How to plan out your last 2017 US Bank Flexperks Travel Rewards redemptions

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I know my readers are some of the biggest fans of US Bank Flexperks Travel Rewards cards, given their convenient bonus earning categories and potentially generous redemptions rates of up to 2 cents per Flexpoint when redeemed for paid airfare.

On January 1, 2018, the redemption rate will fall from up to 2 cents per Flexpoint for paid airfare redemptions and up to 1.5 cents per Flexpoint for hotel redemptions to a flat 1.5 cents per Flexpoint for all redemptions. That's a devaluation for folks who are good at maximizing the value of their Flexpoints, and more or less a shrug for folks who redeem Flexpoints aggressively for paid economy fares because they're so easy to earn.

If you're concerned about the coming devaluation, this last quarter of 2017 is a good opportunity to lock in your Flexpoints' higher value. Here are a few suggestions.

Book high-value Southwest fares

Since Southwest flights can be refunded to your Rapid Rewards account up until the time of departure, an easy way to lock in the highest possible value of your Flexpoints is to book Southwest flights (which unfortunately has to be done over the phone) near the top of a Flexperks redemption band. As long as you fly Southwest often enough to be sure you'll use your credit before it expires, this can be an easy way to prepay for flights using the maximum value of your 2017 Flexpoints.

Book Alaska Airlines flights (much) more than 60 days in the future

Alaska Airlines has a similar policy to Southwest, in that they allow you to redeposit the cash value of your flights into your Mileage Plan "travel bank." However, Alaska Airlines' policy is in some ways more and in some ways less restrictive.

It's more restrictive because non-elite members of Mileage Plan can only redeposit a ticket's value into their account more than 60 days before departure, while Southwest lets you redeposit your ticket's value up until departure.

On the other hand, Alaska opens their flight booking window much further into the future, so you have the option of booking flights deep into 2018, while Southwest opens their booking window by what feels like just a few weeks at a time (although in reality I suppose it's more than that).

Don't forget your airline fee credit!

If you plan to simply redeem Flexpoints for a flight and cancel it 24-48 hours later, you would probably be justified in forgetting the original dates you scheduled your flight for.

But that would be a mistake!

On the day or days of your original Flexpoint flight redemptions, you're eligible for a $25 credit for each ticket you booked using your Flexpoints. So that would be a good day to pay some checked bag fees, the taxes and fees on an award ticket, or simply buy an airline gift card. After the transaction posts, don't forget to call in and request the $25 fee waiver — it's an extremely manual process.

Conclusion

I think there are good arguments on both sides for keeping or cancelling US Bank Flexperks Travel Rewards cards after January 1, 2018, but there's no excuse for letting your points suddenly lose their value on that date! It's time to start thinking about 2018 travel plans which will let you lock in your Flexpoints' current, higher value.

Thinking about the 2018 changes to Delta co-branded credit card MQD waivers

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I've been reading with interest about the recently-announced change to how Delta will handle Medallion Qualifying Dollar waivers starting with the 2019 qualification year (January 1, 2018). Frequent Miler has an interesting post from the perspective of someone who is already maximizing a set of 4 American Express Platinum and Reserve co-branded credit cards.

I've personally been bouncing back and forth between Silver and Gold Medallion status for the past few years, after two glorious years as a Platinum Medallion, so I don't expect this change to affect me personally unless I suddenly have to start flying a lot more. But I know some readers still gun for top-tier status with Delta, so I thought it'd be worth sharing a few thoughts.

Rollover MQM are very valuable

Delta is the only airline to allow you to roll elite qualifying miles over from one year to the next, but they allow this only if you achieve at least Silver Medallion status each year. In other words, if you only earn 20,000 Medallion Qualifying Miles in 2017, you'll start 2018 with zero MQM. If you earn 40,000 MQM in 2017 (and meet the Medallion Qualifying Dollar requirements or have them waived through credit card spend) you'll start 2018 with 15,000 rollover MQM.

When the $25,000 MQD waiver applied to every level of Medallion status, the maximum number of MQM a Platinum Medallion who qualified with a MQD waiver could roll over was 49,999. Any more MQM than that, and they would qualify for Diamond Medallion status, resetting their rollover clock to zero and having to start their requalification from scratch the following year.

