Transfer large blocks of Starpoints using Marriott Flight and Hotel Packages

Today Marriott closed its purchase of Starwood Hotels & Resorts and introduced point convertibility between the Marriott Rewards and Starwood Preferred Guest programs. After linking your accounts, points are now transferrable between the two programs in either direction at a ratio of 3 Marriott Rewards points to 1 Starpoint.

Upon seeing this news, my first reaction was, "doesn't this make Marriott Flight and Hotel Packages astonishingly cheap?"

Well yes, yes it does.

Starwood's new 33%-46% transfer bonus

The math behind Marriott Rewards Flight and Hotel Packages normally works like this: if you book 7 Marriott Rewards nights at full price, you can transfer 50,000, 70,000, 100,000, or 120,000 points at a 1:1 ratio to a domestic airline (the ratio is different for many foreign carriers). If you choose United as your transfer airline, you receive a 10% bonus.

For example, 7 nights at a 25,000 Category 5 Marriott Rewards property would cost 150,000 points (since the 5th night is free). With a Flight and Hotel Package, you can instead spend 200,000, 220,000, 250,000, or 270,000 Marriott Rewards points and receive the difference in airline miles with Alaska, American, Delta, Air Canada, or British Airways, along with a few others.

Since Starpoints now transfer to Marriott Rewards at a 1:3 ratio, 270,000 Marriott Rewards points cost 90,000 Starpoints. 90,000 Starpoints, transferred directly to an airline partner, would yield 110,000 miles. Transferred first to Marriott Rewards, it yields 120,000 miles (132,000 United MileagePlus miles).

This is worth doing even if you don't plan to stay a single night with Marriott, as long as you have a use for the miles. If you are planning a 7-night stay somewhere anyway, then the value becomes virtually unbeatable.

This makes the Starwood Preferred Guest American Express card great for unbonused spend

As long as this option persists, manufacturing unbonused spend with the Starwood Preferred Guest American Express card will earn 1.33 to 1.46 miles per dollar spent with all the major US carriers, when Starpoints are transferred to Marriott Rewards in batches of 90,000.

While the Chase Freedom Unlimited earns a slightly higher 1.5 United MileagePlus mile or British Airways Avios, earning Starpoints instead gives you access to those currencies as well as Delta SkyMiles and American AAdvantage and Alaska Mileage Plan miles.

Obviously, the more of the 7 included Marriott hotel nights you use, the more value you'll get from this technique, but as shown above it's worth doing even if you don't use a single one of your included nights.

Note that you don't have to decide on a property and dates for your stay at the time of redemption — the award is deposited into your account, and can even be upgraded later if you decide to stay at a property in a category higher than the one you paid for.

How to think about the "single best" rewards currency

Last week I joined Joe Cheung for a recording of the Saverocity Observation Deck [edit: now available for listening!] and among the many subjects we touched on was the idea of the "most valuable" loyalty currency. I pointed out that affiliate bloggers are forced by their business model to argue that Starwood Preferred Guest Starpoints are worth at least 2 cents each because Starpoints can only be earned in any volume through the Starwood Preferred Guest American Express cards, which earn 1 Starpoint per dollar spent.

If Starpoints were worth any less than 2 cents each, it would be impossible to promote the card to unsuspecting customers, since there are no-annual-fee cards that offer 2% cash back on all purchases.

A few illustrative examples of this Starpoint value game:

• Bankrate Employee Brian Kelly: 2.5 cents
• Rich Weirdo Ben Schlappig: 2.2 cents
• Thought Leader from Behind Gary Leff: 2.3 cents

If you're curious, Hotel Hustle pegs the median value of Starpoints redeemed for hotel stays at 1.849 cents each.

The fact is, the impulse to identify a "single best" or "most valuable" rewards currency is fundamentally misguided: the most valuable rewards currency may not be the single best rewards currency — and vice versa!

Three "single best" rewards currencies

Knowing everything you know about loyalty programs and travel hacking, what credit card would you sign up for if it you had to pick just one? I think these are three reasonable choices (feel free to suggest others in the comments):

• If you have access to unlimited grocery store or gas station manufactured spend, the US Bank Flexperks Travel Rewards Visa earns "up to" 4% on airfare and up to 3% on hotel stays, and charitable spend earns "up to" 6% and 4.5%.
• If you have access to unlimited unbonused manufactured spend, the Amex EveryDay Preferred offers 1.5 flexible Membership Rewards points per dollar spent everywhere.
• And if you have access to unlimited unbonused manufactured spend, the Starwood Preferred Guest American Express cards earn 1 Starpoint per dollar spent everywhere.

The Flexperks Travel Rewards card has obvious advantages: a high earning rate and the ability to redeem your points on any flight and at any hotel means you're unlikely to experience orphaned points or be unexpectedly forced to pay cash for travel.

The Amex EveryDay Preferred isn't of much use when redeeming for paid flights or hotels, since Membership Rewards points can be redeemed for just one cent each towards those reservations. On the other hand, British Airways Avios transfers (1000 Membership Rewards point for 800 Avios, for an earning rate of 1.2 Avios per dollar spend everywhere) give access to high-value American Airlines and oneworld reservations, and both Delta SkyMiles (Skyteam) and Air Canada Aeroplan (Star Alliance) are Membership Rewards transfer partners at a 1000:1000 transfer ratio. Even transfers to Hilton HHonors would be worthwhile at redemption values above 0.44 cents, after taxes, thanks to the 1000:1500 transfer ratio, since at that rate you'll be better off booking with transferred Hilton points than directly with Membership Rewards points.

The Starwood Preferred Guest American Express cards allow you to earn Starpoints, which can be valuable for hotel stays if you frequently stay in cities with Starwood Preferred Guest properties. They also give you access to American Airlines AAdvantage miles, Air Canada Aeroplan miles, and Delta SkyMiles at a 1:1.25 transfer ratio when you transfer Starpoints in multiples of 20,000. Finally, the SPG Flights award allows you to book paid flights at valuations of between 1 and 1.4 cents per Starpoint.

"Single" is doing all the work in this analysis

At this point the game I'm playing should be clear: no travel hacker should have just one of the three cards described above, because having just one credit card makes travel hacking nearly impossible!

