my partner, I'm paying 2,500 SkyMiles and $7.20 for 2,663 Medallion Qualification Miles.

From a pure imputed redemption value perspective, these two redemptions together leave me with a shortfall of $305.30, getting just $707.20 in cash value compared to the $1,012.50 I needed to break even on the prorated amount of spend (67,500 out of 70,000 SkyMiles).

What do these redemptions have in common?

I connected these redemptions in my mind because I happened to be making both of them on the same day. But they also both illustrate that, for me, there's no such thing as the perfect redemption: there's only the perfect redemption for the moment.

Instead of refusing to fly Southwest unless there were Wanna Get Away fares available, I redeemed fixed value points for the flights I actually wanted to take, and earned a boatload of Rapid Rewards points towards a future redemption. On the other hand, instead of redeeming SkyMiles at a low valuation, I redeemed them at an even lower valuation in order to accumulate a few thousand more Medallion Qualification Miles.

Finally, what all these redemptions have in common is that they let me pay as little as possible for the trips I want to take. And that, for me, is what travel hacking will always be about.

Conclusion

While the affiliate blogger version of this phenomenon is a barely-concealed attempt to sell credit cards, there's another element that rings perfectly true: earning a combination of fixed-value points, flexible points, and brand-specific currencies may give you the opportunity to leverage currencies against each other.

On the other hand, such a combination may cause you to orphan points in multiple programs without every getting sufficient value from any of them.

Money is fungible, but only if you funge it

Back in October, over at the Saverocity Observation Deck podcast Joe Cheung interviewed Noah from Money Metagame and they discussed a post Noah wrote last year asking the question, "Is Anyone Actually Saving Money By Travel Hacking?"

Read the whole piece, as they say, but rather than respond directly to him, I am going to be more proactive and explain how how you really can save money using the tools of travel hacking.

Money doesn't funge itself

Perhaps after opportunity cost, the fungibility of money is one of the most popular concepts from economics applied to travel hacking. If money is fungible, then it doesn't matter how you earn income: whether from employment, reselling, manufactured spending, or high-stakes poker, every dollar you earn goes into the same pot, out of which you make decisions about consumption and savings.

This is true as a description of money, but need not be true about your own behavior towards money.

Ringfence your profits

One way to turn your travel hacking into asset-building is to identify and isolate your profits from travel hacking and direct them exclusively towards long-term asset accumulation. For example, if you have a Fidelity Visa Signature card earning 2% cash back, you're already depositing your cash back each month into a Fidelity account. Instead of withdrawing it into your regular checking account, where it will funge with all your other money, put it into a separate account (I personally use a Consumers Credit Union Free Rewards Checking account that pays 3.09%+ APY).

The key point is that it has to be additive. If you already have an IRA housed with Fidelity that you would max out each year anyway, you aren't increasing your savings by depositing cash back rewards into it, you're just changing the funding stream. Instead, you could open a brokerage account and use your cash back rewards to fund investments in that account.

Buy travel from yourself (with a friends and family discount)

When I'm booking travel for other people, I normally charge them either the cash value of the points I redeem or the fairest price I can think of, for example one cent per mile for airline miles and half a cent for Hilton Honors points. Since in virtually all cases I would rather have money than miles and points, this is usually a way to get my friends and family big discounts and turn my stagnant balances into cash — a win-win.

I don't pay myself for travel I redeem on my own behalf, but you could! After all, if you treat a 25,000-point Hyatt redemption as "free," instead of costing as it does $250 in transferred Ultimate Rewards points, you might travel more than you really, objectively speaking, can afford to. If you instead sold travel to yourself (with the same friends and family discount you'd give anyone else) and moved money permanently into an investment account or other place you were sure you wouldn't spend it, you might develop a more tangible sense of the costs of your "free" travel.

A related issue arises when you redeem bank points like those earned with the BankAmericard Travel Rewards card, Capital One Venture, or Barclaycard Arrival+ against travel purchases: the redemption really does reduce your outstanding credit card balance, and so is clearly some form of "income," but you never actually see a deposit into a bank account. Instead, you simply don't pay off part of the credit card balance you incurred booking your travel. "Buying" travel from yourself is a way of dealing with this curious situation and converting hypothetical profits into long-term assets.

