Free Hilton Honors transfers and my 2.2 cent per point redemption

As we near the winter holiday season, I’ve started planning a New Year jaunt to celebrate my recent nuptials. We already planned to visit the West Coast after Christmas, and since there was an expiring Alaska Airlines Companion Ticket in the mix, I decided to see if I could use the West Coast as a stopover to one of Alaska’s more far-flung destinations. Alaska offers nonstop flights from Portland to several Hawaiian islands, so I checked award availability at one of Hilton’s top-tier, 95,000-point properties: the “Grand Wailea, A Waldorf Astoria Resort.”

Transferring Hilton Honors points is now free and fast (but not instant)

I was surprised to see that for 5 nights right after the New Year, the Grand Wailea had wide open award availability for their standard “Terrace View” room. There was no way I was going to book anything less than a 5-night stay at a 95,000-point property, thanks to Hilton’s fifth-night-free policy on award stays for elite members. But a 5-night stay would still cost 380,000 Hilton Honors points, more than I happened to have in my account. Even after cancelling a couple Hilton reservations and rebooking those stays at Hyatt properties, I was about 100,000 points short.

That’s when I remembered that as part of the April 2, 2018, revamp of the Hilton Honors program, “points pooling” and “points transfers” are now free between all members. Let me start by saying it’s not immediately clear to me exactly why Hilton distinguishes “pooling” from “transfer” transactions: in both cases only the recipient of the transfer, or the creator of the pool, is able to redeem the points, and in both cases the contributor of the points is able to select the number of points they want the recipient to be able to redeem.

The limits on transfers and pooling are somewhat complex, so let me start by sharing the terms and conditions as they’re presented on the Hilton website:

“Hilton Honors Members can transfer Hilton Honors Points to another Hilton Honors Member through Points Pooling or 1-to-1 transfer in increments of 1,000 Points and up to 500,000 Points. Each Hilton Honors Member is limited to sending no more than five hundred thousand (500,000) Points and receiving two million (2,000,000) Points via Points Pooling or Transfers combined per calendar year. Each Hilton Honors Member is limited to making six (6) transfers to other member accounts and six (6) Hilton Points Pooling transactions per calendar year. Invitations to join a Points Pool is not considered transactional. Transactions refer to the transfer of Points to another member account either through 1-to-1 account transfers or through Points Pooling.”

There are three moving pieces here:

  • The total number of points you can send in either transfer or pooling transactions per calendar year (500,000);

  • The total number of points you can receive in either transfer or pooling transactions per calendar year (2,000,000);

  • The total number of outbound transfer and outbound pooling transactions you can make per calendar year (6 transfer and 6 pooling transactions).

That’s my plain English reading of the terms and conditions, but if anyone has run up against these limits in practice or found a way around them, let me and your fellow readers know in the comments.

All that being said, yesterday I asked a travel hacking buddy to transfer over the points I needed to book my 5-night stay at the Grand Wailea. Then I waited. And waited. And waited.

Ok, I only waited about 11 hours, but the point is, don’t expect points transfers to take place immediately, and don’t count on them if you need points for an immediate redemption.

I received a confirmation e-mail (as did the person sending the points) a few minutes after noon the day after the request, so it’s possible they run a batch process every day at noon to execute the previous day’s transfers.

I redeemed 380,000 points for a $8,466 stay

The stay I redeemed 380,000 points for would otherwise cost:

  • $7,199 room rate;

  • $200 resort fee;

  • and $1,067 taxes.

That gives an almost comical 2.2 cent per Hilton Honors point redemption, or 13.2% in value on my grocery store manufactured spend, where I earn 6 Hilton Honors points per dollar on my American Express Ascend card.

You may remember that as part of the April revamp of the program, Hilton no longer excludes Waldorf Astoria resorts from the Gold and Diamond elite breakfast benefit. After reaching out to the property for an explanation of their benefit, the “Room Reservations Agent” explained that:

“You would receive a daily $15.00 per day up to 2 person a in room dining credit. Unfortunately the $15.00 in Only for in Room dining" [sic].

Being a pedant, I looked up the Grand Wailea’s in-room dining menu, and there actually are several items at or below the $15 price point. I hope you like avocado toast as much as I do!

Did I overpay?

To be clear, I booked this particular top-tier property mainly for the blog content, since I couldn’t find any useful information online about how Diamond benefits there work in practice.

But, being me, I also did a quick rundown of alternate properties, in case you want to go to Maui for some reason besides getting a couple good blog posts out of it. Here are the properties that still have award availability as of today:

  • Wailea Beach Resort - Marriott, Maui. 200,000 Marriott Rewards points for a 5-night stay.

  • Days Inn by Wyndham Maui Oceanfront. 75,000 Wyndham Rewards points for a 5-night stay.

Of course, money can also be exchanged for goods and services, and some light browsing turned up what seems like a pretty good deal through, for a total of $2936.03 for five nights at the Hyatt Regency Maui Resort and Spa, a rate that even includes breakfast.

Using 200,000 Marriott Rewards points (worth $2,000 in cash if transferred from Ultimate Rewards) and $2,936 as my most likely alternatives, I redeemed 380,000 Hilton Honors points at between 0.5 and 0.77 cents each, a solid but unremarkable redemption.

Obviously that’s not going to stop me from bragging to friends and family about my $8,500 honeymoon.


I’m very curious how this trip will work out, since after reading a slew of reviews online it seems like the Grand Wailea changes their policies every few weeks. My conservative hope is an upgrade from our standard “terrace view” room to at least an ocean view room, since that was one of the delights of our stay at the Hyatt Zilara Rose Hall. The property also has what looks like an all-suites tower, which Hilton Diamonds seem to very occasionally be upgraded to for free (paid upgrades are also available).