With the Diamond Medallion MQD waiver threshold raised to $250,000, Platinum Medallions will be able to rollover an unlimited number of MQM, giving them a big head start in the next year's requalification.

Why does this matter? Because if you experience a variable amount of travel from year to year, you might prefer to smooth it out by remaining Platinum every year (and enjoying free award changes and cancellations), rather than bounce up and down between Gold and Diamond Medallion statuses.

How much do MQM cost?

Frequent Miler did a good job explaining the value he perceives from earning MQM and achieving Medallion status, but I'm naturally much more interested in the cost of doing so. Assuming you have or are eligible for both personal and business Platinum and Reserve Delta American Express cards, it's easy to calculate the cost of chasing Medallion status:

  • Your first 60,000 MQM cost $900 in annual fees ($450 for each Delta Reserve card) and $2,400 in foregone cash back (the value of charging $120,000 to a 2% cash back card instead), for a total cost of 5.5 cents per MQM.
  • Your next 40,000 MQM cost $390 in annual fees ($195 for each Delta Platinum card) and $2,000 in foregone cash back, for a total cost of 5.98 cents per MQM.

This pattern of spend would yield 100,000 MQM and 320,000 redeemable SkyMiles, and leave you 25,000 MQM (and $30,000 in spend) short of Diamond status, and cost a total of $5,690, for an average MQM cost of 5.69 cents and cost per SkyMile of 1.78 cents.

Timing matters

At this point you have two options: you can earn 25,000 MQM through actual flight activity (and spend another $30,000 on your co-branded credit cards) in order to earn Diamond status, or you can roll over 25,000 MQM into the following calendar year.

In my view, which decision is best depends on how long it takes you to meet the high spend thresholds on your credit cards. That's because when you earn Medallion status it's valid through the rest of the year it's earned in and the entire following year.

Consider two cases:

  • You spend all of 2018 meeting your high spend thresholds and flying on paid Delta tickets (foregoing the opportunity to redeem the haul of SkyMiles you're also accumulating) and qualify as a Diamond Medallion on December 31, 2018. Your status is valid through January, 2020.
  • You spend 2018 meeting your high spend thresholds and aggressively redeeming your SkyMiles. You end the year with 100,000 MQM and Platinum Medallion status. Then in January, 2019, you spend $250,000 across your co-branded credit cards. Together with your 25,000 rollover MQM, you now have 125,000 MQM and a Diamond Medallion MQD waiver. Your Diamond Medallion status is valid through January, 2021.

In other words, if you're confident you can meet your high spend thresholds early in the year, either through manufactured spend or legitimate expenses, you only need to actually requalify as a Diamond Medallion (and meet the $250,000 MQD waiver threshold) every 2 years. And during any gap between the expiry of your Diamond status and your requalification you'll still get to enjoy your Platinum Medallion benefits.

Of course you'll only receive your Diamond Choice Benefits every other year, as well.

Conclusion

As I mentioned, it's been a few years since I had Platinum Medallion status, but I was very satisfied with it and think for the casual travel hacker it is probably adequate in terms of domestic upgrade chances, Sky Club access when traveling internationally, and free award changes and redeposits. You can also achieve it with just 3 co-branded credit cards, saving either $195 or $450 depending on whether you decide to cut a Platinum or Reserve credit card (2 Platinums and 1 Reserve will earn you just 70,000 MQM after $160,000 in spend, so you'd also need to earn at least 5,000 MQM from flying each year).

However, I can easily see how international business travelers who want to redeem global upgrade certificates or those forced to travel in domestic economy who want to maximize their chances of an upgrade might decide to stretch for Diamond Medallion. Depending on how much value you get out of Sky Club access and Delta companion tickets, the co-branded credit cards may be a cost-effective — though far from cheap — way of achieving it.

What to do when a Bank of America ATM eats your money orders

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Automated teller machines are so fully integrated into American life that it's sometimes difficult to remember just how marvelous the technology is. The fact that the global telecommunications infrastructure enables real-time connections to bank accounts all over the world is incredible enough, but ATM's also perform remarkable, and remarkably consistent, mechanical functions: first dispensing cash in precise quantities, and now even accepting deposits of instantly-counted cash and machine-read checks. Even if the machine-reading isn't yet at 100% accuracy, the cash counting function itself is pretty remarkable.