• A Starwood Preferred Guest credit card is great for Starwood stays, but it's a lousy way to pay for flights, leaving you to pay cash for all of your non-award flights and all of your non-Starwood hotel stays.
• An Amex EveryDay Preferred card is great for earning 27,000 Membership Rewards points per calendar year at grocery stores, but it's a lousy way to build up the balances you need to book a whole year's worth of travel with unbonused spend.
• A Flexperks Travel Rewards card is great for booking paid domestic flights, but lousy for booking premium-cabin international flights or expensive hotel stays.

Earn the "best" currency for the job

In the above analysis I completely excluded my favorite travel hacking tool, the Chase Ink Plus. Why? Because it's almost useless without access to other, complementary tools. It's true that it helps you purchase Ultimate Rewards points at 0.59 cents each, and allows you to redeem them for 1.25 cents each, or a 52.4% discount off retail.

But a 2% cash back card, used to manufacture unbonused spend, generates virtually the same discount off retail, and gives you the flexibility to spend your rebate on things besides travel, as well.

Meanwhile, the vaunted transferability of Ultimate Rewards points means you can book Hyatt stays with ease, but under virtually no circumstances are Marriott Rewards or IHG Rewards points worth 1.25 cents each, leaving you to book full-price stays without even earning rewards or triggering hotel promotions. Long-haul premium-cabin United awards may cost less with Ultimate Rewards transfers, but you'll give it all back booking full-price domestic economy awards.

Putting together a travel hacking strategy should be as holistic a process as possible, and trying to decide in advance which rewards currencies is "most valuable" is likely to sabotage that process. Over the course of a year you may need to take into account all sorts of conditions:

• if you're trying to qualify or requalify for Hyatt Diamond status, you might want to book Points + Cash awards, which may require a flexible Ultimate Rewards-earning credit card for the points portion, plus a co-payment with cash or a Hyatt gift card;
• if you have access to grocery store manufactured spend, you may be able to pay for your hotel stays more cheaply with a Hilton HHonors Surpass American Express card than with a Flexperks Travel Rewards card (the Hotel Hustle median value of HHonors points is 0.448 cents each);
• if you book deeply-discounted or weekend leisure travel, you may not be able to qualify for airline elite status without triggering an elite-qualifying dollar waiver using a co-branded credit card.

Conclusion

Never lose sight of the ultimate purpose of travel hacking: to pay as little as possible for the trips you want to take. The "most valuable" currency you earn isn't the "best" currency unless it helps you pay for those trips more cheaply than you could otherwise.

A real travel hacking strategy can be mostly indifferent to the supposedly objective "value" of any given currency. Ultimate Rewards points are "worth" 1.25 cents each when redeemed for paid flights with an Ink Plus or Sapphire Preferred, and 1.5 cents each with a Sapphire Reserve, but can be worth two or three times that when redeemed for Hyatt stays, Southwest flights with a companion pass, or United or Flying Blue award tickets. Delta SkyMiles are "worth" 1 cent each when redeemed for "Pay with Miles" tickets, but far more when deployed strategically for high-value redemptions.

When you are just getting started in the game, it really does make sense to pick one card to focus on — a 2% cash back card! That's not because 2% cash back is the most you can hope to earn in this game, but because until you thoroughly understand the parameters of the game, any "single best" credit card is virtually guaranteed to leave you worse off than that 2% cash back card will.

Pro tip: booking premium cabins with US Bank Flexpoints

As fans of US Bank Flexperks Travel Rewards know, and people who recently applied for a personal or business card during the recent Summer Olympics promotion will soon find out, the third-party travel provider US Bank uses no longer allows multi-city itineraries to be booked online through their travel portal, although such tickets can still be booked over the phone at no additional charge.

Booking premium-cabin tickets is possible to do online, although you need to be extremely careful while doing so, and under most circumstances I think you'll be better off booking such tickets over the phone as well.

Here's how I found that out while making a first class reservation over the weekend.

US Bank allows you to search for "business class" flights

When conducting a search for flights through US Bank's travel provider, you can no longer search for multi-city itineraries, but if you select "Advanced Search" you can search for "Business Class:"

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Check your search results carefully for class of service

Here's the first search result for a "Business Class" flight between Washington and Lexington, KY:

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There's something that should be immediately suspicious about this search result, but which I missed the first time: there are 9 seats available. What Delta Connection flight has a First Class cabin with 9 or more seats?

The answer is revealed when you expand the flight details:

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This flight books into the "W" Comfort+ fare class, not into the correct "P" First Class fare bucket.

The key takeaway here is that this is your one and only chance to see what cabin you're booking into: on none of the subsequent checkout screens is the class of service listed.

"Business Class" search results are all over the place

At first I thought this was a Delta-specific situation, in which you can book Comfort+ but not First Class seats online.

But no! Here's a flight correctly pricing out in Business class between JFK and LAX:

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Basically it seems like a combination of sloppy programming on the part of the travel agency and the exploding number of fare classes and cabin configurations by the airlines. On 3-cabin aircraft you can book into the Business cabin, and on 2-cabin aircraft you might be booked into First class or Comfort+ depending on what fare classes are available and on how the online search engine is feeling that day.

You can change flights within 24 hours for $30 (or free)

After realizing I had mistakenly booked a flight in Comfort+, instead of First Class, I called US Bank's travel agency, QualityRewardTravel, at 1-866-814-1293. After waiting on hold for 5 or 10 minutes, I explained the situation and gave my Agency Record Locator to the phone agent. She told me that within 24 hours of booking, flights could be changed or cancelled for a fee of $30.

I told her I was calling because their website had made a mistake, and that I wasn't going to pay to fix it.

After asking her supervisor, she made a "one-time" exception and changed the flight into First Class for free, noting that the flight cost the same number of points as my original reservation.

Make multi-city and premium-cabin reservations over the phone

Multi-city Flexperks reservations already have to be made over the phone, but I would suggest that any premium cabin flight involving a connection should also be booked over the phone, since the flight search results do not show the class of service available on each leg. It seems likely that they show itineraries where business or first class seats are available on only some of the flights. Alaska Airlines is notorious for doing this in their search results, although they at least alert you when you select a mixed-cabin itinerary.

