Two cautionary tales

I've been blessed multiple times to unknowingly move to communities that had favorable environments for manufactured spend. Now, that's not exactly a "coincidence," since many of the most hostile environments for manufactured spend are also the most expensive cities in the country (New York City, San Francisco), and my income doesn't support living there, so I've never lived there.

But I freely admit that it means this blog focuses more on successful manufactured spend techniques than unsuccessful manufactured spend techniques, since most of my techniques are successful!

MasterCard gift cards issued by U.S. Bank are a problem at Walmart

With that in mind, I took the recent occasion of fee-free MasterCard gift cards at Staples to deliberately revisit an old problem: can you use MasterCard gift cards at Walmart?

For several years after the Federal Reserve required prepaid debit cards to be PIN-enabled, MasterCard gift cards issued by U.S. Bank worked differently than Visa prepaid debit cards issued by Metabank at Walmart. Unless you knew about, and were able to convince your cashier to go along with, the "change payment" trick, MasterCards were unusable for money orders or bill payments.

This history means most people, under most circumstances, simply avoid MasterCard gift cards. After all, most merchants that sell MasterCards also sell Visas, and if a credit card or rewards program bonuses spend at a particular merchant, then your natural preference should be to buy the easy-to-liquidate Visa rather than the hard-to-liquidate MasterCard.

However, that natural preference hits a snag when a promotion comes along that targets MasterCard gift cards directly. For example, for folks who drive a lot, the cost of gas can make up a big part of their monthly budget, so when Stop&Shop offers bonus points on MasterCard gift card purchases, folks are understandably conflicted. How does the (relative) difficulty of liquidating MasterCards weigh against the accelerated earning when you pile gas rewards on top of the bonus credit card rewards you're already earning at grocery stores?

Plastiq isn't a good liquidation technique; Plastiq referrals are a good liquidation technique

This came up over the weekend when I asked a fellow travel hacker how he'd fared during the fee-free Staples MasterCard promotion mentioned above, since I'd only been able to grab 3 $200 cards (3,000 Ultimate Rewards points with my Ink Plus). He responded smartly, "what am I supposed to do with a bunch of MasterCard gift cards?"

I mentioned Plastiq, which allows you to you make payments to a variety of payees using prepaid debit cards, including bills that can amount to thousands of dollars per month: student loans, rent, mortgage, cable, and insurance payments, among others.

My friend again pointed out that under normal circumstances, Plastiq's 2.5% liquidation fee made the service scarcely worth using, let alone worth driving around town searching for gift cards.

The trick, of course, isn't that Plastiq is a good liquidation technique, the trick is that if you're good enough at promoting Plastiq as a liquidation technique, you get to liquidate an unlimited number of your own cards for free.

Affiliate bloggers rely on a constant stream of vulnerable newbies

The only income I get from this site comes from my loyal blog subscribers, Google Adsense, my Amazon Associates link, and the personal referral links I put on my Support the Site! page.

This gives me complete editorial freedom (manufactured spend is good, Membership Rewards points are bad, free night certificates are bad, companion tickets are bad), but it also means my income doesn't depend month-to-month on driving people to sign up for particular cards, chasing bounties or fretting when lucrative payouts go away.

It also means that I don't need to recruit any new travel hackers. My basic view is that most people who are mentally configured to be travel hackers are pretty easy to identify. You can give the absolute simplest task to someone: "buy a Visa gift card," and if they come back with a Home Depot gift card, you know they don't have the attention or precision to be a travel hacker.

That's not to say I "hoard" information; I love sharing information! I just don't have a rooting interest in recruiting additional travel hackers just because they happen to be eligible for new referral bonuses.

But if, on the contrary, your income depends on getting people to sign up for the first time for something, whether it's a Chase Sapphire Preferred card or a Plastiq account, then newbies are the world's most precious resource, and there is nothing more inevitable than a blogger trying to extend their appeal deeper and deeper into less and less appropriate target audiences.

That is to say, a blogger who successfully refers 100 people to Plastiq is correct when they say Plastiq is a good way to liquidate MasterCard gift cards fee-free, because they have $10,000 in fee-free dollars, but incorrect when they tell newbies, about whom they know nothing, to go out and buy a bunch of MasterCard gift cards and to liquidate them through Plastiq.

