Points and Miles Mythbusters…Amazing But True

This is the second post in a series of Points and Miles “Mythbusters.”  You can read the first post here:

Points and Miles Myths…Busted!

My goal: to show how easy it is to travel for free using points and miles.  You don’t need lots of spare time, disposable income, or credit cards.  I’m going to “bust” those myths by planning a 4-night family getaway to Aruba for free using points and miles, in an hour or less (10 minutes/day for 6 days), using only 1 credit card sign-up bonus per adult (I’m using a fictional family of four in my example), and no additional spending.

Where we left off yesterday, I had done some necessary groundwork.  I learned that round-trip flights from Cincinnati to Aruba cost over $700 each if you’re paying in cash, and 35,000 miles each if you’re paying in United or American miles.  I also learned that there are many intriguing hotel choices in Aruba, and I started to look into credit card options.

The reason I am interested in exploring various credit cards at this point is that one of the main ways to really rack up the points and miles is to put all of your everyday spend on a points/miles earning credit card.  If you haven’t given careful consideration to the credit card(s) you choose to use, you are likely not taking advantage of the easiest way to earn points/miles.  If you are only willing to have one credit card, make sure that it is a card that will give you something (useful!) back.  In our hypothetical example, I’m going to assume that neither of these adults has acquired a new credit card for at least a year.  It’s time for a change.

Switching your credit card once a year is not going to lower your credit score in any meaningful way.  Your score will dip 3-5 points from the initial inquiry, but it will bounce back within 6 months.  Also, a handful of points is not going to make an appreciable difference to your score.  So if you are interested in traveling for free, annually re-evaluating the cards in your wallet is an important step to take.  You might decide that you are happy with the cards you already carry and that they fit into your travel goals for the year.  Just make sure that you aren’t taking a passive approach to this, because using the cards that further your travel goals is the easiest way to free travel.

Now let’s see how much I can get done in 10 minutes.

First I cruised over to the Marriott Visa site again.  I quickly scanned the offerings.  A couple of things stood out for me.  I noticed that while each card offered 30,000-50,000 points  plus 1-2 free night stays as a sign-up bonus, the free nights were in a category 1-4 hotel.  I had a suspicion that Marriott’s Aruba Surf Club was in a higher category.  I asked the internet this question and was quickly rewarded with the answer: it’s a category 7.  So the free night stays would not be helpful to me in Aruba.  This is why it is always a good idea to have a travel goal in mind – this way you will know if a certain offer is right for you.  

On to the next option: the Club Carlson Visa.  If you are a regular Points and Pixie Dust reader, you already know about my love affair with these guys.  With their Visa card, I knew I would get 85,000 bonus points, plus one free night with each award stay.  I would also get a free award night each year on my cardmember anniversary.  You can see where I’m going with this.

Yesterday I learned that an award night at the Radisson in Aruba costs 50,000 points.  With the bonanza of points from the credit card: 85,000 point bonus, plus the one night free, plus the anniversary night, we are already at three free nights, with a surplus of 35,000 points.  Boom!  Clearly this card is a front-runner.

Now for the airfare.  From my research yesterday, I knew that the trip would cost me 35,000 points on both United and American.  If you are a regular reader, a little chime should be going off in your head right now.  If it’s not, I’ll give you a hint: Avios.

When you are considering a flight on American, it always pays to check the British Airways site to see if it might be cheaper to fly using Avios, which are a distance-based award.  See my post on this topic here.  Using British Airways partner airlines, you can often find a flight for fewer miles.  I went to the Avios calculator to see if I could confirm this suspicion, but this is what I got:

No problem.  I just went to the American Airlines site and searched for the same itinerary.  Here’s what came up this time (Yikes!  Look at that fare!  No way we’re paying that!):

I went back to the Avios calculator and plugged in each segment individually (CVG-MIA/MIA-AUA).  It priced out at 7,500 Avios per segment, or 15,000 Avios total each way.  This means that a round-trip flight would cost 30,000 Avios, versus 35,000 AA miles.

This was great.  I was definitely getting somewhere.

Since there are two adults in my hypothetical example, and each adult only wants one credit card in his or her wallet, this next card really needs to deliver.  In order to travel for free to Aruba, we need a chunk of 120,000 Avios.  I decided to compare three cards: the British Airways Visa, the Chase Sapphire Card (because I know that Ultimate Rewards can be transferred to British Airways), and the American Express Premier Rewards Gold card (for the same reason – I know that Membership Rewards points can be transferred to British Airways).

A glance at my timer revealed that I had three minutes and 43 seconds remaining.  Perfect.  Here’s what I learned before the timer beeped:

With the British Airways card sign-up bonus, you get:  Up to 100,000 Avios points.  50,000 Avios points after spending $1,000 within 3 months; 25,000 additional points after spending $10,000 within 1 year; an additional 25,000 points after spending and additional $10,000 within 1 year.

With the Chase Sapphire Preferred card you get:  40,000 Ultimate Rewards points after spending $3,000 within the 1st 3 months.

With the American Express Premier Rewards Gold card you get: 25,000 Membership Rewards points when you spend $2,000 during your first three months of card membership; earn 15,000 points when you spend $30,000 within one calendar year.

Can you guess which one I chose?  Tune in tomorrow to find out, because we’re out of time for today!

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