Liquidate into your net worth, not your bank account

I've written before about using Plastiq to liquidate tiny-denomination prepaid debit cards, like the balances left over on 5% Back Visa Simon Giftcards (you can find my personal referral link on my Support the Site! page). Plastiq has a lot of billers in its database, so you might be tempted to use it to pay monthly recurring bills, like your rent or utilities. But making those types of payments won't help you accumulate assets, they just leave extra cash in your already-funged checking account.

Instead, you could deliberately target those payments towards long-term debt reduction, like making additional payments towards your mortgage, auto loans, or student debt. That way, instead of replacing payments you are already making anyway, you're using travel hacking to pay down those debts more aggressively and both increase your net worth and reduce the interest you'll pay over the life of the loans.

Conclusion

The economics professors in my audience are welcome to tut-tut me for suggesting such degrading psychological tricks, but it seems crystal clear to me that if you don't use one of these or some other method of isolating and investing your profits from travel hacking, then it's exceedingly unlikely to actually improve your overall financial position. On the flip side, a few additional thousands of dollars invested in sensible low-cost index funds have the potential to turn your short-term travel hacking profits into long-term financial success.

Quick hits: hijinks booking Mileage Plan awards on Virgin America

In the last few months I've written a couple posts about booking award travel on Virgin America, with Alaska Airlines Mileage Plan miles and with HawaiianMiles, mentioning a few things I had come across doing everyday research.

Lo and behold, I actually just had occasion to book a Virgin America ticket with Mileage Plan, and found a quirk that might cost you thousands of Mileage Plan miles if you aren't paying attention.

Virgin America sometimes only makes one First Class award seat available to Mileage Plan at a time

I was searching for two tickets between the East Coast and San Francisco for June, and saw two First Class seats available for 60,000 Mileage Plan miles on Virgin America's nonstop flight:

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After running the dates by my partner, I decided to just book one ticket for myself and book hers later. After running a search for one passenger, I found a First Class ticket available for just 25,000 miles:

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While selecting my seat, I noticed that the First Class cabin was completely empty. After booking my ticket, I decided that booking a refundable 60,000-mile ticket for my partner made sense to make sure we were on the same flight. But when I searched again, another First Class ticket had become available at the 25,000-mile level!

Then I remembered that all Alaska Airlines tickets are refundable greater than 60 days before departure, so I went ahead and booked her a low-level ticket as well.

Out of curiosity, I searched again and yet another 25,000-mile ticket had become available. In other words, Alaska Airlines was only showing one low-level First Class award seat at time, but immediately made an additional seat available each time one was booked.

This doesn't seem to be a universal phenomenon, since I was able to find 7 First Class seats simultaneously on the same route on January 18, 2018, but it does seem fairly common for dates in June, when I'm planning my trip.

Since Alaska award tickets are refundable within 24 hours of booking, and outside of 60 days, there's no risk booking low-level award tickets one at a time to see if additional seats become available. If they don't, and you'd like to make different plans, you can quickly cancel all the reservations you were able to make.

The Mileage Plan search engine shows incorrect fees on Virgin America

For some reason the Mileage Plan search engine shows fees and charges of $19, but once you select a flight and continue the correct fees and charges, in this case $5.60, are shown.

My only theory is that the engine might be adding half the $25 partner booking fee, $12.50, to the security fee of $5.60, and rounding up to $19.

In any case, when you proceed to checkout you'll see the correct, lower fee before paying.

My Jamaica all-inclusive wasn't annoying for any of the reasons I expected

I got back from Jamaica on Monday night, and had an absolutely marvelous time. On Friday I wrote about some questions I had about the experience, since I've never visited an all-inclusive resort (or Jamaica) before.

Now I have the answers to those questions and more! This is a pretty detailed [i.e. boring — ed.] post so go ahead and skip it unless you're curious.

