Credit-card-rewards guru Brian Kelly says we’re in a “golden age” of travel

http://www.newyorker.com/business/currency/how-to-travel-like-a-millionaire-ask-the-points-guy

by shubhamjain • 9 years ago

58 65 9 years ago

newyorker.com

AznHisoka• 9 years ago

Rule #0. Dont have kids. otherwise everything else is moot.

roadbeats4• 9 years ago

Not really; http://www.dailymail.co.uk/news/article-2300179/Herman-Cande...

onion2k• 9 years ago

Rule #0b. If you do have kids, don't take them with you. ;)

empath753• 9 years ago

Or have money.

shubb• 9 years ago

If the general point is that kids are super expensive - I dunno about that.

I'm happily childless in my 30s, and when I look around at my circle of friends, those who had children early tend to have more stuff and more savings.

Why? Because children force you to live a stable, boring life. And overall that reduces your costs more than having children increases them.

For instance, when my friend Bob graduated, he stayed in my home town and bought the a fairly cheap house that he could afford, and he's still in it. I moved city to get the best job I could, and did it again, and then again.

While I've been off increasing my earnings, Bob has been accumulating actual stuff. He lives in a house he owns outright, while I've only ever rented. He has great furniture and kitchen stuff, while I have cheap things because I know that when I move, it'll cost more to shift them than to buy them again.

And moving city and breaking up with partners and changing career, and all these things that childless people do because we can are really expensive. It's hard to accumulate savings when you end up buying a new washing machine every 2 years.

And he has kids, which when you think about it is a great addition to your retirement planning. Even if the stock market crashes and wipes out your investments, well raised kids will let you move into their living room and give you a bed bath.

UK-AL• 9 years ago

You can do all of that without kids. In fact I've done that, and moved for better jobs.

EA• 9 years ago

I know someone who churns credit cards systematically (you know, follows a regimen like suggested in the article) and has been traveling with his family around the world for years, taking trips every 4 to 6 weeks.

That doesn't sound too "boring".

In fact, we churned cards a few years ago to pay for our trip to Europe. We took our toddler.

I would like to know where this "boring" life is that parents have. At times, I could use some of that.

dejv• 9 years ago

Rule #1. Be from USA, or maybe UK, otherwise good luck finding miles or credit card deals.

gommm• 9 years ago

Countries in Asia are not too bad either. As a rule, countries with weak laws protecting customers from customer debt are more likely to have good deals on credit card...

Credit cards need to get money and beside the interchange fees, the late fees and interest rates are where they get their money.

roadbeats4• 9 years ago

How to travel better than a millionaire ? Spend less, do more. It's possible and better to travel with almost no money, discipline and challenge your body and your desires. Last year, I spent 3 months in Morocco, 1 month in Indonesia and 1 month in Jordan. As a married couple, our daily budget in Indonesia and Morocco was about $2-$3 dollar per day because we camped and hitchhiked, sometimes ate only bread for one week, sometimes had to walk for hours, sometimes got sick and spent hole day sleeping under a tree in the middle of nowhere. I can't express the taste of an egg after weeks of strict diet though. The wonderful taste of true freedom is not more money; it's actually not spending money. I had as much as time I wanted, and I could go any route I wanted. No credit cards, no bills, no worries. I believe travel should be about developing good habits and learning value of small things rather than turning the brain off and enjoying luxury and desire... Hope I didn't sound snobby, just wanna give different perspectives a voice. If it sounded interesting, you can take a look at this video to see it in action; https://www.youtube.com/watch?v=_CC5htqMMFc

prawn• 9 years ago

Loved your video.

There are some great experiences that money helps with but some of the most incredible things on the planet are free or cheap - walking, national parks, museums, etc. Sadly, the loudest voices (including advertising) are often the ones earning the most from speaking and so encouragement to find the simple and cheap attractions gets ignored.

sokoloff• 9 years ago

sometimes ate only bread for one week, sometimes had to walk for hours, sometimes got sick

A lot of people would disagree that that's "traveling better than a millionaire".

roadbeats4• 9 years ago

"Pain is a treasure, for it contains mercies." - Rumi

The point I'm trying to make is, happiness and joy is not in "more", it's in "less". And the "less" requires people to discipline their body to not demand comfort and luxury.

Sleeep10• 9 years ago

Luckily there is not a correct way to enjoy travel (or anything else in life).

It escapes me why someone would want to go all the way to Southeast Asia for that though.

mrisoli2• 9 years ago

It is okay to have your beliefs, but don't come outright saying your travel habits are better than others, some people want to enjoy comfort and luxury while traveling or otherwise and there is nothing wrong with that. There is a reason five-star hotels are in business just like there is space for crumbling hostels and camping grounds.