We plan to rent a car in order to see some other parts of the island, which means at a bare minimum paying $30 per day for valet parking, since the hotel doesn’t have a self-park option. Given the certainty of those expenses, plus any food and drinks we charge to our room, I’m thinking hard about whether to sign up for an Aspire card before we make the trip. I have the option of upgrading my Ascend card, which would sacrifice my bonused grocery store earning rate, so that’s of marginal interest. But my partner has never had a Hilton credit card and she’d be eligible for the current 150,000-point signup bonus, plus a $250 resort credit during our stay.

My favorite credit card auxiliary benefits, ranked

I've been thinking lately about the Bank of America Alaska Airlines credit card, since it has a somewhat higher signup bonus than usual, at 30,000 Mileage Plan miles, a $100 statement credit, and a taxes-and-fees-only companion ticket for the first year, instead of the usual $99-plus-taxes-and-fees offer.

Since Alaska companion tickets can be used on any economy fare, and Mileage Plan has last-seat award availability, this is basically a signup bonus of between 1.5 and 2 roundtrips on Alaska or Virgin America, depending on whether you can find low-level award space or have to redeem all 30,000 Mileage Plan miles for a one-way (or possibly a few more if you're flying to Hawaii or Mexico).

Since Bank of America lets you apply for and receive the same card and signup bonus multiple times, it used to be popular to apply for a new Alaska Airlines card every 91 days and then request product changes to the Better Balance Rewards card, which can be automated to spin off $30 every quarter in cash back. I believe that product change is no longer available as the Better Balance Rewards card isn't being offered to new customers, but a product change from a card with a good signup bonus is still likely the best way to get a card like the BankAmericard Travel Rewards card, which only has a standard signup bonus of 20,000 points.

Since ranking stuff is fun, here are a few of my other favorite credit card auxiliary benefits, ranked.

5. Centurion Lounge access

This is technically not one of my favorite auxiliary benefits since I don't have an American Express Platinum or Business Platinum card, but it's one of my favorite auxiliary benefits for other people to have so they can guest me into the lounges.

I've invited subscribers to join me at meetups in the Centurion lounges in Las Vegas, New York La Guardia, and Dallas/Fort Worth, and as someone who would never pay for lounge access I am happy to say they really are terrific lounges. Great food, cocktails, views, seating, and wi-fi. If I lived in or regularly traveled through cities with Centurion Lounges I could certainly see applying for a Business Platinum card. I don't, so I won't, but this benefit still sneaks into the top 5.

4. America Express Delta Platinum and Reserve companion tickets

I don't think the Delta companion tickets, which can both be redeemed for tickets in certain cheap domestic economy fare buckets, and in the case of the Reserve companion ticket in first class, are as valuable as people claim. They essentially function as a not-quite-50% discount on economy tickets, if you are willing to be flexible with your routing and plan far enough in advance, because you still have to pay taxes and fees on the second ticket.

The best value of the companion tickets, of course, is to simply sell them to someone who isn't a travel hacker. That's an easy way to bring down the out-of-pocket cost of your annual fee, if you're primarily interested in the cards in order to earn bonus SkyMiles and waive the Medallion Qualifying Dollar requirements for status.

Finally, Frequent Miler has written about the opportunity to combine Delta companion tickets and the American Express Business Platinum card's 35% Membership Rewards point rebate. Apparently Membership Rewards points can be redeemed against purchases made with the Business Platinum card outside the American Express Travel booking portal. It does require a phone call and is apparently up to the discretion of the phone agent, and I've never tried it, so don't take my word for it. To give a simple example, two $500 tickets with $11.20 in taxes and fees would cost a total of $511.20 if booked with a Delta companion ticket. Since you can pay for Delta companion tickets with any American Express card, you'd then put the charge on your Business Platinum card. Calling into Membership Rewards, you'd redeem 51,120 Membership Rewards points, and eventually receive a rebate of 35% of those points, or 17,892. That would give you a total out-of-pocket cost of 33,228 Membership Rewards points for $1,000 in flights, or 3 cents per Membership Rewards point.

Be careful to note the reason this works: you can't pay for Delta companion tickets with any card that is not an American Express card. If you could, you'd be better off paying with a travel rewards card that you manufacture cheap spend on, or a card that offers free trip delay insurance. But since you have to choose an American Express card, the Business Platinum is the card that lets you leverage the value of your Membership Rewards points against the already-discounted cost of the companion ticket.

3. Trip Delay insurance

Speaking of trip delay insurance, after my experience getting stranded by United in Denver, I've come around to the idea. I'd never pay for it separately, and I probably wouldn't keep a card just because it offers trip delay insurance, but if you already carry a card like the Chase Sapphire Preferred or Barclaycard Arrival+, then you should be booking as many of your flights with it as possible.

That won't always be possible, for example if you're booking tickets using US Bank Flexpoints or Chase Ultimate Rewards points, but for tickets you book with cash, or award tickets that give you a choice of cards to pay with — use the right card! It only takes one claim every few years to pay for many years of $89 or $95 annual fees.

2. Hilton Honors Gold (Diamond) status

Hilton Gold status is notoriously easy to earn, and Hilton Diamond status is notoriously worth little above and beyond the benefits of Gold. Nonetheless, no matter how easy it is to earn, you still want to earn it somehow if Hilton is going to be one of your primary loyalty programs. Personally I carry the American Express Hilton Honors Surpass card, which gives automatic Gold status and Diamond status when you spend $40,000 on the card, although the Citi Hilton Honors Reserve card has the same status earning structure (but earns just 5 Honors points per dollar spent at grocery stores).

