My version of the co-branded paradox

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I was listening to the latest episode of the new Milenomics² podcast, which everyone should subscribe to, and sign up for bonus Patreon content from, and the hosts brought up what they call the “co-branded paradox.” By this they mean the counter-intuitive way that even if you like staying at Hyatt properties, or like flying on Delta, your best bet for a credit card to use on everyday spend is probably not a Hyatt or Delta co-branded credit card.

That’s for the simple reason that while those cards may offer other worthwhile benefits, they actually earn points at a lower rate than other available options. A Chase World of Hyatt credit card may be worth carrying for the annual free night, but for non-bonused spend you’d be better off using a Freedom Unlimited card, which earns 50% more Ultimate Rewards points. At restaurants, the World of Hyatt card earns 2 points per dollar, but so does the Chase Sapphire Preferred, which allows you to transfer your points to Hyatt or any of Chase’s other transfer partners.

Likewise, you might want to carry a Delta Platinum card for the annual companion ticket or to take advantage of free checked bags, but that card only earns 1 SkyMile per dollar spent, while a no-annual fee Amex EveryDay earns 1.2 Membership Rewards points everywhere when you use the card 20 times per month (and the $95 EveryDay Preferred earns 1.5 points everywhere when you use it 30 times per month).

This is even more true in the case of products like the Chase IHG Rewards Club credit cards, which earn just 1 point per dollar spent on unbonused purchases: the more you value IHG Rewards Club points, the less you should be willing to spend on their co-branded credit cards, for the simple reason that a simple 2% cash back credit card earns almost 3 points per dollar, given that points can be purchased year-round for 0.7 cents or less.

All this produces a simple conclusion: get co-branded credit cards if you like their benefits, but don’t use them for actual purchases, where you can earn more points, more valuable points, or both using other products.

This is fine as far as it goes, but I actually think the logic of the co-branded paradox can be taken one step further.

Put everyday purchases on the card that earns the least useful rewards

What listening to the Milenomics podcast got me thinking about was the fact that most frequent travelers are usually already optimizing their earning of their most useful loyalty currencies. If you’re a paid business traveler that likes flying on United, you’re already earning United miles every time you fly. The fact that you like flying United shouldn’t encourage you to earn more United miles because your paid travel is already taking care of that. Likewise if you’re spending 55 nights a year at Hyatt properties for work, you’re likely already earning somewhere in the neighborhood of 100,000 points per year, plus two annual free nights (at the 30-night and 55-night thresholds) and any points earned from seasonal promotions.

To me, this is the real co-branded paradox: if your paid travel and manufactured spend are already optimized around the most useful rewards currencies, then your everyday spend should be going to the least useful rewards currencies, the ones that are nice to have lying around but that you don’t count on for your major travel needs.

A few examples off the top of my head:

  • Barclaycard Choice Privileges Visa. If you’re like me, you don’t stay at Choice Hotels properties very often. But when you do want to stay at a Choice Hotel, you can get terrific value from having a handful of Choice Privileges points lying around.

  • Bank of America Amtrak Guest Rewards MasterCard. This is another card that doesn’t make any sense to put hundreds of thousands of dollars in spend on, but if you do like to occasionally ride on Amtrak, you might like to have 20 or 30 thousand points kicking around so you don’t have to pay cash for what would be an especially high-value redemption, like 2.9 cent-per-point long-haul sleeper accommodations.

  • US Bank Radisson Rewards cards. I don’t carry any of these cards anymore because, with the exception of the Radisson Blu Aqua in Chicago, I have mostly found Radisson properties to be trash heaps. However, if you do still carry any of these cards due to their anniversary point bonanzas, you might also consider using them for everyday spend, earning as they do 5 points per dollar on unbonused spend.

Conclusion

Of course in one sense I’m being a bit tongue-in-cheek: obviously you shouldn’t prioritize earning less-useful currencies over more-useful currencies. But this is another way of expressing my long-standing observation that people really are inclined to earn too much, and redeem too little, of the currencies they consider most valuable. If there’s one good thing about the end of the Starwood Preferred Guest program it will be that we won’t have to listen to people complain that Starpoints are “too valuable to redeem” ever again!

If you’re maxing out a couple of Ink Plus cards at office supply stores every year and sitting on a million Ultimate Rewards points already, then I think it can make perfect sense to put away the Freedom Unlimited card when you go out to eat and pulling out something a little more exotic. Not because Amtrak Guest Rewards points are more valuable than Ultimate Rewards points in the abstract, but because they might be more valuable to you at the frontier you are personally operating at.

Pro tip: an easy Amtrak Guest Rewards mistake to make

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Amtrak Guest Rewards, the loyalty program for the United States' national passenger rail system, underwent a dual devaluation in 2015/2016 which made Amtrak Guest Rewards points much more difficult to earn (with the end of Chase Ultimate Rewards transfers) and somewhat less valuable (with the zone-based award chart replaced with a revenue-based redemption scheme).

As an Amtrak enthusiast, this was disappointing to me, since in just my first few years of travel hacking I had been able to redeem my Ultimate Rewards points for phenomenal value in bedrooms on long-haul routes like the Empire Builder, Southwest Chief, City of New Orleans, and Coast Starlight, not to mention saving hundreds or thousands of dollars on Northeast Regional trips.