Of course, when the cabin you want simply doesn't appear in the online search results, you'll also need to call to book.

Conclusion

One of the great things about US Bank Flexpoints is that they allow you to take advantage of price compression, when nonstop, more convenient, or premium cabin itineraries cost the same number of Flexpoints as inconvenient or economy class flights. However, US Bank's travel agency doesn't make it as easy as it should be to take advantage of that key feature of the program.

Finding the value in the Chase Sapphire Reserve

Now that everyone's had a chance to calm down about the Chase Sapphire Reserve card, let's take a look at the card's features and see what, if any, value it might have to a travel hacker.

Keep in mind that since the Sapphire Reserve has a $450 annual fee, you don't need to get $450 in value to make the card worth getting. You need to get $450 in value to break even.

Ultimate Rewards flexibility

When you have a Chase Sapphire Preferred, Ink Plus, or Sapphire Reserve, you can transfer your Ultimate Rewards points to Chase's travel partners.

I won't relitigate the question of who qualifies for a Chase Ink Plus credit card. But suffice it to say, some readers cannot or feel they cannot be approved for Chase Ink Plus cards, in which case their only option if they want to make their Ultimate Rewards points flexible has been to carry a Sapphire Preferred, with its $95 annual fee.

If carrying a Sapphire Reserve allows you to downgrade your Sapphire Preferred to a Freedom or Freedom Unlimited, that brings your Sapphire Reserve's annual fee down by $95, plus the value of any additional points you earn with whichever of the the two, far superior, credit cards you change your Sapphire Preferred to.

Note that this is not true if you have access to an Ink Plus, since its accelerated earning rates at gas stations and office supply stores makes it worth carrying whether or not you have a Sapphire Reserve.

100,000 Ultimate Rewards-point signup bonus

After spending $4,000 on purchases within 3 months, you'll earn 100,000 Ultimate Rewards points, worth $1,000 in cash. Since the annual fee of $450 isn't waived the first year, this is the equivalent of a $550 signup bonus, less the difference in value between the cashback you'd otherwise earn on the same $4,000 in spend. Assuming you have a 2% cashback card you'd otherwise manufacture spend on, the total value of the signup bonus drops to $510 in cash.

Is a $510 signup bonus worth pursuing? Maybe! But I walked into a Citi bank branch today and picked up a brochure for a $400 cash bonus for opening a new Citibank Checking account. Doctor of Credit has a list of a few thousand dollars in bank account signup bonuses. The Chase Sapphire Reserve signup bonus is a bit higher than those signup bonuses, but a bit harder to get — you have to be approved, after all!

In short, if you chase signup bonuses, the 100,000 Ultimate Rewards-point signup bonus is probably all you need to know about this credit card. If you don't, you'll need to find the card's value elsewhere.

Increased value of Ultimate Rewards travel reservations

With a Sapphire Preferred or Ink Plus credit card, there are exactly two reasons you would redeem Ultimate Rewards points to book travel through the Ultimate Rewards booking engine:

• you are booking paid air travel on an airline or a stay at a hotel without award availability;
• or, although there is award availability, transferring Ultimate Rewards points to one of Chase's transfer partners would yield less than 1.25 cents per point in value.

The two situations have different implications, and need to be treated differently.

If you regularly use Ultimate Rewards points to book travel when there is no award availability with Chase's travel partners, then the move from a 1.25 to 1.5 cent-per-point redemption means saving Ultimate Rewards points: every $1,000 in paid reservations you make costs 13,333 fewer Ultimate Rewards points (66,667 instead of 80,000). If you currently book $3,375 in paid Ultimate Rewards reservations per year, the Sapphire Reserve will pay for its annual fee in the cash value of those savings.

In the second case, you are moving the threshold for points transfers compared to paid bookings. With a Sapphire Preferred or Ink Plus card, at all redemption values above 1.25 cents per point, accounting for taxes and fees, you'll get more value transferring Ultimate Rewards points to a travel partner than booking through the Ultimate Rewards portal. For example, a simple domestic United one-way costing 12,500 Mileage Plus miles and $5.60 in fees is a better value than redeeming Ultimate Rewards points for the same flight at any price higher than $161.85. At 1.5 cents per point, that breakeven point moves to $193.10. This is a very small change in the breakeven point!

The fact that taxes and fees are levied on both paid airline reservations and award flights means that the breakeven point increases by less than the 20% increase in the value of Ultimate Rewards points redeemed for paid travel.

Thus the difference between the first and second situations becomes clear: if you already find value redeeming your Ultimate Rewards points for paid travel, the Sapphire Reserve generates genuine savings compared to what you're currently paying. However, the increase in breakeven point is not significant enough to change the value calculation for Ink Plus and Sapphire Preferred cardholders who already get more than 1.5 cents per point in value from their United Mileage Plus and Hyatt Gold Passport points transfers.

Southwest Airlines presents a slightly different case, recently discussed by Trevor at Tagging Miles.

$300 annual travel credit

I'm the only blogger who says this, which either means I'm wrong or that I need to keep saying it more loudly and convincingly: statement credits are worth much less than cash.

How much less? Well, we've already established that with the Sapphire Reserve, $300 in travel booked through the Ultimate Rewards booking engine costs just $200 in Ultimate Rewards points.

If that is true, then how can it be the case that a $300 annual travel credit is worth $300, rather than $200?

There are lots of ways to get $300 in travel out of the $300 annual travel credit:

• Buy $300 Alaska Airlines tickets and refund them to your travel bank.
• Buy $300 in Southwest Airlines tickets and redeposit their value to your account.
• Buy $300 in gift cards from a travel provider that sells its own gift cards (Marriott properties all sell Marriott gift cards, for example).
• Pay $300 for travel.

The card is too new to know whether this would work, but you could theoretically even book an Alaska Airlines ticket more than 61 days out, or a fully refundable airline ticket, or a refundable, prepaid hotel reservation, wait for the credit to hit your account, then refund the reservation. I consider that an excruciatingly bad idea, but that's up to you.

The point is, $300 in travel is not worth $300 in cash to a travel hacker, but credit card annual fees have to be paid for in cash!