1. Hyatt annual free night certificate

The annual free night certificate earned by the Chase Hyatt credit card is the best credit card free night certificate for a few reasons:

  • Unlike the Citi Hilton Honors Reserve free night certificate, it can be used on any day, not just on weekends, and doesn't have a $10,000 spending requirement, allowing that spend to be put on more lucrative credit cards.
  • Unlike the Chase IHG Rewards Club free night certificate, the Hyatt certificate can be combined with valuable World of Hyatt points instead of worthless IHG Rewards Club points. To illustrate this point, a 3-night stay at a top-tier IHG Rewards Club property like the InterContinental Sydney would require the transfer of 120,000 Ultimate Rewards points to IHG Rewards Club, plus the use of an annual free night certificate. A 3-night stay at a top-tier Hyatt property requires just 90,000 Ultimate Rewards points — no certificate required! The corollary of that is the ability to save valuable World of Hyatt points at lower-tier properties by swapping in the free Category 1-4 certificate. The credit card's $75 annual fee buys you a free night certificate worth between $50 and $150 in Ultimate Rewards points.
  • Unlike the Chase Marriott Rewards Premier free night certificate, the Hyatt free night certificate can be used at properties you actually want to stay at. The Marriott Rewards Premier certificate can be used at properties up to Category 5, which would cost 25,000 Marriott Rewards points, if you could find one to stay at. But while Marriott has so totally gutted their categories that there's no reason to count on finding a Category 5 property that's worth an $85 annual fee, there are still plentiful Category 4 Hyatt properties where paying a $75 annual fee will get you a reasonable discount.


Naturally, your ranking should differ based on your own travel needs:

  • if you travel often enough that you are desperate for lounge access, the premium airline credit cards will offer it;
  • likewise Hawaiian travelers may get value from the Barclaycard Hawaiian Airlines credit card's companion ticket;
  • and if you stay at a lot of Sheratons the American Express Starwood Preferred Guest Business card gives Sheraton Club Lounge access (I've never stayed at a Sheraton or visited a Sheraton Club Lounge but I'm sure they're nice).

But for my own travel needs, these are the five benefits I value the most.

Grocery store spend and the possibilities of loyalty-agnostic travel

I'm a big proponent of the US Bank Flexperks Travel Rewards card, since I think it provides the straightest path for most people to pay as little as possible for their airline tickets. With the recent return of PIN-enabled prepaid debit cards to many grocery stores, that view has been confirmed and even strengthened.

But it's also true that another favorite card of mine, the American Express Hilton HHonors Surpass card, also earns bonus points at grocery stores. And of course unbonused spend can earn between 2% and 2.625% cash back, and at lower cost than grocery store manufactured spend.

So I thought it would be useful to revisit some break-even points, or what I call imputed redemption values, for spend on a variety of cards, to help readers think through the best way to book their flights and hotel stays.

Three opportunities, three costs

The simplest way of approaching the tradeoffs between bonused grocery store spend and unbonused spend is to look at the cost per point. Using only the most widely available methods of manufacturing spend, you'd arrive at these simple calculations:

  • US Bank Flexperks Travel Rewards, 2 Flexpoints per dollar spent at grocery stores: 0.62 cents per Flexpoint;
  • Hilton HHonors Surpass American Express, 6 HHonors points per dollar spent at grocery stores: 0.21 cents per HHonors point;
  • 2% cash back credit card at unbonused merchants: 0.43 cents per cent in cash back.

That final line allows us to have an anchor for the kind of value we should expect to get from Flexpoints and HHonors points that would make them competitive with unbonused cash back. For example, if you redeem Flexpoints for cash back you'll never come out ahead compared to a 2% cash back card, since you're paying 44% more for each Flexpoint, which are, like pennies, worth just a penny each.

The flip side of that calculus is that all Flexpoint airfare redemptions above 1.44 cents each are cheaper than paying cash for the same trip. For example, a $288 plane ticket would cost 20,000 Flexpoints, and $124 in out-of-pocket grocery store fees, while the same $288 plane ticket paid for with cash earned on unbonused spend with a 2% cash back credit card would cost $123 in fees. That means for all airline tickets between $289 and $399 (or any other price point that falls between a multiple of 10,000, 0.0144, and 0.2), the Flexpoint redemption is cheaper than the cash ticket.

Now let's do the same math with Hilton HHonors points earned at grocery stores with a Surpass card. Due to the difference in total price per point, compared to a 2% cash back card, Hilton HHonors points have to be redeemed not at 0.33 cents each, but rather at 0.49 cents each. For example, a 5,000 HHonors-point stay would cost $10.50 in fees, while $10.50 in fees would earn $24.42 in cash back — 0.49 cents per point. This is a purely mechanical calculation: a 95,000-point HHonors redemption would cost $199.50 in fees, while $199.50 in fees would earn $463.95 in cash back — 0.49 cents per point. That produces the simple maxim that stays which offer more than 0.49 cents per HHonors point are cheaper if paid for with HHonors points than with cash.

Flexpoints can also be used for hotel stays

There's one additional wrinkle worth mentioning here: Flexpoints can provide value on hotel stays that are too cheap for HHonors redemptions. I'll be the first to admit that this doesn't happen very often, but it's something to keep an eye out for: when Flexperks redemptions fall in the 1.44 to 1.5 cent per point band on hotel redemptions, they still entail a lower out-of-pocket cost than manufacturing the needed cash with unbonused spend on a 2% cash back card.

For example, a $144 stay (including taxes) would cost 10,000 Flexpoints ($62 in fees), and paying in cash earned with a 2% cash back card would require $62 in fees. Of course, it might be cheaper yet depending on the HHonors point rate available, if any.

This makes Flexpoints one of my favorite currencies to earn speculatively: if good flight opportunities present themselves, they can be redeemed for valuable flights; if middling hotel opportunities present themselves, they can be redeemed for middling hotels; and if no opportunities present themselves, they can be redeemed for cash.

While it's easy to posit a general principle that Flexpoints should be spent where they're most valuable — on paid airline redemptions — it's also true that they're more valuable redeemed for hotel stays than for cash, so if you find yourself in the situation of having to choose between spending precious cash or spending down a constantly growing balance of Flexpoints, you'll probably thank yourself later if you save the cash today.

Some bonus categories I never think about

I belong to the noisy-but-unpopular school that believes everyday spending should properly be a rounding error in the typical travel hacker's overall miles and points strategy. That's because more miles can be earned in an afternoon of light manufactured spending than will be earned in a month or year of trying to earn as many points as possible on actual purchases.