Of course, no technology is perfect, and most people have wondered at one point or another, "what would happen if an ATM dispensed the wrong amount of cash?" I actually asked a cashier at my local credit union that very question, and she responded that they count the cash at the end of the night and would notice any disparity and correct it. Whether that's true or not, I had my own ATM mishap last week, and I have to confess it was resolved perfectly, at the cost of a single 21-minute phone call.

Here's what happened.

Bank of America ATM's accept money order deposits, but they are not great

I've deposited hundreds of thousands of dollars of money orders in Bank of America ATM's over the years and never run into any problems although, depending on the model of the money order printer and the model of the ATM, I usually have to manually input the amount of the money orders I deposit.

What had never happened to me before last Sunday was for the ATM to accept my money order deposit, go to a "processing" screen for 2-3 minutes, and then "cancel" the transaction without returning the money orders or acknowledging the transaction in any way.

I immediately checked my account online, and when I saw no transaction had been recorded, it was time to get on the phone.

Filing a claim

I used the "contact us" button within the Bank of America iPhone app, which dialed 844-870-8569. After explaining the situation to the front-line rep, I was directed to a department I believe was called "fraud," and given an additional phone number, 877-366-1121. After explaining the situation to that rep, I was then transferred to another department, which I wasn't given the name of. That rep was finally able to open a claim for me. He asked for:

  • the date of the transaction;
  • the approximate time of the transaction;
  • the amount of the deposit;
  • the serial numbers of the money orders I deposited;
  • the ATM's identification code, which was tucked over the ATM's screen and under the ATM's hood (it took me a minute or two to find).

I also asked him how often this kind of thing happened, and he answered that he gets "3-5 calls per day." Naturally, after I tweeted about the situation I heard from several readers who had experienced identical problems. That's what you get when you execute several lifetimes' worth of ordinary ATM usage every year!

Resolution

As promised, my account was credited with a "temporary credit" on Monday, September 11 (actually one day earlier than promised). On Thursday, September 21, I received an online message that the claim had been resolved and the temporary credit was made permanent. The entire text of the attached PDF was:

"We've concluded our investigation of this disputed transaction. The previously issued credit is now permanent."

I assume I'll receive a paper letter to the same effect in a day or two.

Conclusion

I don't think there's an epidemic of malfunctioning Bank of America ATM's sweeping the country, so I don't think this is something you should be worrying about, let alone obsessing over. The real point of this post is simply to put your mind at ease: there is a system for resolving ATM transactions which malfunction, and it works.

Unlike, for example, claiming credit card trip delay insurance, there's no secret recipe for resolving these problems. Just call immediately, provide as much information as possible, and your claim will be resolved in short order (and you'll have use of the money in the meantime). I imagine that some of the information I provided wasn't even necessary to resolve the claim. Since I called immediately I was able to provide the ATM's identification code, but if I waited until I got home I assume Bank of America would be able to look it up themselves.

Travel hacking without manufactured spend

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I was having lunch with a travel hacker in my area the other day and we got to talking about different approaches to the game.

My personal approach depends almost entirely on manufactured spend. I think it's fair to say that if every manufactured spend avenue died tomorrow, I'd close all my travel credit cards and put all my regular purchases on a 2% cash back card (or a 2.625% cash back card if I ever had $100,000 in assets). I don't have any reimbursed business travel, either to generate real credit card spend or to take advantage of the benefits of elite status. And I'm poor, so I don't have enough monthly expenses to meet even a "modest" minimum spend requirement of $3,000 or more. Remember, we're imagining a world without any manufactured spend opportunities, including whatever you're thinking of right now.

That's one extreme, but obviously it doesn't apply to most or all of my readers, especially the well-heeled ones! The fact is, travel hacking is and would be possible without any manufactured spend at all. But the benefits would still depend on the discipline you applied to it. With that in mind, here are a few approaches you could take.

