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The Quartet of Amex Cards=Powerful Combo for an Average Family, and More!

In this hobby, there are two camps: Those who mostly obtain miles and points through flying and hotel stays (purists), and those who get them from credit card bonuses (gamers). The first camp despises the other. After all, they are a special (dying) breed, putting in all that work and time to collect their precious stash. They look down on those who obtain miles and points the “easy” way. It just isn’t fair. Guess what? They are right.

It isn’t fair that you can just sign up for a card, put $3,000 on it, and get 50,000 miles just like that. It would take a person 6 roundtrip flights to Europe (in an eligible fare) to collect the same amount.  Why do Americans get these amazing opportunities while the rest of the world doesn’t?  The thing is, life isn’t fair. I don’t make the rules, but I do try to play by them.

Don’t be an airhead

Let’s also take the argument that it’s wrong for miles and points bloggers to promote credit cards. I find it laughable. Of course, there is the obvious conflict of interest aka BIG elephant in the room. And yes, the sheer amount/frequency of advertising (some use another term for it) can be overwhelming at times.

crazy woman

Image courtesy of num_skyman at FreeDigitalPhotos.net

You guessed it, it’s  “Asian theme” week here at Miles for Family.

Anyway, to say that credit cards are irrelevant/evil when it comes to affordable travel is plain absurd. If someone can point out a  way where a husband and a wife can earn 100,000 miles combined, that happens to be easier than opening 2 credit cards, I am all ears. Seriously, let me know. Well, as long as it doesn’t involve any illegal activity.

One of the reasons I started this blog was to help my cousin-in-law. She was genuinely interested in miles and points hobby, and there was no site I could point her to. Don’t get me wrong, there were many good blogs, but none were conveying my “special brand of crazy” message. Well, two years later, she and her husband  went to Kauai by getting award flights on American and stayed in a nice Hyatt using hotel certificates. All that was required: 4 credit cards and some self-discipline. Imagine what it would take to save up for a trip like that.

An important disclaimer

Obviously, you have to be realistic. I’ve mentioned last week that all 4 of us will be flying roundtrip in first-class from Tampa to Seattle. The miles were accumulated from sign-up bonuses and I actually bought 50K miles at penny each. I had close to 500K in AAdvantage program and decided to splurge. What I didn’t say: this will be almost impossible to replicate for someone just starting out in the hobby. You see, most of this stash was accumulated due to US Airways Barclaycard (no longer available). You got 40,000 (or more) miles after spending $1, and the bank seemed happy to give out the bonus a few times per year.

Now, your best source of AAdvantage miles is Citi AA co-branded card, and you can only qualify for the bonus 18 months after closing your previous card. Realistically, a typical couple can only get 100,000 AA miles every two years under the best of circumstances. So, yes, you can still fly 4 in first-class domestically using that stash, but only one-way… maybe.  First rule of miles and points hobby: There are no guarantees.

No churn, no problem

Of course, switching credit cards isn’t for everyone. In fact, this was another reason I started this site. A common thread running through blogs was/is this: Everyone should renew CSP and Amex SPG. So I challenged it. I admit, my argument mostly fell upon deaf ears, but some have listened. Contrary to popular belief, I never said those cards are bad. I only encouraged everyone to do their own math when it comes to  annual fees.

Finding best long-term cards for regular family has been the main goal of this blog. Majority of population just wants to keep things simple and maximize their everyday spending. This is the reason for most email requests in my Consulting Service. There is absolutely nothing wrong with it! If switching credit cards is making you uncomfortable, don’t do it.

But what if you and your spouse are willing to do a little bit of work, and have easy access  to purchasing Visa gift cards at a grocery store via credit card? You should consider getting an Amex quartet. Let me explain. In my post last month, I’ve mentioned that if my spending didn’t go towards meeting minimum spend, I would probably get Amex Everyday Preferred and Amex Blue Cash Preferred. Those two cards are the ones I mostly recommend to friends and family. Why? The grocery store bonus. You can read more on both here

But say, both you and your spouse got each of these cards. Majority of my posts assume monthly family spending of $2,000 to $2,500. You would get the best bang for your buck when purchasing one $500 Visa gift card with each Amex. That’s because the extra bonus only applies on up to maximum of $6,000 per year/ per account. Of course, if you need to get groceries anyway, you can just use the credit card. But even if you shop at Walmart, this is probably the most lucrative/easy strategy  for most busy families. You can just stop once a week by your grocery store, get a  few things you need anyway, and pick up a gift card. Then use it for your regular bills.

