My honeymoon was proof that the points collection enterprise could have large payoffs, enabling me to travel across the globe in style for pennies on the dollar, but luxurious aspirational travel on big planes was hardly the only perk of the job. There are dozens of ways to maximize rewards programs to save you money, lots of it.
One of the first major credit card sign up bonuses that I maximized was a 100,000 point bonus on Chase’s British Airways Credit Card. 100,000 points didn’t seem like quite enough, so I churned the card, and got 200,000 Avios points.
Churning is the art of repeat-applying (and repeat-earning) sign up bonuses on a single card. It is not possible for all credit cards, and most have some if not many restrictions to prevent or limit this, but not all. If you work it right, it’s sometimes possible to open the same credit card 3, 4 or 5 times, or more, all to maximize the sign up bonuses and quickly earn tens if not hundreds of thousands of points.
While the idea of flying British Air to some exotic spot in a fancy class was exciting, British Air imposes massive taxes and fees on its award tickets – you can end up paying more than $1000 each way on a first class “free” award ticket.
No thank you.
On the other hand, British Air is a member of the OneWorld alliance, allowing you to use British Air Avios for flights on American Airlines. British Air has a mileage-based award chart, rather than the traditional “zone” based award chart. Instead of a flat fee of, say, 25,000 miles for a roundtrip domestic ticket, British Air charges Avios relative to the distance of the flight. For long flights, this makes the cost extremely expensive, but for short flights, the cost is ridiculously cheap. And for short flights that traditionally sell at an expensive price, the value per mile can be insane.
For example, I was living in Dallas at the time, and American Airlines had a monopoly on the Dallas-San Diego market. Ticket prices often hovered around $500 for the two hour flight. Eek. I could pay that much, or I could use my 200,000 Avios for 10 roundtrip tickets between the two cities – leveraging $5,000 in value from the two credit card sign up bonuses!
It’s all a matter of realizing that points and miles are currencies and then leveraging them toward whatever is of most value to you. Maybe you don’t care about fancy shmancy cabins or showers in the air, and you just want to get from point A to Z as inexpensively as possible. By getting sufficiently #pointedout, you can do that too.
Southwest Airlines is the king of no-frills travel. For decades they have built their successful model around giving you exactly what they promise – a seat on a plane, getting you from one city to another for peanuts (with a bag of peanuts too), with free checked bags and no hubs to travel through. They also have one of the most generous “elite” awards out there: The Companion Pass.
Southwest describes the Companion Pass like this:
Companion Pass is the benefit that lets you choose one person to fly free* with you every time you purchase or redeem points for a flight. To qualify, simply fly 100 qualifying one-way flights or earn 110,000 Qualifying Points in a calendar year, and you’ll earn Companion Pass for the following full calendar year, plus the remainder of the year in which you earned it.
Let’s parse that. The Companion Pass means that I can designate Danielle as my travel companion so that any time I have a ticket on Southwest – whether paid for with cash or with points – she can fly with me for free (except the $5.60 9/11 Security Fee). The benefit can be used for any seat on the plane; the companion ticket can be booked right up to departure so long as there is availability. In effect, this cuts the cost of our travel on Southwest Airlines in half.
But if you don’t fly 100 segments on Southwest in a year, how can you possibly earn 110,000 qualifying points and get the pass?
Every now and then, Chase offers a Southwest Airlines credit card that comes with a 50,000 point sign up bonus. Two sign up bonuses means 100,000 points, leaving you only 10,000 more to earn through credit card spending or other means. But this is not a card that you can churn. So what do you do?
Did you know that you have a personal business? Almost all of us do, in one form or another, and if you don’t yet, you can. This business is a sole proprietorship, which gives you access to small business credit cards, using your social security number as the identifier. Technically, I’m self-employed, so I have plenty of reason to have a business credit card where I can separate out my business expenses from my personal ones. But you don’t need to be a blogger or own a grocery store to qualify for a business credit card. So long as you accurately represent all the information reported in a credit card application, this is perfectly, 100% legal.
And, in the case of the Southwest Credit Cards, it means two sign up bonuses of 50,000 points each.
I signed up for these two cards in December 2013, so that I hit the minimum spending requirements for both cards ($3,000 each) in January, crediting more than 106,000 points to my Southwest account. With a little additional spending, I was easily at the 110,000 point mark and Companion Pass in hand! With the Companion Pass, my 110,000 Southwest Points were now effectively worth twice as much – 220,000 Southwest points (worth almost $3,500 in travel credit) for signing up for credit cards!
But it gets better. I was very specific with the months in which I applied for and hit the minimum spend on these cards because the Companion Pass is good for the calendar year in which you earn it and the following year as well! I had half-priced travel on Southwest for two years, in addition to all the points listed above.
This was a HUGE money saver, making travel for two immensely more affordable. We loved it so much that in 2015, when my pass was set to expire, Danielle went through the steps above, and we’re covered with a new Companion Pass through the end of next year.
This is what collecting points, leveraging credit cards and hacking travel is all about, using the rules to your favor to gain awesome perks and see fantastic places in style. It pays off. Hugely.