The real deal behind the Bilt Rewards reboot

[Update 9/21/2021: Listen to the free episode of the Manifesto here]

Like most folks who take travel hacking seriously, I was a bit bemused by the wave of coverage Bilt Rewards received back in June from Thought Followers in Travel and The Cocaine Guy alike. I didn’t write about it at the time, because it frankly didn’t look that interesting.

At launch, the basic conceit of the program was that you could pay your rent with a co-branded credit card. Then if you also hit other spend thresholds with that credit card, you would earn points on your rent payments as well as on those other purchases. You can check out the above-linked posts if you’re interested in the original program, but basically the whole thing was a mess.

When I saw on Twitter that Richard Kerr, a personal acquaintance and recently of Red Ventures, was involved, I decided to reach out and ask him to come on my podcast to talk about the program. He said he’d be happy to, but that he wanted to wait a month since they were rebooting the entire program in September. Well, it’s September, he came on the Manifesto, and he gave me the lowdown on the entirely-revamped program.

Bilt Rewards, Redux

The most important thing to get your head around with Bilt Rewards is that it’s not a credit card loyalty program. They want you to get their co-branded credit card, and the program isn’t particularly interesting unless you do, but in principle you can sign up for Bilt Rewards, plug in your landlord’s payment information, and pay through ACH from your checking account every month. They have a bunch of major residential real estate companies they can pay electronically but they’ll also cut a check if your landlord isn’t in their database, just like payment services like Plastiq. You’ll earn 250 Bilt Rewards points per month you pay your rent this way, and the whole thing is free.

Their credit card, a white-label World Elite MasterCard issued by Evolve Bank & Trust, is how you unlock the program’s potential value. It’s a no-annual-fee credit card that earns 2 points per dollar on travel and 3 points per dollar on dining, and 1 point per dollar everywhere else.

Oddly for a card designed to pay rent with, rent is the only category with capped earning, at 50,000 points per year, which works out to $4,167 in monthly rent. I assume that’s some kind of anti-abuse provision, so your spouse doesn’t write you a “lease” for $10,000 a month to live in your own home.

So what’s a Bilt Rewards point?

The whole point of this scheme is to rack up Bilt Rewards points, which can be transferred at a 1:1 ratio to their 9 travel partners:

• American Airlines AAdvantage

• Air Canada’s Aeroplan

• Emirates Skywards

• FlyingBlue

• Turkish Miles & Smiles

• Virgin Atlantic Flying Club

• HawaiianMiles

• World of Hyatt

• IHG Rewards

American Airlines, Air Canada, and World of Hyatt are the most obviously valuable opportunities here, but there are sweet spots in each program that you might find personally appealing (and Richard was kind enough to list many of them on the Manifesto).

You can also redeem points for household stuff from their retail catalog or for money towards the down payment on a home.

Bilt Protect

One feature of the program so curious I had to send a follow-up e-mail to Richard about it after our interview is what they call “Bilt Protect.” This is a feature available to all Bilt Rewards credit cardholders, which allows rent payments to be debited from your linked checking account instead of charged to your credit card. According to my follow-up exchange with Richard, these transactions still earn 1 Bilt Rewards point per dollar, despite not flowing through the credit card at all.

If that’s correct, then anyone who rents can apply for a Bilt Rewards credit card, throw it in the sock drawer (although see below for transaction requirements), and still earn 1 point per dollar on their rent payments debited from their checking account.

As I said, I have this in writing from Richard, but if it is true the loophole seems yawning, if not cavernous.

Three more quibbles and quirks

There are a few more things to be aware of if you are at all interested in pursuing Bilt Rewards.

First, there’s a transaction requirement for credit cardholders. If you don’t make 5 transactions per statement cycle, you won’t earn any Bilt Rewards points at all. This is very dumb, but if you’re holding the credit card to earn points through Bilt Protect, be sure to throw 5 random charges on the credit card per month or you’ll earn nothing at all. Ideally, automate these through Plastiq, Amazon, or another recurring payment service.

Second, they have a funny “status” system which you should ignore completely. You can earn “interest” on your Bilt Rewards balance if you have “elite” status, but the interest rate is based on the national savings account interest rate, which is approximately 0.00%.

Finally, they’ve paid to upgrade the “basic” World Elite MasterCard with a suite of features I don’t know if I’ve seen recently on a no-annual-fee card, with trip delay protection and cell phone insurance being the two of most obvious interest.

Who is Bilt Rewards right for?

Let’s not mince words: these are very early days for the company, and we’re going to have to see how the program is managed, both on the outsourced credit card side and the in-house administrative side. They may burn through their venture capital quickly or slowly, they may attract a flood of customers or a trickle. In the startup world a surge of customers may make you a valuable acquisition target or unicorn IPO, or it may bankrupt you, so hopefully no readers will be building their travel strategy around Bilt Rewards any time soon.

But, there are obvious opportunities here. Since Citi fired me as a customer years ago, I don’t have any convenient method of earning American AAdvantage miles through credit card spend; if you’re in my position, this is a potential opening to transfer Bilt Rewards to AAdvantage. If you’re over the 5 cards per 24 month limit on Chase credit card approvals, you might not have easy access to World of Hyatt points — here’s a new one.

It also has a certain appeal as a “starter” card for folks renting their first apartment, with no annual fee and transfer partners in each alliance, plus Hyatt for hotel stays. Since Bilt Protect allows you to pay your rent from your checking account regardless of your credit limit, you could potentially run up a sizable rewards balance that way without paying any annual fees or risking falling into debt.

I work for you

As you know, nobody pays me for anything except my subscribers, Google Adsense, Amazon Associates, and the Milenomics Podcast Network, so you know Bilt Rewards didn’t pay me anything to write this. What they did do is give me a code to let you skip the “waiting list” and get instant access to the program. That code is: FQF4BILT. If you plug that in while signing up at biltrewards.com/waitlist, you should get instant access to the program. If not, let me know in the comments and I’ll bug Richard about fixing it, if he still talks to me after this post.

What travel partner should you credit car rentals to?

I detest driving, so we haven’t owned a car in years, and I try my best to design vacations that don’t require a private vehicle. In recent years, that started to slip, and we started to rent cars 2-3 times a year. During the pandemic, the change accelerated when nearby driving vacations became the only ones available.