Conclusion

There are a lot of places a travel hacker can look for value with the Sapphire Reserve, but the card's benefits are not additive in the way affiliate bloggers suggest: 100,000 Ultimate Rewards points are not worth $1,500, a $300 travel credit is not worth $300, and the increased value of Ultimate Rewards points through the Chase booking portal is only valuable to the exact extent you redeem Ultimate Rewards points through the Chase booking portal.

This doesn't mean the Sapphire Reserve is a bad card or that you shouldn't get it.

This does mean you should look at your own pattern of earning and redemption, then think for yourself before jumping on the latest credit card affiliate bandwagon.

3 ways I would use the Ritz-Carlton credit card

There's a simple reason why I am so skeptical of signup bonuses and recurring annual benefits. I receive e-mails and comments every day from readers who say the same thing: "I signed up for this credit card before I found your site, and now I have no way to use these points/certificates/companion tickets." If you don't get those e-mails and comments, there's no reason for you to realize just how widespread the problem of orphaned and expiring loyalty benefits is. You may even think you're the only one who has trouble redeeming Membership Rewards points (you're not).

I don't have anything against signup bonuses. But if you chase signup bonuses, rather than focus on how to pay as little as possible for the trips you want to take, you're unlikely to get the most value from your travel hacking budget, whether that budget is in the form of time or money.

Last week I applied that skepticism to the new Chase Ritz-Carlton Rewards credit card. But just because I don't chase signup bonuses doesn't mean signup bonuses are worthless or bad! On the contrary, the right signup bonus at the right time can help you achieve your travel goals at the right price.

With that in mind, here are 3 ways I would use the new Ritz-Carlton credit card signup bonus of 3 free nights at a Tier 1-4 Ritz-Carlton property after spending $5,000 within 3 months.

A 3-night vacation

Sometimes you just want to go away for a long weekend. Nothing wrong with that! Without flying halfway around the world, you could spend 3 nights at Lake Tahoe, in downtown Boston (where hotels, even on points, are shockingly expensive), or in Puerto Rico. Slightly farther afield, there's a Tier 2 Ritz-Carlton in Santiago, Chile.

Those aren't all properties where you'll get outsize value from your redemption, simply because there are other, cheaper properties nearby. But you'll still save the money or points you'd otherwise pay, and you'll get to stay in a class of property you might not otherwise be able to afford.

A leg or side trip during a vacation

If you're planning on a multi-week trip like the one I took to Europe this summer, it would be easy to book one of your stops at a Ritz-Carlton property. The Ritz-Carltons in Budapest and Geneva both look lovely and are centrally located.

Likewise, if you are planning a long stay in a single location, you might want to make a side trip to see more of an area. While planning a trip to Kauai, you might decide to take a side trip to stay at the Ritz-Carlton in Kapalua, or while visiting Tokyo you might plan a few nights in Okinawa or Osaka as well.

Extending a stay

There are a few ways you could use the Ritz-Carlton signup bonus to extend a stay.

First, if you are relentlessly focused on maximizing the value of your points, there are certain inevitable obstacles to doing so. For example, Hilton HHonors points are most valuable when redeemed for 5-night stays, since the fifth night is free. If you want to stay more than 5 nights, but less than 10, that benefit is correspondingly less valuable.

But if you are staying in an area with both Hilton and Ritz-Carlton properties, you can use Ritz-Carlton free night certificates to extend your stay. For example, you might redeem 320,000 HHonors points for 5 nights at Hilton's Grand Wailea, then head around Maui for another 3 nights at the The Ritz-Carlton, Kapalua, maximizing the value of your HHonors points and enjoying an 8-night Hawaiian vacation.

Second, you could extend a stay at a Ritz-Carlton property. For example, for 350,000 Marriott Rewards points you could book 7 nights at the Tier 3 Ritz-Carlton Vienna (plus 55,000 United MileagePlus miles or 50,000 miles in other loyalty programs), then redeem your Ritz-Carlton free night certificates to extend your stay to 10 nights. Note that if you're transferring Ultimate Rewards points to Marriott Rewards, this is only a marginal play since the Park Hyatt Vienna costs just 25,000 Gold Passport points per night.

Third, you might try to achieve something similar to my experience with Hyatt Gold Passport suite upgrade awards. Since the Ritz-Carlton credit card comes with 3 "Club Level" upgrades annually on paid stays, you could book one paid night, apply a Club Level upgrade, and see if you're allowed to keep the same Club Level room on subsequent nights paid for with your free night certificates. There's no guarantee that would work every time, but it's virtually certain to work at some properties, some of the time.

Conclusion

The right time to sign up for a new credit card is when you already have a redemption in mind, and your research indicates that a new card's signup bonus or earning and redemption structure make it the cheapest, easiest, or fastest way to achieve that redemption.

The wrong time to sign up for a new credit card is when bloggers are salivating over temporarily raised payouts on their affiliate links.

I moved. What did I miss?

Well, faithful readers, I'm back. For the past week I've been packing all my earthly possessions and transporting them 904 miles eastward. They're now, mostly, unpacked, and life should be very slowly returning to normal. Here's what I've learned in the past week.

Pay people to load and unload trucks for you

Packing your possessions into boxes for transport is a long, hard, chore, with a correspondingly high payoff. You can discover long-lost mementos, dispose of mountains of clutter, and get the opportunity to thank your old clothes and books for their service before disposing of them.

Loading and unloading trucks is an utterly thankless task that has no redeeming value. Pay someone else to do it for you. Don't try to help. Just watch.

There are only 81 Ritz-Carlton properties where you can use their new free night bonus

The new Chase Ritz-Carlton Rewards credit card has a signup bonus of 3 nights at any "participating" Tier 1 to Tier 4 Ritz-Carlton property after spending $5,000 in the first 3 months.

According to my brute force calculations (Tier 1, Tier 2, Tier 3, Tier 4), that leaves you with 81 properties in the world where you can use your 3 free night certificates.

Maybe you're planning to visit one of the 81 locations where you can use your free night certificates anyway. That makes the credit card a no-brainer, with a signup bonus worth thousands of dollars.

But if you aren't already planning to visit a Ritz-Carlton property, why would you be interested in a credit card that forces you to plan a whole vacation around it?