If you don't understand this reasoning, then a lot of blogger behavior looks absurd. Even setting aside the blogs that are actually owned and operated by credit card affiliate companies, why would Rich Weirdo Ben Schlappig participate in this humiliating spectacle for Rolling Stone? But if you understand that he needs to fish where the fish are, then it makes perfect sense that the more outlandish the venue, the more likely he is to find vulnerable newbies! After all, if your livelihood depended on it, you too would prefer to attract 10 signups from Brides.com than 1 signup from Flyertalk.

Conclusion

Unfortunately, even with a patient cashier and plenty of tries, I wasn't able to make the "change payment" trick work at my local Walmart. Thank God for grocery stores (and Plastiq)!

The forgotten joy of booking independent hotels

I'm currently in the middle of planning a summer trip to the Czech Republic to revisit some of my old haunts and check out the Karlovy Vary International Film Festival. The plan is to spend a few nights in Karlovy Vary before returning to Prague. This gave me the occasion to do something I haven't done in years: book a non-chain hotel!

Chain hotels are great

For many people, it's become easier and more desirable than ever to avoid chain hotels. AirBNB is a popular option for parents traveling with kids since you often get more space and the use of a kitchen, and in many places it's also cheaper than whatever chain hotels are available. And of course if you're going on safari, camping with bedouins, or hiking Kilimanjaro you're not likely to have options when it comes to accommodations.

But personally, I like chain hotels. Of course there are exceptions, but you can generally count on clean beds, hot water, and decent service. Manufacturing spend on Hilton Honors and Ultimate Rewards-earning credit cards lets me prepay for discounted stays at Hilton and Hyatt properties, and those two chains account for the overwhelming majority of my annual stays.

While there are a lot of hotels in Karlovy Vary, not one of them belongs to a chain. That means while planning this trip I got to brush up on the art and science of booking independent hotels.

Booking independent hotels is tricky

The biggest problem going in is that there's no floor for hotel quality. While hotel chains impose standards (that are occasionally not met), non-chain hotels don't even have standards to fall short of, so filtering a search by number of stars is the beginning, not the end, of finding a suitable room.

I started my search on TripAdvisor to get a sense of the price range available during our stay. After filtering for four-star and five-star hotels, it became a game of trying to make an optimal choice across the variables of price, location, and quality. The third-ranked hotel in town costs $196 per night while the fourteenth-ranked costs $148. I'd surely pay something to move up 11 spots, but would I pay $50 per night? Probably not.

TripAdvisor is a decent way to get a sense of prices and narrow down your options, but you probably don't want to book directly through TripAdviser. That's because you want to lower the final price you pay as much as possible. There are two obvious ways to do so.

Book using credit card rewards

The premium Ultimate Rewards-earning credit cards, US Bank Flexperks Travel Rewards card, Citi ThankYou Premier, and I'm sure some other cards offer increased value when you redeem your points for travel booked directly through the credit card company. That means if a property is available for the same (or a lower) price through a credit card portal, you can get more than 1 cent per point in value.

In my case I'd like to redeem my Ultimate Rewards points for 1.25 cents each for my stay, but the property I identified as the best value wasn't available through Chase's travel portal (in such cases you may still be able to book by calling the bank in question).

Book through a shopping portal

Another great option is using a shopping portal like TopCashBack to click through to a online travel agent like Hotels.com. When you do that, you're able to earn both cashback and Hotels.com Rewards free nights. TopCashBack pays out less when you choose to collect Rewards nights (5% instead of 9%), but the two programs together still offer the equivalent of 15% off the price of your stay (once you accumulate 10 Hotels.com Rewards nights).

A drawback of making reservations at chain hotels through Hotels.com is that you typically don't get elite status benefits. But if you're staying at an independent hotel, that's no drawback at all!

Pay with discounted gift cards

Finally, you can save even more by paying with Hotels.com gift cards bought at a discount. For example, the cashback portal Lemoney pays 11% on the first $100 in Hotels.com gift cards you buy each month (and you can stock up when Lemoney periodically lifts the limit on the number of times you can earn "Turbo Cashback"), and Hotels.com gift cards are available through Raise for 7% off.