I got an email the other day asking me if one would have a problem paying power bill, insurance etc. with gift cards. I have not had any issues. If Visa/Mastercard logo is present, the merchant should accept gift cards as well. Obviously, you would be better off using credit card for things that might have issues down the road, like expensive electronics and appliances.

Here is how your awards would stack up:

1. Grocery spending alone will yield 27,000 Membership Rewards on each Amex Everyday Preferred. The total would be 54,000 Membership Rewards. You can add your spouse as an authorized user, and they will be allowed to transfer points to their own mileage account.

I wrote about some possible uses of MR program when it comes to family travel. This amount will take care of 4 one-way (at times, roundtrip) tickets in most loyalty schemes. If there is a transfer bonus, you will do even better. So, after 2 years, you should have enough miles to fly your family of 4 roundtrip in economy domestically, excluding Hawaii.

2. Grocery spending bonus will yield $360 on each Blue Cash Preferred. The total on both would be $720.

So, if you maximize grocery store bonus, you will have $720 AND 54,000 Membership Rewards points (which I speculatively value at $675). Of course, there are fees:

1. You will pay $95 annual fee on each Amex Everyday Preferred and $75 on Blue Cash Preferred. Grand total of $340. But if you are familiar with Amex, you know you can make up for those fees via various promos. Yes, it will take some work, but it’s not unreasonable to assume that.

2. You will pay around $240 in fees if you buy gift cards and spend very little at a  grocery store.

Even if you assume that you will get zero value out of Amex offers, there is a compelling argument to stick with this combo. Say you pay $580 in fees. You would still have 54,000 MR points, and $140, all via spending of $24,000 per year. That’s a terrific return, all things considered. By comparison, if you used Citi Double Cash, you would have $480. Plus, remember, we are assuming that you will get zero out of Amex offers. Of course, some of your bills will be paid with credit card, but this breakdown should give you a general idea on possible return following this scenario.

Don’t ignore hotel cards

But what about “free” hotels? While I wouldn’t use them for everyday spending, there are a few hotel cards that can be worth renewing. Among them are Chase IHG MasterCard and US Bank Club Carlson card. The second one is no longer a no-brainer due to loss of BOGO benefit, but I still consider it a keeper.

You may also look into Chase Hyatt credit card. If you have a nice Hyatt property in mind, now might be a good time to consider this offer since the sign-up bonus is improved. A nice perk is that every year, it comes with a category 1-4 certificate after paying an annual fee of $75. That’s extremely reasonable, and can get you 1 night at hotels like Hyatt Place Daytona Beach and Hyatt Regency Coconut Point resort  in Bonita Springs, Fl. Those  properties are very expensive in the spring and during holidays. If both spouses get this card, it could provide a reasonably priced 2-night resort getaway for an entire family. Yes, you can combine it with a trip to Disney, sigh…

I don’t know how Wyndham program will evolve (and it will), but their co-branded card is also a keeper for now. For $69 annual fee, you get 15,000 points, good for 1 night at any Wyndham property. That is if you can find availability.

Just say No to “free” travel

That’s the thing with this hobby. The word “free” is overused to the point that it doesn’t make any sense. When you pay $49 renewal fee on Chase IHG card, you pay $49 for your night at that beachfront Holiday Inn. Sure, it’s a heck of a deal, but free? Nope. Transferred 20,000 Ultimate Rewards for Hyatt redemption? You just paid at least $200. Yes, you did.

And folks, let’s not forget the time this hobby sucks out of your day! I could have probably earned a college degree online with the hours I’ve spent on this obsession. Of course, I really do dig it.

I admit, I have used “almost free” term on  quite a few occasions, too many, really. No more. Looking at our bills from Europe trip, I’m reminded just how not free travel actually is. Yes, miles and points hobby is extremely lucrative and when done right, can open terrific opportunities. But please, don’t fall for the “free” baloney.