Travel is too cheap to chase signup bonuses that make you play by the loyalty industry's rules.

Chase Sapphire Reserve seems fine

Now that the details of the Chase Sapphire Reserve have been more-or-less-or-more officially confirmed, I can say with absolute conviction that it seems fine.

The 3 Ultimate Rewards points per dollar spent on travel and dining seems fine.

The $300 in annual statement credits seems fine.

The ability to get 1.5 cents per Ultimate Rewards point when redeeming them for travel through the Ultimate Rewards portal seems fine.

I personally don't chase signup bonuses. But I know a lot of people do! They'll no doubt enjoy the 100,000-point signup bonus after spending $4,000 within 3 months. That seems fine too.

I apply for cards that either help me earn more points or help me leverage the points I already have. The Chase Sapphire Reserve does neither, so I won't be getting it.

Conclusion

I'm sure I'll have more to say about all this (well, probably not about moving trucks) as time goes on and the affiliates continue harping on these cards' supposed benefits. But since I've been out of touch for over a week, I thought I'd get started by sharing my 10,000-foot view of these latest fads in the credit card marketing blogosphere.

Thinking about Hyatt Diamond requalification

I took advantage of the Hyatt Diamond status match late last year and have been enjoying my suite upgrades, free breakfast, lounge access, and check-in amenities for over half a year now. With just under 5 months left to requalify, I've been giving some thought to whether and how to do so.

Whether to requalify

I have a high baseline level of skepticism that elite status benefits are worth paying anything for.

For example, I manufacture elite status on Delta with a Business Platinum American Express card, but I also earn 1.4 SkyMiles per dollar spent when I meet the $25,000 and $50,000 annual spend thresholds. Since SkyMiles are the airline currency I use most frequently and to greatest effect, I manufacture spend on the card with the SkyMiles in mind, and appreciate the bonus Medallion Qualifying Miles merely as an ancillary benefit.

Requalifying for Hyatt Diamond status has a related logic: since Hyatt Gold Passport points are some of the most useful points, thanks to how easy they are to earn through Ultimate Rewards transfers, qualifying for Diamond status means getting more value from points I'll redeem anyway. I'm not going to try to quantify that additional value — I'm pointing out the difference between elite status in programs you already use aggressively and elite status in programs you use infrequently or never, like the periodic elite status challenges you see offered by airlines.

How to requalify

Hyatt Diamond status requires 25 paid or Points + Cash stays, or 50 paid or Points + Cash nights during the calendar year. There are three important things to consider when deciding on a path to requalification: the Chase Hyatt credit card; requalifying on stays; and requalifying on nights.

Chase Hyatt Credit Card elite-qualifying stays and nights

The Chase Hyatt credit card gives 2 elite-qualifying stays and 5 elite-qualifying nights after spending $20,000, and 3 additional elite-qualifying stays and 5 additional elite-qualifying nights after spending a total of $40,000 during the calendar year. If you spend $40,000 on the card, and value Hyatt Gold Passport points at the 1 cent each you can buy them for with a transfer from Ultimate Rewards, you'll pay $400 in foregone cash back for 5 stays and 10 nights, compared to a 2% cashback card.

Whether that's cheap or expensive depends both on your alternatives and on whether you decide to requalify on stays or nights.

Requalifying on stays

Qualifying with elite-qualifying stays is the option that gets the most attention from travel hackers for three reasons.

First, it's much cheaper to mattress run for additional stays than additional nights. If you are requalifying on stays and get 80% of the way to Diamond status (20 stays), you only need to book 5 more one-night stays. If you are requalifying on nights and get 80% of the way to Diamond status (40 nights), you need to book twice as many more nights, at double the cost.

Second, requalifying on stays allows you to mix and match your booking options. Since Hyatt guarantees standard room award availability, you can book just one night of each stay with cash or Points + Cash, and the remaining nights using only points. This is, in fact, the strategy I've been following this year.

Finally, requalifying on stays allows you to rapidly earn stay credits on longer trips by moving between multiple Hyatt properties in the same city. For example, the Andaz 5th Avenue is just 2 street blocks from the Grand Hyatt New York. It would get old fast, but if you travel alone or have understanding travel companions, on a 5-night stay in New York City you could earn 5 stay credits alternating between the two hotels each night.

As indicated above, if you choose to requalify on stays, then the Chase Hyatt credit card will earn you 5 stays for $400, or $80 each. Is that cheap or expensive? In general, it is cheaper than mattress running with Points + Cash stays unless you have access to Category 1 properties. Those Category 1 Hyatt properties cost 2,500 Hyatt Gold Passport points and $50 per night, plus taxes. If you're able to mattress run at one of the 12 Category 1 Hyatt Regency properties in the Americas (there are many more in the Asia/Pacific region), you'll be able to select a 1,000-point Diamond amenity and earn 325 Hyatt Gold Passport points per stay, bringing your total cost down to $61.75, plus taxes, cheaper than the $80 you'd pay manufacturing spend with the Chase Hyatt credit card.

Using the same logic, even a Category 2 Hyatt Regency Points + Cash stay would cost $81.42, plus taxes (the proof of this is left as an exercise for the reader).

Requalifying on nights

While the case for requalifying for Diamond status on stays is strong, it's not airtight.

Looking at my own stay history this year, I have 7 elite-qualifying stays and 15 elite-qualifying nights. But I have also redeemed 7 free nights. If I had booked those nights as elite-qualifying Points + Cash nights, I'd be at 22 total nights, or 44% of the way to Diamond status, whereas by trying to requalify on stays, I'm only 28% of the way there.

Of course, I had reasons for booking those nights as free awards: 4 of them were redemptions of Chase Hyatt credit card certificates, for example, which can't be booked as elite-qualifying nights!

There are three key questions when deciding whether to requalify on stays or nights: the average length of your stay, the availability of Points + Cash award availability, and the category of property you typically stay in.

If your average length of stay is less than 2 nights, you're strictly better off requalifying on stays, because twice as many nights than stays are required to requalify. This is true even if you have more than 25 stays or more than 50 nights! That's because the more easily you can qualify, the more flexibility you have in selecting between free nights, Points + Cash, and paid stays, and flexibility in this game is worth a lot.