The flip side of that is a blind spot when it comes to the bonused categories of spend on cards that I already carry, either for purposes of manufactured spend or recurring annual bonuses. In the interests of keeping my blind spots few and far between, I decided to take a closer look at a few of those categories.


With increasingly limited access to gas station manufactured spend, you may find that you're not able to manufacture $50,000 in spend in a Chase Ink Plus's double point category of "gas stations and hotel accommodations when purchased directly with the hotel."

Since Ultimate Rewards points are worth 1.25 cents each when redeemed for paid airfare, or more when transferred to Hyatt Gold Passport, Southwest Rapid Rewards, and (usually) United MileagePlus, you're strictly better off paying for your hotel stays with a Chase Ink Plus than with the 2% cash back card you use for your other everyday purchases. One possible exception is if you are having trouble finding eligible expenses to redeem your Barclaycard Arrival Plus, Capital One Venture, or BankAmericard Travel Rewards miles against, although you can always consider refundable reservations in that case.

I'm fond of paying the revenue component of my Hyatt stays with Hyatt gift cards purchased at a discount using cashback rewards, but if you pay for Hyatt stays directly, the 3 Hyatt Gold Passport points earned per dollar with the Chase Hyatt credit card are superior to the 2 Ultimate Rewards points earned by both the Chase Ink Plus and Chase Sapphire Preferred — assuming you plan to transfer your Ultimate Rewards points to Hyatt Gold Passport at any point in the future.

The math is somewhat less favorable when paying for Hilton stays with the American Express Hilton HHonors Surpass card, which earns 12 HHonors points per dollar spent at Hilton properties. According to the Wandering Aramean visualization tool, 12 HHonors points are worth a median 5.376 cents, while 2 Ultimate Rewards points, transferred to Hyatt Gold Passport, are worth a median 3.724 cents. That's an edge, but it's an edge that's highly dependent on your actual redemption pattern.

Finally, the Chase Marriott Rewards Premier credit card is by and large not worth holding for either its recurring benefit (one free category 1-5 night each account anniversary) nor for manufactured spending (one elite night credit for each $3,000 spent). But if you do have it for one reason, the other, or both, you are still unlikely to get more value from the 5 Marriott Rewards points earned per dollar spent at Marriott properties than you would from 2 Ultimate Rewards points earned on the same spend — unless, of course, you are already planning to transfer Ultimate Rewards points to Marriott for some reason, like booking a 7-night Hotel + Air package.


As I've written before, most of the time one or more rotating cashback bonus card is offering 5% cash back at restaurants, so the idea of needing a particular card "dedicated" to restaurant spend is misleading: you should use your most lucrative card, which will, at least 6 months of this year, be a Discover it or Chase Freedom card. But that leaves the other half of the year, which makes it a legitimate question whether there are better cards than a straight 2% cashback card for use at restaurants.

Using the same median Hilton HHonors point value as above, the 6 HHonors points earned per dollar with the Hilton HHonors Surpass American Express at restaurants slightly edges out a 2% cash back card, earning the equivalent 2.688 cents per dollar spent, while the Chase Hyatt credit card earns 2 Hyatt Gold Passport points per dollar spent, or a median 3.724 cents per dollar.

This matters because the Chase Sapphire Preferred, often promoted by affiliate bloggers for its high affiliate payout and earning rate on travel and dining, earns 2 Ultimate Rewards points per dollar. In other words, for just $75, rather than $95, you can earn 2 Hyatt Gold Passport points at restaurants with a card that also offers a free night at Category 1-4 Hyatt properties worldwide. That's a fact that's helpful to keep in mind the next time someone tells you the Chase Sapphire Preferred is the best card to carry for restaurant spend.

Airline tickets

Finally, I very rarely find myself booking air travel directly through an airline (preferring to use miles, Ultimate Rewards points, or Flexpoints earned with a US Bank Flexperks Travel Rewards card), but if you do book air travel directly, or need to pay the taxes and fees attached to award tickets, you can do better than a 2% cashback card with cards you may already carry.

If you periodically sign up for a "spare" US Bank Flexperks Travel Rewards card, for example during the current Olympics promotion, you can use that extra card to pay for airfare, earning 2 Flexpoints per dollar spent, and transfer the resulting bonus Flexpoints to your primary account for future redemptions.

If you use an American Express Premier Rewards Gold card to manufacture grocery store spend on an ongoing basis, you may as well use it to pay for airfare, earning 3 Membership Rewards points for your airline tickets as well, which can be transferred to potentially lucrative travel partners like Delta SkyMiles. The same goes for a Citi Prestige card you may carry to raise the value of your existing Citi ThankYou points.

And the Chase Hyatt credit card earns 2 Hyatt Gold Passport points per dollar spent on airfare, giving it an edge over a straight 2% cashback card, depending as always on your actual planned redemptions.


I don't think it's useful, let alone necessary, for a travel hacker to stress over every possible bonus point at every possible merchant. But for the kind of purchases that you know you make frequently, it's at least worth considering finding additional value by keeping in mind the bonus categories offered by cards that you already use to manufacture spend, or hold for their recurring annual benefits.

As I indicated above, I don't usually pay for airline tickets or hotel stays with credit cards. But digging into my existing cards' bonus categories, I realized I could replicate the majority of the Chase Sapphire Preferred's "travel and dining" bonus categories with cards I already had: the Chase Ink Plus and Chase Hyatt credit cards. Between the two, they cover hotels, airlines, restaurants, and rental cars.

Obviously that leaves out things like cruises, travel agency bookings, local transportation, and so on. But they do include the bulk of reimbursable business travel, so if you do spend a large amount in those categories each year, you may find yourself coming out ahead by examining the bonus categories on your existing card card portfolio.

Is the Citi Prestige a good deal? Compared to what?