90% of the time we rent from Hertz simply because their nearby location typically offers the lowest prices on Autoslash, and I add my Hertz Gold Plus Rewards number to those reservations, but the main advantage seems to be saving my credit card, insurance, and fuel preferences: the program just isn’t that valuable.

In the last year, I’ve spent $936.64 on four Hertz rentals and earned a grand total of 737 points (one of the rentals didn’t credit to my account for some reason, either because Autoslash put me in an ineligible booking code or I forgot to re-add the reservation to my Hertz profile after booking through Priceline, a tedious necessity). That’s not quite enough points for a single day standard car rental subject to blackout dates, which costs 750 points.

It was only when I recently needed to make a reservation with Avis that I remembered it’s also possible to earn partner miles and points on these reservations. I had assumed that those partnerships were of trivial value, since the points you earn with a program are almost always more valuable than those earned with partners. That turned out to be exactly wrong: airline miles are almost always more valuable than points earned in rental car programs.

Since I wasn’t able to find any useful information about car rental programs on non-affiliate sites, I realized I needed to research and cover these programs more closely myself.

Hertz Gold Plus Rewards

The main problem with Hertz, and the reason it took me so long to figure out their rewards, is that their website is held together with twine. You can save partner loyalty account numbers to your Hertz account by navigating to “My Profile” and editing your “Membership Details” (don’t forget to hit “update” on the bottom of the page in order to save your accounts).

In principle, the terms of the program are clear that you must decide whether to earn Hertz Gold Plus Rewards points or partner loyalty points. In fact, I was able to submit a “Retroactive Credit Form” for two recent rentals and received an e-mail confirming two sets of 500 miles were headed to my Alaska Mileage Plan account. They haven’t arrived yet (they give themselves 4-6 weeks) and I don’t know if they ever will, but if so they represent a potential double dip opportunity.

Each partner loyalty program has its own earning rate, so the optimal choice depends on your precise rental:

• Short rentals and airline elites: Delta SkyMiles, United Mileage Plus, or Marriott Bonvoy (500 miles or points per rental, more for Delta and United elites)

• Long rentals: Alaska Mileage Plan (500 miles for rentals over 5 days)

• Expensive rentals: American AAdvantage (1 mile per dollar spent)

Note that when crediting a rental to an airline partner, Hertz charges a surcharge to recover the excise tax; I’m not sure how or whether that surcharge is recovered when you request retroactive airline credit.

Avis

Avis’s website works a lot better than Hertz’s, and makes it easy to select an airline partner by navigating to “My Profile,” then “Rewards,” then editing your “Rewards Program.” You can select either “Avis Preferred Points,” or one of their partner loyalty programs.

As in the case of Hertz, earning rates vary by partner, so you’ll want to select a travel partner before each rental to maximize the value of your rewards. Here are my top choices:

• Short rentals: World of Hyatt or American AAdvantage (500 miles or points per rental)

• Long rentals: Alaska Mileage Plan (500 miles for rentals over 5 days)

• Expensive rentals: British Airways Avios (3 avios per dollar spent)

Thrifty

I have my first Thrifty car rental coming up in December and while I’m not worried, I’m certainly frustrated by their primitive website; I haven’t even been able to create a “Blue Chip Rewards” account in order to save my partner loyalty programs and manage my reservation. Hopefully somebody else will notice and complain loud enough to get the site fixed by the time my reservation rolls around. In any case, as with the first two programs, you’ll want to choose which program to credit your rental to depending on its length:

• Short rentals: Delta SkyMiles (500 miles per rental)

• Medium rentals: United Mileage Plus (500 miles per rental over 5 days)

• 10-day+ rentals: Alaska Mileage Plan (50 miles per rental day, up to 30 days) or American AAdvantage (50 miles per rental day, up to 28 days)

National

Unlike the above three programs, National’s Emerald Club does earn rewards worth considering, especially if you make a lot of short rentals. Since you earn one “rental credit” for all rentals up to 7 days, and one free rental day for every 6 credits, the program can provide an outsized rebate value: 6 cheap one-day rentals earn you enough credits for an expensive one-day rental. If you find yourself spreading your car rentals across multiple companies, however, it may take you years to accumulate those 6 rental credits, and you’ll likely be better off crediting your rentals to one of their loyalty partners.

• Short rentals: National Emerald Club or Delta SkyMiles (500 miles per rental)

• Long rentals: National Emerald Club, Alaska Mileage Plan, or American AAdvantage (50 miles per day)

Conclusion

In my experience the price differences between rental car companies are so large, and the quality differences so small, that it would never make sense to be “loyal,” or even have a slight preference, for one rental car company over another. Your own situation may well differ, with the most obvious example being a company with a deeply discounted corporate rate that you can use on business and leisure trips alike. In that case, you might find rental car rewards worth earning on reimbursed travel and redeeming on your own vacations.

But unless you rent cars from the same company year-round, it’s likely worth tactically crediting your rentals to partner programs, based on their length, cost, and earning rate.

Don't sleep on the American Express Hilton Surpass $5,000 threshold bonuses through June 30, 2021

For obvious reasons since early last year I’ve been focusing my manufactured spend on cards earning cash back or rewards easily converted to cash or paid travel, and slacking off on the few remaining co-branded credit cards I carry. That allowed it to completely slip my mind that the American Express Hilton Honors Surpass card has been running a fairly compelling deal, for 10,000 bonus Honors points each time you spend $5,000 on the card, up to 100,000 points when you spend $50,000. If all of your Surpass spend is in the card’s 6-points-per-dollar categories, that works out to 8 Honors points per dollar each time your cumulative spend reaches a $5,000 threshold.

The offer ends June 30, 2021, but it’s well worth checking how close you are to the next threshold and seeing if any additional local gas station or grocery store bonuses make it worth closing the gap. Speaking from personal experience, I received a “Thanks for using your Amex Offer” e-mail as soon as a purchase put me over the $5,000 threshold, so you shouldn’t need to wait or worry about whether your purchase has triggered the threshold bonus.

In my experience Hilton Honors points are consistently worth about half a cent each, which makes this a 4% rebate at gas stations and grocery stores, with the potential for outsized return at specific properties and when using the 5th-night-free benefit on award stays.