Since the devaluation, Amtrak Guest Rewards points can still be very valuable for Amtrak redemptions, in my experience ranging from 1.71 to 2.9 cents each, depending on the route and class of service. The problem is that earning them has become so onerous that the program has lost even more value than the points themselves.

Three ways to earn Amtrak Guest Rewards points

The three easiest ways to earn Amtrak Guest Rewards points are:

  • The Bank of America Amtrak Guest Rewards World Mastercard, which earns 1 Amtrak Guest Rewards point per dollar spent on onbonused purchases.
  • The American Express Starwood Preferred Guest Credit Card, which earns 1 Starpoint per dollar spent on unbonused purchases, which can be transferred 1:1 to Amtrak Guest Rewards.
  • And the American Express Hilton Honors Ascend Card, which earns 6 Honors points per dollar spent at (more expensive) supermarkets, which can be transferred to Amtrak Guest Rewards at a 10,000:1,500 ratio, or the equivalent of 0.9 Amtrak Guest Rewards points per dollar spent at bonused merchants.

The Starwood Preferred Guest option may be time-limited by the impending merger of that program with Marriott Rewards, but if you have a lot of Starwood Preferred Guest points you're anxious to get rid of, Amtrak Guest Rewards is worth considering as a pressure valve for those large balances.

The third option, the Hilton Honors Ascend Card, is not time-limited but the unfavorable transfer ratio and high cost of grocery store manufactured spend will likely turn most people off unless they're in particularly dire straits.

Don't forget: Starwood Preferred Guest transfers to Amtrak do not earn bonus points

In complete fairness to Starwood, they have always made clear in the description of the program itself that only "Transfer Air Miles" redemptions are eligible for a 5,000-Starpoint bonus when you transfer multiples of 20,000 Starpoints: "Transfer your Starpoints directly to miles with your frequent flyer program. Even better: We'll add 5,000 bonus Starpoints for every 20,000 you transfer at a time."

Meanwhile, "Rail Miles" redemptions read simply, "Transfer Starpoints to Amtrak Guest Rewards at a 1:1 ratio and get on the next train."

However, someone on the backend had the brilliant idea of using the same interface to order both redemptions. And, as you may have guessed by this point, they screwed it up:

So we find ourselves in this situation where the terms of the program clearly say one thing, but the implementation of the program clearly says something completely different. You can even reproduce the same effect by submitting a transfer of 80,000 Starpoints and be told 20,000 Bonus Starpoints will be added to the transfer.

But to be clear: this is not how the program actually works, and you will not receive the bonus Amtrak Guest Rewards points automatically when transferring multiples of 20,000 Starpoints to Amtrak.

Conclusion

I know folks who are rightly concerned about losing out when Starwood Preferred Guest irrevocably transitions into Marriott Rewards in August, and I think Amtrak Guest Rewards is a sensible place to stash at least some points, given their relatively high, relatively consistent value, even post-devaluation.

But this post is a warning not to go overboard on those transfers when you see Bonus Starpoints in the dialog box since you won't, actually, receive them.

At least, not automatically. What you can or can't convince Starwood's agents to do, as a one-time courtesy to you, is entirely between you and them.

Hey look the Amtrak Guest Rewards MasterCard raised their signup bonus

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I saw at Miles to Memories yesterday morning that the Bank of America Amtrak Guest Rewards MasterCard had raised its signup bonus from 20,000 to 30,000 Guest Rewards points after spending $1,000 within 3 months.

While I don't chase signup bonuses, I'm not a lunatic: if you want to get a card, you're better off getting it when the signup bonus is higher rather than when the signup bonus is lower!

And the Amtrak Guest Rewards MasterCard is a pretty good card, if you travel on Amtrak regularly and pay for your own tickets.

Amtrak Guest Rewards points are pretty valuable

Amtrak Guest Rewards points are now redeemable for between 1.71 cents each (on certain Acela fares) and 2.9 cents each (on certain close-in Value fares), meaning a 30,000-point signup bonus is worth between $513 and $870, if you pay for your own Amtrak tickets out of pocket.

Note that this is not true if all of your Amtrak travel is reimbursed by an employer! If that's the case you should be putting your Amtrak purchases on the most lucrative card in your wallet for unbonused spend or travel purchases.

But if you just like taking trains (trains are great) then you can save a lot of money on train travel with this signup bonus.

Additionally, under certain circumstances it's possible to make large transfers of Amtrak Guest Rewards points to Choice Privileges points. Choice has a fairly confusing loyalty program but if you are able to take advantage of their properties you can get a lot of value from relatively few points.