Author: Leana

Leana is the owner and founder of Miles For Family. She enjoys beach vacations and visiting her family in Europe. Originally from Belarus, Leana resides in central Florida with her husband and two children.

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6 thoughts on “The Quartet of Amex Cards=Powerful Combo for an Average Family, and More!

  1. I just have to make one correction as the cousin-in-law. It wasn’t a “nice Hyatt.” It was a totally awesome Hyatt and the trip of a lifetime! It did take us two years to go, but that was because of our circumstances and not because the rewards took that long get. I can’t wait to go back.

    • Jen, I’m so glad you guys got to do it! It really looked like a fun trip. I lived vicariously through your adventures. Actually, you did most of the research, so I can’t really take the credit. 🙂 But I was glad to help.

  2. Hi Leana,

    I just read your post and your link to good uses of Membership Rewards. I can’t find it now but I saw a couple of weeks ago a promotion where you could get extra points if you transfer your MR points to British Airways. I can always use AA points so I thought I could do that. My fear/question is: Is it easy to fly on AA with BA avios? If I call BA and try to book a trip on AA, how helpful are they? Because right now I’m stuck with a one way to South America with AA miles and I can’t get AA to book a return flight on Lan. Was that too confusing? I guess my question is, how easy is it go get an airline to book you a flight with their miles on a different partner?

    Thanks,

    Leticia

  3. @Leticia I don’t believe there is a bonus on MR transfers to Avios going on right now. I know there is one from SPG, but it’s only 10%, plus transfers are not instant. I could be wrong, but I didn’t find anything via Google search. Maybe it’s a targeted bonus that only shows up in your profile.
    As far as redeeming Avios on AA flights, for the most part, it’s pretty straightforward. If “saver” level flights show up on AA, they should be bookable via Avios as well. The scheme is different, since the price is per segment. So more connections and longer distance= more Avios miles. Also, very often, connecting flights don’t show up in online search on ba.com, but if you call, the agent should see them. I wrote a post on my experience with Avios redemption if you care to read it http://milesforfamily.com/2014/12/03/my-flexible-points-envy/

    As far as LAN flights are concerned, they should be bookable via Avios since they are a member of Oneworld alliance. But if AAdvantage agent doesn’t see them, it’s unlikely that BA agent will. They all have access to the same pool of award seats, if it makes sense. The partner informs them of availability, and AA program and BA program go from there. Also, the price via Avios will most likely be a bit higher depending on where you are flying to. I know AA has off-peak flat price at 20,000 miles one-way to South America. Since I know you will have connecting flights, you will likely pay more with Avios.

    So, in a nutshell, I do think that Avios program is great for AA redemptions, especially if they are non-stop short flights. For example, you can fly from Miami to Nassau or Cancun for 9,000 Avios roundtrip by redeeming on American, their partner. Via AAdvantage, you will pay at least 25,000 miles for the very same flights. Also, Avios doesn’t charge close-in ticketing fee of $75, while AAdvantage does. I recommend you read my linked post for more. Overall, it is fairly easy to book American flights via Avios, but you may need to call their center. Not a deal breaker IMO. Hope it helps. Comment or email me with any other questions.

  4. I do like the EveryDay cards. I’ve been holding out for a public or targeted-to-me offer that is hugher than the usual 10-20k. However, given the decreased transfer ratio to Avios soon, I may just avoid them :(.

    • @Cheapblackdad I agree, the sign-up bonus is nothing to brag about. I hope you can get a better offer. Honestly, even with the decreased Avios transfer ratio, I still think this card might be worth it for you. Think about it, you can get 4.5 points on grocery purchases on just one Amex Everyday Preferred. Say you transfer 27,000 MR points to 21,600 Avios. That’s almost enough for 3 one-way flights from Chicago to Orlando. I know you like to use Freedom/Ink combo. But you can still supplement it with buying 1 Visa gift card for normal purchases that don’t fall in the 5% bonus category. And as you know, you can make up for the annual fee on Amex cards. That way, you will have a good supply of Avios and Southwest.
      Also, my gut feeling is that Amex will run transfer bonuses on Avios to make up for this poor transfer ratio. And of course, you have other programs you can consider as well. Jet Blue is similar to Southwest and could work for certain routes.

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