Finally, if you plan on meeting the $15,000 annual spend threshold to receive a free weekend night certificate (and if you aren’t planning on meeting the spend threshold you shouldn’t be carrying the card and paying its annual fee), then it’s obviously better to meet that spend threshold while the same spend also counts towards the extra bonus point threshold. Free night certificates and bonus points: two great tastes that taste great together.

Deciding where to credit Alaska, American, and JetBlue flights

A sort of interesting conundrum has arisen recently due to the coincidence of Alaska Airlines becoming a full member of the oneworld alliance, which American Airlines also belongs to, and American entering a codeshare agreement with JetBlue that allows reciprocal earning for paid flights on both airlines (redemptions are not yet available).

That means if you’re flying on any of the three carriers (except JetBlue’s transatlantic fares, which don’t earn American miles), you have between 2 and 3 reasonable programs to credit your flights to. Note that Hawaiian Airlines is another partner of American and JetBlue, but unless you’re a Hawaii resident it doesn’t seem like a particularly generous program so I’ll set it aside for now.

There’s no one right answer for everybody, so I want to lay out the general principles I’d use to decide where to credit my flights.

Value of points

This is the easiest calculation to make: how much do you value the points you’ll earn on a given flight if credited to each? Note the discussion below is based on having no elite status in any of the three programs. You’ll need to calculate your individual breakeven point based on your actual elite status in each program using the linked earning charts.

Flights operated by JetBlue

For flights operated by JetBlue, you’re comparing the value of the TrueBlue points you’d earn to the value of the American AAdvantage points you’d earn. For example, non-elites earn 6 TrueBlue points per dollar when booked through the JetBlue app and website or 5 AAdvantage miles. TrueBlue points are worth 1.4 cents when redeemed for most fares, so if you value AAdvantage miles at more than 1.68 cents, credit your JetBlue flights to American. The only additional consideration is if you typically redeem your JetBlue flights for flights in their Mint cabin, you’ll get less than 1.1 cent per point in value, so you only need to value AAdvantage points at 1.3 cents to break even with the lower earning rate when credited to American. Finally, Blue Basic fares earn just 2 TrueBlue points per dollar but 5 AAdvantage miles per dollar, so in most cases you’ll want to credit them to American.

Here are the relevant earning charts for JetBlue flights:

• JetBlue TrueBlue

• American AAdvantage

Flights operated by Alaska

For flights operated by Alaska, we need to look not at the revenue-based earning of JetBlue flights, but the distance-based computations of Alaska Mileage Plan and American AAdvantage. For example, when an Alaska flight booked into a first class “J” fare is credited to Mileage Plan, non-elites earn 100% of the miles flown and a 100% bonus, while the same flight credited to AAdvantage earns just a 75% bonus. If value is your only consideration, you’d need to value AAdvantage miles at more than 14% above Mileage Plan miles to choose to credit that flight to American.

Even the cheapest Alaska flights still earn 100% of the distance flown with a 500-mile minimum, while the cheapest X-class Alaska fares earn just 25% of the distance flown when credit to American, so if you’re booking into cheap fare classes you’d need to consider American miles two to four times more valuable than Mileage Plan miles to choose to credit your flights to AAdvantage based on value alone.

Here are the relevant earning charts for flights operated by Alaska:

• Alaska Mileage Plan

• American AAdvantage

Flights operated by American

Finally, American Airlines-operated flights pose the biggest challenge, since they can now be credited to Alaska, American, or JetBlue. When credited to American or JetBlue, they are revenue based, but when credited to Alaska, earning remains distance based. In other words, the optimal airline to credit American flights to depends on the cost, distance, and fare class of the flight. Cheap premium fares might earn many more points in Mileage Plan, while expensive economy fares earn more in AAdvantage.

Take for instance the flight I take a few times a year to visit my partner’s family in Indiana. This Thanksgiving, that 500-mile American flight in their “M” fare class costs $249, and would earn a non-elite 1,245 AAdvantage miles, 500 Alaska miles, or 1,494 TrueBlue points. Since I have MVP status with Alaska, I’d earn a 50% bonus for a total of 750 Mileage Plan miles. Since I don’t fly JetBlue, and pay with cash when I fly American for these short holiday flights, I find the 750 Mileage Plan miles the most appealing and credit my American flights there. An exception would be if the only flights available were very expensive economy fares, since Alaska awards a maximum of 110% for American economy fares, while you can earn up to 75,000 miles per ticket in American’s revenue-based scheme.

Here are the relevant earning charts for flights operated by American:

• American AAdvantage

• Alaska Mileage Plan

• JetBlue TrueBlue

Elite status

Obviously many travel hackers pursue elite status in one or more program, whether it’s to earn miles at an accelerated rate or to take advantage of other benefits like free upgrades, changes and cancellations, lounge access, etc.

Elite status in one program

I imagine this is the most common case: if you live in a city served by two or more of these airlines but book exclusively based on price, you might fly too few miles to earn status in any of the three programs if you credit each flight to the carrier’s program, but enough miles to earn status if you credit all your flights to one of them.

An obvious example is someone living in Boston, a city that’s served by American, Alaska, and JetBlue, who splits their flights between the three carriers, but doesn’t fly enough on any one of them to earn elite status. In this case, there are three natural possibilities:

1. Credit all flights to American. For many people this is the obvious solution, especially since someone who books exclusively on price is by definition going to struggle to meet the Elite Qualifying Dollar and Segment requirements for AAdvantage elite status. JetBlue flights (except Blue Basic) earn full EQM, EQD and EQS credit, while Alaska flights earn them based on fare class and distance flown.

2. Credit Alaska and American to Mileage Plan, JetBlue to TrueBlue. The appeal here is that Alaska Airlines doesn’t have a spending requirement for elite status and has a somewhat lower mileage requirement than other carriers, combining Alaska and American flights might get you to their mid-tier MVP Gold status, which translates to oneworld Sapphire status and free access to those lounges when traveling internationally. There is downside in the possibility of orphaning your TrueBlue points, but since JetBlue allows you to book with both points and cash, they’re actually relatively difficult to orphan compared to most loyalty schemes.