You can apparently combine the balances of Hotels.com gift cards on this page, although I've never used that feature myself.

Conclusion

So, that's how I plan on booking our independent hotel in Karlovy Vary to hopefully get the equivalent of a 26% discount off the room rate. What other tips are there for saving money on independent hotels?

What a 10-minute schedule change taught me about Delta — and about myself

It's no secret that the core of my travel hacking practice is manufactured spend. I focus on low-risk, high-reward opportunities to earn points and cash with credit card purchases and liquidate those purchases back to cash as quickly as possible. But while different travel hackers focus on different areas, I don't intentionally ignore the other elements of the game, and I don't think anyone else should either:

• keeping an eye out for mistake fares may let you save money on trips you're already planning to take, or go on short-notice jaunts in premium cabins if your schedule is flexible enough.
• taking advantage of status matches between loyalty programs, especially before trips where status might be particularly valuable.
• using shopping portals strategically to earn seasonal shopping bonuses or secure outsized rewards like the Southwest Companion Pass.

One of the oldest travel hacking tricks I know about is using schedule changes to rebook from less convenient to more convenient flights while avoiding change fees and fare differences.

How a 10-minute schedule change saved me $2,000

One of the beauties of living in a city with a perimeter-limited airport is that we have non-stop flights virtually everywhere within the perimeter. That means I can fly from my most convenient airport basically anywhere within the Midwest, Northeast, or Southeast without a connection. To some destinations, however, those flights are just once a day, which can create schedule conflicts with people whose schedules have less flexibility than mine.

My trip this weekend back to the Midwest proved to be just such an occasion. Back in November, I'd booked our flights on the early-afternoon nonstop to and from the Midwest in each direction.

But it wasn't to be; my partner had an urgent work meeting that afternoon that couldn't be changed. I quickly calculated that I had three options:

• a same-day confirmed change;
• a same-day standby change;
• bullshitting.

I understand that there are people who treat same-day confirmed and same-day standby as core elements of the travel hacker's inventory — and good for them! As a Gold Medallion, in principle I should have waived same-day confirmed and same-day standby fees, which would have made either option, in principle, possible.

But — and this is just between us — I have no idea how that works and I wasn't about to experiment on a trip that I actually wanted to go on.

That left bullshitting as my first line of offense.

My front-line customer service representative had some well-justified skepticism

Once I learned about the problem, I checked my reservation details and immediately noticed that our original outbound flight was scheduled for 3:10 pm, while a few weeks later it had been rescheduled for 3:00 pm. So I picked up the phone and called Delta, asking them to reaccommodate us on a connecting flight later in the day.

I explained that the earlier flight didn't work with our schedule. After all, if we wanted a 3 pm flight, we would have booked one, right? My adorable representative repeatedly asked me, "you can't make it to the airport 10 minutes earlier?"

After I repeatedly explained that no, I could not make it to the airport 10 minutes earlier, she told me that there would be a $250 change fee per ticket, plus any fare difference (these were very cheap tickets, so the amounts involved would be a few thousand dollars more than I actually paid).

I calmly told her that the new departure time didn't work for us and that we needed to be rebooked on a later flight, and she said what was perhaps the funniest thing in our entire conversation: "we have a 90-minute change policy." I can only assume she meant that Delta was free to move the departure time of a flight 90 minutes in either direction without reaccommodating customers, which is untrue, but in a way so absurd it's hard to believe even she believed what she was saying.

So I asked for her supervisor.

My customer service supervisor had rebooked me before she even picked up the phone

After about a minute on hold, a Delta supervisor picked up the phone, told me that she understood I wanted to be rebooked on the later connecting flight, and asked me to hold while she took care of it for me.

It was absurdly painless.

Conclusion

There are no heroes in this story.

• Why do passengers book flights they're ultimately unable to catch?
• Why do airlines change their schedules so often?
• Why do airlines charge change fees for passengers whose schedules change?
• Why must everything be a battle?
• Why must we treat merely not being fleeced as a triumph in its own right?