Amtrak Guest Rewards points aren't that easy to earn

Since Chase Ultimate Rewards removed Amtrak Guest Rewards as a transfer partner, the only ways I know of to earn Amtrak Guest Rewards points are:

  • Paid travel on Amtrak. If you commute on Amtrak, or if you have your Amtrak travel reimbursed, this is the most seamless way to earn Guest Rewards points.
  • Shopping through the Amtrak Guest Rewards portal. If you're a reseller who's able to direct your online purchases through the portal of your choosing, you can use Amtrak's and not muck around with credit cards or manufactured spend.
  • Transfers from Starwood Preferred Guest and Diners Club. If you have a Starwood Preferred Guest American Express or Diners Club credit card (either from the long long ago or during the brief period when cards were available to new applicants) then you can already earn one Amtrak Guest Rewards point per dollar spent at unbonused merchants.
  • The Amtrak Guest Rewards MasterCard. Of course, some people don't have access to American Express credit cards for one reason or another, and almost nobody has access to Diners Club credit cards. That means if you are interested in earning Amtrak Guest Rewards points, don't have paid travel on Amtrak, don't do a lot of online shopping, and don't have a Starwood Preferred Guest or Diners Club credit card, well, you're going to need an Amtrak Guest Rewards MasterCard.

A few other benefits

The Amtrak Guest Rewards MasterCard isn't exclusively for folks who redeem points for Amtrak travel: the annual roundtrip companion ticket, even with its numerous restrictions, is the kind of thing that folks who frequently buy paid Amtrak tickets can take advantage of so that a partner or family member can come along on business trips. That's the kind of thing business folks seem to enjoy.

There's also an annual lounge pass. Amtrak lounges are pretty bad, so I'd ordinarily say to just show up right before your train leaves, but given Amtrak delays maybe a lounge pass is more valuable than I'm giving it credit for.

Conclusion

I won't personally be applying for the current increased signup bonus because I have about 9 credit cards that are higher priorities for my applications right now. But if you don't have anything better on deck, I think the Amtrak Guest Rewards MasterCard is a pretty good card with a better-than-usual signup bonus.

Reminder: Starwood Preferred Guest transfers to Amtrak Guest Rewards

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It feels like it's been a while since I've written about Amtrak Guest Rewards! That's mainly because the program underwent a dual devaluation in late 2015 and early 2016:

  • On December 8, 2015, Chase Ultimate Rewards points could no longer be transferred to Amtrak Guest Rewards;
  • On January 24, 2016, the previous fixed-rate award chart was discontinued and all Amtrak Guest Rewards redemptions became revenue-based.

That made Amtrak Guest Rewards points harder to obtain (since they couldn't be transferred from Ultimate Rewards) and less valuable (since obscenely lucrative fixed-rate sleeping cabin redemptions began costing additional points in line with their revenue cost).

The program still has value, though — in fact, more value than I expected.

Starpoints can still be transferred to Amtrak

While there's no 5,000-point bonus for transfers of 20,000 Starpoints or more, all Starwood Preferred Guest members can transfer up to 100,000 Starpoints to Amtrak. The minimum transfer is 2,500 Starpoints for non-elite members, 1,500 Starpoints for Gold Preferred member, and there's no minimum transfer for Platinum Preferred members.

Amtrak Guest Rewards points can be valuable, more valuable, or very valuable

Amtrak has always had last-seat-availability for Amtrak Guest Rewards redemptions, meaning Amtrak Guest Rewards points could be redeemed for any seat on any train up to the moment of departure (although this was mitigated somewhat by their onerous blackout dates). As you'd expect, before the program went revenue-based, that meant there was more value in expensive, last-minute redemptions than there was in further out, cheaper redemptions.

That's still true today, although for a different reason. Today, the reason that Amtrak Guest Rewards points are more valuable for closer-in redemptions is that they can't be used for "Saver" fares. A simple example should help illustrate the point:

  • On Friday, October 21, a Northeast Regional "Value" fare between Washington, DC, and Boston costs $140, or 4,830 Amtrak Guest Rewards points, for 2.9 cents per point in value;
  • On Friday, November 25, the same train has a "Saver" fare of $79, but Amtrak Guest Rewards points can't be redeemed against "Saver" fares at 2.9 cents each. They can only be redeemed against the more expensive $108 "Value" fare at 2.9 cents each, or 3,726 Amtrak Guest Rewards points. But if you'd otherwise book the available $79 fare, not the $108 fare, you're only getting 2.12 cents per point!

In other words, fixed-value redemptions against "Value" fares are a great deal when "Value" fares are the only ones available. That means close-in redemptions are more likely to give greater value, just like they did before the program's devaluation.

These 2.9 cent-per-point "Value" redemptions are available for coach and sleeper-cabin tickets, while Acela Business and First Class redemptions give between 1.71 and 2.56 cents per point (it's not immediately clear to me why some Acela redemptions are at the 1.71-cent level and some are at the 2.56-cent level).

Conclusion: Starpoints are valuable — and this is one more valuable use of them

I've been doing this long enough to know that everybody has their own favorite use of each rewards currency they collect. You might be earning and saving up your Starpoints for a big Alaska partner award, or a Singapore award, or just a hotel stay at one of Starwood's bespoke properties.

But earning up to 2.9 cents in fixed value per dollar of unbonused spend is well above what you're likely earning on your cash back credit cards. So while you're saving up for your dream Starpoint redemption, you can also be saving money by transferring them as needed to Amtrak Guest Rewards, rather than being stuck paying cash for your Amtrak tickets.

Instead of thinking of Amtrak Guest Rewards redemptions as being less valuable than your perfect redemption, you can think of them as being one more reason Starpoints are so valuable in the first place.

