Frequent Miler has existed for only 4 months, so it’s a bit silly for me to produce a best and worst of 2011, but hey I’m on vacation so I don’t mind “phoning it in” as they say.  This will be a two part post.  In this post I’ll present my top failures of 2011 based upon my own subjective option.  So, without further ado, let’s start with the worst of Frequent Miler and I’ll follow-up with the best in a second post:

Frequent Miler Fails:

1. How to meet credit card spend thresholds without breaking a sweat, How to buy points and miles for less than a penny.
   I’ve listed two posts here because they both had the same flaw. They relied on a technique of buying American Express gift cards through Big Crumbs and then liquidating the cards through a service called Square. Well, it turns out that Amex doesn’t like people to do this, and neither does Square. Both companies have frozen some people’s accounts for doing this. Yikes.
2. Buy American Airlines Miles for less than 1.6 cents each.  No limit
   This one started out as a big win.  At the time, many people were anxious to build up their AA miles while they still counted towards million miler status.  Unfortunately, this trick relied on the Aadvantage e-Shopping Mall and the purchases of Sears gift cards.  To my knowledge, no-one who followed this lame advice received miles in time to count towards million miler status.  Worse, only one person has reported receiving miles at all and that was only after many months, many phone calls, and many emails.
3. Post Christmas Cash
   In this post I reported that Monday, Dec 26th was “Gift Card Exchange Day” and that people would be able to sell their gift cards for more money than usual. Well, December 26th came and went with no discernable difference in trade-in values.
4. Hacking Hawaii
   The goal was to show a couple who were not into credit card churning (or any other hacks) how easy it would be to take their family to Hawaii for very little money.  Unfortunately, even though I left out a number of hacks that would have made things cheaper, it was still too complicated and too much trouble for most people.
5. Hacking Hawaii Revised
   I tried a second time here with a drastically simplified plan, but the end result was less than satisfactory.  Even though I love the title “Hacking Hawaii”, I decided it was time for me to hang it up after this one.
6. Business Class Tickets to Australia, Cheap
   This one was actually one of my favorite posts.  I wrote it in anticipation of the Delta Skymall promotion in which they were giving away 25000 Delta Miles for purchases of $500 or more.  I got word that the promotion would open up late at night so I scheduled the post to appear early the next morning.  Well, when I woke up and checked my email I learned that the promotion did go live in the middle of the night, but it also ended in the middle of the night thanks to all of you night owls who placed 1000 qualifying orders!

So, did I nail the failures or do you want to suggest your own “worst of Frequent Miler” post?  Comment away!  And, have a great New Year’s Eve everyone!  On New Year’s day I’ll post the “best of”.  See you in 2012!

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For those of you who, like me, are always on the lookout for more ways to spend a lot on your credit card and get most of it back, here’s another possibility: get a cash advance from your hotel.

I have no idea how many hotels offer this option, but according to one reader the London Park Lane Sheraton offers up to 50 GBP per day as a cash advance, fee free.  The cash advance is charged to the room as if it were a non-points earning charge (such as internet, for example).  Since it is charged to your room, it will not look like a cash advance to your credit card company.  In fact, if your card offers extra points for hotel spend, that should apply here as well!

Sure, it’s not a ton of money, but it just may be worth asking, next time you check into a hotel, whether they offer fee free cash advances.  You will get credit card points and, in exchange, you’ll get cash that could be used directly or deposited back into your bank.  Maybe it will even make those end of year mattress runs just a wee bit sweeter.

Tip of the hat to Brent for this one!  Has anyone else seen this?  Please, let us know!

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Last week I posted Frequent Miler’s Top 10 ways to spend a lot of money (and get most of it back).  #3 on the list was to pay your taxes by credit card.  And, yesterday, Million Mile Secrets published details about how to do this.  It’s an excellent, well researched, post.  If you’re interested, make sure to also look at the reader comments since there is great information there too. 

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This morning I wrote about how the Hilton HHonors Surpass card from American Express surpassed my expectations for its point-earning ability.  A few helpful readers pointed out that American Express has another Hilton HHonors card without the “Surpass” title and without the Surpass card’s $75 annual fee.  I took a look at this card and indeed it appears to be almost as good as the Surpass for point-earnings.  The main differences appear to be that for spending at Hilton hotels, the Surpass earns 9 points per dollar whereas the regular card earns 6; and while both cards will get you Gold status with $20K spend per year, only the Surpass will get you Diamond status for $40K spend per year.  Check out the comments of the previous post to see one way (if you are a big spender) that you could actually cycle back and forth between these cards to keep Diamond status without paying $75 every year for the annual fee.