Target individual expenses

The most intuitive way to travel hack without manufactured spend is to target individual expenses on upcoming trips. As I often say, at least for economy travel, your hotel expenses can quickly outstrip your flight expenses, so that's a natural place to start. Once you have a destination in mind, it's easy to find the credit card or cards with signup bonuses that will save you the most money on hotel stays — emphasis on you. I truly do not care what a point is "worth" in the abstract; I care what it's worth to you, and what it's worth to you depends on how much money it's going to save you.

If you are planning a trip with stays at Marriott properties, the Marriott Rewards Premier card can earn you 80,000 points after spending $3,000. That's a minimum of 2 nights at all but their top-tier Category 9 properties, and at least 3 nights at Category 5 properties and below. Category 5 properties are an endangered species these days, which is one reason I cancelled my card; the annual free night certificate is only redeemable at Category 1-5 properties. But if you have upcoming Marriott expenses it's easy to calculate the precise value to you of the 80,000-point signup bonus.

Likewise with the current 100,000-point Hilton Honors Surpass American Express signup offer (you can find my personal referral link on my Support the Site! page), and the Chase Hyatt Visa Signature offer of 40,000 points. If you don't have the ability to manufacture spend, then those one-time points hauls can save you a lot of money on trips involving stays at Hilton or Hyatt.

The point is that this exercise doesn't require figuring out how much points are worth in the abstract. Instead, you can ground the value you're getting from a signup bonus directly in your own experience: the amount of money you would otherwise spend on nights you're able to pay for with a credit card's signup bonus.

Targeting airfare is somewhat more difficult, and should be done cautiously. For example, there's a big difference between cards which only allow you to redeem points for the entire cost of a flight (like US Bank Flexpoints) and cards which allow you to redeem points against the partial cost of a flight (like Chase Sapphire and Ink cards, Barclaycard Arrival cards, BankAmericard Travel Rewards, and others).

Likewise, there's a difference between airlines that allow you to pay for your flights with miles (Delta), airlines that offer last-seat availability at much higher rates (Alaska and American), and airlines that offer last-seat availability only to certain customers (United). This difference matters less in a world with manufactured spend, since with plentiful points you are always free to use the right points for the right job. In a world without manufactured spend you have much less room for error in earning and redeeming precisely the points you need. United miles simply won't get you where you need to go, if where you need to go is served only by American.

Build trips around the signup bonuses you're eligible for

A totally different approach to travel hacking without manufactured spend is to build your travel around the signup bonuses you have available to you. It often feels like this is the approach implicitly endorsed by affiliate bloggers who, in promoting a given credit card, explain exactly how and where they think you should use the card's signup bonus.

The advantage of this strategy is that you may be able to reduce your out-of-pocket expenses much more than you would with the strategy of targeting individual expenses, since each part of the trip will be designed around a particular points balance.

The disadvantage is that you have much less control over where you go. While to a travel hacker this may sound like a commonsense trade-off, it's worth pointing out how unusual it would seem to a civilian who plans trips around places they actually want or need to visit.

Even reimbursed business travelers need to think carefully

I often hold up reimbursed business travelers as a sort of platonic ideal of a travel hacker, one who is able to spend her employer's money, accrue elite-qualifying miles with the airline of her choice, and earn top-tier hotel status on someone else's dime.

But that's no excuse for reimbursed business travelers to relax: they still have to make decisions about the cards they use to pay for their reimbursed travel, and to a lesser extent which airline and hotel programs to pursue loyalty with. I say "to a lesser extent" because the various loyalty programs have become extremely adept at making the value proposition of their programs closely track each other. In other words, for actual paid hotel stays and for actual paid flights, the rebate you receive will be similar regardless of the program you select, as long as you direct all your paid business to a single program.

When it comes to credit cards, however, slacking off can be expensive. For example, a reimbursed business traveler who spends $1,000 at a Marriott property could earn 5,000 Marriott Rewards points by paying with a Chase Marriott Rewards Premier card, or 2,000 Starpoints with an American Express Starwood Preferred Guest card — which can be instantly transferred to 6,000 Marriott Rewards points. If you aren't aware of that, you're simply leaving points on the table.

Likewise, a reimbursed business traveler who is able to pay for their own flights still has to decide whether to concentrate or diversify. Should a reimbursed Delta flight be paid for with a Delta American Express card in order to earn as many Delta SkyMiles as quickly as possible, or with another card that bonuses airline purchases in order to diversify their points balances, even if that means lower balances across multiple accounts?