Getting to the resort is totally seamless

All the Zilara website says is "After passing through customs, simply visit the Hyatt Lounge, where airport agents will arrange travel to our hotel."

I had no idea what this meant, but it turns out be to uncannily accurate. Immediately after customs in Montego Bay, you enter a large arrival hall with "lounges" for most or all of the resorts on the island. There, I confirmed the credit card I had on file, filled out some paperwork, and after 5 or 10 minutes a driver arrived to take us to the resort.

I'm not entirely clear on the economics of these airport vans, since none of the vans I saw had any kind of resort branding, so I assume they're private contractors who take turns driving guests to and from all the resorts as they arrive and leave.

Everything about the physical property is terrific

Reader Ben commented on Friday's post that the Hyatt all-inclusive properties are relatively new, and as far as I can tell the Hyatt Zilara Rose Hall opened in late 2014. If anything, I'd say the property felt even newer than that. The little things that are usually the first to go worked flawlessly: the sinks, showers, light switches, air conditioning, phones, etc. never gave us any trouble at all, which is something at a property where people are constantly tracking around sand and seawater!

My Diamond status maybe got me an upgrade or two

When we checked in at the airport I saw that our room type was "Jr. Suite King," which is at least an upgrade from the room I'd reserved, and which I assume was based on my Diamond status (it certainly wasn't based on the rate I paid). We arrived at the property around noon, and were told that we wouldn't be able to check in until 3 pm, the guaranteed check-in time.

When 3 pm came and went, our room still wasn't available, so we parked in the lobby to wait. After half an hour more, the front desk clerk came over, apologized even more, and upgraded us again to an "Ocean View Jr. Suite King."

It was great! Here's the view from our balcony, in case you missed it on Twitter:

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We ate several meals out on the balcony, as well as resting and reading out there.

The employees are incredibly friendly

I always have a lot of followup questions when I'm in a new and unfamiliar environment, and all the employees were friendly and accommodating.

One interesting thing I observed and finally asked someone about is that the hierarchy of employees felt very "flat." There were always a lot of staff around but I never observed anyone "managing" anyone else, giving instructions or criticism. It turns out the only way to identify the supervisors is that their shirts, which are otherwise identical, have a slight slit at the bottom that I never would have noticed if I hadn't asked. After that it was funny to keep an eye out for who was in charge at each restaurant, bar, and activity.

I discovered two and a half rules governing guests

As the curious sort, one of my biggest questions was just how many rules we'd accidentally bump against. I figured as a bumbling American people would always be telling me to do this and not do that.

But over the course of our 3-night stay I only ever observed 2 (and a half) rules being enforced.

First, children are absolutely forbidden on the adults-only Zilara side of the resort. This was somewhat funny because the Zilara side, especially at the beach, literally runs into the family-friendly Ziva side; it has to since the two properties share the same water sports booth. But if any kids stepped over onto the Zilara side security suddenly materialized and ushered them quickly away. The parents did not, usually, find this as funny as I did.

Second, you had to wear a shirt in the food service areas, which is not an unreasonable rule and one I only discovered because I tried to grab a sandwich from one of the to-go areas on my way back to my room.

The half-rule I also discovered is that the bars don't serve beer before 10 am. I don't have a good sense of why this rule exists, since the minibars in each room are restocked with beer every day.

You may ask, what rules did I expect to encounter? Lots! For example, the swimming pool is right next to the beach, and there's a long list of rules, including the obvious "guests must shower before using the pool." I am the only person I observed, in 3 days, showering before using the pool. So, the pool had some sand in it, but no one seemed to mind, including the employees.

I didn't observe anyone trying to sunbathe in the nude so I don't know whether they'd allow that or not. It seems like an obvious benefit of an adults-only resort, but perhaps they get too many American tourists for anyone to be interested. I didn't see any rules posted against it, though.