In order to estimate the point earning power of credit cards, I’ve setup a simple spreadsheet to automate the calculations.  When I plugged the Hilton HHonors specs into the spreadsheet, it came out with a 4.43 points per dollar average.  Compared to the 4.5 points per dollar average of the Surpass, this card is a close contender!

With the non-Surpass card, you will receive 6 Hilton HHonors bonus points at Hilton hotels, supermarkets; drug stores; stand-alone gas stations; and home telephone, wireless, cable, satellite TV and internet service providers. You will receive 3 Hilton HHonors bonus points per dollar for all other eligible spending.

The Hilton HHonors Surpass Card from American Express might just be worth a second look.

I had all but given up on Hilton.  I signed up for the Amex SPG card (Starwood) over the summer and since then have been quite impressed at how valuable SPG points can be.  In addition to the SPG card’s great ability to transfer to airline miles, I found that some of my favorite Starwood hotels (Westin, W, etc.) were available for award nights for only 10K or 12K per night!  Not only that, but SPG often has “points and cash” options where you can get those same hotels for far fewer points and a modest cash copay.  When I compared that to my Hilton experience (usually 30K to 50K per night for awards I was interested in), I was blown away.  Even better, with SPG points you have the option to transfer your points to airline miles and get a 25% bonus in miles for every 20K point transfer!  And, as if that wasn’t enough, SPG also has a “Nights and Flights” option in which you can use your points for hotel awards and mile transfers at the same time.

Recently Hilton changed their program a bit to allow points and cash options (great!) and to make upgraded rooms such as suites available for award redemptions as well.  Unfortunately, these changes were also accompanied by a new award chart and redemption rules which mean that even more points are now needed for many hotel redemptions.  See, for example, this post.

All of the above led me to believe that the idea of using a credit card for earning Hilton points was ridiculous.  Why would I want to earn Hilton points from my credit card spend when I could earn much more valuable SPG points?  [I can’t help but also mention the option of earning valuable Ultimate Rewards points with Chase cards, but let’s not get too much off topic…]

In the course of building the Fair Trading Prices table for points and miles, I learned about the Hilton HHonors Surpass card from American Express.  I knew about the card before, of course, but I had never given it a hard look.  Why pick a Hilton card with a $75 annual fee when there are other Hilton cards available for free?  And, why go with Hilton when SPG is so valuable?  Well, it turns out that there are very good reasons:

• According to my calculations, the card earns, on average, 4.5 Hilton HHonors points per dollar spent!  So even if you think that SPG points are 3 or 4 times more valuable than HHonors points, this card beats out the SPG card which averages only 1.025 points per dollar spent (but don’t forget that, unlike SPG, you won’t have any decent options for transferring to airline miles).

  The Hilton card earns 9 points per dollar at Hilton properties, 6 points per dollar in bonus categories (supermarkets, drug stores and stand- alone gas stations; and for service payments for home and wireless phone, cable, satellite TV and Internet service providers), and 3 points per dollar everywhere else.

  Note these assumptions I made: 2.5% of spend is with a particular hotel chain (e.g. Hilton or SPG), 15% is for gas, 25% is for groceries, and 5% is spent in other bonus categories such as drug stores, phone, etc.

• The Hilton Surpass card fasts tracks you to Hilton elite status:  In the first year, you will automatically get Gold status.  After that you need to reach $20K in spend per year to maintain Gold status or if you spend $40K you will get Diamond status.  With just Gold status, I have many times been upgraded to suites, received free breakfast, and received free internet, so this benefit can be quite valuable!
• There are several other valuable benefits as well.  If you’re interested, go to the Amex web site to read more.

Lately I’ve been concentrating my spend on earning Ultimate Rewards points using my Chase Sapphire Preferred and my Chase Ink Bold cards.  I also continue to put a lot of spend on my Delta Reserve in order to help bump up my elite status with Delta.  So, there isn’t really much room for a hotel card in my wallet, but this Hilton Surpass discovery has me really rethinking things!  Hilton hotels are everywhere and, in general, I really like them.  I probably spend more time in Hilton properties than in the air with Delta.  Should I switch my allegiance from the air to the ground?  Readers, what do you think?

NOTE: I do not receive a referral commission for this card.