Conclusion

At the end of the day, travel hacking means different things to different people. For some people it means manufacturing spend, for others it means earning points cheaply and redeeming them dearly, and for others it just means occasionally signing up for a new round of credit cards in order to chop off a chunk of the cost of their travel expenses.

The thing I think it can't mean, or rather the thing travel hacking is in contrast to, is applying, spending, and traveling without thinking. So: don't do that.

Quick hit: changes to US Bank Flexpoint transfers

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In the last few years US Bank has made a number of negative tweaks to the Flexperks Travel Rewards Visa Signature card. They restricted the once-generous "grocery" bonus category to a more restrictive definition of "grocery stores." They limited the number of points that could be transferred in or out of a Flexperks account to 20,000 per year (although see here for a possible workaround). And starting January 1, 2018, Flexpoints will be worth a fixed 1.5 cents each for flight redemptions, rather than being redeemable in $200 "bands" as they have been to date.

There is another change I have not seen discussed elsewhere, which was quietly implemented relatively recently.

Online Flexpoint transfers now require the recipient's credit card number

The Flexperks rewards interface is run by a third-party fulfillment center, and internally they assign accounts a 12-digit account number. As recently as January 7, I used that Flexpoints account number to transfer points between accounts. It seems that as late as March either the Flexpoints account number or the Flexperks credit card number could be used to transfer points.

At some point since then, they've changed the "Transfer Points" form (found under the "Manage Points" heading) to request the "credit card account number where the FlexPoints will be transferred."

And sure enough, attempting to transfer points to a Flexpoints number online now returns an error, while using a credit card number results in success.

Conclusion

The cynic in me naturally suspects that US Bank implemented this change in order to slow down the rate of Flexpoint redemptions, figuring that fewer people are willing to share their credit card number than were willing to share a single-use account designator. The fewer points are shared, the less efficient redemptions become and the more points will tend to go unredeemed.

On the other hand, while US Bank may internally treat Flexpoint redemptions as a cost center, I have to wonder what their ultimate goal is with these steady, piecemeal attacks on the program's value. It may be that each one of these changes individually shaves off another few hundred of the bank's most expensive customers, but it also leaves the rest of their cardholders rightly feeling like the remaining value of the program is being nickle-and-dimed away. I'll keep the card for now, but even so they've left a bad taste in my mouth, which seems suboptimal for a medium-sized regional bank trying to grow its credit card portfolio.

How I would requalify for World of Hyatt Globalist status

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[edit 8/30/17: corrected to reflect that Globalists qualifying under this promotion will not receive a Category 1-7 free night certificate; only 60-night Globalists receive free night certificates] 

This is my second and last year of top-tier Hyatt elite status. I matched to Diamond status during their short-lived offer when the Starwood-Marriott merger was announced, then requalified as a World of Hyatt Globalist through credit card spend and a few mattress runs at a local property.

This year, I have five elite-qualifying nights so far, which were credited to my account in error due to meeting my annual credit card spend threshold relatively late last year.

Like other credit cardholders, I received an e-mailed offer to renew my Globalist status by staying 20 paid nights between September 1 and December 30, 2017.

I'm not going to do this, but 20 paid stays is a pretty easy threshold to meet. Here's how I would meet it, if I were so inclined.

Swap out award nights for Points + Cash nights

If you value World of Hyatt points at 1 cent each (their cash value if transferred from Chase Ultimate Rewards), then at most low- and mid-tier properties you can pay a nominal sum to turn non-elite-qualifying nights into elite-qualifying ones, subject to Points + Cash availability. Ignoring taxes, the marginal amount paid on Points + Cash nights is:

  • Category 1: $21.75 ($25 less 325 points earned on the $50 cash component);
  • Category 2: $11.42;
  • Category 3: $10.12;
  • Category 4: $18.50;
  • Category 5: $16.87;
  • Category 6: $15.25;
  • Category 7: $130.50 (yes, that's a staggering jump; don't do this at Category 7 properties!).

If you are traveling between September 1 and September 5, you'll also receive a 10% rebate on the points portion of your stay (if you registered for that promotion in time).

