Question from Reader: How Do You Balance Supply/Demand of Miles and Points?

Few weeks ago I had an email exchange with one of my readers and she asked me how I balance my supply/demand of miles and points. So I have decided to highlight this topic in a separate post.

I’ve already addressed it quite a few times over the years, but hope some of you (particularly newbies) will find my write-up helpful. But remember: my situation is not your situation. Just because I’m collecting specific miles or points doesn’t mean you should drop everything and follow my lead. Also don’t forget, I make mistakes now and again and make sure to record them in the blog. So, as always, take everything I write here with a grain of salt. You are the ultimate expert on what works for you.

Focusing on goals first and foremost

For us the only true “demand” when it comes to travel is bringing my parents here from Europe and visiting them every few years. Fortunately, those type of fares have come down significantly lately, often making using miles obsolete. I still utilize them if at all possible, but with one-way tickets form Orlando to Iceland often costing $250 all-in, having a huge stash of miles isn’t a priority.

But love for travel and adventure is an itch I just can’t scratch, so I’m always on a lookout for ways I can go places without bankrupting the family in the process.

While certain sign-up bonuses may be lucrative in theory, if I’m unlikely to use them within the next three years, I will usually pass. Awhile back there was a 50k offer on Cathay Pacific card (now 35k miles). I mentioned that it was potentially a good deal for some, but I was hesitant to bite. Why? Because the miles in that program expire after three years, and there is no way to extend validity without paying a huge fee.

Ultimately, I decided to skip that offer. Sure, I may end up regretting it. But I would regret even more going through the trouble of taking a hit to my credit score, spending $3,000 plus paying an annual fee, and then losing my stash in the end. To be honest, I would probably end up planning an extra trip just to utilize the darn miles.

And therein lies a problem. I want miles and points to fit  my existing plans, not the other way around. Of course, there is nothing wrong with spur-of-the-moment trips, but I want them to be my decision, not loyalty program’s. If you are a frequent traveler, 36-months miles expiration isn’t as big of an issue. But I’m not a frequent traveler.

Cash is king, except when it’s not

For the reason described above, my favorite currency is always cash. I can spend it on travel or invest it. There is no expiration date looming on the horizon and making me act irrationally. It’s not a glamorous type of currency in the miles and points hobby, but it’s the most useful. Unfortunately, many cash back bonuses are kind of puny. You can expect a $200 offer, occasionally a bit  more. Still, cash is king.

Flexible points also fall in the same category because they can usually be turned into cash. Chase UR currency is the cream of the crop because it allows you to cash out points directly at 1 cent apiece. Unfortunately, if you are like me, by now you have probably applied for every decent flexible card out there.

I will become eligible for Citi Prestige or Premier in May of this year, so I’m hoping to see working links with bonus attached. I can’t get any UR cards due to 5/24 restriction, but we plan to swing by Chase branch in March  to see if my husband is pre-approved for Chase Sapphire Reserve or Preferred. We will take either one, beggars can’t be choosers.

Out of all Amex MR-earning cards my husband is still eligible for Amex Premier Rewards Gold (personal version). If I can get a 50k offer to come up, we will pull the trigger. We can’t get any SPG cards due to one bonus/per lifetime rule. I’m eagerly anticipating new Amex Marriott card because Marriott points transfer to SPG 3:1. Fingers crossed!

But overall, when it comes to flexible points, right now my best bet are targeted offers that don’t contain restricted language. Unfortunately, I haven’t received anything attractive enough yet.

Going after low-hanging fruit of miles and hotel points

My ability to accumulate flexible points via everyday spending is quite limited. As I’ve mentioned earlier, the banks put up barriers to entry that are at times, impossible for me to overcome. I like to channel my spending towards new sign-up bonuses because this strategy gives me the most bang for my buck. And I try to get more than $200 per card, which  disqualifies most cash back offers. What is a gal to do?

I try to find low-hanging fruit type miles/ hotel  bonus that comes with the fewest restrictions. That’s why I jumped on 60k Jet Blue offer (now dead). Jet Blue points are certainly not as good as cash, but they don’t ever expire. Jet Blue also has decent coverage from Florida, the state where we live. I didn’t have any specific plans for this currency, but I knew that 60k points equals around $900 in airfare.

Yes, Jet Blue may devalue the program in the next few years. However, let’s say the points will be worth only 1 cent apiece towards all flights. That’s still potential value of $600. Even after paying an annual fee of $99, it’s a very nice haul. Sure, if someone offered me $500 instead right now, I would probably take it. But I didn’t have that option. All cash back offers I was looking at were $200-$250. Given the choice, I went with Jet Blue bonus.

The thing is, one can only get approved for so many cards, and banks are getting stricter and stricter. That’s why I wanted to strike when the iron was hot. The regular offer on Jet Blue card is only 30k points, which was another reason I went this route. I probably won’t touch Jet Blue points for at least 2 years, but it’s OK. I will be happy to have them when the time comes.

Right now, Citi will let you get  AAdvantage sign-up bonus  if your previous AA card was closed for at least 24 months. While AA miles are kind of weak when it comes to domestic sAAver availability, they are by no means worthless. So I will make sure to apply for AA card as soon as my husband or I become eligible. The first annual fee is usually waived, so why wouldn’t I accept 60k miles in exchange for spending $3,000? That’s the definition of low-hanging fruit. See more information on this card and other bonus offers here

The same goes for hotel points. I applied for Hilton Surpass back when it came with free weekend certificate upon renewal. We live in Florida and there are many nice places where I can utilize it, so I decided to bite. I didn’t have solid plans for Hilton currency, but the offer was attractive enough to choose it over cash back bonuses. We did end up utilizing points in Moorea, where Hilton property is considered to be the best on the island. I’ll probably end up burning my Hilton weekend certificate at Hilton Auckland, NZ which runs at 60,000 points per night.

I plan to cancel both of our Amex Ascend (formerly Surpass) cards close to second anniversary date, in order to avoid another set of annual fees.

Relying on annual hotel certificates for weekend getaways/expensive stays

We don’t travel often, but having annual credit card certificates allows us to vacation on the cheap. I currently pay annual fees on six cards. We have Chase IHG card X 2, Chase Hyatt card X 2 and Wyndham card X 2 (read about all three  here). That’s $386 in annual fees, ouch! But those points and certificates cover three weekend getaways at places that cost $250+ per night. So, essentially, I’m prepaying $1,500 in hotel stays for $386. Is it for everyone? Absolutely not! But our Florida location justifies it… for now.

The certificates from Hyatt  and IHG cards do have a 12-months expiration window, but so far we haven’t had any problems finding a good use for them. Though that may change in the future.

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p style=”text-align: center;”>Staying at this Hyatt resort for $75 all-in is  a pretty sweet deal IMO

I got Wyndham card when it came with 15,000 points each year after paying $69 annual fee (no longer available). When I saw the offer, I knew it was a good deal that will likely get devalued, and that’s exactly what happened.

It does take a few years of being in this hobby to recognize an unusually good offer, so don’t beat yourself up if you miss out now and again. Plus, like I said, even us old-timers make mistakes on occasion. Try to focus on the big picture and enjoy the ride. Are you better off than you were before you found miles and points hobby? If so, it’s something to be thankful for.

Readers, how do you balance your supply/demand of miles and points?

Click here to view various credit cards and available sign-up bonuses