3. Credit American and JetBlue to TrueBlue, Alaska to Mileage Plan. The TrueBlue program only has a single elite status level, called Mosaic, which you achieve when you earn 15,000 base points, i.e. when you spend $5,000 on JetBlue or their partners. I consider Mosaic the least valuable of the three, especially for casual flyers, but there are those who swear by it. The main quantifiable benefits are free checked bags, changes, and cancellations, and the secondary benefits are free (albeit space-available) upgrades their extended legroom seats and free booze. This strategy has the downside of orphaning your Mileage Plan miles, but for a casual traveler that may not be a big deal, for instance if your Alaska Airlines flights are all paid companion fare tickets (as 90% of mine are), you may not have any plans to redeem Mileage Plan miles and have no particular interest in the program.

Elite status in multiple programs

It’s worth mentioning the opposite situation: someone who flies enough on one or more of the carriers to earn elite status in two or more of these programs. Should they spread their flight credit around, or concentrate their fire on just one (or two) programs as described above?

Let’s take an extreme example: someone who each year flies 75,000 miles on Alaska, spends $15,000 and flies 100,000 miles on American, and spends $5,000 on JetBlue. If each flight was credited to the carrier’s loyalty program, the flyer would earn MVP Gold 75K with Alaska, AAdvantage Executive Platinum, and TrueBlue Mosaic. They’d also earn the following redeemable miles:

• 218,000 Mileage Plan (125% bonus miles plus 50,000 miles on MVP Gold 75K qualification);

• 235,000 AAdvantage (11 miles per dollar plus 20,000 miles on Platinum Pro qualification and 50,000 on Executive Platinum qualification);

• 150,000 TrueBlue (9 points per dollar plus 15,000 points on Mosaic qualification. Add 12,000 points if you also fly 7 round-trip flights).

Here are those same values in each of the three crediting scenarios I described above (assuming an average earning rate of 50% when crediting Alaska flights to AAdvantage and vice versa, and an average earning rate of 7.5 points per dollar when crediting American flights to TrueBlue, since non-codeshare flights can’t be booked through JetBlue):

1. 372,500 AAdvantage (82,000 from Alaska flights and 55,000 from JetBlue flights);

2. 330,500 Mileage Plan (112,500 from American flights), 150,000 TrueBlue;

3. 262,000 TrueBlue (112,500 from American flights), 218,000 Mileage Plan.

An actual flyer’s experience would vary based on the exact Alaska fare classes and exact American flights they took, but this should be the result you expected: since airlines naturally reward their own passengers more generously than those of their partners, concentrating your fire does increase your total earning in your focus program, but not by as much as it reduces your earning in your distributed programs. In a sense this functions the same way as a points transfer from Marriott to United: you’ll never get as many miles into United as you got out of Marriott. It may still be worth it depending on your plans and corresponding needs, but only after careful scrutiny and exploring other alternatives.

Conclusion

If you made it this far, congratulations! If you found this analysis useful, even better. If you found this analysis mindlessly boring, well, send it to someone you want to annoy.

I personally plan to bookmark the post for my own convenience just to have those earning links in one place, since I find it irritating to track down cross-airline earning rates every time I fly and need to decide where to credit flights based on fare class, elite status, and partner programs.

Safeway versus Giant: Value, Scale, and Timing

As so often happens in the grocery store rewards game, when it rains it pours, with both Safeway and Giant currently offering big bonuses on the purchase of “Happy” brand gift cards. This family of gift cards can be loaded with up to $500, and each sub-brand can only be used at specific merchants, where they are processed as credit cards. They can be easy or difficult to turn into more universally accepted prepaid debit cards depending on the merchants you have convenient.

Safeway versus Giant: Value

Through April 10, 2021, the purchase of Happy gift cards at Safeway will earn 8 Just4U points, while their purchase at Giant/Stop&Shop/Martin’s stores will earn 8 Flexible Rewards points. As the name suggests, Flexible Rewards points are more flexible than Just4U points, since they can be redeemed down to the penny for almost anything in the store. If you’re able to redeem them at scale, however, Just4U points are somewhat more valuable: if you can redeem your entire balance of Just4U Rewards for their maximum value you can get over 1.3 cents per point, or a 10.56% rebate on the purchase of Happy gift cards (plus any credit card rewards earned on the purchase), and you can take advantage of the Just4U double dip to even redeem some of them against otherwise-forbidden goods like liquid dairy products.

In other words, if you have equally convenient access to both stores, and can maximize the value of your points in either program, you should treat 8 Just4U points as “somewhat” more valuable than the same number of Flexible Rewards points.

Safeway versus Giant: Scale

If you don’t have the time or inclination to maximize the value of Just4U points, then Flexible Rewards are clearly superior. Capped monthly rewards redemptions and quick expiration make it pointless to earn more than a few thousand Just4U points. You could easily maximize the value of the entire Safeway promotion in a single trip and just one or two Happy gift cards. Exploiting the higher value of Just4U points requires a disproportionate level of planning, networking and attention to detail, while maximizing the value of Flexible Rewards points requires nothing more than doing your shopping as usual, scanning your card, and walking out with free groceries.

Safeway versus Giant: Timing

The two factors above should do 100% of the work for 90% of listeners. Do you have access to both Safeway and Giant stores? If not, your decision has been made for you. Are you a detail-oriented control freak or do you just want to score some free groceries? If the former, Safeway’s your store; if the latter, Giant’s for you.

There’s one final consideration I want to put out for the remaining 10%: even if you are comfortable maximizing the value of Just4U points, you may want to consider hitting Giant first, and waiting until May 1 to take advantage of Safeway’s offer.

That’s for two reasons. First, Giant’s offer ends earlier, on Thursday, April 29, while Safeway’s runs through May 10, 2021 (as long as you add the offer to your Just4U accounts while it’s still available in the app and online).

The second reason is more pedantic: Just4U points expire at the end of the month in which they’re earned. That means points earned between now and April 30 will expire at the end of May, while points earned between May 1 and May 10 will expire at the end of June (for the clipping of rewards that will themselves expire at the end of July). Especially if you’re already exhausted your April redemption opportunities, waiting until May 1 to begin refilling your Just4U balance will give you a lot more time to ultimately redeem your points.