Order room service all the time

If I go back to this property I'll order room service for breakfast every day (I recommend the Yardie omelette, side of toast, side of bacon), and then just grab a sandwich, burger, or pizza for lunch. I tried a couple of the restaurants that open for breakfast and lunch every day and they made no impression whatsoever. One served a "barbecue chicken" that didn't taste like anything even after I doused it in hot sauce, and I got some eggs and toast at the other which tasted about the same. Just a waste of time waiting to be seated, waiting for a waiter, and waiting for your food.

Plan around dinner

I knew this going in, but didn't put enough emphasis on it while actually planning our days. The dinner restaurants open at 6 pm each day, and if you don't get there at 6 pm, you're going to have trouble eating there. Our first night we managed to be seated immediately at the French restaurant, our second night we gave up and ate at the buffet (big mistake), and our third night we couldn't get seated at the Italian restaurant but ended up having an amazing meal at the Caribbean restaurant.

It seemed like the consensus was that the Italian restaurant was the best on the property, so it's a bit disappointing we didn't get to eat there, although we could have done a lot worse. I'd recommend picking a restaurant in advance every day and simply planning to be there at 5:55 pm, since I don't know of another way to be sure you get your first choice.

People were tipping a lot

I don't know what the point of going to an all-inclusive is if you're going to walk around with a wallet, but people were tipping everywhere. People sitting, in swim trunks, at the swim-up bar would pull soggy dollar bills out of their underwater pockets to hand to the bartenders! I'm glad the US dollar is so durable, and I'm sure the staff were appreciative, but it seemed like overkill to me.

The entertainment surprised and delighted

In the evenings there were a lot of very strange events going on. One night on our way back to the room we accidentally stumbled upon a fashion show, firebreathing performance, and synchronized swimming show (in that order, not all at once). There was nothing about any of them in the daily program so it felt oddly serendipitous, although I'm sure I could have asked someone what the evening entertainment was in advance, if I'd known there would be evening entertainment.

Likewise someone told me Saturday morning that they'd just been going for a walk on the beach the night before and discovered the resort had set up a rum bar and dance party.

Basically, save some energy for the evening and walk around after dinner and you'll likely run into something totally unexpected.

Conclusion

Overall, I'd say my expectations were exceeded in almost every way: the resort was great, the beach was great, the pool was great, and the staff were terrific.

The only area where I'd say my expectations were met, but not exceeded, was at the themed restaurants, which it turned out work just like the cruise ship dining experience I feared: either plan ahead or plan to wait if you want to eat at the in-demand restaurants.

I'm going to Jamaica and I couldn't be more excited

This weekend I'm heading to the Hyatt Zilara Rose Hall for my first international trip of 2017 (and first since being approved for Global Entry). I'm not bringing my computer so there shouldn't be any activity here on the blog until next week, although if you find yourself in FQF-withdrawal you can check out my new personal finance blog on the Saverocity network. I hope you like it.

This is my first time visiting Jamaica and my first stay at an all-inclusive resort (although a couple Spanish girls did let me use their wristband at an all-inclusive in Cuba once), and I am both excited and extremely curious.

What will the facilities be like?

This is obviously an issue visiting any hotel for the first time, but it seems like a slightly bigger deal this time, since I don't plan on going anywhere else all weekend. If the swimming pools are cold, the rooms are dated, and the showers don't work it's not like I can go walk around Paris to distract myself.

What will the beach/ocean be like?

The quality of the sand and water, and the temperature of the ocean, can vary incredibly from beach to beach and from season to season. I've dived in crystal clear warm water off the coast of Cuba and trudged around in murky silt in Atlantic City. If the beaches are great and the ocean's clean, even if not warm, then I don't expect I'll have much to complain about.

What will the food be like?

I tried to reach out to the Hyatt but never got a response, so my current expectation is that none of the restaurants on the Zilara and connected Ziva properties require reservations, and I plan to try as many of them as possible (we'll only be there 3 nights). I'm not a food blogger or a very good photographer but I'll try to get some pictures to share when I get back.

Will my status get me anything?