Anatomy of an Award Trip: Spring Break in San Francisco

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If you follow me on Twitter (as you should!) you know I spent last week in San Francisco. It was only upon returning that I realized I hadn't posted an anatomy of the award trip. Better late then never!

Getting there: Amtrak's California Zephyr

This was my last long-haul Amtrak sleeper cabin redemption before the December 8, 2015, revenue-based Amtrak Guest Rewards devaluation. I transferred 40,000 Chase Ultimate Rewards points to Amtrak Guest Rewards points for a 2-zone bedroom reservation between Chicago and San Francisco on the California Zephyr.

Total cost: 40,000 Amtrak Guest Rewards points, transferred from Ultimate Rewards. Total value: $1,246. Value per point: 3.12 cents per Ultimate Rewards point.

Staying there: Hyatt Fisherman's Wharf

As a newly minted Hyatt Diamond, I was eager to see what all the fuss was about and booked a 5-night Points + Cash reservation at the Hyatt Fisherman's Wharf, and applied one of my 2015 Suite Upgrade Awards.

Total cost: 37,500 Hyatt Gold Passport points and $582.25. Total value: $1,769.96. Value per point: 3.17 cents per Ultimate Rewards point.

I then earned 3,250 of those points back, bringing my final value per point to 3.47 cents per Ultimate Rewards point. Note that this value is based on an ordinary room reservation, not a suite reservation, since I could have applied a Suite Upgrade Award to either type of reservation.

Getting back: Delta first class tickets

To get back, I employed a strategy I use increasingly often: I booked my partner on an award ticket and myself on a paid ticket using a Delta voluntary denied boarding voucher. My partner doesn't play the game at all (besides traveling with me) so I don't make any attempt to get her elite status or earn bonus miles in her accounts.

Total cost: 37,500 Delta SkyMiles and $5.60, plus $729.10 in voluntary denied boarding compensation. Total value: $1,458.20. Value per point: 1.93 cents per SkyMile.

Conclusion

From my point of view, this award trip was quite close to ideal: I redeemed points I earned extremely cheaply for relatively expensive reservations.

In the case of Ultimate Rewards points redeemed at 3 cents or more per point, I earned close to 15% back on spend I manufactured with Ultimate Rewards-earning credit cards in their 5-points-per-dollar bonus categories.

In the case of Delta SkyMiles earned at 1.4 SkyMiles per dollar spent with my American Express Delta SkyMiles Platinum credit card, I earned roughly 2.7% back when redeeming those miles for my partner's first class ticket, which is quite strong for unbonused manufactured spend.

And of course when redeeming Delta voluntary denied boarding vouchers for my own travel, I came out ahead simply by being able to redeem it at face value.

Tune in tomorrow for some reflections on the train ride, hotel stay, and my impressions of a 5-day visit to the bay area!

One-time opportunity to buy 450,000 Choice Privileges points for $1,600

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Via Drew at Travel is Free, until December 8, 2015, there's a one-time opportunity to buy 450,000 Choice Privileges points for $1,600. That's not exactly how Drew framed it, so I'll walk through the essential elements of the deal.

Chase Ultimate Rewards transfers to Amtrak end December 8, 2015

Through December 7, 2015, it is possible to buy Amtrak Guest Rewards points for 1 cent each by transferring Chase Ultimate Rewards points (worth 1 cent each when redeemed for cash) to Amtrak Guest Rewards.

Amtrak Guest Rewards Select and Select Plus elites can transfer up to 50,000 points to Choice Privileges per calendar year

One Amtrak Guest Rewards point can be exchanged for 3 Choice Privileges points, but only if you have elite status with Amtrak Guest Rewards, which starts at 5,000 Tier Qualifying Points.

The Bank of America Amtrak Guest Rewards MasterCard earns both Amtrak Guest Rewards points and Tier Qualifying Points

The $79-annual-fee Amtrak Guest Rewards MasterCard earns 20,000 Amtrak Guest Rewards points after spending $1,000 within 90 days of account opening.

It also earns 1,000 Tier Qualifying Points each time you spend $5,000 with the card, up to 4,000 Tier Qualifying Points per calendar year.

Finally, it earns 1 Amtrak Guest Rewards point per dollar spent.

Buy 450,000 Choice Privileges points for $1,600

Here's how this one-time opportunity works:

  1. Transfer 110,000 Ultimate Rewards points to Amtrak Guest Rewards ($1,100 cash value);
  2. Sign up for the Bank of America Amtrak Guest Rewards MasterCard ($79 annual fee);
  3. Spend $20,000 with the MasterCard ($421 opportunity cost compared to 2.105% cash back on unbonused spend);
  4. Earn an additional 1,000 Tier Qualifying Points;
  5. Transfer 50,000 Amtrak Guest Rewards points to Choice Privileges in each of 2015, 2016, and 2017 (before your elite status expires on February 28, 2017).

You'll end up with 450,000 Choice Privileges points (well, hopefully you'll be redeeming them as you go, since Choice Privileges points do expire) after having paid $1,600 in fees and foregone cash back.

Should you do this?