Book rooms for others

We all have people in our lives who aren't travel hackers, but still travel with some frequency.

If you know a traveler who is planning to pay cash for a hotel room in a city with Hyatt properties, you're virtually certain to save them money by booking their reservation using your World of Hyatt points and their cash. They can pay you for the points portion of the reservation and pay the hotel the cash portion directly. By staying on your Globalist reservation, they'll also enjoy breakfast and club access at applicable properties.

Be sure that you're not making a "Guest of Honor" reservation. Instead, book a room in your own name and then add the other person to the reservation so they can check in (and pay).

I divide the world of travel not into paid reservations and points reservations, but rather reimbursed travel and non-reimbursed travel. The above works best if you're booking for someone with unreimbursed travel, since you can save them money directly by reducing their out-of-pocket travel expenses.

In the case of a reimbursed business traveler, the logic of the situation is reversed. You'd like someone whose employer or sponsor is paying for their hotel room to forego earning points and status in their own account and instead credit the paid nights to your account. If the person doesn't care about points or status, they may be willing to do this simply as a favor, or in exchange for breakfast and club access. If they're a bit more mercenary, they may ask you to pay them for the privilege.

As indicated above, it seems that $10-$20 per night is a reasonable range to pay for an elite-qualifying night, which gives a total breakeven value for 20 nights of $200-$400. That doesn't strike me as a totally unreasonable amount to pay if you can take aggressive advantage of Globalist late check-out, suite upgrade awards, waived resort fees, and free breakfast.

Mattress Run

Of course the last refuge of a scoundrel is the mattress run. Depending on where you live, you may have access to cheap weekend nights or Points + Cash reservations at nearby properties. While you'd be nuts to mattress run all the way to Globalist status, the fewer nights left in your challenge the more enticing it may be. If you can naturally accumulate 18 nights before December 30, what's a few hundred dollars between friends for the remaining two nights?

Conclusion

Twenty nights in four months is an utterly reasonable threshold to earn top-tier status with Hyatt, and I expect this promotion to be quite successful at filling up Hyatt's top-tier elite ranks. While I won't personally be putting any effort into requalifying, if you do I hope some of the ideas above will make your requalification as painless — and cheap — as possible.

Are your unredeemed points killing your game?

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I haven't written about this lately, so hopefully my long-time readers will indulge me as I dive back into what I find is one of the most under-appreciated risks of travel hacking: the risk of unredeemed points.

Plenty of attention is paid to devaluation risk, which is what you encounter when it takes you too long to earn the points you need for the trip you want to take, and the amount you earn in anticipation of a redemption ends up not being sufficient. This risk does not concern me in the least. Earning more points is the natural condition of the travel hacker, so who cares if every few years you need to pack on a few tens of thousands of points in order to secure the redemption of your dreams?

No, the real risk faced by travel hackers every day isn't earning too few points — it's earning too many points, and finding them unredeemable or redeemable only at much lower value than the redemption they were earned in anticipation of.

It turns out flying to Munich is very cheap

The occasion for me thinking about this subject is my partner's planned intercontinental family reunion in Germany this year, which I figured was the perfect opportunity to prove the value of all those trips to Walmart: with all the transatlantic Star Alliance traffic, it should be a piece of cake to find some premium cabin award space so we can travel there in style and comfort. Since I've got way more Ultimate Rewards points than I'm comfortable with, a quick transfer to United would yield a high-value redemption and take a weight off my mind.

Unfortunately, flying to Munich is very cheap. We can fly there and back, nonstop, on the day of our choosing for $775. That's handily under the $800 US Bank Flexperks redemption threshold, so I can book a nonstop ticket for $400 in Flexpoints.

Meanwhile, two roundtrip award tickets in Lufthansa's business class would cost 280,000 Mileage Plus miles and $212 in taxes and fees, or $1,506 per ticket valuing Ultimate Rewards points at their cash value of 1 cent each.

$1,106 is a lot of money, and $2,212 is even more money, so I'm not going to pay that much to upgrade us to business class on a couple of 8-10 hour flights.

What do you do when this happens over and over again?