I say this as someone who's traveled a little bit on a minimal budget, there are good things about both and your posture is typical of condescending wanderlust travel bloggers(which these days come in troves) even if that is not your intention.

empath753• 9 years ago

The answer is apparently to get the credit card companies to pay you for ads.

Sleeep10• 9 years ago

[Most] credit card bloggers like The Points Guy are shills, don't listen to them. They make their money from affiliate marketing so they'll pimp the cards that make them the most (like Chase cards) and ignore deals that are good for you but bad for them. The Points Guy's website is owned by Bankrate.

Here's him getting called out on Reddit for some practices: https://www.reddit.com/r/IAmA/comments/471yey/im_the_points_...

The Points Guy and other credit card bloggers are like the people who hold "I Will Teach You To Get Rich" seminars at the Holiday Inn. He never answered when asked how much his salary he makes from his blog is but it's reported to be 7 figures.

This is not the golden age, it's pretty mainstream. Card issues are cracking down on gamers. AMEX just started putting terms about gaming in their application. Citi merged limits on sign up bonuses across their cards. Chase doesn't even approve you if you've opened too many credit cards in the last 24 months (5) and has long called out gaming as against their T&C.

Even if you get a million miles it's a chore to redeem them for something worthwhile. You also have to worry about keeping them from expiring.

I still collect points and miles but don't kid yourself that it's not a commitment. Most people who are serious in the miles/points game go out buying gift cards and then using ever closing loopholes to liquidate the gift cards. It's just crazy some of the time, money, and effort people put into it. Might as well get a part time job at that point.

Personally, in two years, between credit cards and bank accounts I've gotten $6,000 in realized worth (that is redeemed) and at least as much in unrealized worth. I've got my first rejection a few weeks ago.

This is a credit card blog that is independent, the only blog I look at: https://www.doctorofcredit.com

bonesinger8• 9 years ago

I don't know if your assessment of that is accurate. I opened 2 cards last year, the AMEX Platinum and Chase Sapphire Reserve deal. I got 100k points for each card. I had some existing points and then some extra spending and I was able to get 2 business class tickets to Japan ($18k value) and 15 nights in 5 and 6 star Hyatt hotels. That was probably another $8k in value. I spent 170k AMEX points on the flights and 155k Chase points on the hotels. That trip was amazing and it was only possible because of the points.

Was it a lot of work? Not really. I just put all my spending on my AMEX for a few months. Then I switched to the Chase Sapphire for a months. Once I got all the points I needed, I just transferred the the Amex points to ANA and the Chase points to Hyatt. I then booked my flights and hotels. Booking flights was slightly harder as my fiance and I weren't married so we had to transfer points to separate accounts, but it definitely wasn't a chore at all. A simple phone call to AMEX took care of that. Booking rooms with Hyatt and using points was a breeze.

There are other benefits of having high end cards too. I got Global Entry for my fiance and I ($200 value). We didn't have to go through customs on the way back to USA. I got $300 travel credit from CSR card per year. $200 airline credit from AMEX Plat. I was able to get orchestra tickets to Hamilton in NYC for $399 through AMEX plat.

If I had a million points, I could book 3-4 dream vacations. Not sure what went wrong with your redemptions.

charlesdm• 9 years ago

Isn't the Amex platinum $550 a year though? Still a good deal, but not entirely free either?

Sleeep10• 9 years ago

You can't call your airlines tickets $18k in value because you wouldn't have spent $18k on two airline tickets. My value is the max I'm willing to pay for a ticket, not the price the airline says the ticket I redeemed for is worth. Bloggers say this too and it's disingenuous. For me those tickets would be $5k because that's the most I'm willing to pay for two tickets to Japan.

It's a pain to figure out the best way to get from point A to point B using points. You have to figure out which points to collect,then you have to collect enough of them, then figure out which time of the year to go where the redemptions you can afford are. Then you have to transfer and book on partner airlines. It certainly isn't straightforward.

Yeah, sure, you can do a big trip with two HUGE sign up bonuses of flexible points very easily. Being able to get one high quality trip isn't the same as being able to get many high quality trips, you aren't going to be able to do that a couple times a year (which is what bloggers make it seem like). Travel bloggers promote churning through cards to keep generating more points. You can't just churn through Platinum and CSR applications over and over again. (Platinum is churable to an extent but that's another topic and AMEX is cracking down on that)

Those two sign up bonuses you got are not common and the CSR one won't come back ever again (Chase is losing money on the CSR, look for a devaluation in the future).