I don't have answers to those questions. But I do have an answer to one question: what should you do if a front-line representative refuses to rebook you after a minor schedule change? Ask to speak to their supervisor, and demand to be rebooked.

If your new flight leaves earlier, explain that you can't make the earlier departure time. If your flight arrives later, explain that you'll miss your meeting, wedding, or tryst. No airline has ever been forced to come up with an explanation for why their schedule suddenly changed, so feel free to apply some imagination and explain why you can't possibly accommodate their change in schedule.

Buying Broadway tickets (is expensive)

On Tuesday I wrote that I was going to New York to see Hamilton, the smash hit Broadway musical. Commenter BetterByDesign astutely asked,

"How the heck did you find Hamilton tickets? Or did you just throw cash into the venture?"

Long story short, I just threw cash into the venture. There are ways to save money on Broadway tickets, but not as many as I'd like.

TKTS for when you don't care what you see

If you're already in New York City, you can head down to the TKTS ticket booth on Times Square (lines can be very long at this booth), the South Street Seaport, or in Brooklyn. They offer discounted tickets to same-day shows on an as-available basis.

If you're just in New York for a weekend, you are going to be stuck with whatever tickets TKTS has available, since there's no way to predict which shows will be offering tickets on a given day.

I've seen some great shows using TKTS, like A Gentleman's Guide to Love and Murder (Tony award for Best Musical in 2014) and Pippin (Tony award for Best Revival of a Musical in 2013).

Full price box office tickets

If you want to see a popular show and live in New York, you can buy full price tickets from theatre box offices (TKTS also sells full price tickets for future performances). Popular shows sell out far in advance, but you can save hundreds of dollars by paying the face value of your tickets rather than buying them on the resale market.

The resale market

If you don't live in New York and have a particular show you want to see, that leaves the resale market. There are many resale sites, and many of them charge additional administrative fees which can add up to hundreds of dollars. However, most of the sites carry the same inventory, as resellers upload the same ticket to multiple sites to increase their chances of making a sale (sounds familiar, right?).

Having said that, this was my general strategy for paying the lowest price for our Hamilton tickets.

Use SeatGeek to find the cheapest reseller

SeatGeak is a ticket-reselling aggregator, which shows prices available on a range of other ticket reselling sites. They will sell you tickets themselves, but they will also tell you on which other ticket reselling site the tickets were found. For example, here are some tickets available for the January 9, 2016, evening performance of Hamilton:

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In this example you can see SeatGeek is listing tickets for sale on:

• uberseat
• ravetix.com
• TN Direct
• Prime Entertainment

You'll also see tickets sold on FanXchange, TicketCity, and other reselling sites.

Find out how much the tickets are reselling for on the original reselling site

After you've selected a few promising seats, you'll want to see how much the tickets are actually selling for on the original reselling site. In the example above, SeatGeek shows the cheapest ticket as $314 at uberseat.

On uberseat's website, the cheapest tickets price out at just $268:

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Sure, you can save some money cutting out SeatGeek, but there's another reason to go directly to the reseller's website: SeatGeek doesn't participate in cash back portals.

Search your favorite cashback portal for payout rates

Here are the ticket resellers that I easily found participating in TopCashBack:

• ScoreBig. 12% cash back, $30 off purchases of $250 or more in October using code "trickortreat"
• TicketLiquidator. 12.5% cash back, $10 off purchases of $350 or more using code "TLFALL"
• TicketCity. 3% cash back.
• VenueKings.com. 13% cash back, $4.99 off purchases of $40 or more using code "TRICKORTREAT5"
• PurchaseTix. $9% cash back.

Conclusion

You're never going to make money buying tickets on reselling sites, but using these techniques you can start to get your ticket prices down into the ballpark of full price box office tickets.

Personally, since Delta was paying for our tickets to New York City, I ended up splurging a little bit and buying orchestra seats for Hamilton, but if you're planning far enough in advance and don't care where you sit, you can use these techniques to pay under $200 per ticket for mezzanine seats, for the hottest show of the year!