There are two potentially competing forces at work here: the drive to earn the most valuable points possible and the drive to redeem the right points for each individual redemption. I say "potentially" competing because in many — hopefully most — cases you'll find they are not: if you primarily travel to cities with Hyatt locations that meet your needs, you'll almost invariably find that cheaply-earned Ultimate Rewards points transferred to Hyatt are one of the best values available.

For example (just because I like examples), in Seattle a night at the Hyatt at Olive 8 costs 15,000 World of Hyatt points ($3,000 in office supply store spend with a Chase Ink Plus) while the Hilton Seattle may cost 70,000 Honors points ($11,667 in bonused spend on a Surpass American Express).

But what happens when "high-value" redemptions like the Lufthansa business award I described above are ruled out over and over again by far cheaper paid tickets booked using fixed-value currencies like Flexpoints?

I stay at a lot of Hyatt properties, and I book them for friends and family every chance I get, and I still have enough World of Hyatt and Ultimate Rewards points for 10 nights at a Category 7 property, or 64(!) nights at a Category 1 property. Having too many points to redeem doesn't feel as acutely painful as having too few points to redeem, but both situations send the same signal: that my system is out of of balance.

I think you should redeem your points for cash, but you won't (and neither will I)

The funniest thing I see on Twitter and in the miles and points blogosphere is people bragging about their points balances, as if having a high balance was a point of pride, rather than an admission of failure.

To state what should be obvious, the best number of miles and points to have in all your accounts is zero: the perfect calibration of your earning and burning activity would leave all of your accounts empty virtually all the time, with all of your earning activity purposefully directed towards particular planned redemptions.

That's impossible, both because the world isn't so tidy and because humans are blessed with foresight: odd numbers of points accumulate here and there as various promotions are triggered, and points are earned in small amounts in anticipation of large future redemptions. Such is life.

But the necessity of living in the world as it actually confronts us is sometimes converted into the false belief that high balances are good in their own right, because they give you "flexibility" for future redemptions or "insurance" against a particular deal or earning opportunity dying.

Conclusion

I understand that one subset of travel hackers is wealthy people who use miles and points as a kind of stunt to save money on the kinds of luxury vacations they'd still take if the game didn't exist.

Above I compared a business class award flight on Lufthansa to a paid economy class flight on United. However, if your alternative to each redemption were payment in cash, the comparison would look very different: the $775 United flight gets you about two cents per point on a Flexperks redemption, while the $1,506 Lufthansa flight gets you over 4 cents per point (for a ticket that would otherwise cost $6,143). There you'd be comparing a "good," or even "great," Ultimate Rewards redemption against a "standard" Flexperks redemption, and you wouldn't be wasting $1,106, but rather saving $4,637 per ticket!

That is, needless to say, not my perspective.

Sleeping the rails

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As some readers may know, in a former life I worked as an English language teacher in Russia. At that time, it was typical for expats to arrive on a business visa, which as a rule only allowed you to be present in the country for 91 out of every 180 days. The idea was, you'd arrive on a business visa, get a job, and then switch over to the appropriate visa at some later date (I think of this whenever I hear about unauthorized immigrants who "overstay" their visas to the United States — that was me and most of my friends, and it was simply the way things were done).

In the winter of 2007-2008, rumors started to spread that the Russian Foreign Ministry had issued a new decree that visas could only be issued in the home country of foreign passport holders. While previously people had hopped over the border to the Baltic states, those Russian embassies were refusing to issue visas to third-country passport holders. However, we were hearing reports that the Russian Embassy in Kiev, Ukraine, was still issuing visas to third-country passport holders — for now.

With that in mind, my company bundled me off to Kiev to spend the Christmas vacation waiting for a visa. The embassy was no longer issuing one-day visas, so I would have to spend 10 days in the country while my visa was prepared. In Kiev, the hostel I ended up in was owned and operated by a fanatically racist Englishman (this is a common problem in expat communities), and after a day or two I decided I couldn't stay there any longer. But where to stay? Having just gotten off an overnight train ride, I quickly arrived at a solution. Here's a map of Ukraine:

Glancing at this map, you can immediately see there are four cities located roughly equidistant from one another: Kiev, Lviv, Odessa, and Dnipro (still called Dnepropetrovsk while I was there). Not only are they roughly equidistant, but they're also all about 7-9 hours apart by train. The solution to my housing problem was obvious: I'd board a train about midnight each night, sleep on the train, and arrive in a new city around 8 am. I could spend the day exploring the city and get back on the train that evening.