Conclusion

Obviously if you don’t drive much or spend much on groceries there’s not necessarily any reason to try to maximize both of these promotions, and it’s perfectly reasonable to keep life simple by focusing on just one (or neither). But these are at least some of the factors you should consider when weighing grocery store bonus rewards against one another.

Disappointed by Alaska Airlines IT, satisfied by their customer service

I wrote a few weeks back about the maze of rules relating to the elimination of change fees by most US carriers. My basic conclusion was that eliminating fees is better than keeping them, but that if you’re trying to claim a credit for a fall in price you should anticipate having to put some work in.

That turned out to be prophetic in my own case, rebooking a 3-week trip out West in July. But while I didn’t run into any problems with Alaska’s change fees, I am now 3 weeks into an IT saga.

My reservation was complicated, but uneventful

For my summer trip, I booked a fairly straightforward multi-city itinerary, with stops in California, Oregon, and Montana. I was able to book the itinerary entirely online, and I didn’t violate any of Alaska’s rudimentary routing rules. However, I did pay for it in a modestly complicated way:

• I made the reservation logged into another person’s account, using their companion fare;

• I paid for part of the fare using their Wallet funds;

• and I paid for the rest using their Alaska Airlines credit card.

Obviously there are a lot of moving pieces here, but the reservation itself was made online with no hiccups.

Changing the reservation was straightforward

In my original post, I wrote that Alaska “offers two methods of changing an existing itinerary.” It turns out that’s not right. You can also “Deposit a ticket” through the “Wallet” tab in your account, which offers three additional options:

View fullsize

In hindsight, I wish I’d chosen one of those options! Instead, I called in, had my ticket re-priced, and was told I’d receive a certificate by e-mail I could deposit to my Wallet.

But, the certificate never came.

A “known issue,” but nobody knows what it is

When I called back last week to follow up, the rep made me walk through the entire story from scratch, researched the history of the ticket, put me on hold while she called accounting, and then confirmed that I was due the $720 certificate, which I would receive by e-mail.

Yet again, the certificate never came.

When I called in again today, I decided to be a bit more straightforward: they had screwed up, I was sick of being given the runaround, and I needed to know what they were doing to fix it. This elicited a slightly more effective reaction, and the phone rep contacted the most knowledgable person in accounting she knew (“I’ve been working here for 29 years and Carrie’s been here even longer than me”).

This time, I got what seems like a sensible answer: “there’s a known IT issue, accounting is making great strides to fix it, and it will hopefully be resolved soon.” She even threw in that “Carrie” had recognized my name and knew I was one of the “handful” of people affected by the issue.

She also offered me a $100 discount code, bringing the total gross value of the rebooking to $783. I don’t believe I’ll be able to use the discount code since (unlike Wallet funds) I don’t think discount codes can be combined with companion tickets. Still, someone will surely use it.

Conclusion

I don’t know exactly which piece of my booking broke Alaska’s IT, so there’s nothing I can recommend to avoid running into the same problem until it’s finally resolved. I suspect it has something to do with how their change fee waiver populated across various systems, since I was using a companion fare, Wallet funds, and a non-traveler’s credit card.

But despite the incomplete and inadequate information they’ve given me since the beginning, I came away impressed with their overall customer service. Even as an entry-level MVP elite, I never had to wait more than a few minutes on hold. Every rep I spoke to confirmed that I was owed the fare difference, so there was no need to recite terms and conditions to them at any point. And when the problem continued far too long I was even offered a fare discount as a goodwill gesture.

It’s not like people have much of a choice in carrier these days, but I’m frankly thrilled Alaska's doing their best to keep up their customer service standards.

A tale of two Hyatts Place

Last week I took a road trip to neighboring Delaware to check out some of the beach communities we missed on our trip to Exmore in August. It was a fun time, and since neither of us had ever been to Delaware before we built the trip around completing the Discover Delaware Trail. We saw a lot of Delaware, and got some great ideas for stuff we’d like to do next summer assuming the vaccination campaign is up to speed by then.

But I don’t want to talk about Delaware today, I want to talk about “brand standards.” Except when American Express is running offers that are only valid at specific property types, I’m basically indifferent to the sub-brands each hotel chain licenses, not because I don’t acknowledge there are differences, but because there are just too many for me to keep straight. At the low end who cares if it’s a Hyatt House or a Hyatt Place, in the middle can anyone keep straight the difference between a Hyatt, Grand Hyatt, or Hyatt Regency, and even at the most luxurious properties, how do you decide between a Waldorf Astoria and a Conrad (the Maldives is host to both)?

Like any sane person, I decide between hotels based on location and cost, taking into account any points balances, free award nights, and credit card promotions. Which is why I was so surprised by the totally different practices at the two Hyatts Place we stayed in the same state during the same week.

Hyatt Place Dewey Beach versus Hyatt Place Wilmington Riverfront

To get it out of the way: these are two different properties in different parts of the state, they opened 6 years apart, and they have different ownership groups. Obviously the properties are going to be different. Dewey Beach is a party town just south of Rehoboth Beach, and relies on summer vacationers and hard-partying future Supreme Court Justices. Wilmington is a financial center that brings in conventions and business travelers year-round (until this year).

The Hyatt Place Dewey Beach was happy to sell us some beers to take out back and watch the sunset over the bay, but they didn’t have a kitchen, instead offering a few packaged snacks next to the reception counter. The Wilmington Riverfront had a “grab and go” pantry, but also a bar and restaurant, which served both lunch and dinner until March (they now open at 4 pm and close at 9:30 pm for an extremely limited dinner menu only).

But that’s not what I’m talking about. I’m talking about the stuff that goes to the core of so-called “brand standards,” and three things stuck out to me:

• Coffee. In Dewey Beach, the Hyatt Place had removed coffee makers from the rooms. This seemed perfectly reasonable: coffee makers are high-contact surfaces and relatively difficult to thoroughly clean (we occasionally run vinegar through our home coffee maker and it doesn’t work particularly well). Instead, they offered coffee all-day in the lobby, which worked fine for us. Imagine our surprise when we arrived in Wilmington and the coffee makers, difficult to clean and all, were still in the rooms.