If your average length of stay is 2 nights or longer, then you have to consider the category of property you typically stay in and the availability of Points + Cash award availability. Two extreme examples illustrate this point: if you stay exclusively at Category 7 properties, each night you book with Points + Cash instead of just points costs $150 in extra Hyatt Gold Passport points — that's an expensive elite-qualifying night! If you stay exclusively at Category 1 properties, each night you book with Points + Cash costs just $25 per elite-qualifying night, plus taxes. However, if the properties you stay at don't regularly make Points + Cash awards available, you're out of luck: back to requalifying on stays.

Manufacturing spend on the Chase Hyatt credit card, at $40 in foregone cash back per night, is far superior to mattress running for nights, which even with Points + Cash awards starts at $61.75, as shown above. However, if you already stay 50 nights per year at Hyatt properties, the Chase Hyatt credit card elite-qualifying nights are inferior to simply swapping your award nights for Points + Cash nights, which only requires a "top-up" of $15-25 in Hyatt Gold Passport points (until you get to Category 7 properties).

Conclusion

I already have 2 additional elite-qualifying stays booked, with another 2 planned. Together with the Chase Hyatt credit card elite-qualifying stays, those trips will get me to 16 of the required 25 stays. To mattress run for the 9 remaining elite-qualifying stays at a Category 1 Hyatt Regency property would cost $555.75, plus taxes, which is out of the question.

On the other hand, I haven't planned my fall and winter travel yet, so it's still possible that enough real trips will come along to either get me over the finish line naturally, or get me close enough to mattress run for the final few stays.

I don't buy points, but maybe you should!

Every major loyalty program sells their points for cash, normally at a fixed rate through the industry-sponsored site Points.com.

For example, you can buy up to 60,000 Delta SkyMiles per calendar year for 3.76 cents each, up to 75,000 United MileagePlus miles for 3.76 cents each, up to 150,000 American AAdvantage miles for 3.19 cents each, and up to 60,000 Alaska Mileage Plan miles for 2.96 cents each.

Hotel programs likewise sell their points currencies for cash, with IHG Rewards Club selling up to 60,000 points for 1.15 cents each, Hilton HHonors selling 80,000 points for one cent each, Marriott Rewards selling up to 50,000 points for 1.25 cents each, Starwood Preferred Guest selling up to 30,000 points for 3.5 cents each, and Hyatt Gold Passport selling up to 55,000 points for 2.4 cents each.

Purchased points are too expensive for me

I don't personally buy miles or points because it's a more expensive way of acquiring miles and points than the other methods I have available.

United MileagePlus miles and Hyatt Gold Passport points cost just 1 cent each when purchased with Ultimate Rewards points transferred from a Chase Ink Plus account.

I happen to have a Citi AAdvantage Platinum Select MasterCard, so if I ever needed to stock up on AAdvantage miles, I can do so for 2.105 cents each — the cash back I'd earn manufacturing the same unbonused spend on my Barclaycard Arrival+ MasterCard.

And of course I earn 6 HHonors points per dollar spent with my American Express Hilton HHonors Surpass card at grocery stores, so even compared to an "optimal" redemption rate of 2 cents per US Bank Flexpoint, I'm already buying HHonors points at a mere 0.67 cents each, 33% less than the 1 cent per point Hilton wants to charge.

Purchased points may make sense for you

As the examples above make clear, the decision whether to purchase miles and points or manufacture them rightly depends upon your next best alternative: your opportunity cost.

If you're currently manufacturing the bulk of your otherwise-unbonused spend on a 5% cash back card like the Wells Fargo Rewards Visa during the introductory promotional period, then manufacturing spend on a one-mile-per-dollar card costs not 2.105 cents per mile, but 5 cents per mile, 57% more than, for example, American is willing to sell them!

Likewise, if you have $100,000 on deposit with Bank of America, you might be earning 2.625% cash back with a BankAmericard Travel Rewards card. That may make purchasing Hyatt Gold Passport points at 2.4 cents each worthwhile, compared to manufacturing spend on a Chase Hyatt credit card.

Purchase small numbers of points for high-value, upcoming redemptions

While you usually see affiliate bloggers advocate buying large numbers of points speculatively when loyalty programs offer the highest bonuses on purchased points (bringing down the cost per point), I have exactly the opposite view.

If you find yourself with an upcoming, high-value redemption, and don't have the time to manufacture the required points, then go ahead and buy them. Paying "too much" per point, if it drastically brings down your total out-of-pocket cost, makes perfect sense: the goal isn't to pay as little as possible per point, it's to spend as little money as possible on the trips you actually want to take!

But the money you spend speculatively buying miles for redemptions you don't actually have planned could almost invariably be better spent building a credit card and manufacturing spend strategy that generates the trips you want to take at far lower out-of-pocket expense.

Travel hacking without spend

While I write a lot about strategies for using manufactured spend to get pay for travel at deep discounts, I know that many of my readers find manufacturing spend to be distasteful, time-consuming, or impossible (I know because you never hesitate to tell me in the comments section).

So at a reader's suggestion, I want to share some thoughts on travel hacking without manufacturing spend, and indeed without the requirement to spend any money on credit cards at all (besides annual membership fees).

Annual benefits

There is a not-unreasonable intuition that in the absence of manufactured spend, which properly focuses on high earning rates, bonus categories, and valuable points, annual recurring benefits of credit cards would become more important in developing a travel hacking strategy.

For airlines, those benefits include things like American Express Delta Platinum and Reserve companion tickets, the Chase Southwest Airlines 3,000 (Plus) or 6,000 (Premier) annual bonus points, the Bank of America Alaska Airlines annual $99 companion ticket and, for those grandfathered in, the 10,000 bonus anniversary miles offered by the Barclaycard American Airlines Aviator card.

Many hotel co-branded credit cards offer anniversary nights: the Chase IHG credit card gives a free night worldwide, Chase's Hyatt credit card gives a Category 1-4 night annually, and US Bank's Club Carlson credit cards give 40,000 (Premier Rewards and Business Rewards) or 25,000 (Rewards) bonus Gold Points on each account anniversary.