This isn't my favorite kind of blog post to write, but I do consider it essential service journalism in the context of a travel hacking blogosphere whose default mode is "breathlessly excited."

The Citi Prestige credit card is often pitched as an essential tool for the sophisticated travel hacker. In this post I want to make the argument that, on the contrary, the benefits of the Citi Prestige are valuable almost exclusively to the least-sophisticated travel hackers, who don't have a well-designed portfolio of credit cards, or to travelers who don't have access to even the most mundane techniques for manufacturing spend.

Let's take each of the benefits of the Citi Prestige card in turn.

Price compression makes airfare cheap

The first thing you hear about the Citi Prestige card is how it multiplies the value of your ThankYou points: with the card, ThankYou points are worth 1.33 cents each towards airfare, or 1.6 cents each towards airfare on American Airlines-marketed flights.

That creates a theoretical cash value of the current 50,000 ThankYou-point signup bonus of $665-$800 in paid airfare.

But $800 in paid airfare manufactured with a Chase Ink Plus card at office supply stores costs $380 in purchase and liquidation fees ($665 in paid airfare costs just $316).

So don't tell me a 50,000 ThankYou-point signup bonus is worth $800; it's worth between $316 and $380, the money you'd spend manufacturing the same airfare with a much more versatile (and, obviously, much cheaper) Chase Ink Plus.

If you have access to manufactured spend at grocery stores, then you'll find a card like the US Bank Flexperks Travel Rewards Visa runs around the world before the Citi Prestige has even got its boots on.

Compare a 25% discount on paid hotel stays to real travel hacking

The "killer app" of the Citi Prestige is supposed to be its "4th-night-free" benefit, whereby reservations made through Citi's contract travel agency, and paid for with the Citi Prestige, earn a statement credit equal to the amount of the stay's fourth night, including taxes.

In other words, when used for stays of exactly 4 nights, the Citi Prestige offers a discount of 25% on average (the actual discount will vary depending on the distribution of room rates over the four nights; Frequent Miler provides some extreme examples here).

By contrast, using only the most commonly available manufactured spending techniques, the Barclaycard Arrival Plus produces $21.05 in hotel stays for just $11.50 — a 45.4% discount.

A Chase Freedom Unlimited, earning 1.5 Ultimate Rewards points per dollar spent (or 1,515 Ultimate Rewards points for the same $11.50 above), paired with a $95 Chase Sapphire Preferred or Chase Ink Plus, requires just 1.01 cents in value per Ultimate Rewards point transferred to Hyatt Gold Passport point to match the 25% discount offered by the Citi Prestige. You have to look pretty hard to get that little value from a Hyatt Gold Passport point.

Finally, using an American Express Hilton Surpass card, you'll earn 6 HHonors points per dollar spent at grocery stores. Given only the most widely available cost of $6.30 for 3,036 HHonors points, you'll need to get just 0.28 cents per HHonors points to beat the Citi Prestige's 25% average discount on four-night stays. And that doesn't account for the value of 5th-night-free award reservations for Hilton elites.

Which brings me to the most important drawback of the Citi Prestige's "killer app:" it's only useful on stays of 4 nights or more! While all the cards and techniques I described above are useful on stays as short as 1 night, to get even a 25% discount on your paid stays, you'll have to stay for exactly 4 nights: any less, and your stay isn't eligible; any more, and your discount shrinks as a percentage of your total stay.

How does the the Citi Prestige 4th-night-free differ from the Club Carlson last-night-free?

When the US Bank Club Carlson co-branded credit cards offered the last night free on award stays, I was one of their biggest enthusiasts. That's because the last-night-free benefit allowed you to leverage the already generous 5 Gold Points earned per dollar spent on all purchases. In other words, it made valuable manufactured spend more valuable.

The Citi Prestige 4th-night-free benefit is exactly the opposite: it requires you to pay cash out of pocket for your room, which violates one of the most important principles underlying a successful travel hacking strategy: spend cash last.

Value all the other Citi Prestige card benefits at what you're willing to pay for them: nothing

You can check out the remaining benefits of the Citi Prestige over at Miles to Memories. They include:

  • airline fee credits (worth much less than cash);
  • lounge access (you're not paying for it now, are you?);
  • Global Entry fee credit ($100 every 5 years, so, $20 per year);
  • and 3 rounds of golf (not 3 foursomes, just 3 rounds: your friends will have to pay their own way).

Reimbursed business travelers should ignore everything I've said

Travelers who are reimbursed for their out-of-pocket expenses have opportunities that are, from a normal person's perspective, stratospherically lucrative. If you're able to book Monday-Friday hotel reservations for a product launch, investment banking intervention, or Republican Party platform committee meeting with your own credit card for later reimbursement, you have no excuse not to earn thousands or tens of thousands of dollars per year in 4th-night-free reimbursements from a Citi Prestige card.

But when a rich weirdo like Ben Schlappig tells you how much money he's saved with the Citi Prestige 4th-night-free benefit, remember that you don't have to pay cash for your hotels, and when you do, you can get a much better discount than 25% by developing a credit card portfolio and manufactured spend strategy that meets your actual travel needs.

What do I think about the 100,000 Hilton HHonors Surpass offer?

Yesterday blog subscriber JH wrote to ask me, "what's your opinion on the current 100k Hilton card offer?" JH is referring to the current offer of 100,000 Hilton HHonors points after spending $3,000 within three months on the Hilton HHonors Surpass American Express. The offer is available until May 4, 2016. Incidentally, I don't include personal referral links here on the blog, but you can find the relevant offer on my "Support the Site!" page.

Since I wrote JH a detailed answer, I thought it may be useful to share and expand on it here.

Higher signup bonuses are better than lower signup bonuses

In general, if you've been going through life vaguely considering signing up for a Hilton HHonors Surpass American Express, but have been waiting to sign up until the bonus goes up to an all-time high, well, you're in luck: the bonus is at an all-time high.

If that's you, this is the time to sign up.

What do you call 100,000 Hilton HHonors points?