Yes, yes, I know: the only thing worse than another blog post proclaiming the God-like virtues of the Chase Sapphire Preferred card is yet another blog post fretting about whether or not the blogger in question should make money from credit card signup referrals. So, rather than belabor the point I’m just going to come right out and tell you what I’ve decided to do:

• I have a few permanent pages on the Frequent Miler site. These will continue to show credit card signup links that I’ll profit from, but I’ll only show a link if I believe it is a good deal and if I too have the card or I’m planning to get the card.
  
• From now on, I will not post referral links within my blog posts, with one exception: when I create new permanent pages on my site (or make major changes to them) I like to copy the contents into a blog post so that people who subscribe via RSS, email, etc. will get a chance to read the contents. In those cases, if the permanent page happens to have credit card signup links then the blog post will too.

Like other bloggers, I enjoy blogging and hope that someday blogging can become my daytime job. The reason I started using credit card referral links is that ad revenue doesn’t amount to much. I’ll be lucky if ad revenue covers some of the extra expenses of this hobby such as conferences and DOs. On the other hand, it is more important to me that you see me as a trustworthy source of information. I’ve come to realize that credit card links take away from that perception. The ads on the site are a BoardingArea thing which I can’t control, but I can stop hawking credit cards in my posts. For those who want to help me out by using my links for credit card signups, you can continue to do so. Just visit thefrequentmiler.com and click on Preparing for Miles.

Was this the right move? Should I have eliminated links altogether? Let me know your thoughts in the comments below.

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On Saturday I wrote about how GiftCardGranny was hosting GiftCardExchangeDay in which you could sell gift cards to resellers at a higher than usual price.  I’ve checked out a few gift card offers, but have yet to find one that is higher than the rates that were available last week (including Sears).  I’m waiting to hear back from the company with clarification about this.  Once I do, I’ll update this post so check back!  Has anyone else found any good offers?

Here is an update from GiftCardGranny in response to my questions:

1. Gift card exchange rates are, historically, always higher right around/after the holiday season, due to the stocks being depleted, which gift card exchanges needs to replenish.  So they are willing to pay more for consumer’s cards.
2. With the onset of Gift Card Exchange Day, we have taken that a step further and worked directly with selected merchants to make sure they are offering their best rates possible today.
3. Rates will vary depending on the merchant – some have been higher for days, others are just going up now, others will stay higher longer.  But the key is that this is gift card season, when rates are at their best.  They won’t simply drop  tonight at midnight  – how long the deals stay optimal will vary depending on merchant card and the reseller, so today is definitely the consumer’s best option.
4. Gift Card Exchange Day is all about awareness.  Making the public aware that a)this is an option they have, rather than just eating the money, and b) now is the time to do it for the most money they can.
   GiftCardExchangeDay.com isn’t a reseller – we are an aggregate of all the top resellers.  Though we work with them, it is up to the individual merchant to set their own rates.  But for all of them, this is the time for the best deals. 

When I write about my favorite Christmas present, I’m supposed to declare that my favorite Xmas present was the company of friends and family. Or, perhaps I should say that the sheep given in my name to a poor villager in Africa was
the perfect gift. Or, how about the gift of giving when I’ve donated time and/or money to worthy causes?

Those are great things, sure, but I’m not going to lie. My favorite gift this year was a thing. A thing for me. Sure, call me shallow — whatever. 

I got a beautiful Samsonite spinner.  A spinner is the type of luggage that has four wheels that spin in all directions. Unlike traditional two wheeled luggage, with a spinner you don’t need to tilt your luggage and pull it behind you. Instead, you can keep it upright and just slide it along beside you.  If you haven’t used one, it’s probably a bit hard to imagine or to understand why it’s a good thing, but hey you probably didn’t get TiVo when you first heard of it either.  Just trust me — it’s awesome.

Now back to my new spinner. It’s beautiful (like my wife who bought it for me), it’s incredibly light, it’s small enough to fit in the most challenging overheads, and it’s just the right size to fit everything I need for several days on the road. I love it!

If you get a spinner too, keep in mind one little word of caution: if you stop somewhere on an incline, don’t let go!

Thank you Mrs. Miler!  And, Happy Holidays everyone!

The day after Christmas you’re likely to have a few merchant gift cards lying around.  If you’ve been following my posts about Gift Card Churning, you might have more than a few.

The best way to get full value from these cards is to use them for things you would have bought anyway.  Or, treat yourself or others to something special.  However, if you can’t find a good use for them and you’d really prefer cash, that’s when it’s time to look at options for selling them.