Trailing interest charges: the silent killer

Every travel hacker knows that interest charges (and annual fees) are the flip side of credit card rewards. You may earn 2% on the front end when paying with a credit card, whether you're buying a cup of coffee or manufacturing spend, but if you don't pay off your entire balance in full by the due date on your statement, you'll give it all back and more as your remaining balance accrues interest. On my credit cards rates typically start at 12.99% APR annually and go way, way up from there.

All over the travel hacking blogosphere you'll find variations of the mantra, "if you don't pay your credit cards off in full every month, travel hacking isn't for you." There's an ironclad kernel of truth to that (your interest charges will far exceed the value of your rewards) but also a deep illogic: even if you have to pay interest, you're strictly better off earning the most valuable rewards possible on any purchases you have to make. So I'll skip the lectures and stick to the facts.

Warning: trailing interest is like interest, but worse

Just like the interest earned on your savings, the interest paid on your credit card balances compounds, which gives rise to a (deliberately) confusing concept: trailing interest. Trailing interest is the product of a mismatch between the pace at which interest accrues (daily) and the pace at which it posts to your outstanding credit card balance (monthly).

Here's the description of trailing interest given on my American Express credit card statements:

"About Trailing Interest

You may see interest on your next statement even if you pay the new balance in full and on time and make no new charges. This is called "trailing interest." Trailing interest is the interest charged when, for example, you didn't pay your previous balance in full. When that happens we charge interest from the first day of the billing period until we receive your payment in full. You can avoid paying interest on purchases by paying your balance in full and on time each month."

The takeaway from this statement is that, if you failed to pay for your purchases in full and thus have a balance that's accruing interest, the date your credit card statement closes is the only date when your outstanding balance accurately reflects the amount you owe. Every subsequent day, a hidden amount of trailing interest accrues which will only post on the following statement closing date.

To avoid paying interest, you have to pay your balances off on time. To avoid paying trailing interest, you have to pay any interest-bearing balances off early, preferably on the statement closing date, to avoid giving trailing interest a chance to accrue.

Bonus warning: know how your banks calculate interest charges

Since I pay off my credit cards in full every month (preferably before my statement closes, to ensure as low a credit utilization as possible is reported to the credit bureaux), I never took the slightest interest in how banks calculate interest charges.

Until a few months back, that is, when due entirely to my own negligence I paid $5 less than my statement balance on my US Bank Flexperks Travel Rewards Visa Signature card:

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Mint, the website I use to track my bank accounts, credit cards, and investments alerted me that interest had been charged on one of my accounts, so I pulled up my statement and was horrified to see an interest charge of $20.35. Naturally my first move was to call in and ask a representative reverse the interest charge:

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But while I was on the phone, I asked her to explain how it was possible that I was charged $20.35 in interest on a $5 unpaid balance. The representative explained that at US Bank, they charge interest on your entire balance if any part of it is unpaid on the statement's due date.

So in case you were wondering how credit card companies pay for the rewards they shower on us, this is how: by aggressively charging customers who are anything less than totally and utterly vigilant about paying off their credit cards in full and on time.

Conclusion

I hope credit card interest charges are an issue that will remain completely and utterly academic for all my readers. Realistically, that's not going to be the case, but the more information you have about the kinds of interest charges and the way they're calculated, the more lucrative I hope your relationship with your credit card issuers will be.

Moving credit lines between American Express accounts

There are many reasons someone might want to move a credit line between accounts. Perhaps the most common situation is when closing a card to avoid its annual fee; rather than seeing your total available credit decrease by the amount of the card's credit limit, you can transfer all but (typically) a nominal sum to another credit card issued by the same bank.

Alternatively, if you have a large credit line on a non-rewards-earning credit card like the Chase Slate from your pre-travel-hacking days, then you might decide to transfer the credit line to a more lucrative card also issued by Chase.

Each bank has a different procedure for this operation. In my experience, I've been able to transfer all but $2,500 from my Chase credit cards when closing them, and I've done that both over the phone and through the Secure Message Center without any difficulty.

Bank of America, on the other hand, in my experience requires a hard credit pull when transferring credit lines – even though they're not extending any additional credit!

American Express has fiddled with their procedure over the years, but since I just did this, I thought I'd share the method that worked for me today.

What cards are eligible?