As a newly-requalified Hyatt Diamond and soon-to-be Globalist I'm curious whether I'll get any kind of special treatment, like an upgraded room or slippers or something. I don't think of Hyatt Gold Passport as offering "soft" benefits, versus concrete benefits like confirmed suite upgrades and breakfast, but maybe they'll surprise me.

How annoyed will I be?

I like to say that the worst possible price for anything is "free," the proof of which is the line around the block every time Ben & Jerry's offers a free small ice cream cone. People waiting for hours to save $1.09 is both a moral and economic catastrophe.

Price is the greatest rationing mechanism mankind has devised so far, which means an all-inclusive resort is guaranteed to use some other mechanism. Will the restaurants have inconvenient hours? Limited capacity? How much time will I spend waiting in line versus drinking rum out of a coconut on the beach?

Conclusion

I don't want to come across as pessimistic; like I say, I'm absolutely thrilled about the trip and can't wait to get there. But I truly have no idea what to expect, which means the trip has the potential to give me a huge pleasant surprise or end in, well, disappointment.

I expect I'll have internet access at least some of the time I'm there so be sure to follow me on Twitter if you want to find out all the details in more-or-less real time, although God willing I won't be spending much time on my phone while I'm there!

Interesting Starwood and Marriott stacking opportunities

I was chatting yesterday with someone who has had a lot of success with Marriott recently, taking advantage of a number of opportunities that currently intersect due to the merger of the Marriott and Starwood hotel chains. While I don't generally think of Marriott Rewards as being a program that offers travel hackers much value, that may be less true today than it has been even in the recent past.

Here are a few ways you might be able to get above-average value from Marriott Rewards.

Transfer Starpoints to Marriott Rewards

While I mentioned this back in September in the context of Marriott Flight and Hotel packages, it's also true that you can simply transfer Starpoints to Marriott in order to book award stays.

Marriott award stays top out at 45,000 Marriott Rewards points (15,000 Starpoints) and Ritz-Carlton stays cost up to 70,000 Marriott Rewards points (23,333 Starpoints). The 5th award night is free for reservations with both Marriott Rewards and Ritz-Carlton.

That means the most expensive Ritz-Carlton property in the world requires just $23,333 in unbonused spend on the Starwood Preferred Guest American Express, or $18,667 in spend for stays of exactly 5 nights.

At the Tier 5 Ritz-Carlton, St. Thomas, you'd pay 280,000 Marriott Rewards points for a stay that would otherwise cost $2,729 in cash (dates June 30 to July 5, 2017). At roughly 1 cent per point, that would give you a roughly 3% return on your unbonused Starwood Preferred Guest American Express purchases.

Note that Marriott is terrible about making award rates available, so this isn't as low-hanging a fruit as you might otherwise hope.

Match Starwood Preferred Guest Gold to Marriott Rewards Gold

Since the merger you've been able to link your Starwood Preferred Guest and Marriott Rewards accounts and take advantage of your highest status in either program. You can find the details here, but the most important takeaway is that Starwood Preferred Guest Gold status matches to Marriott Rewards Gold status.

You can get Starwood Preferred Guest Gold status by spending $30,000 on a Starwood Preferred Guest American Express, or simply by holding an American Express Platinum or Platinum Business card, both of which offer complimentary Starwood Preferred Guest Gold status.

Marriott Rewards Gold status, on the other hand, is somewhat harder to earn and somewhat more valuable, coming as it does with free continental breakfast at Marriott properties.

Maximize the Chase Ritz-Carlton Visa

I don't carry the Chase Ritz-Carlton Visa since I don't pay $450 annual fees, but it has a number of features that may offer genuine value: a $100 hotel credit every time you book a paid Ritz-Carlton stay of 2 or more nights and three lounge upgrades on paid stays annually.

Those can be combined, and if you're aggressive about maximizing both benefits then three paid 2-night stays, each with a $100 hotel credit and lounge upgrade, during lower-cost or off-peak periods could handily offset a big part of that $450 annual fee, especially if you're traveling with a large family.