If our intuition that recurring benefits are more valuable without manufactured spend is true, then one credit card strategy might be to carry:

• both a personal and small business version of both the Platinum and Reserve cards ($1290 in annual fees);
• a Chase Southwest Premier card ($99 annual fee);
• a Chase IHG credit card ($49 annual fee);
• a Chase Hyatt credit card ($75 annual fee);
• and one or more US Bank Club Carlson Premier Rewards and Business Rewards credit cards ($75 and $60 annual fee, respectively). Note that US Bank doesn't impose a hard cap on the number of its products you're allowed to have.

For $1,648 in annual fees per year, you could thus buy 4 domestic companion tickets on Delta (subject to fare bucket constraints), 6,000 Southwest Rapid Rewards points (worth perhaps $100), a free night at any IHG Rewards property, a free night at a Category 1-4 Hyatt property, and 80,000 Club Carlson Gold Points (good for at least one free night at any Club Carlson property).

I'm deliberately leaving out the Citi Hilton Reserve free weekend night benefit and the Club Carlson free domestic night benefit, since they each require $10,000 in annual spend.

Without price compression, free nights are an expensive trap

In a world with plentiful manufactured spend, travelers experience a phenomenon I've dubbed "price compression:" nights and flights that have large differences in retail price have much smaller or nonexistent out-of-pocket differences in cost to the travel hacker.

For example, a free Category 4 Hyatt night from the Hyatt credit card can be combined with Hyatt Gold Passport points transferred from a Chase Ink Plus, where you've manufactured cheap Ultimate Rewards points.

Without manufactured spend, and the price compression it produces, you'll be paying the retail price of your stays out of pocket, less any rebates earned by booking through shopping portals and online travel agencies. Unless you typically spend only a single night in each city you visit, travel solo, or have a very understanding travel companion, this can become very expensive very quickly.

To see why, take a stylized example of a city with a Category 4 Hyatt that costs $125 per night and a nearby Holiday Inn that costs $100 per night. On a four-night stay, you'll pay $375 out of pocket for the Hyatt, and $400 out of pocket for the Holiday Inn: a savings of $25.

So far, so good. But remember you paid a $75 annual fee for your Hyatt credit card! If you only compared the value of your night to your annual fee, you'd mistakenly believe you saved $50. By taking into account how the "free" night benefit affects your behavior, you'll realize the truth: the Hyatt credit card in fact cost you $50.

Of course if you are a solo traveler or have an understanding travel companion, moving hotels in the middle of your stay may not be a big deal. If you have a lot of one-night stays, you may also save real money. But that's an individual assessment you should take seriously before paying hundreds, let alone thousands, of dollars in annual fees.

You'll find a similar principle applies to the airline credit cards: if Delta flights are consistently more expensive, or less convenient, than competitor flights you may find yourself over-paying just to take advantage of your companion ticket. Southwest Rapid Rewards points, likewise, are only valuable if you're able to earn enough of them to redeem them for the flights you want.

None of which is to say these are bad credit cards or bad benefits. They just need to approached critically if you're to have any hope of using them to save money on travel.

Everyday spend

My standard response when asked which credit card people should use for their actual purchases is that actual purchases should represent a rounding error in your miles and points balances. Without manufactured spend, of course, that rounding error may turn into the bulk of your balances!

In my view, there are only a few credit cards that have any measurable advantage over paying for your purchases with cash.

• Discover it Miles. If you can sign up for a Discover it Miles card that doubles your cash back after your first year, you'll earn 3% cash back on all purchases and pay no annual fee or foreign transaction fees. You can boost your earning even more by redeeming your cash back for certain gift cards — you can currently redeem $90 in cash back for $100 in Hyatt gift cards, turning a Discover it Miles card into a 3.33% cash back card. Canceling and applying for a new card each year may let you continue on an ongoing basis.
• BankAmericard Travel Rewards. If you have $100,000 on deposit with Bank of America, Merrill Lynch, or MerrillEdge, you'll earn 2.625% cash back on all purchases, and pay no annual fee or foreign transaction fee.
• American Express Amex EveryDay Preferred. If you make 30 purchases per month, this card earns 1.5 Membership Rewards points per dollar spent everywhere, 3 points at gas stations and 4.5 points at grocery stores. Because of its $95 annual fee, you should only consider this card if you spend a lot of money each year. If you do, you might find the ability to transfer points to Delta, Air Canada, British Airways, or American Express's other partners more valuable than cash back.

Travel hacks that don't require spend

Of course, credit cards are just one tiny corner of the travel hacking universe. It's just a corner that's become unusually prominent because there's so much money to be made selling credit cards to the unwitting.

So here's a brief list of other travel hacking techniques, no credit card required:

• Mistake fares and attack fares. Among the original travel hacks are simply waiting for an airline to slip up and forget to add a zero to an airfare, or to "attack" a rival's hub by cutting fares far below normal. By following Twitter accounts like @TheFlightDeal and @EscapeATX, and bookmarking sites like Flyertalk's mileage run forum, you can handily see whenever those hard workers find a new error fare or attack fare. Julian the Devil's Advocate wrote up a terrific guide to getting text alerts for a particular city or airline that interests you.
• Stacking portal and online travel agency rewards. In the bleak world without manufactured spend, you've got to make every dollar count. By clicking through shopping portals to online travel agencies before making hotel reservations, you can earn portal rewards plus the rewards offered by whichever travel agency you select.
• Best rate guarantees. I've written before that I find best rate guarantees to typically be a waste of time, and I don't think it makes a whole lot of sense to make booking decisions around best rate guarantees. But once you've identified a hotel and rate, it's common sense to check if there's a lower rate elsewhere that's eligible for a best rate guarantee claim.
• Hidden city ticketing. It's not for everyone, and it won't work for every itinerary, but it's possible to save a lot of money searching for flights using Skiplagged, a service that takes care of the hard work of finding cheaper "hidden city" tickets. Note that you usually will not be able to check bags when flying domestically on such tickets.
• Corporate rates and other discounts. There are a number of lists circulating of corporate rate codes, which can bring down the cost of chain hotel stays significantly. Likewise, if you find out there's a convention, conference, or athletic event in a city being held during your visit, you may be able to piggyback on their lower negotiated rates.
• Aggressively book and rebook. Autoslash makes it easy to monitor rental car rates so you can rebook your car if and when the price goes down. By booking cancellable hotel reservations early on, periodically checking for price changes lets you lock in any price declines while being protected from any price increases.