I’ve written before about a site called GiftCardGranny that lists online options for selling gift cards and shows in a nice chart how much money you’ll get with each option.  Well, this Monday (Dec 26th) they are running a special promotion called Gift Card Exchange Day in which gift card resellers will have better offers just on this one day.  I’ve been told to expect most cards to sell for 2 to 3 percentage points more than usual, but some offers will be even better.

To get an idea of why this is important, consider Sears gift cards that some of us bought on December 9th in exchange for 11.77 Ultimate Rewards points per dollar.  According to the current rate chart on GiftCardGranny, we can sell those cards today for 84 cents on the dollar.  In other words, not counting the points earned, we would lose 16 cents for each dollar spent.  This would mean that we would be essentially buying Ultimate Rewards points for 16/11.77 = 1.36 cents each.  That’s not a bad price as it is close to the fair trading price of 1.31 cents, but it’s not great.  Now suppose the offer on Sears gift cards goes up to 87 cents on the dollar (this is just a guess – we’ll have to wait until Monday to see).  In that case, by selling our gift cards we would be essentially buying Ultimate Rewards points for 13/11.77 = 1.1 cents each, which is an excellent price!

The Gift Card Exchange Day website to checkout on Monday is: http://www.giftcardexchangeday.com/

I’ll send out a reminder on Monday along with whatever interesting prices I’ve found.

Suppose you are looking for a good deal for a flight and you find that you can either buy a ticket for $400 or redeem 25,000 miles for an award flight. Which should you do? The decision can be quite complicated. You need to know how much those 25,000 miles are worth to you. Plus, if you redeem miles, you won’t earn miles from either the purchase of tickets or the flight itself. And if you’re looking to earn elite status, you need to consider that you won’t earn elite qualifying miles from an award flight.

In order to try to wipe away most of that confusion, I’ve put together a three step guide to help you figure things out. The formulas are far from perfect and they won’t match everyone’s needs or beliefs about miles, but I know that I need something like this so maybe you do to. As much as possible, I’ve kept to nice round numbers and easy formulas.  Here goes:

Step 1) Take the # of miles you would need to redeem, chop off the final two zeros, and add a dollar sign in front. Example:

25000 Miles -> $250

This is the value of your miles if each mile was only worth a penny. However, according to the Fair Trading Prices chart, most miles are worth about 1.3 cents, so this is just a starting point. Also, don’t forget that by redeeming miles for a flight, you will lose out on earning new miles. So, go on to step 2:

Step 2) Answer the question: do elite qualifying miles matter to you?

When you fly on a regular purchased ticket, you earn both redeemable miles and elite qualifying miles. Redeemable miles are used for award flights. Elite qualifying miles are used for gaining airline elite status. You generally need to earn at least 25,000 elite qualifying miles on an airline in a calendar year in order to earn the lowest level of elite status.

If you are unlikely to earn elite status, then your answer should be “No”. Or, if you simply don’t understand the question, go with the answer “No”.

Step 3A) Use this formula if your answer to step 2 was “no, elite miles don’t matter”:

$250 x 1.5 = $375

This is your estimated loss for redeeming miles and forfeiting new bonus miles.

Step 3B) Use this formula if your answer to step 2 was “yes, elite miles matter”:

$250 x 2 = $500

This is your estimated loss for redeeming miles and forfeiting new bonus and elite miles.

Step 4: Compare

Take the value you computed above (either $375 or $500 in the examples) and compare to the paid flight option. If the calculated amount is less than the paid flight option, then redeem your miles.  Otherwise buy the ticket.

Example A: The estimated loss from redeeming miles ($375) is less than the cost of a ticket ($400), so: redeem miles

Example B: The estimated loss from redeeming miles ($500) is more than the cost of a ticket ($400), so: buy the ticket.

Notes:

1. Don’t forget to use your own common sense here. If you’re low on cash, or you don’t think you’ll ever be able to use your miles for a high value redemption, or you simply don’t value your miles, then by all means use the miles despite what the formula says! Conversely, you may value elite miles more than the formula allows, or you may be holding onto your miles for much higher value redemptions. In those cases, it would make sense to err towards buying flights.
   
2. The factor of 2 used in step 3B to compensate for the loss of elite miles is a very rough approximation. If you really want to be rigorous you can determine the number of elite miles that would have been earned for the flight and multiply by $.03 (3 cents per elite mile). Then, use formula 3A and add in the result of your extra calculation.

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