A good start.

The fact is, 100,000 HHonors points is not an interesting number of HHonors points. The key characteristic of the Hilton HHonors program is that award nights at desirable properties are extremely expensive (up to 95,000 points per night), but Hilton HHonors points are easy to earn at bonused grocery store and gas station merchants using the Hilton HHonors Surpass American Express.

Two approaches to an unusually high signup bonus

There are two ways to approach a 100,000 Hilton HHonors point signup bonus.

If you are already planning an expensive vacation to a Hilton HHonors property, signing up for the Hilton HHonors Surpass American Express with a 100,000 points signup bonus will get you a minimum of one night free at that property (and breakfast, if you don't already have Hilton HHonors Gold elite status). That could mean saving real money compared to your cash rate!

Alternatively, you can use this unusually high signup bonus as an impulse towards earning large numbers of Hilton HHonors points on an ongoing basis in bonused spending categories.

But most readers shouldn't care about signup bonus fluctuations

The third approach, and the one I personally take, is to not pay any attention to the barrage of blog posts and twitter feeds dedicated to identifying the highest and shortest-lived signup bonuses.

The difference between a 50,000 and 100,000 Hilton HHonors Surpass American Express signup bonus is $8,333 in grocery store or gas station spend. If it wasn't worth spending that much on the card before the 100,000 signup bonus came around, what makes you think it is now?

These increased signup bonuses occupy an outsized portion of the attention of the travel hacking blogosphere, and the best thing you can do for yourself is to simply ignore them.

Let's all remember why (keeping) Chase Sapphire Preferred is so bad

I was going about my appointed rounds the other day enjoying the latest episode of the Saverocity Observation Deck podcast when I was suddenly felled by a violent attack of chagrin: here was Matt, the Fearless Leader(TM) over at Saverocity, defending the Chase Sapphire Preferred!

I'm not about to let all my hard work tearing that card to shreds be undone by a careless podcaster, no matter how dulcet his tones. So here's a refresher course on why almost no one should get the Sapphire Preferred (except for the signup bonus), put any spend on the Sapphire Preferred (after meeting the minimum spend requirement), or keep the Sapphire Preferred after the first year.

Everyday spend should be a rounding error in your miles and points strategy

Matt's first point was that on a trip into the city to meet some colleagues, he needed to buy a train ticket, catch a cab, pay for lunch, and do the whole thing in reverse. If he didn't want to bring a bulky wallet, he could grab the Chase Sapphire Preferred on his way out the door and use it for all his expenses, merrily earning bonus points all along the way.

A $100 roundtrip train ticket, $30 cab, and $400 lunch (Manhattan's expensive!) paid for with the Sapphire Preferred would earn Matt 1,060 Ultimate Rewards points. Valuing those points at a conservative 10 cents each means Matt has scored $106 in value, just from making purchases he was planning to make anyway!

But Matt knows perfectly well how to buy 1,060 Ultimate Rewards points for less than a penny each all day, every day. Using your actual purchases to decide which cards to get and keep is a surefire way to trick yourself into making bad — and expensive — decisions.

A Sapphire Preferred is a Freedom that hasn't hatched yet

Keeping a Sapphire Preferred after the first year for the bonus categories makes particularly little sense since the Sapphire Preferred can be product changed to a Chase Freedom. While great for manufacturing spend, the Chase Freedom has also bonused restaurants in one quarter for at least the last 4 years. So for 3 months of the year Matt shouldn't be putting his $400 lunches on the Sapphire Preferred anyway!

Likewise, in the current quarter Freedom is bonusing local commuter transportation, so if Matt's inclined to earn Ultimate Rewards points for his train tickets (Amtrak excepted), he can buy a whole year's worth of rail passes and earn 5 Ultimate Rewards points per dollar rather than the measly 2 points offered by Sapphire Preferred!

As Twitter user @BoonDR concisely put it, "a CSP is a Freedom that hasn't hatched yet." Keeping a Sapphire Preferred out of regard for its bonus earning categories is leaving literally tens of thousands of Ultimate Rewards points on the table every year you persist.

The value of flexibility depends entirely on your earning ability

Now let's get to the core issue: if you don't have or want a Chase Ink Plus small business credit card, you have no choice but to carry a Sapphire Preferred if you want your Ultimate Rewards points to be transferrable to Chase's travel partners (or redeemable for 1.25 cents towards travel booked through the Ultimate Rewards portal).

The problem is that without a Chase Ink Plus (and as many Freedoms as you can talk Chase into), you aren't going to be able to cheaply earn the kind of Ultimate Rewards balances that let you maximize the value of Ultimate Rewards' flexibility: the most valuable Ultimate Rewards redemptions give you a high redemption value per point (the appeal of Ultimate Rewards), but individually require large numbers of points.

Drawing on some examples I've used before, a 15.6-cent-per-point redemption at the Park Hyatt Milan is a great redemption — that costs 30,000 Gold Passport points per night ($30,000 in unbonused Sapphire Preferred spend). A 10-cent-per-point Lufthansa First Class redemption is a great value, but costs 110,000 United MileagePlus miles ($110,000 in unbonused spend).

The transferability of Ultimate Rewards points, whether it comes from a Sapphire Preferred or Ink Plus card, is valuable precisely to the extent that you are able to easily and cheaply manufacture Ultimate Rewards points. A combination of Ink Plus and Freedom gives that earning ability in a way that a Sapphire Preferred alone doesn't, which makes the Sapphire Preferred radically less valuable than the other two.

It's even worse if you're cannibalizing bonused spend

If you have limited liquidation bandwidth, as most of us do, then a dollar of unbonused spend put on the Sapphire Preferred might actually be displacing a dollar of bonused manufactured spend. And that's virtually never a good idea.

Ultimate Rewards points can be transferred to Hyatt at a 1-to-1 rate, which is a great deal if you're earning 2 or 5 Ultimate Rewards points per dollar. But if an unbonused dollar of Sapphire Preferred spend is displacing a dollar of bonused Hilton HHonors Surpass spend, you're exchanging 6 HHonors points for a single Hyatt Gold Passport point.