American Express's basic rule is that a card must be open for at least 12 months before you can transfer that card's credit line away from it. In theory, credit lines can be transferred to a credit card almost immediately after the card account is opened.

I can now report from personal experience that the 12 month clock does not reset when you upgrade a credit card: I upgraded my Hilton HHonors Surpass card less than 12 months ago, but was able to reallocate credit away from it today.

Additionally, credit lines cannot be reallocated from business credit cards to consumer credit cards. Any other combination is theoretically possible using the online system: from consumer to business, between business, and between consumer credit cards.

Avoid the phone and online agents

I twice attempted exactly the same procedure that was successful today, once over the phone and once through the online messaging system, but was unsuccessful both times. Both times I believe the agents attempted to reallocate the credit lines from my (new) Blue Cash card to my HHonors card, instead of the other way around. I may have simply had incompetent agents helping me both times, or they might all be equally poorly-trained.

So for the sake of your sanity, use the online system if possible.

How it works

From your American Express home page, click on "Profile" near the top of the screen, then "Manage Credit Limit:"

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From there, look for "Transfer Available Credit to Another Card," and click "Start:"

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From there, select the card you want to transfer your available credit limit from:

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And the card you want to transfer your available credit to:

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Once you confirm the request, you'll be immediately notified whether the request was successful or not, and your available credit limits will almost immediately reflect the change (they say it can take up to 15 minutes).

Reminder: rewards aren't earned on statement credits and fees

Over the course of about 24 hours I ran into several variations of this situation, and it took me about 25 minutes of staring at my credit card statements to figure out what was going on. In case any of my gentle readers run into a similar situation, I thought I'd share my experience.

Statement credits are treated as discounts, not payments

This is a situation you're bound to run into if you take advantage of Amex Sync deals or Visa Savings Edge. When your statement closes, you won't receive points for the part of your purchase rebated by the two programs.

So if you paid exactly $50 in flowers from 1-800-FLOWERS for Valentine's day and received a $15 Amex Sync rebate (and a 5% Amex OPEN rebate), you'll only earn miles and points on $35 (or $33.25).

Of course that's not true of portal earnings, which your credit card company doesn't see, so you'll receive portal earnings on the entire purchase as reported by the online merchant (who may exclude taxes, shipping, or gift cards, but frequently don't).

Credit card fees aren't treated as purchases

A kind of inverse problem arose when my Chase Sapphire Preferred annual fee hit this month. Since I pay off all my credit cards each month, my statement balance should always equal my purchases during the statement cycle, and I should earn exactly that number of Ultimate Rewards points (plus bonused earnings, which are listed separately).

But this month my numbers were off! Since I'm constantly running experiments with my rewards credit cards, my first thought was that I hadn't earned points for one or more of those small experimental transactions. It wasn't until I realized that I had earned exactly 95 fewer points than I expected that I realized the problem: my $95 annual fee was included in my statement balance, but wasn't treated as a purchase (which, of course, it wasn't).

Conclusion

All this is spelled out in your credit card's terms and conditions, so don't think they're trying to pull a fast one on you. However, it can be confusing the first time you notice it happen. Hopefully after reading this post you'll be both forewarned and forearmed.

"What's the best credit card?"

I have a lot of family and friends who typically find themselves somewhere between amusement, shock, and awe when I talk about this crazy game we play. But sooner or later when they foresee a big upcoming expense, whether it's a wedding, a move, or a remodel, they come to me and ask, "Alright hotshot, you're the expert, what's the best credit card?"

After all, here I am, a starving artist trying to push books out the door and get people to pay for a blog they can read for free, but I take long weekends a few times a month and three or four long vacations each year – in first class, whenever possible. Nonetheless, my answer is almost always the same:

It doesn't really work like that.

Sure, I'll pass along a particularly good signup bonus, like the 55,000 mile Chase United MileagePlus Explorer offer I recommended to my Polish friend, or the 50,000 mile Citi Platinum Select / AAdvantage offer I signed up for earlier this month, since those bonuses are so high even a rookie is sure to get a good enough value that I'll be able to sleep at night.