None of those techniques will save you as much as manufacturing spend will, which is why I write a lot about the benefits of manufacturing spend. But the universe of travel hacking, like the universe itself, is vast and growing, so it pays to keep an open mind and to keep exploring!

In defense of mileage running for top-tier elites

I have the rather unfashionable view that mileage runs on Delta, American, and United are more likely to be worthwhile for top-tier elites now that those programs are revenue-based than they were under the previous, distance-based regime.

Mileage running is definitely not for everyone: it takes time, and unless you actually like flying, it's not particularly fun. You may end up paying for transportation, parking, and meals, so it's far from free besides whatever you pay for your actual airfare. But there are still reasons you might consider it.

So here's why I don't think mileage running is dead.

Revenue-based programs give a fixed rebate on airfare dollars

Top-tier elites in all three of the legacy carrier frequent flyer programs earn 11 redeemable miles per dollar spent on airfare on their own flights.

That fixed rebate in miles produces a rebate in value that's likewise fixed, although not by the carrier, but rather by your own planned pattern of future redemptions. If you redeem miles for domestic economy flights, you might get 1.5 cents per mile in value. For international business class flights, you might get 2.5 cents per mile. And on partner first class flights, you might get 4 or more cents per mile in value.

In an extreme case, you could imagine a top-tier elite consistently getting 9.09 cents or more per mile in value, in which case their entire airfare expenditure would be rebated back to them in the form of a future high-cost flight: buy one get one free.

Most travelers, however, don't consistently get 9.09 cents per mile in value, and so even top-tier elites don't earn enough miles to completely rebate their out-of-pocket expenses, if they're paying cash.

Using fixed-value points to fund mileage runs

The above is a strong argument against paying for mileage runs with cash: the difference between the amount paid and the rebate earned in miles is too large to justify wasting a day or more in flight, unless you're very close to top-tier elite status and have no opportunity to qualify otherwise (and plan to fly enough the following year to take advantage of your top-tier benefits).

But what if you're able to fund mileage runs with cheaply-acquired fixed-value points? How would that change the calculus?

Rather than look at the out-of-pocket cost of manufactured spend, as I did last Thursday, let's look at four fixed-value currencies and compare a straightforward cash redemption value of 1 cent each to the redemption value when spent on a mileage run.

• Chase Ultimate Rewards are worth 1.25 cents in paid airfare, earning 13.75 redeemable miles for a top tier elite. To break even compared to a one-cent cash redemption, you'd need to get 7.27 cents in value per redeemable mile.
• Citi ThankYou points in a Citi Prestige account are worth 1.33 cents when redeemed on Delta or United, or 1.6 cents when redeemed on American. Compared to a one-cent cash redemption (for example, for a student loan or mortgage rebate check), you'd need to get 6.8 cents per SkyMile or MileagePlus mile, or 5.7 cents per AAdvantage mile to break even.
• American Express Membership Rewards points in a Business Platinum accounts are worth 1.43 cents each when redeemed for flights on your selected airline, requiring a value of 6.4 cents per redeemable mile to break even compared to a cash redemption.
• US Bank Flexpoints are worth 2 cents each when redeemed for paid airfare, requiring 4.55 cents per redeemable mile in value compared to redeeming the same Flexpoints for cash at one cent each.

Obviously your out-of-pocket cost for those fixed-value points currencies will be lower than one cent each. However, once you've earned them, the question is how you'll redeem them, and at that point they're worth roughly one cent each in cash (slightly less in the case of Membership Rewards points, which have to be liquidated with American Express gift cards).

Why swap fixed-value points and time for redeemable miles and elite status?

My beloved readers sometimes accuse me of making arguments just to be difficult. My defense is that I don't give advice — my only advice is that people should do whatever they want to do!

But top-tier elites who have access to cheap fixed-value points and who redeem their Delta, United, and American miles for long-haul premium cabin awards may do well to consider mileage running to requalify for top-tier status for a few reasons:

• Upgrade priority. Smaller domestic first class cabins and more pressure to sell first class seats for cash means top-tier elite status is the only reliable way to secure free first class upgrades on routes with a lot of elite volume. If you fly on paid economy fares regularly, that may matter to you.
• Award flexibility. I haven't had high-tier elite status for a few years now, but when I was a Delta Platinum Medallion I used free award changes and redeposits constantly to make slight alterations to my itineraries or to recoup miles when cheaper awards became available. On my last trip to Europe business class award availability opened up at the last minute, which would have made our trip much more comfortable, but I couldn't bring myself to pay United's extortionate award change fees — top-tier elite status would have made the free change a no-brainer.
• Top-tier elite status benefits. United Global Premier Upgrades, American systemwide upgrades, and Delta's Platinum and Diamond Choice Benefits have concrete value if you're able to take advantage of them. Not everyone will, so like everything in the world of travel hacking, they're not worth pursuing if you don't have a plan or intention to use them. But for many people, being able to upgrade paid economy tickets may provide even greater value and flexibility than booking award tickets in premium cabins.

If redeemable miles are based on revenue, only distance matters

One important thing to note is that unlike the previous era of mileage running, the number of cents paid per mile flown is totally irrelevant to this calculation: if you've accurately calculated that you'll receive the total price of your airfare back in redeemable miles, your only goal should be to maximize the distance flown on any given mileage run, in order to secure top-tier elite status while spending as little out-of-pocket time as possible.

Long, multi-leg, inconvenient flight routings are ideal regardless of whether they're more or less expensive than direct flights.

Conclusion

Most people rightly think that mileage running, if it ever made sense, only did so in the distant past. However, for top-tier elites with access to cheap fixed-value points, mileage running in revenue-based legacy mileage programs may still make sense, if they plan to redeem their miles for long-haul premium cabin awards, if they have a realistic expectation that they will take full advantage of top-tier elite benefits, and if they have the time to do so.

That may be a smaller subset of the travel hacking population than it was when the legacy carriers offered miles based on distance, but it's not nobody.