• Breakfast. Stays at Hyatts Place include breakfast, and when we checked in at Dewey Beach the receptionist informed us that they were offering one “hot item” and one “cold item.” The next morning I went down and discovered that the hot item was a Jimmy Dean sausage sandwich. Not a Jimmy Dean-style sausage sandwich — it was literally still in its microwaveable Jimmy Dean wrapping paper. When I mentioned this to the receptionist in Wilmington, she was shocked, since they have someone come in every morning exclusively to cook breakfast in order to meet “brand standards,” a rotating cycle of french toast sticks, oatmeal, and something else.

• Toiletries. Another weird one: our bathroom in Dewey Beach was set up with shampoo and conditioner, but not skin lotion, which I’ve come to expect at even the most basic chain hotels. And sure enough, the Hyatt Place in Wilmington provided it.

None of this would have been of more than passing interest for me at all, except that while I was waiting to pick up a few things for dinner in Wilmington, the receptionist wandered over and I told her I was surprised by the difference between the two properties. She got more agitated than I was! They had worked so hard to meet “brand standards” since they opened in October, and this other property in the same chain 90 miles away was just phoning it in. I guess I’d be upset too.

Conclusion

Nothing on Earth could convince me to learn the differences between the 28 post-merger Marriott sub-brands, and in general I’m going to stick to booking the cheapest properties in the locations that best suit my needs. But the fact that two properties in the same sub-brand, in the same state, could have such different interpretations of “brand standards” has at least given me pause. Where prices and redemption costs are similar, I might start occasionally picking up the phone to find out in advance how individual properties are implementing them.

How I'm positioned going into 2021

With the end of the year in sight and the possibility of travel again appearing on the horizon, I thought it would be unusually desirous to take stock of my current portfolio of rewards currencies, identify any strengths and shortcomings, and apply myself with renewed vigor as needed.

Bank Programs

The three bank-sponsored programs I participate in are Chase Ultimate Rewards, US Bank Flexperks, and Barclay’s Arrival+, and right now my Chase balance is the only one I feel good about. With four Freedom cards I can earn up to 120,000 Ultimate Rewards points per year depending on how the bonus categories fall, and my Ink Plus lets me earn 250,000 more points at office supply stores, preferably during negative cost promotions like the one currently running at Office Depot and OfficeMax.

US Bank Flexpoints are worth 1.5 cents each when redeemed through the US Bank travel portal or through Real-Time Rewards, which allows you to redeem points for their full value against purchases at many merchant categories. That means the Flexperks Travel Rewards card earns the equivalent of 3% cash back at grocery stores, and it’s typically one of my go-to cards for grocery store manufactured spend. However, times haven’t been typical, and it fell out of my rotation in favor of cards offering temporary benefits during the pandemic, like my Chase Hyatt card and American Express Delta Platinum card, which is earning the equivalent of 1.5 SkyMiles per dollar (at $1,000 thresholds), with bonus MQM’s along for the ride. I wouldn’t normally consider buying SkyMiles for 2 cents each, but the bonus MQM’s (and recent news that all 2020 MQM will roll over to 2021) and the time-limited nature of the deals ended up convincing me to put a fair amount of spend on the card this year.

Finally, I still have a Barclays Arrival+ card, which used to function as a decent 2%+ cash back card with a chip-and-PIN functionality for use abroad and a trip delay benefit, which made it my go-to card when booking paid flights. Effective November 1, 2019, the trip delay benefit was removed, so I can’t recommend anyone pay an annual fee on the card anymore, as long as they have access to 2% or higher cash back on unbonused spend with another card (Fidelity Rewards or Citi Double Cash, for example).

Airline Programs

From one perspective, my airline mile balances are even more dismal than my bank balances. My highest balance is with Delta, with about 40,000 miles, and my lowest with Alaska, at around 13,000, with American and United in between. In hindsight this ended up being the ideal way to go into the pandemic, since the balances that ended up stranded and unredeemable since March were so minuscule. Looking forward, of course, I’d ideally like to get at least some of those balances up in order to opportunistically redeem them in the summer and fall.

My United Mileage Plus balance is the easiest to address since it’s an Ultimate Rewards transfer partner, so my strategy for earning more Ultimate Rewards points works as a Mileage Plus strategy as well.

In 2021 I’ll have two Delta companion certificates: my 2020 companion certificate with its extended expiration date of December 31, 2021, and the new 2021 certificate I’ll receive in May. Those should cover all my domestic Delta travel in 2021.

With my family on the West Coast, my partner’s family easily accessible on American Airlines, and Alaska joining oneworld on March 31, 2021, I expect Mileage Plan miles will be one of the most valuable currencies for me for the next few years. Unfortunately, opportunities to earn them besides through flying are pretty limited. I have a good relationship with Bank of America, so I’ll keep an eye out for heightened credit card signup bonuses in 2021 (the current offer is for 40,000 miles with a waived annual fee the first year).

Another option for flights operated by Alaska and American will be to transfer Ultimate Rewards points to British Airways Avios, which should be redeemable for the lowest-priced award tickets on either carrier. Tickets to the Pacific Northwest cost the same with Avios as they do with Mileage Plan, and British Airways offers periodic bonuses when transferring points in. Unfortunately, those low-level award tickets are few and far between, so realistically Mileage Plan miles and companion fares will remain the best way to book Alaska Airlines flights. Flights to the Midwest on American cost just 15,000 Avios roundtrip, which would create a decent opportunity if flights weren’t already so cheap. Instead, I’ll likely just pay with Flexpoints or Arrival+ miles and credit the flights to Alaska.

Finally, my American balance, about 15,000 miles, is low enough that my two best options are to either spend it down entirely (for example on a 15,000-mile roundtrip redemption to the Midwest), or to aggressively boost it with a new credit card application. Since Citi doesn’t want my business anymore, that would mean a Barclays Aviator Red MasterCard (current signup bonus of 50,000 miles, $99 annual fee not waived). With no minimum spend requirement, that’s almost a tempting offer, but I don’t have a concrete enough redemption in mind to justify the application for now.

Hotel Programs

My two main hotel programs are Hilton and Hyatt, and here things are actually looking alright.

While my World of Hyatt points balance is low, I’m sitting on one Category 1-4 free night award from 2020 (extended until December 31, 2021), earning another by spending $4,000 on the card by December 31, 2020, and will receive a third when my card is renewed in April 2021. This is perfect as I already have (tentative, vaccine-dependent) plans for these awards in July, since a new Category 4 Hyatt opened in Portland in February, 2020. For additional Hyatt stays in 2021 I’ll be depending on Ultimate Rewards transfers.