Also your points have to be spread out among 5+ different loyalty programs if you want to continue churning credit cards/points/bonuses.

My redemptions are fine, they fit my needs. I have not redeemed a lot yet. I haven't planned a big trip yet. So far all my redemptions have been for a couple nights at a time. You aren't going to get as much value if you simply fly domestic. Flying to Japan may get you the most value but it's worthless if you don't want to fly to Japan.

Anyways, my point of the GP was:

-TPG and most travel blogs are a business that are making money off you.

-Points aren't as simple as "sign up for credit card, fly to Japan," you have to be flexible and usually to get a good redemption you'll have to transfer and book off peak. Availably is limited.

-To get more than 1-2 trips you're going to have to game the system. Sign up, collect bonuses, close card, repeat. You hit a wall with this after a while.

-Credit card companies are cracking down on gamers.

-Some people are better off getting part time job with how much effort they put into gaming the system.

-The rules are always changing.

BlackJack3• 9 years ago

Would you have paid $18K to fly to Japan though? The "cents per mile" is high but it's better to measure your WTP (willingness to pay).

BTW, you can regularly get west coast to Japan in business class for ~$3-4k/pp. ex. https://goo.gl/flights/BDTu. If you wait for deals, there was Vancouver - Japan/Hong Kong/SE Asia for ~$2k in business class for a while. Business class prices have been consistently dropping transatlantic (TATL) and we're seeing that transpacific (TPAC) too, albeit more slowly.

I think what you did was smart, but there's really no way to continue to get that kind of value from your miles. You could get the other Amex cards (~150k MR?), and other Chase cards (~150k UR?), but hard to repeatedly get big bonuses like that :P

Totally agree though that keeping one or both of those cards is great for the right kind of spend. It's just not like a free trip to Europe every quarter like it used to be.

sersi2• 9 years ago

2 business class tickets is definitely not $18k in value. There are regularly sales with various airlines when you can get a business class to Japan for around $2k per ticket. And since availabilities for rewards vary and are sometimes hard to come buy, you cannot compare them to the price of a fully flexible airline ticket.

But that said, you can get good value from using miles.

ac29• 9 years ago

Out of curiosity, how much do you have to spend to get those bonus miles? Right now Chase Sapphire Reserve will give you 50k miles for $4k in spending within 3 months (in addition to the $450 annual fee).

It just seems like a lot of these credit card based mileage schemes are really limited to people who can naturally spend tens of thousands a year on credit cards and can additionally afford the potentially thousands more in annual fees (if you have multiple cards). For those who aren't in the top 20th percentile of income, or who just prefer a frugal lifestyle, I don't see how its viable.

Or are there tricks to manufacture spending and recoup your costs?

kenneth2• 9 years ago

The Points Guy is fine in that it'll teach most people the basics. It's not perfect advice, and they (Kelly, and Bankrate) make a killing on it… but it's good enough. For most people, the alternative is using a debit card or redeeming their miles for a new toaster. Following TPG's advice is already a massive improvement.

In the past year, I've flown >100 times, 200k "butt-in-seat" miles, all long-haul in first or business class, spent 150+ nights in luxury hotels. I've flown around the US in private jets. I have millions of points and miles. I don't dare imagine what the retail cost would've been—but I pay a tiny tiny fraction of the price. Travel in that style is a hobby and I go out of my way to fly new airlines (I've tried long-haul first class on almost every reputable airline) and visit new places (40 countries and counting).

Getting really good at this, however, is a ton of work. It's a time-consuming hobby. I have spreadsheets, scripts, crawlers, and private groups to trade info, miles, and favors. I'm constantly on the lookout for new deals and loopholes; and I know the ins-and-outs of airlines' and hotels' policies. I've put in my 10,000h.

The point is that sure; for me, TPG seems like child's play. A lot of the information is a bit inaccurate, and they're not entirely unbiased. But most people don't have the willingness or interest to put in the work required to be really successful at this hobby. For that majority of people, following TPG's advice will let them experience a taste of this lifestyle. It might be enough to take their fiancé on a first class luxury honeymoon to Japan. In my opinion, that's pretty cool…

patrickg_zill• 9 years ago

Have you considered monetizing your knowledge? I would pay maybe $100/hour for some advice on how to adapt my current lifestyle and credit card usage to gain more miles/benefits.

Sleeep10• 9 years ago

TPG exists to make TPG money not to lead you to the right cards for your needs. If you want to learn you should learn from a resource that doesn't contain referral links.