While Gold Passport points are worth more than HHonors points, they aren't worth 6 times more — Hilton's award chart tops out at 95,000 HHonors points, while Hyatt's ends at 30,000 Gold Passport points.

If you have a lot of reimbursed business travel expenses, fine, go for it

Since the Chase Ink Plus also gives 2 Ultimate Rewards points per dollar spent at hotels (up to $50,000 per year), it's still a strong choice for a lot of business travelers. But if you travel very regularly for business and are reimbursed by your employer for plane tickets, car rentals, and meals, you may have tens or hundreds of thousands of dollars in travel expenses each year to charge to the Sapphire Preferred. In that case, be my guest: keep Sapphire Preferred and you won't hear a peep out of me.

But if you're just charging the occasional taxes and fees on award tickets, and domestic economy tickets when you can't find award availability, we're likely talking about a few thousand bonus Ultimate Rewards points per year.

So do yourself a favor: call Chase and ask nicely for a product change to Freedom. You can thank me later.

The 5.5 cards I'll use to manufacture spend in 2016

Happy New Year's Eve to all my readers (and especially to my beloved subscribers)!

2016 is almost upon us, so I thought it might be interesting to share my manufactured spend strategy for the first half of next year.

Here are the five cards I'll be doing virtually all my manufactured spend on for the next 6 months, plus a bonus card to fill in the remaining gaps.

Wells Fargo Rewards

I applied for this card back in March while opening my Wells Fargo checking account, but was declined for income verification reasons. When I received a pre-approval offer in the mail, I jumped on it and was approved with a $10,000 credit limit.

This card earns 5 Wells Fargo Rewards points per dollar spent at gas stations, grocery stores, and drug stores for the first 6 months, making it my manufactured spend workhorse until June, 2016.

Chase Ink Plus

Although gas station manufactured spend is no longer available in my area, I will continue to order $300 Visa gift cards from Staples and earn 1,545 flexible Ultimate Rewards points for $8.95 — about 0.58 cents each.

As a Hyatt Diamond in 2016, I plan to make a lot of Points + Cash reservations, which both earn elite qualifying stays and are eligible for Diamond suite upgrades. For those reservations, I'll be transferring in a lot of Hyatt Gold Passport points from Ultimate rewards.

US Bank Flexperks Travel Rewards

This card earns "up to" 4% at grocery stores when you redeem your Flexpoints for air travel. That's less valuable and less flexible than my Wells Fargo Rewards card, but when that card's credit limit isn't available, Flexperks Travel Rewards will be my backup card at grocery stores.

American Express Platinum Delta SkyMiles Business

Even less valuable than Flexperks, I'll spend $50,000 on this card in order to earn 70,000 redeemable SkyMiles and 20,000 Medallion Qualification Miles, enough to secure Silver Medallion status for 2017. Then I'll call American Express to ask for either a retention bonus or a product change to a more valuable card.

American Express Hilton HHonors Surpass

Thanks to my Hyatt Diamond status in 2016, I won't be staying with Hilton as consistently as I did in 2015. But I still plan to spend $40,000 on the Surpass in 2016 in order to both secure Diamond status for another year and earn another 240,000 HHonors points, which I'll redeem when Hyatt properties aren't available or are too expensive.

Bonus card: Barclaycard Arrival+

I won't be using Arrival+ nearly as much in 2016 as I did in 2015, but there are a few ideal use cases where I'll continue to generate some spend: funding Nationwide Visa Buxx cards, opening bank accounts, and my actual expenses outside of the Wells Fargo Rewards bonus categories.


As you can see, I keep my manufactured spend practice pretty simple: start with the most valuable cards I have available, set realistic goals, and work my way down from there. That has the additional benefit of giving me the clarity to see immediately which cards would see reduced spend if my ability to manufacture spend suddenly contracted.

Don't retire to hotels, live in them!

I've written a few speculative posts in the past based on the conceit that manufactured spend makes staying in hotels full time a cheap way to save on rent in retirement.

I recently joked on Twitter that it's cheaper to stay at the Hilton in San Francisco than it is to rent an apartment there, which got me to thinking: are there really places where the rent is so high that living in hotels could make practical sense?


To compare the cost of renting versus monthlong hotel stays, I used the figures in this recent CBS News article about median apartment prices in the 10 most expensive cities in the United States. These are median, not average, prices, so 50% of rental units are less expensive and 50% are more expensive.

I don't have any reason to trust these numbers, compiled by, but at least they give us some concrete figures to work with.

I then looked at the imputed redemption value of a 30-day stay with four programs:

  • Hilton HHonors (manufactured with an American Express Surpass card at gas stations or grocery stores at an imputed redemption value of 0.35 cents each and redeemed in blocks of five nights, with the fifth night free);
  • IHG Rewards (purchased during a fake reservation at 0.7 cents each);
  • Hyatt Gold Passport (1 cent per point transferred from Chase Ultimate Rewards);
  • Choice Privileges (manufactured with the Chase Choice Privileges Visa at an imputed redemption value of 1.0525 cents each).

In the case of Hilton and Choice I compared their earning rate to the 2.105 cents per dollar earned everywhere on a Barclaycard Arrival+ MasterCard.

Wherever possible, I observed the following rules:

  1. I used the actual municipality given by CBS News/, so in the case of Oakland I excluded properties in San Francisco, and vice versa (the exceptions were Los Angeles, which doesn't have a Hyatt property downtown — I used the Andaz West Hollywood instead, and Miami, where I included Miami Beach properties);
  2. I used the cheapest property located within the central area of each city, with the exception of Washington DC, where I used the Holiday Inn Washington-Georgetown.
  3. Where seasonal adjustments were small, I used the smaller figure as long as it was realistic. In one case where the seasonal increase was over 100% (Bluegreen Vacations Solara Surfside, the Choice property I used in Miami) I gave both the high and low season figures;
  4. Large seasonal variations are the rule with Hilton HHonors, so in all cases I gave both the low and high season figures.