My Hilton balance is in much sorrier shape. I actually went into the pandemic with a reasonable reserve, but it’s also the only hotel currency I’ve redeemed since March: two nights on the Eastern Shore in August and a 4-night stay in the Midwest in October. Without accelerated earning or definite plans, I simply stopped putting grocery store manufactured spend on my American Express Surpass card. Since American Express updated their website to show progress towards the $15,000 spend requirement to earn a free weekend night certificate, I realized there’s virtually no way I’ll spend that much on the card this year. Simply put, it was a wasted year not earning one of my favorite rewards currencies or the free night certificate that’s a main justification for keeping the card. In 2021, I’ll be ramping up spend again and getting ready for redemptions in the summer and fall.

Conclusion

I’ve gone into a lot of detail here because I think readers benefit more from knowing precise information they can compare against their own experience, rather than the idealized stories people are paid to sell. My situation is crystal clear: I try to earn the miles and points I need for the trips I want to take, and since March, I haven’t wanted to take any trips. On the contrary, I’ve wanted to keep my household safe, and keep my friends and family safe, so I pivoted my strategy towards earning cash back I can “redeem” today, rather than miles and points that I wouldn’t be able to use for 12-18 months.

As the vaccine enters widespread distribution, it’s time to start thinking about pivoting back. That means ramping up my most useful currency, Chase Ultimate Rewards, while also starting to pay renewed attention to Alaska Airlines, Hyatt, and Hilton earning opportunities.

Making the decision to keep my Delta Platinum Business card

I wrote last month about a little experiment I was running with my American Express Delta Platinum Business companion ticket. By booking a ticket before May 31, 2020, for travel before September 30, 2020, I should be able to move the ticket to any dates before September 30 with no difference in fare, or use the ticket value towards travel anywhere on Delta after that date. Additionally, since my annual fee appeared on my May statement, this would allow me to get my last companion ticket “free” by cancelling my card and having the annual fee refunded (in some states American Express is required to pro-rate annual fee refunds so residents of those states needn’t feel the same urgency).

Against my better judgment, I ultimately decided to keep the card for another year.

American Express gave me an “Appreciation Credit”

As I wrote back at the beginning of May, American Express increased the earning rate on the consumer Delta credit cards to 4 Skymiles per dollar spent at grocery stores through July, 2020. That’s a pretty good earning rate, and if I had a consumer card I’d be hitting it hard. Unfortunately, they didn’t extend the same courtesy to business card holders, so it didn’t affect my decision to close my card.

However, at the end of May, I refreshed my Mint account and found a pleasant surprise: American Express had credited my account with a $75 “Appreciation Credit.” Doctor of Credit had shared some information about the similar ($200) credit for Business Platinum cardholders, but American Express never communicated anything about it to me, by e-mail or in my online account, so I simply don’t know whether I would “keep” the credit if I cancelled my card and had the annual fee refunded. In other words, was the “Appreciation Credit” a retention offer, which in effect lowered my annual fee from $250 (itself an increase from the previous $195 fee), or a free statement credit like the ones provided through Amex Offers, in which case closing my account would produce a negative-$75 account balance and (eventually) a refund check.

Ultimately, I decided to treat the credit as an annual fee reduction, and that the card was worth keeping for another year at $175.

Is the Delta Platinum Business card worth $175 a year?

There are four potential sources of value from a Delta Platinum Business card (as mentioned, the consumer card has the additional temporary benefit of increased earnings at grocery stores):

• a domestic (lower 48 except for residents of Hawaii, Alaska, Puerto Rico or the United States Virgin Islands whose flights also originate there) companion fare;

• free checked bags for the cardholder and up to 8 others traveling on the same reservation;

• access to certain Amex Offers;

• bonus Medallion Qualification Miles at the $25,000 and $50,000 spend thresholds.

The list above is roughly in the order I value the benefits in.

Domestic companion tickets are most valuable when simply sold to someone who is willing to pay some fraction of the fare’s value. For example, someone who would otherwise pay for two $500 fares in cash should be happy to buy a companion ticket for $250, wiping out your annual fee and letting you enjoy the other benefits for free. Unfortunately, unlike Alaska Airlines companion fares, the Delta offer is strictly limited to the cheaper fare classes, making that kind of win-win exchange hard to arrange; no one likes to be told what flights they have to take based on fare buckets!

If you’re going to use a companion ticket for yourself, then you should value it well below your nominal savings — you should value it at what you would other pay for the same tickets, either with a traditional mileage redemption or using a cheaply-earned currency like US Bank Flexpoints or Chase Ultimate Rewards. For that reason, I value Delta companion tickets much more conservatively than many travel hackers, perhaps $100.

Free checked bags, on the other hand, I value more or less at face value, because I don’t have elite status anymore and I really like checking bags! Delta now charges $30 for your first checked bag (and $40 for the second!), so two travelers making 2 round-trips per year with one checked bag each will save $240 just on those fees. We don’t fly Delta quite as much as we used to since our families are now easier to reach on Alaska and American, but between trips to see friends and domestic vacations I’m very comfortable valuing our free checked bags at $120 per year.

The third source of value, Amex Offers, used to be more valuable when each offer could be added to and redeemed on multiple cards; having more American Express cards mechanically increased the savings available to you. That’s less true now, but there are still some offers that are only made available on business or Consumer cards, so having at least one of each gives you the maximum likelihood of being targeted for the most valuable ones. Since my Delta Business is my only business American Express card, I’d assign perhaps $50 in value purely to the additional Amex Offers I receive.

Finally, since I don’t travel on Delta more than once or twice a year (and 2020 will be even less than that), I don’t assign any value to the card’s ability to earn bonus Medallion Qualification Miles. Until we move somewhere with more convenient Delta service, I won’t be coming close to earning even Silver Medallion status. The value you assign to this feature should depend on both how necessary it is to earn status (does it make or break your ability to achieve the status you’re chasing) and how you value that status (how frequently do your upgrades clear, etc.).