Conclusion

It really does seem like, for now, the merger of Marriott and Starwood has given those with Starwood Preferred Guest American Express cards access to similar values as they're used to at Starwood properties in Marriott's much larger portfolio of hotels.

Personally, my Hilton Honors Diamond status and cheap and plentiful access to Hilton Honors points, as well as Hyatt Gold Passport Diamond status and cheap and plentiful access to Hyatt points through Ultimate Rewards, together mean that I have no interest in spinning up another hotel loyalty relationship. But if you're still deciding on an approach to hotel stays, it seems you could do worse than looking into the Marriott/Starwood relationship.

How I think about the Hilton Honors reforms

People are talking about Hilton's recent announcement that they'll be eliminating the concept of hotel award categories and charging whatever they think is fair for a free night at their properties. They're also rebranding their loyalty program to "Hilton Honors," although I assume I'll keep spelling it "HHonors" for at least 8-12 months.

Hilton HHonors then

While some bloggers made a big deal about Hilton HHonors variable pricing, there was nothing mysterious about it. Every property had a fixed price for standard room awards, and that price varied by calendar month. You could find each property's standard room award rate, by month, by going to the Hilton HHonors Standard Room Rewards Pricing Points Search Tool.

That URL now redirects to the Hilton homepage.

Hilton Honors now

Now, properties will still have standard award rates, those award rates will vary by day, month, or season, and there will be no way of knowing how much a room costs until you check the award availability for the specific dates you're interested in.

That's bad if you are in the business of slowly saving up Hilton Honors points for specific stays at specific properties on specific dates, since by the time you save up enough points, the number required might slip away from you.

Obviously no travel hacker does anything like that.

What it means for a travel hacker

The starting point for a travel hacker looking at this situation is the Wandering Aramean Hotel Hustle "Visualize" page, where you learn that across thousands of Hotel Hustle searches, the average value of a Hilton Honors point is 0.450 cents and the median value is 0.425 cents.

Like Doctor of Credit, I'm under no illusion that this change is being implemented to help Hilton Honors members get more value from their points.

But there are three ways the changes to Hilton Honors could be implemented, all of which would be in the spirit of "saving Hilton money," but that would have very different implications for travel hackers.

• The average value of a Hilton Honors point could go down. Since grocery store manufactured spend on an American Express Hilton HHonors Surpass requires that you get 0.35 cents per Honors point to break even compared to a 2.105% cash back card, reducing the average value of a Honors point below that level would reduce the value of manufacturing Hilton Honors points compared to cash back.
• The standard deviation could go down. Currently, even with Hilton Honors points worth 0.45 cents on average, it's not difficult to find more valuable redemptions that get you up closer to the 1 cent-per-point range. A more aggressive pricing scheme might tighten the band around 0.45 cents so that it's still worthwhile to manufacture Hilton Honors points, but the potential upside of saving up Honors points is much lower than what a travel hacker might expect today.
• The upside value might be capped. This is the real risk to travel hackers, and to the Hilton Honors program itself: if the program keeps low-value redemptions, and keeps the average redemption value at 0.45 cents per point, but at high-end properties, or during peak seasons, instead of simply charging more points switches to a revenue-based system anchored at 0.4 or 0.5 cents per point, then the "upside risk" of accumulating Hilton Honors points will be eliminated. Currently, you can accumulate Hilton Honors points with relatively little downside risk and the potential for significant upside if you stay at a particularly expensive property during particularly expensive dates. Putting a firm cap on that upside would mean there was little point in wasting credit card spend on any of their Citi or American Express co-branded credit cards.

Conclusion

I think it's an interesting question, although not one to spend too much time thinking about, whether Hilton HHonors points were worth too much in the past.

While it was and for now continues to be trivial to earn hundreds of thousands of points while redeeming them for outsized value at Hilton's prestige properties, that could only have ever represented a tiny percentage of overall Hilton redemptions, most of which were done safely in their comfort zone of 0.4 cents or below.

So, will Hilton reduce the average value of their points by causing mid-tier properties to cost slightly more points, or will they make top-tier properties cost vastly more points? We shall see.