I eventually got back to Kiev, got my visa, and headed back to Russia. But that adventure has always left me wondering: could it work here?

Using Amtrak for both housing and transportation

Trying the same thing in the United States poses several difficulties:

  • our trains are far less frequent than trains in Eastern Europe, often passing through a given community as rarely as once a day;
  • our trains are more expensive than trains in Eastern Europe (although often less expensive than you think, and very often less expensive than flying);
  • and our network of train stations is more limited, with routes that typically either feature very frequent stops or very infrequent stops.

So, I decided to investigate if it's possible to replicate something like what I did in Ukraine, and if so, at what cost?

Back and forth

Due to less frequent US train schedules, the easiest way to do what I'm describing is simply to go back and forth on the same route. Head north, south, east, or west one night, and head back the next night.

For example:

  • Northeast Regional 65/67 southbound from Boston to Richmond, leaving 9:30 pm and arriving 9:29 am, and Northeast Regional 66 northbound from Richmond to Boston, leaving 7:00 pm and arriving 7:58 am, roundtrip (2 nights) from $166;
  • or City of New Orleans 59 southbound from Chicago to Jackson, MS, returning on City of New Orleans 58, roundtrip from $196.

This is, obviously, a pretty boring way to travel since you'd be bouncing back and forth between the same cities. It is cheaper than a typical downtown hotel, though, at less than $100 per night.

Hub and spokes

A more interesting way to sleep the rails would be starting at an Amtrak hub and taking individual routes out and back each day. This would give you the benefit of a little variety in your site-seeing. Amtrak, unfortunately, is a little short on hubs, with the only ones I can think of worth mentioning being Chicago (11 routes), Los Angeles (5 routes), and New York (14 routes). New Orleans is another possible option with 3 routes.

I think all three hubs are fairly promising, depending on the part of the country you want to see. For example, from Chicago you can overnight to Denver on the California Zephyr ($97), Pittsburgh on the Capitol Limited ($57), West Virginia on the Cardinal ($62), Memphis or Jackson on the City of New Orleans ($86), North Dakota on the Empire Builder ($102), Buffalo or Rochester on the Lake Shore Limited ($59), Colorado on the Southwest Chief ($102), or Texas on the Texas Eagle ($98).

Circle the country

To circle back to my original anecdote: is it possible to spend time around the country while spending every night on a train, instead of in a hotel?

The short answer is no: long-haul train schedules are too infrequent in the United States to give people the opportunity to arrive in the morning and leave the same night on most routes. Here's one option I found that illustrates the network's limitations:

  • Empire Builder westbound from Chicago, leaving 2:15 pm and arriving in Portland 10:10 am 2 days later;
  • Coast Starlight southbound from Portland, leaving 1:50 pm and arriving Los Angeles 9:00 pm one day later;
  • Sunset Limited eastbound from Los Angeles, leaving 10:00 pm and arriving in New Orleans at 9:40 pm two days later;
  • Overnight in New Orleans;
  • City of New Orleans northbound from New Orleans, leaving 1:45 pm and arriving in Chicago at 9:00 am the next day.

The route described above would cost, if booked sufficiently far in advance, about $483, and would take 7 nights to complete, from beginning to end, although you'd be on the hook for one night in New Orleans. That would give you a cost per night spent in the coach car of a train of $80.50. Not a bad deal, and a much better set of views than a roach motel in Chicago (I've seen my fair share).

Don't forget Amtrak unreliability

Of course, the stylized route above assumes that four different Amtrak trains all run on schedule. This will not happen, because Amtrak trains don't run on schedule. On most versions of this run you would end up spending many more nights on trains than I indicated, which would drive down your per-night cost of sleeping on Amtrak trains.

Conclusion

Unfortunately, American cities and Amtrak routes aren't very accommodating to the kind of tour I was able to take of Ukraine. Only rarely are cities served by the kind of morning and evening trains that are typical in Eastern Europe. But if you have to spend 10 days in the United States waiting for a consular official to stamp a visa in your passport, remember that we do have trains, and you can see a lot of the country in 10 days without spending very much money.