So in my case, the $270 in value I conservatively get from the card clears the $175 annual fee hurdle comfortably enough that I reluctantly decided to keep the card for another year, while if I had to pay the entire $250 annual fee, I would have proceeded to cancel the card.

The annual fee isn’t the only cost!

That was my calculus: the card is a little bit better than a wash, so I’ll keep it around and see what develops. I still plan to cancel it next May, but I’m equally prepared to be surprised on the upside as the downside.

Besides assigning the above benefits different values than I did (for example, if you have a particularly high-value companion fare redemption or a good opportunity to sell or gift the companion fare), your cost calculus might also be different than mine. For me, the annual fee is the only cost of holding the card. But since the Delta Business card is a credit card, it counts against your four-card (or five-card) limit with American Express. If you already have four or five American Express credit cards, then an additional cost of holding onto any one card is the inability to open additional American Express credit cards.

That means if your Delta Platinum card is your least valuable American Express credit card, then it is by definition the one keeping you from signing up for additional American Express credit cards, whether your intention is to trigger a signup bonus or add new, different, or more valuable bonus categories to your manufactured spend strategy.

Conclusion

Obviously there are some cards so valuable that this exercise isn’t worth going through in such fine detail, like the Chase Hyatt and legacy Ink Plus and Ink Bold cards. But for most cards with an annual fee, seeing that fee hit is as good an opportunity as any to take a step back and evaluate exactly what role the card is playing in your travel hacking strategy, and whether it still belongs there.

By default, your answer should be “no:” an annual fee is a hole you have to climb out of over the course of the year. Some cards make it relatively easy to get out of that hole and some cards make it relatively hard, but if you’re not digging up, you’re digging down.

Three notes on Chase Sapphire Preferred and Reserve grocery statement credits

I haven’t had a Chase Sapphire card in a long time, having downgraded my Preferred years ago to a second Freedom card and replacing it with an Ink Plus card to maintain the flexibility of my Ultimate Rewards points and the ability to redeem them for 1.25 cents each towards paid travel through the Ultimate Rewards portal.

Still, I’ve obviously been following with interest the news that Sapphire Preferred and Reserve cards will allow Ultimate Rewards points to be redeem for 1.25 and 1.5 cents each, respectively, for “grocery, home improvement, and dining purchases.” That stacks with the accelerated earning on up to $1,500 in monthly grocery store spend on Sapphire cards through the end of June.

I wanted to share three quick notes on this new opportunity.

If you ever redeem points for paid travel, redeem them for groceries

There are three basic value buckets for Ultimate Rewards point redemptions:

• bank account direct deposit and credit card statement credits at 1 cent each;

• paid travel booked through the Ultimate Rewards portal at 1.25 cents (Sapphire Preferred and Ink Bold/Plus/Preferred) or 1.5 cents (Sapphire Reserve);

• travel partner transfers at higher — potentially much higher — redemption values for premium travel.

If you redeem, or plan to redeem, most or all of your Ultimate Rewards point balance for high-value transfers to Chase’s travel partners, then this opportunity doesn’t affect you at all; save your points, transfer them to high-value partners, and make high value redemptions!

If, on the other hand, you think of Ultimate Rewards points as a useful reserve account for paid domestic airline tickets, and were already happy to redeem them for 1.25 or 1.5 cents each for airfare or hotels when award space wasn’t available, then you should be eager to redeem them for the same value as statement credits against eligible grocery purchases. After all, once you’ve redeemed the points for a statement credit, you can use the same cash to buy the same tickets with a different credit card, and earn miles, points, or statement credits on that card!

A word of warning: statement credits aren’t “payments”

I wanted to flag one issue for folks who are planning to hit this deal especially hard. Most responsible travel hackers will tell you not to carry a balance on your credit cards, in order to avoid interest charges that can easily overwhelm the value of any rewards you earn on purchases. The “statement credit” is one way credit card companies have developed to charge fees regardless of how carefully you monitor your balances: according to the terms and conditions of most, if not all, of my credit cards, statement credits are not treated as payments and do not decrease your minimum payment due.

This doesn’t matter if you diligently pay your credit cards off before each statement closes, but one of the nice benefits of travel hacking and manufacturing spend is having several weeks of float to earn interest, meet minimum spend requirements, and spin up other opportunities. In that case, even if you pay off your entire statement balance with statement credits, you may get hit with a late payment or interest charge on the minimum payment. This shouldn’t apply if you reduce your balance to $0, but if you have made additional purchases during the month, your credit card company may consider those purchases to be subject to interest charges since your remaining previous balance was merged with your new balance.

This isn’t an extremely common situation, but I wanted to flag it for folks seeking to redeem tens or hundreds of thousands of Ultimate Rewards points towards grocery store purchases: go ahead and make your minimum payment in addition to any statement credits you redeem, to make sure Chase doesn’t decide to ding you for missing a credit card payment (and take a closer look at your account activity).

Apply or upgrade to Sapphire for redemptions?

Finally, this new opportunity raises the question whether you should upgrade an existing Freedom, Freedom Unlimited, or Sapphire card to a Sapphire Preferred or Sapphire Reserve card, or apply for a new card, in order to take advantage of these new statement credit redemption opportunities. Here, I don’t have a strong feeling either way.

If your credit history made you eligible for a Sapphire Preferred or Reserve offer prior to the new redemption opportunity, then it was probably already worth applying. It’s unclear to me that the new redemption opportunity should change your application calculus.

On the other hand, for folks with an existing large Ultimate Rewards balance held on Chase Ink cards, the new ability to redeem those points for statement credits may well justify upgrading a Slate, Freedom or Freedom Unlimited card to a Sapphire Reserve in order to cash out that existing Ultimate Rewards balance for grocery statement credits while travel redemptions remains a distant prospect.

Conclusion

I have to had it to Chase in making a fairly crafty calculation with this new redemption option. Existing members with large existing points balances, but who found themselves unable to redeem their points during the pandemic, might be tempted to simply cash out and cancel their accounts. Instead, Chase offered them the opportunity to both earn bonus points on their everyday purchases and redeem their Ultimate Rewards points at their “full” 1.25 or 1.5 cent value against them. That both directs spending towards Chase products and reduces the attrition of their “travel” clients during a period when travel is impossible.

But however clever Chase is, it’s still up to you to make the important decisions about how, when, and where to redeem your points.