One Question

Mile-and-point-earning credits cards are not right for everybody, and in fact they're right for almost nobody. When my brother recently asked what credit cards his friend should sign up for, the only question I asked was,

"Is she a businessman who is allowed to charge business travel to her personal credit card, and/or is she crazy?"

If the answer to both is no, a mile-and-point-earning credit card is not right for her.

One Size Fits All? Cash Back.

The best credit for the average civilian is the Fidelity Investment Rewards American Express card. It earns 2% cash back everywhere American Express is accepted, and has no annual fee. American Express isn't accepted everywhere, so our average civilian should carry a backup Visa, MasterCard, or Discover. I have both a Chase Freedom Visa and Discover it card, for example, and I'll be doing a product change to the Citi Dividend Platinum Select once I use up my ThankYou point balance from my current ThankYou Preferred card.

Even better, the rewards balance on Chase Freedom and Discover it cards can be used at their full value on Amazon.com purchases, so users can use their rewards immediately for online purchases, rather than waiting for them to accumulate. For example, Discover requires a $50 rewards balance to redeem for cash, the swine.

Foreign Transaction Fees

I would slightly lean towards the Discover it because it doesn't have a foreign transaction fee, so for the very occasional international trip the average user takes, that would provide some real savings. Discover cards are processed on the Diner's Club network, so they have quite good acceptance overseas, although somewhat less than Visa or MasterCard (and much better than American Express).

Of course a free Bluebird account also doesn't have foreign transaction fees, and can be used as an ATM card at many international ATMs, but does operate on the American Express card network so acceptance could be a problem depending on the destination.

The Exceptions

Of course, if you are a businessman who charges company expenses to your personal credit card, or you are crazy, travel hacking is an amazingly lucrative hobby that allows you to travel the world for pennies on the dollar. Buy my book! Read my blog! If you like it, consider setting up a monthly PayPal subscription! But when your friends ask, tell them the same thing I told my brother: a solid 2% cash back card is going to get them farther, faster, then messing around with co-branded credit cards that earn just one mile or point per dollar.

Getting Away With It: Seasoning Credit Cards

I know there are a lot of very exciting developments that I've been reporting on for the last few days, and there will be lots of updates on those fronts over the coming days and weeks.

However, I always have a lot of topics on the back burner, and tonight I want to briefly address one question that a lot of readers asked in response to my end of year reflections: how do I keep from getting in trouble with my credit card issuers, given the amount of manufactured spend I put on my credit cards?

While it's not an exact science, I've used one and only one technique since I got into the travel hacking game: seasoning credit cards. Using this ridiculously simple technique I have never had a single card shut down or a single "hostile" conversation with a credit card company representative — although I periodically do trigger fraud alerts, which can normally be resolved through a text message or automated phone call.

Why Season?

I have a friend in town whom I've been gradually introducing to the travel hacking game, and since he flies to Poland once or twice a year, I suggested he sign up for the Chase United MileagePlus Explorer Card when it had a 55,000 mile signup bonus (after adding an authorized user), so he could redeem award tickets on LOT, a Star Alliance member (this was pre-United devaluation, of course).

Once he received his card, on a walk over to our friendly neighborhood CVS I explained that credit card companies don't like to see sudden, large transactions on newly issued credit cards, since that's the kind of behavior that desperate people and crooks exhibit – people trying to get as much cash off a line of credit as quickly as possible.

When we got to the store, he promptly picked up 2 Vanilla Reload Network reload cards and attempted to load them both with $500.

What happened?

What do you think? The transaction was frozen and he had to spend 15 minutes of his (and my) afternoon on the phone with Chase Card Services explaining why his first transaction on his brand new card was for over $1,000.

How to Season

So while it's no great secret — and I'll be the first to admit that it's superstition, not science — here's what I do to season a new credit card, reducing (in my mind) the likelihood of fraud alerts and frozen transactions down the road:

• When I first get a new credit card, I buy a single $500 Vanilla Reload Network card (or whatever I need to buy at the moment);
• Then, I wait. And wait. And wait;
• I wait until that first transactions has cleared from pending to posted;
• Then I buy another $500 card;
• And wait. And wait. And wait;
• I wait until that second transaction has cleared from pending to posted;
• Only then will I buy 2 cards at once;
• And wait. And wait. And wait...