TFA is nothing but a marketing piece. The travel blog market is saturated.

empath753• 9 years ago

how much money did you actually spend on all of that?

Hnrobert42• 9 years ago

The article acknowledges both the affiliate marketing and bankrate ownership. Do you have evidence that his reporting is influenced 8n a way that serves him but not his readers? Not really fair to call him a shill otherwise.

As for your assessment of the utility of collecting points, I agree. I have ADHD. I will miss a payment or something that will blow the whole mess apart. Not worth it to me, but good for those who can make it work.

youngprogrammer• 9 years ago

How to travel like a millionaire? Ask the millionaire

everyone• 9 years ago

So the gentry also dont have to endure the TSA shit? Nice

mbillie1• 9 years ago

TSA Precheck, assuming you can pass the background check, is $80 and is absolutely worth it if you have the extra cash and can fit an appointment into your schedule.

HillaryBriss• 9 years ago

does TSA recheck require retina scans?

BlackJack3• 9 years ago

I'm well versed with this world, and actually blog sometimes too. Here's some observations:

1. Lots of people use credit card points and frequent flyer miles to buy premier hotel and flight experiences. For example, you can fly from the US to Europe in business class round-trip for ~120,000 points and ~$200 in taxes/fees. Buying a business class roundtrip would cost $2000-7000, depending on which airlines and which times you fly.

2. You can earn points by flying, but the fastest way is by credit card bonuses. Recently the Chase Sapphire Reserve (CSR) had a 100K point bonus if you spent $4,000 in 3 months. You could transfer those Chase points to United and nearly have enough for round-trip business class tickets. To earn 100K United miles by flying would require you to spend $9k+ dollars on united tickets (if you're top tier elite), or fly business class between US-Asia 3 times on their partners or ~6 times in economy. It's waaay faster to use credit card sign-up bonuses to earn points.

3. There are lots of bloggers. boardingarea.com is full of them. Many cards give you referral bonuses for customers, so they just use their affiliate links. They're generally trying to push the links when they can. If you're a bigger blogger, you can get a deal with a bank to get cash per referral as opposed to the "max 5 referrals per year" deal that most people get.

4. The Points Guy (TPG) gets lambasted for using referral links that have the best referral bonuses instead of what's best for the end user. For example, the CSR above (100k/$4k spend), did not give a referral bonus. It's little brother, the Chase Sapphire Preserve (CSP), gave a 50k point bonus for $4k spend, but did give the referrer a bonus as well (10k points, or some cash depending on the deal). TPG regularly linked to the CSP even when every other blog was linking to the CSR.

5. The "golden age of travel" has transformed. In the past, frequent flyer programs were very beneficial, and cards had awesome sign-up bonuses. People would "churn" cards i.e. apply for a card every 90 days to get the sign up bonus and then never use it again. After a few years it wouldn't hurt your credit score, but you can read-up more online. reddit.com/r/churning is generally a good source.

6. Nowadays you still have big card bonuses but they tend to be more for the premium credit cards ($450+ annual fee) instead of no-fee or low-fee cards. In addition, banks are tighter about how often you can apply for those cards.

7. Airlines are much stingier with their award space. Even if a business class flight is supposed to cost 55-60k miles, you need availability from your origin and destination. The airlines can simply limit availability and render your points less useful. American is notorious for this - good luck finding business class awards from the US to anywhere. United is the best because Star Alliance has a ton of partners and usually sufficient availability. Delta has variable awards so sometimes a flight will cost 50k miles and other times it will cost 100k or even 300k miles for the same flight. A real PITA :(

8. You'll notice that I am consistently talking about business class awards. That's because economy fares have become very cheap nowadays that it's better value to just buy them. If you follow Scott's Cheap Flights, you can get notifications of fare deals. You can regularly get $300-400 flights from US-Europe or $500 US-Asia flights. These flights would cost 60-70k miles roundtrip, but with CSR you can "buy them for 1.5 cents per mile," so you can use 25K chase points to buy a $375 flight, and earn miles on that flight. Conversely business class tickets usually go for $2-4K, so using 100K miles is a way better "redemption", if that's what you're interested it. Ultimately it depends on your willingness to pay - some people stretch miles to economy as much as they can.

Hope that helps as a quick primer. Happy to answer any questions. Miles & points is an interesting world but it has gotten less rewarding. Nowadays I just see them as a nice to have but not something I'd go out of my way for.

giarc• 9 years ago

Delta has variable awards so sometimes a flight will cost 50k miles and other times it will cost 100k or even 300k miles for the same flight. A real PITA :(

This is what I hate about reward miles. I live in Canada so I collect Airmiles and Aeroplan, not through any credit cards though. The reason I don't have those two reward cards is because every time I would log on, they would say "Reward flights starting at 50k point." But the only flights available were 80k+. Very frustrating.

mrisoli2• 9 years ago

What I dislike about this world is how US-centric it is, I have yet to see good recommendations for people in Europe.