I went on something of a Choice Privileges tear back in July, and had a lot of fun researching and writing about the program. The key thing I learned was that there are a lot of Choice Privileges properties in the world.

The second thing I learned was that properties start at 6,000 Choice Privileges points per night.

In other words, for your $1,600 you could buy 75 nights at a 6,000-point property ($21 per night) or 56 nights at an 8,000-point property ($29 per night).

Alternatively, you could buy 7 nights at a 60,000-point Preferred Hotels & Resorts property, paying $228 per night for a property like the Hotel Monaco & Grand Canal in Venice, which retails for over 350 Euros per night in June.

Just keep in mind you won't have the final 150,000 Choice Privileges points until January, 2017, which makes this what we call a "long con."

Conclusion

I'm normally pretty blasé about deals like this which require large up-front cash investments and only speculative returns later on.

But this is a deal I'm actually tempted to jump on! Keep in mind that the only truly time-sensitive part of the deal is the transfer to Amtrak Guest Rewards by December 7, 2015. You can transfer any number of points speculatively now, and then follow steps 2-5 of the technique next year, allowing you to make transfers in 2016, 2017, and early 2018.

Of course, if you naturally earn Amtrak Guest Rewards points and elite status through your travel, the deal is even sweeter, allowing you to transfer just enough Ultimate Rewards points to allow you to maximize the next three years' Choice Privileges transfer limits.

Finally, remember to redeem the points you earn! If you commit to this technique and end up with hundreds of thousands of Choice Privileges points, don't let yourself be stingy with them while you wait for the perfect redemption to come along — stay at Choice Hotels properties!

Let's go rail running!

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Earlier this year, Frequent Miler wrote about the possibility of achieving Amtrak elite status through "rail running:" boarding trains for the sole purpose of earning enough Tier Qualifying Points with Amtrak Guest Rewards to achieve "Select" status, which allows the transfer of up to 50,000 Amtrak Guest Rewards points to their hotel partners, Choice Privileges and Hilton HHonors.

Being based in Ann Arbor, Frequent Miler couldn't make the numbers work out for himself, but after writing about Choice Hotels a few times recently, I wondered under what circumstances rail running could make sense.

Making rail running work

Here are the basics of rail running for Amtrak elite status:

  • 5,000 Tier Qualifying Points are required to earn Amtrak Guest Rewards Select status;
  • 2 Tier Qualifying Points are earned per dollar spent on Amtrak fares, except;
  • each one-way trip earns a minimum of 100 Tier Qualifying Points, but;
  • a maximum of 4 one-way trips per calendar day are eligible for the 100-Tier-Qualifying-Point minimum.

The ideal rail run, then, is two one-way tickets in one direction, followed immediately by two one-way tickets back to your starting location. That means you need to find three stations which are close to each other in one direction and a train schedule that keeps you from having to wait very long at the second station you arrive at.

Do such stations and such a schedule, along with cheap enough prices to justify rail running, exist?

A few promising station constellations

There are a number of promising station constellations (three stations closely packed together) on the Pacific Surfliner route in California. Here's one:

  • Oceanside, CA (OSD) — Carlsbad, CA - Village (CBV) — Carlsbad, CA - Poinsettia (POI)

Tickets for each leg cost $8.10 for AAA members on the random December day I checked, for a total cost of Select status of $405. Unfortunately the schedule doesn't allow for an immediate turn in either direction (although if you go northbound POI-CBV-OSD and then turn around you may be able to rely on the southbound train being delayed as it nears the end of its route — it only has to be delayed 6 minutes for you to make the connection).

Another candidate on the same Pacific Surfliner route is SNA-ANA-FUL, at the same price.

Down South, the City of New Orleans has a slightly longer, but cheaper option:

  • Hazlehurst, MS (HAZ) — Brookhaven, MS (BRH) — McComb, MS (MCB)

AAA tickets on the same random December day cost $4.95 and $7.20, for a roundtrip cost of $24.30, or $303.75 for Amtrak Select status. Same-day turns only work starting Southbound, which would give you a leisurely 3 hour lunch in McComb, Mississippi.

Here's an easy one for our brothers in Philadelphia on the Keystone Service:

  • Philadelphia, PA (PHL) — Ardmore, PA (ARD) — Paoli, PA (PAO)

Each leg costs $5.85 for AAA members, for a roundtrip cost of $23.40 and $292.50 for Amtrak Guest Rewards Select elite status. Best of all, the train operates frequently enough that you should be able to put together an easy same-day turn, for example departing Philadelphia at 4:45 PM and returning to Philadelphia at 6:25 PM.

Amtrak Guest Rewards points are valuable!

So far I haven't mentioned the fact that during the course of all this rail running, you'll also be earning redeemable Amtrak Guest Rewards points! At least 5,000 of them, in fact.

And since the point of this operation is to transfer your Amtrak Guest Rewards points to Choice Privileges, you have to assign those redeemable points at least $50 in value, since that's the cash value of the Ultimate Rewards points you'll save. In other words, to max out your annual 50,000 in Amtrak Guest Rewards points transfers to Choice Privileges, you only have to transfer 45,000 Ultimate Rewards points to Amtrak.