You get the idea. The concern of the credit card companies is not "perk abuse" or anything like that. The concern the credit card companies have is the risk of chargebacks: if an identity thief gets a credit card in your name, you will naturally refuse to pay for any purchases made with that card. Your pattern of activity should have as its goal proving to your credit card company that it's you making those purchases, and that you intend to pay for them.

If I've signed up for a credit card exclusively for the signup bonus then I can typically meet any minimum spending requirement within a week or two using this technique.

If it's a card that I plan to put spending on long-term, then sure, this technique means I only manufacture $7,000 or so the first month that I have the card. But that's a small price to pay, in my opinion, for a smooth and uninterrupted relationship with my credit card providers.

The best hacks I've missed out on

By now, a lot of people have heard about classic hacks of days gone by, like ordering presidential dollar coins from the US Mint with a rewards-earning credit card, depositing the coins unopened into a bank account, and then paying off the credit card balance. What's often forgotten is the incredible amount of work that went into carrying out this hack: lots of trips to the post office or Mail Boxes Etc.; negotiating with bank managers to accept your coins for deposit; and of course hauling a bunch of heavy coins around town. All to manufacture non-bonused credit card spend! It might have been good work, but it was still work, and it wasn't free.

On the other hand, other hacks really are too good to be true, and these are the ones I really regret not taking advantage of.

Priority Club to Amtrak Transfers

The day before Christmas last year, I woke up to a series of confusing messages about Priority Club and Amtrak. Since Priority Club isn't a program I focus on, I put it on the back burner. Later that afternoon, after lots of trips to the airport picking up family members, I went back and discovered I'd missed out on an incredible deal: the ability to transfer 5,000 Priority Club points into 6,666 Amtrak Guest Rewards points.

Since you can purchase Priority Club points at a cost of 0.7 cents each, this was a chance to buy Amtrak Guest Rewards points at just over half a cent each. Since I value Amtrak Guest Rewards points at between 4 and 6 cents each for Acela First Class tickets and long-haul sleeper accomodations, this was a chance to buy those tickets for pennies on the dollar. Needless to say, I wasn't as merry as I could have been that Chirstmas!

Home Improvement Gift Cards

Last week Frequent Miler gave a great rundown of this short-lived opportunity. Basically, if you were in the right place at the right time, you could purchase – in-person – vast quantities of "Home Improvement Gift Cards," which had begun to be treated as true PIN-based debit cards at merchants like Walmart. The window of opportunity quickly slammed shut, but there was a day or two where points could be purchased for free (if you had load room on your Bluebird or Gobank cards) or for the price of a Walmart money order (around 0.14 cents per dollar of manufactured spend).

Unfortunately, I wasn't in the right place at the right time – they don't sell Home Improvement Gift Cards in Europe! 

Chase Gift Cards

For months now, Chase has been selling gift cards online with no purchase or shipping fees. Best of all, these cards can be configured with PIN codes, which allow them to be used to load Bluebird or Gobank at Walmart, or purchase money orders in many stores that accepts PIN-based debit cards (though USPS code their money orders differently and do not consistently work with all kinds of gift cards).

There are a few limitations on the purchase of these cards: 

1. they can only be purchased using credit cards issued by Chase;
2. each Chase credit card can be used to purchase up to $2,600 per rolling 30-day period;

If this deal's still going on, why have I missed out on it so far? Well, there is a third restriction listed on Chase's gift card website: 

This website does not support online sales of Chase Gift Cards to residents of the following states: AR, CT, HI, ME, NH, NJ, RI, VT. We apologize for any inconvenience.

I presume this is because of the abandonment laws in these days, which require merchants to turn unused gift card balances over to the state. Abandoned gift card balances are a big source of profit for banks and gift card companies, and they might not think it's worth offering the cards if they can't keep abandoned balances.

Now, this isn't an insurmountable problem: I could change my billing address to a state where shipments are allowed, then have the cards mailed back to me in New England. But at that point, there are more moving parts than I'm comfortable with, especially since it's not clear how much longer this opportunity will be available.