In fact, I mostly see the opposite, changes to Lufthansa's FFP have been largely criticized on relevant communities(Flyertalk ).

saryant4• 9 years ago

Churning to the degree described in any of the major blogs by and large doesn't exist outside the US. No other market has as many airlines and banks competing for the same business, not the mention the relative lack of regulation.

have_faith• 9 years ago

Like most "in clubs". Once everyone is In, the system doesn't work anymore and the added value dissipates.

saryant4• 9 years ago

I think that was true up to the point where the US-based programs all devalued and largely put a stop to churners. The game is hard enough if you're only willing to deal with domestic reward programs that I think the vast majority give up chasing aspirational awards.

Anecdotally I've found that things have been getting gradually easier. For example, now that AA has devalued their award program and Citi cards can't be churned so easily, it's a lot easier to find Cathay Pacific awards if you're redeeming through another program like Alaska.

saryant4• 9 years ago

I've been playing this game for about six years now. In that time I've earned and burned just over 2.5 million points.

Certainly the game isn't as easy as it used to be but it's still very lucrative if you're dedicated. Can't churn the Citi AA cards as frequently anymore, and anyways AA devalued their award chart. No more Cathay Pacific first class for 67.5k. United's devaluation a few years back was pretty painful as well.

I still accrue United and American points, there are enough ways to get a decent amount and wring a redemption out of them once a year or so, but most of my focus is on foreign or smaller programs.

Lately I've put all my energy towards Singapore Airlines and Alaska Air. Alaska often sells points cheaply enough that's it's worth it to just buy the points and redeem for partner redemptions. I did that recently and booked SFO-HKG-AKL on Cathay Pacific in first class for 80k points. Buying the 40k I needed was <$600. Well worth it.

Singapore Airlines is a transfer partner with all the transferrable currencies (Chase, Citi, Amex and SPG) which makes earning there easy. The award chart is a bit steep but there are some good deals. My return from that Cathay flight is a Singapore award for AKL-SYD-SIN-NRT-SFO-DEN on Air New Zealand, Singapore Airlines and United with the long-hauls all in first class. I think it was around 120k miles.

I started this game in college when my only goal was free travel—managed to earn enough points before graduation to buy myself a "free" round-trip ticket to Thailand in order to backpack around Southeast Asia for the summer. Now that I have substantially more money, I generally use points to enable cheap premium cabin travel, like buying points when they're on sale from Alaska or LifeMiles and essentially getting deep-discount first or business class tickets.

I've hit most of the cliche churner experiences at this point: being driven in a Porsche to your flight from the Lufthansa first class terminal, Etihad's first class apartment, taste-testing both Dom and Krug in a Singapore Suite. It's an absurd hobby.

And it's a hobby that takes monumental amounts of time to keep up with. Want to book Cathay via Alaska? Better know to ask to agent to look at the right screen on her computer. How do you know that? Because you've been following a 5,000-post thread over on Flyertalk about it. Knowing when and how to correctly apply for your next Citi card means you're following a similar thread over in that part of Flyertalk. Keeping up with the details like that is time consuming. I enjoy the detail work but I don't really know why.

This hobby lets me go on generally two international vacations in first class each year for very little money. I'll be spending three weeks in New Zealand later this year, with time in Hong Kong, Singapore and Tokyo along the way. Last year I spent a week in Tokyo with friends before making my way back via Shanghai, Hong Kong and Dubai—two of those were new cities to me.

I've somehow become very, very good at one of the world's silliest skills.

That said, I have absolutely gotten off a first class fight only to check in to a hostel. Luxury travel actually gets pretty damn boring after about 24 hours IMO. Nothing is less interesting than flying to the other side of the world only to stay in a Hilton marginally nicer than the one in your home town.

wink• 9 years ago

I really wonder how feasible this is when you live in a country where you can't pay everything by CC and therefore have a hard time collecting points/miles in the first place.

I did look into this a few years ago, but basically nothing expensive I ever buy makes it worth to get full-on credit card hypey. Or maybe I'm indeed just to lazy to properly research it :)

For real flying miles.. I guess with like one vacation and one business trip per year, all the time with different airlines.. they usually expire before I can even get a bag of sweets :P

Credit-card-rewards guru Brian Kelly says we’re in a “golden age” of travel

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