If you are thinking about rail running, wait until Amtrak runs a promotion

Amtrak periodically offers double points on paid travel, their so-called "Double Days" promotions. The last Double Days promotion ran from March 16 to May 16, 2015. If you wait until the next one, you'll be able to score even more redeemable points, saving yourself the corresponding number of Ultimate Rewards points when the time comes to transfer them into your Amtrak Guest Rewards account.

Conclusion

Researching this post was a lot of fun, but I fully understand most of my readers are not actually going to go rail running in order to achieve Amtrak elite status. Nonetheless, I think it's an idea that's more defensible than it appears at first blush, especially if you have your heart set on one of Choice Privileges' Preferred Hotels & Resorts.

If you decide to go rail running, remember: you need to book two one-ways in each direction to earn the maximum of 400 Tier Qualifying Points each day, and the goal of the game is finding the cheapest trips and shortest turnaround times possible!

Fun with Choice Privileges Preferred Hotels & Resorts

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On Friday I wrote a quick rundown on the basics of redeeming Choice Privileges points at their thousands of hotels all over the world at reasonable cost, compared to the big chains I usually write about. Readers were quick to point out that I had missed a key value proposition of the Choice Privileges program, which is their Preferred Hotels & Resorts collection. So let's rectify that today.

Preferred Hotels & Resorts can be more expensive than normal Choice properties

The Preferred Hotels & resorts collection cost between 30,000 and 60,000 Choice Privileges points per night, and each property's cost does not vary by season (indeed I don't know if it varies even from year to year).

Preferred Hotels & Resorts availability can be checked online...

Just navigate to the Participating Hotels page and click on "check availability" next to the property that interests you. There are three kinds of availability: "No Availability," "Availability," and "Minimum Stay Required."

At the property I looked at (Pier 2620 Fisherman's Wharf) the minimum stay requirement for many nights was 3 nights for arrivals on the given night, while earlier arrivals could stay through the restricted nights. Those restrictions likely vary by property.

...but cannot be booked online

To book a Preferred Hotels & Resorts property, you need to call the appropriate booking phone number. For US residents, it's 888-770-6800.

How do Preferred Hotels & Resorts compare?

With that out of the way, let's see if we can get any value from this program.

There are two easy places to watch for outsized value from this program: at the low, 30,000-point-per-night level and the high, 60,000-point-per-night level.

At the low level we see an imputed redemption value of $333 per night, which is competitive with low-to-mid-tier properties in all the chains but Hilton (it's competitive with top-tier Hilton properties).

At the high level, 50,000- and 60,000-point redemptions are competitive with mid-to-top-tier properties in all the chains but Hilton (where imputed redemption values top out at $352 per night).

At the bottom end I wasn't able to find any properties that cost more than $333 per night for a random date in August I searched. That doesn't mean they don't exist, but I certainly wouldn't stockpile Choice Privileges points on the off-chance of finding one.

At the top end, Drew at Travel is Free conveniently assembled 31 Preferred Hotel & Resort properties bookable with Choice Privileges points, all of which are among the top 500 hotels in the world, apparently according to Travel and Leisure. My value added is searching for prices at all 31 properties and seeing whether any are, in fact, good deals at 50,000 or 60,000 Choice Privileges points.

These are the only two of Drew's 31 properties where I found nightly rates exceeding the properties' imputed redemption values:

  • Montage Beverly Hills – 60,000 points
  • Montage Laguna Beach – 60,000 points

That's not to say that the other properties aren't nice, or expensive. They're just not expensive enough to justify manufacturing the spend required to stay there on a Choice Privileges co-branded credit card (for the dates I searched).

Squaring the circle: the Amtrak co-branded credit card and Amtrak elite status

As Drew points out when he writes about Choice Privileges, the key to maximizing the program is not earning Choice Privileges points through hotel stays or through co-branded credit card earning. The key is transferring points from Amtrak Guest Rewards to Choice Privileges at an extremely favorable ratio: 5,000 Amtrak Guest Rewards point can be converted into 15,000 Choice Privileges points, and Amtrak Guest Rewards is a transfer partner of Chase Ultimate Rewards.

In other words, it's possible to buy Choice Privileges points for a third of a cent each (rather than 1.1 cents each) by transferring your Ultimate Rewards points first to Amtrak, then to Choice Privileges.

But there a catch.

According to Amtrak's website:

"Members that are active cardholders of the Amtrak Guest Rewards MasterCard issued by Chase Bank with an Amtrak travel spend on the card of over $200 per calendar year may redeem up to 25,000 Amtrak Guest Rewards points per calendar year for hotel points and Audience Rewards.

"Current Amtrak Guest Rewards Select or Select Plus Members...may redeem up to 50,000 Amtrak Guest Rewards points per calendar year for hotel points and Audience Rewards.

"Current Amtrak Guest Rewards Select Executive Members...are not subject to point limits when redeeming for hotel points and Audience Rewards."

Since the Amtrak Guest Rewards co-branded credit card is no longer available for new applicants, unless you already have the card, you'll need Amtrak elite status in order to take advantage of Amtrak Guest Rewards points transfers to Choice Privileges.