Finally there's an additional wrinkle worth noting: since hotels offer both award stays and paid stays for the same nights, you should be able to reduce your actual expenses below the imputed redemption values I give by paying cash for those nights where the cash rate is lower than the imputed redemption value of an award night.


Here are my results, in all their Excel spreadsheet glory:

For each city, I've highlighted the chain with the lowest and second-lowest imputed redemption values. That leads to a few observations:

  • In four of the ten cases, the Hilton properties have the lowest imputed redemption values whether or not the property is charging low-season or high-season prices;
  • In four of the remaining cases, the Hilton property is cheapest during low season and the Hyatt property is lowest during the Hilton property's high season. In these cases the logical thing to do would be to move from Hilton to Hyatt once high season pricing went into effect at Hilton;
  • The IHG Rewards Club property never has the lowest or second-lowest imputed redemption value.

These results so strongly confirm my biases towards Hilton and Hyatt that I had to double-check my math to make sure I hadn't tampered with the scales.

Hilton's dominance seems to be a mechanical product of two facts: earning 6 HHonors points per dollar with the Surpass card, and taking advantage of the fifth night free on award stays. While Hyatt typically charges fewer points for award reservations than Hilton, they have to charge 72% less to get an edge on Hilton. Since Hyatt doesn't charge more for rooms during high season as Hilton does, that's where their edge tends to emerge.


From one point of view, my original question was answered conclusively: in none of the top ten most expensive rental markets are monthslong award stays cheaper than renting the median apartment.

This conclusion should be taken with a healthy dose of salt, however:

  • as noted under Methodology above, you can save money over award stays by swapping in cheap paid nights over weekends and during low season. Doing so will also trigger points earning, which reduces the total amount of manufactured spend necessary each month;
  • as a top-level elite, your stay at many properties will include a continental or hot breakfast, and may include dinner as well, depending on the food spread available in the property's lounge;
  • this research compared the median rental property in a city to downtown chain hotel properties. Depending on the city, the median rental property may be in much worse condition, in a much worse neighborhood, much farther from downtown. In other words, if you're an upper middle class travel hacker working in San Jose, you're probably not living in the median rental property in the city, and you're probably paying much more in rent than the figures I cited.

Finally, while I intentionally framed it that way, living in hotels isn't an all-or-nothing proposition. For example, you may find that moving into a hotel for a month while you're between apartments, or in the process of moving to a new city, offers savings compared to other short-term housing options, or convenience compared to staying with friends or renting a room on AirBNB.

Optimizing Hilton points and nights earning across cards

In general, I prefer the American Express Hilton HHonors Surpass to the Citi Hilton HHonors Reserve. To review, the American Express card's three big advantages are:

  • issuance by American Express, so the primary user's card and all authorized users are eligible for American Express Offers for You;
  • Better bonus categories (gas and grocery versus airline and car rental) and higher earning in bonus categories (6 HHonors points instead of 5);
  • Lower annual fee ($75 instead of $95).

Both cards grant Diamond elite status after $40,000 in purchases each calendar year.

The comparison isn't completely one-sided, however. In addition to the fact that some people have success making payments against Citi credit card accounts over the phone using debit cards, the Citi Hilton HHonors Reserve card also grants an annual weekend night certificate each cardmember year you spend $10,000 or more with the card.

What's the imputed redemption value of a free weekend night?

Since the card earns 3 HHonors points on purchases outside of bonus categories, we can find the imputed redemption value of the annual free night certificate by comparing it to earning 6 HHonors points per dollar at grocery stores or gas stations with the Surpass card. Assuming you value HHonors points earned with the Surpass card at precisely their imputed redemption value (0.35 cents each), you have to get at least $105.25 in value from the free night certificate in order to justify earning it instead of 30,000 additional HHonors points or $210.50 in Arrival+ miles.

That is relatively easy. There are only 3 Hilton HHonors price points (5,000, 10,000, and 20,000) lower than 30,000 and 7 HHonors price points at 30,000 or above. That would imply that under most circumstances, if you value HHonors point enough to earn them in the first place, it's worth carrying the Citi Hilton HHonors Reserve card.

Keep in mind how imputed redemption values work: they show the breakeven point that justifies earning hotel points instead of cash back, not the actual value of the points when redeemed. The more value you typically get from your HHonors points above and beyond their imputed redemption value, the higher the value you need to place on the free night certificate to justify earning it instead.

And then there's the annual fee

If the Citi HHonors Reserve card didn't have an annual fee, the analysis would end there — the free night certificates would be so valuable it would be worth carrying multiple copies of the card and earning as many free nights as possible.

But there is an annual fee, and not a cheap one. Adding back in the $95 annual fee raises the breakeven imputed redemption value from $105 to $200, the equivalent not of a 30,000-HHonors-point hotel redemption, but a 60,000-point one!

That leaves the free weekend night certificates competitive with HHonors point redemptions at many high-end properties, but it makes them much less competitive with the typical mid-tier urban properties I stay at.

And of course weekend night certificates can only be redeemed over the weekend. That doesn't radically reduce the value for me (since I like taking trips over the weekend), but it's something to keep in mind.


The Citi Hilton HHonors Reserve card can provide a value competitive with the American Express Hilton HHonors Surpass card under two conditions:

  • during the first year, thanks to its signup bonus of 2 free weekend night certificates and a $100 statement credit;
  • and during subsequent years, if the cardholder has a plan to work the free weekend night certificate into a redemption at Hilton properties costing 60,000 or more HHonors points per night.

Of course, if you can talk Citi into waiving the annual fee in subsequent years, the value proposition reverts to the first one I outlined above.

Otherwise, the Surpass card's increased earning rate in lucrative categories makes it my go-to card for manufacturing HHonors points.