[update 7/13/15]

Here's the actual dollar cost of Choice Privileges properties when transferring Ultimate Rewards points to Choice through Amtrak:


Anatomy of an Award Trip: City of New Orleans

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As teased in yesterday's housekeeping post, I'm headed to New Orleans for a week! Here's the scoop:

Getting there: a family bedroom on Amtrak's City of New Orleans

Amtrak operates a daily service between Chicago and New Orleans stopping in, among other places: Champaign-Urbana, IL, Carbondale, IL, Memphis, TN, and Jackson, MS.

Since both Chicago and New Orleans are in Amtrak's "Central Zone," a roomette award costs 15,000 Amtrak Guest Rewards points while a bedroom award costs just 25,000 Amtrak Guest Rewards points. Importantly, such awards include the fare for up to the maximum occupancy of the room. In other words, up to two people can travel in a roomette on a single, one-zone 15,000 Amtrak Guest Rewards award redemption.

Since my partner and I have already experienced the "roomette" (on the Empire Builder) and "bedroom" (on the Southwest Chief and Coast Starlight) room types, I decided to redeem my points for a "family bedroom." Here are a few key things to know about such redemptions:

  • They cost the same number of Amtrak Guest Rewards points as a regular bedroom award;
  • They include up to two adults and two children;
  • They have windows facing out both sides of the train (roomettes and bedrooms are lined up along each side of the wagon, looking out one direction or the other);
  • They do not have en-suite facilities. My understanding is that the family bedroom is on the same level of the wagon as the public showers, while bedrooms have private showers and toilets directly off the sleeping quarters.

Since the ride is just under 20 hours, my expectation is that the roomier accommodations and better views will make up for the lack of a private toilet and shower, but on a longer, cross-country trip that may become increasingly inconvenient.

Total cost: 25,000 Amtrak Guest Rewards points (transferred instantly from Ultimate Rewards).
Total value: $637. Value per point: 2.55 cents.

Staying there: Club Carlson and Hilton HHonors

Since we'll be in New Orleans for 7 nights, there were a few decent options for hotel redemptions:

  • There's a category 6 Marriott downtown, the AC Hotel New Orleans Bourbon/French Quarter Area, where I could have redeemed 230,000 Marriott Rewards points for a 7-night Hotel + Air package and received a rebate of up to 55,000 United Mileage Plus miles or, more realistically, 50,000 Alaska Airlines Mileage Plan miles. That would have involved transferring 180,000 Ultimate Rewards points, worth $1,800 in cash. Since 7 nights at a 4-star hotel downtown cost (very roughly) $1,300, even generously valuing the Alaska miles at 2 cents each I'd only be getting about 1.28 cents per transferred Ultimate Rewards point. I felt I could do better.
  • There's a Club Carlson property downtown in the French Quarter, the Country Inn & Suites By Carlson, New Orleans French Quarter, LA. As a Category 5 property costing 44,000 Gold Points per night, I could theoretically book 7 nights for the price of 6, or 264,000 Gold Points. Using the same $1,300 valuation as above, that would yield 0.49 cents per Gold Points. Since the Club Carlson Business Rewards Visa earns 5 Gold Points per dollar spent, that would yield a return of 2.46% on the spend I manufacture with the card, which isn't terrible for non-bonused spend.
  • There's also a category 7 Hilton property downtown, the Hilton New Orleans/St. Charles Avenue. It ordinarily costs 50,000 HHonors points per night, but due to weird Hilton premium award pricing is available for 44,519 HHonors points during our stay in New Orleans. The wrinkle is that as an HHonors elite, I can book 5 nights for the price of 4, or 200,000 HHonors points, but unfortunately that benefit only applies to standard room awards, not premium room awards, which is where "weird" award pricing comes into play! Nonetheless, 280,000 HHonors points for a 7-night stay, $1,300 stay would yield 0.46 cents per HHonors point, or a 2.79% return on gas station and grocery store spend with my American Express HHonors Surpass card.

Ultimately, I split the difference: since the last night is free on all Club Carlson award reservations separated by at least one day, I booked our first two and last two nights in New Orleans at the Country Inn & Suites, and the middle three nights at the Hilton New Orleans/St. Charles Avenue, taking advantage of "weird" premium award pricing. In total, I paid 88,000 Club Carlson Gold Points for four nights (0.84 cents per Gold Point at $185 per night) and 133,557 HHonors points for three nights (0.42 cents per HHonors point at $185 per night).

However, if standard rooms open up for five consecutive nights at the Hilton, I'll cancel the first or last Club Carlson redemption and rebook using 200,000 HHonors points instead, saving the Gold Points for another day.

Getting back: US Bank Flexpoints for Delta first class (credited to Alaska)

For our return, I noticed that Delta was selling first class seats on the perfect itinerary home for just a hair under $400: $392.10, to be precise. Since I'm sitting on a constantly-growing stash of US Bank Flexpoints, it was a no-brainer to book us in paid first class for 20,000 Flexpoints per ticket. I'll credit the flights to Alaska, which will net me 3,922 Mileage Plan miles and get me 2,139 elite-qualifying miles closer to MVP status for next year.

Total cost: 40,000 Flexpoints.
Total value: $784.20. Value per point: 1.96 cents.

Conclusion

We're thrilled to be headed back to New Orleans, and I'm excited to try out a new Amtrak accommodation type on a new route. So until next week, I'll leave you with this:

Have a great weekend!

Chase Amtrak Guest Rewards credit card companion coupons

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For years, Flyertalk hosted a "zombie" link to a 32,000 Amtrak Guest Rewards point signup bonus for their Chase co-branded credit card. That link no longer works, and the only publicly advertised offer is for 12,000 Amtrak Guest Rewards points.

If, like me, you like using AGR points for long-haul sleeper accommodations, that offer wasn't worth a hard credit pull even though I find Amtrak Guest Rewards points extraordinarily valuable, typically redeeming them for 3-5 cents or more each.

Amtrak credit card comes with companion coupon

In the latest e-mail I received from Amtrak Guest Rewards, exhorting me to sign up for their co-branded credit card, I noticed a benefit that was new, or at least new to me:

"Apply today and, after you spend $500 on purchases in the first 3 months from account opening, earn 12,000 bonus points - enough for a free roundtrip, plus a free companion coupon." [emphasis mine]

So, what's a companion coupon? Digging into the terms and conditions, we find:

"Coupon valid for one (1) free companion fare when traveling with a paid regular (full) adult rail fare. Free companion and paying passenger must travel together at all times and have ticket issued at the same time. Valid for sale and travel completed within one year after qualifying for the companion coupon. Travel blackouts apply: [...] Valid for travel as one (1) one-way or one (1) round trip on one reservation per coupon. Both tickets for roundtrip must be reserved at the same time. Valid for travel on all Amtrak services except joint Amtrak/VIA Rail service and 7000-8999 Thruway series. Free Companion offer may be combined with corporate discounts, but not combined with any other discount, coupon or Amtrak Guest Rewards redemption travel. Offer valid for coach rail fare only (Business class or [sic] Acela); not valid for sleeper accommodations, Upgrades to Business class or First Class is available upon full payment of applicable accommodation charges"

There are four key takeaways here:

  1. The coupon is good on one-way or roundtrip reservations;
  2. The coupon is good for a companion paid fare — it can't be redeemed on an award reservation (unlike, for example, British Airways' companion ticket);
  3. The coupon can be redeemed on Acela in Business class, or on long-haul trains in coach, but not on sleeper accommodations or for Acela's First class.
  4. Acela Business class companion reservations can be upgraded with cash, but not Amtrak Guest Rewards points (a popular use of AGR points is to upgrade Acela Business class reservations).

How should you use an Amtrak companion coupon?

The most valuable use of this companion coupon won't be on long-haul trains, since those trains can be easily and cheaply booked using Amtrak Guest Rewards points transferred from Ultimate Rewards for sleeper accommodations, and those reservations include the maximum number of passengers the sleeper room is designed for (i.e., 2 adults and 2 children for a Family Bedroom reservation).

So let's look at the next-most-expensive Amtrak reservation type the companion coupon can be redeemed for: Acela Business class travel.

After a little light searching, the most expensive Acela roundtrip I found was $532, for a weekend in May, 2015:

On the cheaper side, here's a weekday roundtrip in April, 2015:

That establishes a nominal range of $412 to $532 for the companion coupon's value. However, as always we need to decide what we're actually comparing the Amtrak companion coupon to. The best comparison is booking using Amtrak Guest Rewards points transferred from a flexible Ultimate Rewards-earning credit card. If you go that route, you'll spend 16,000 Ultimate Rewards points per passenger, or 32,000 points for two passengers, and save $412-$532 in cash. If you value your Ultimate Rewards points at more than 1.29 to 1.66 cents each, you'd be better off redeeming a companion coupon and paying the cash value of the first passenger's fare.

Additional considerations

There are a few final things to consider when deciding whether an Amtrak Guest Rewards credit card is right for you, and when and whether to redeem a companion coupon:

  • Amtrak Guest Rewards point redemptions on Acela have additional restrictions, in addition to Amtrak's standard redemption blackout dates. From Amtrak's redemption guidelines: "Weekday redemption travel is not permitted on any Acela Express segment with a scheduled departure between 12:01 a.m. and 8:59 a.m., or between 2:00 p.m. and 5:59 p.m., inclusive, Monday through Friday. Rule Buster redemptions are not exempt from this restriction." As I discovered last year, this rule can be circumvented by traveling to a station with a permitted departure time, like Providence, RI (slightly south of Boston, and therefore with a later departure time on southbound trains). This rule doesn't apply to paid fares or the companion coupon, to the best of my knowledge.
  • You may want to spend money on Amtrak with your Chase Amtrak Guest Rewards credit card. For example, after spending $200 on Amtrak train travel with the credit card, you're able to transfer up to 25,000 Amtrak Guest Rewards points (i.e. Ultimate Rewards points) to 50,000 Hilton HHonors points or 75,000 Choice Privileges points.

Conclusion

I'm still praying that some kind of increased signup bonus will return, so I can sign up for the Chase Amtrak Guest Rewards credit card with a clear conscience. For now, I'm unwilling to sacrifice a hard pull to save just 12,000 Ultimate Rewards points, even though I do redeem Amtrak Guest Rewards points at least 2 or 3 times per year and always receive exceptional value from them.