Tuesday, April 22, 2014

Why Avios is my #1 miles currency

Less than a year ago, I had ZERO miles in my wife’s and my Avios account. Rather we did not have a British Airways Executive Club account. Infact I hadn't even stepped on a BA flight ever, which is surprising  because I lived in London for 2 years and was regularly travelling between London and India.

Fast forward to 11 months later, we have a combined total of 300,000 Avios and we have spent about 75,000 of it on holidays, already. Holiday’s we wouldn't have taken if we did not have the miles. 250,000 miles were simply earned through credit card sign up bonus and the balance through our flying as well as some through car rentals. And in this short span, Avios has become my favorite miles currency. And there are many reasons for this. When I started dabbling in miles currency last year, almost all the blogs I read were raving about United Mileage and some of them had some nasty things to say about the Avios Fuel Surcharge. Obviously, since I was a newbie at this, I followed the herd and started accumulating United miles like there’s no tomorrow. But once I had some balance in my Avios account and I used them, I realized the power they hold and more importantly, the huge difference between United Miles and Avios and which one worked best in what situation.

Here are three awesome reasons, why Avios is my new best buddy in this world:

1.       Easy to earn: Seriously – I don’t think there is another miles program that is as easy to accumulate as Avios. There are the 100,000 sign up bonuses that the banks throw our way. Then there is the Avios you earn through your regular spending – most banks you give 1 mile per dollar for the affiliate mileage card – but not Avios. You get 1.25 Avios per dollar and while it may seem very little, but at a 25% higher earning rate, they add up pretty fast. Some credit cards offer you annual spend bonus, but to earn them you need to hit a certain threshold of spends, say $25000 or $30000. With the Chase BA Card, you don't have to worry as you earn 1.25 Avios for all spends. Then you earn them through their partners – my favorite being the car rental, as I rent a car for every single day of the year. Then there are the hotels and other partners which can all add to your travel plans. And lastly- there is transfer programs. Every program transfer to BA, be it SPG points, be it Amex Membership Reward or be it Chase Ultimate Reward (not to mention, my point earning program on my Indian Citi and American express cards too…!!). So if you ever need to top off your account for a reward booking, you got plenty of options.

2.       Least amount of fee(s):  Unlike United or American or US Air, there is no last minute or close in booking fee. The tax, etc. on an award ticket is the same, irrespective of how far out or how close in you book your ticket. There is no award redemption fee (yes, I am looking at you US Airways). In case you can’t find your award online but are certain the award is available, you can always call in. They will even waive the $25 phone booking charge, if you explain the situation to the CSR. The best part – the LOW cancellation fee. The cancellation fee is $40 only. And in case you have booked a domestic US award, in which cases your taxes come out to only $2.5, then that is all you need to pay as cancellation. That’s it. $2.5..!! Compared to $150 at almost all other airlines to get your award miles back.

3.       Distance based award chart: The BA Avios award chart is quirky. It’s not region based like any of the US legacy carriers. It’s distance based. So every flight segment you are on is priced separately. So for e.g. you take an AUS-SFO flight via LAX- a US carrier would price it as one single flight within US, for a standard 12,500 miles. But BA would price it as one flight from AUS-LAX and a second flight from LAX-SFO. While this might sound like paying for 2 flights, most often than not, you would actually be saving miles. All short distance flights (less than 650 miles) are only 4500 Avios (yes that is not a typo). Infact you could fly upto 3,000 miles using 12,500 Avios (refer chart below). A NYC-SFO flight is just 2,574 miles. So it’s safe to say, as long as you have a direct flight on AA or US Air (One World Partners), you can simply use your Avios and give yourself the flexibility of less fee and anytime cancellation..!! I don’t see how that doesn’t trump United Mileage.
BA Mileage Redemption Chart - Refer BA website for updated information. Source Britishairways.com

Now, this is not to say the United Mileage is not a great FFP or that BA doesn’t have its drawbacks. United is still one of the best when it comes to redeeming for international travel. And BA does have one of the longest hold times on their phone lines, when calling in for any booking related issue, whether award or revenue. No program is perfect so depending on your need, you should choose your FFP. If you want to fly internationally for cheap, United is the way to go. But if you want to fly domestic US, then there is no better program than the British Airways Executive Club Avios.

Wednesday, April 16, 2014

A-O-R 3

AOR 3 made a grand appearance this earlier this month. This is my first AOR this year and my 3rd so far. The last AOR was 6 months earlier. I started with a quick check of my credit score on CreditKarma (both Transunion and Vantage Score), CreditSesame and my FICO score from my Discover card and was happy to see that all of them were higher than when I started out last year. So, now that I was in the green, it was time to get cracking.

I finalized 11 cards that I wanted. But this was too high for my taste, so I finally came down to 6 card and decided to play the other 5 based on the success on the first 6. These were my choices:
Final Haul

6 Must apply cards (Green = approved):

1.       Barclays US Airways
2.       Chase UA Business
3.       Citi AA Business
4.       Amex SPG Business
5.       Chase Sapphire Preferred
6.       Amex Everyday Card

And the 5 “may be apply” card:

A.      Barclays Arrival Card
B.      US Bank FlexPerk – Travel Card
C.      Chase IHG
D.      US Bank Aviana Airlines
E.       Capital One Venture

Here’s how it ended.

I started with the Barclays US Airways card. I am expecting this card to vanish in near future and I din mind 30,000 US Airways points for absolutely no spend requirement. If I can use this, great. If not, and they get converted to AA miles, that’s cool too. I was pretty sure I am going to get a pending status and then I will have to call the reco line and I will get rejected. It’s Barclays after all. I was ready for that, but I did not want to not try it. I tried and contrary to expectation – I got approved IMMEDIATELY! I was on cloud 9. That was a great start.

Now that this was done, I got greedy and decided to go for the Barclays Arrival Card. I thought maybe I will get really lucky. It didn’t happen. I got a pending review and the call to the reco line, did not do anything to change it. So I was on 1/6 and 0/5.

Moving on, I decided to first go for the Business cards on my list. There was the Amex SPG Business, Citi AA Business and the United Explorer Business. I had no doubt in my mind I will get approved for all 3 of them; though I was sure Citi will ask for additional documents. All 3 applications gave me a pending status. I called Citi first and just as expected, they asked for an address proof, which I promptly emailed them. A phone call 24 hours later ended in a request for another document and another 24 hours later, I was approved for the card. Next I called Chase and after I lengthy discussion I was denied. I was fairly surprised and disappointed to say the least. This card was on the top of my list and I was sure I will get it. Chase has never denied any of my application. 50,000 UA points would have really helped my currently meagre balance. But a denial was a denial and I moved on. I was unhappy with Chase, but it’s ok. Last was Amex SPG Business Card. Before I called reco, I decided to check my status online once and voila – I was approved. Score 3/6 and 0/5.

Next up was the Chase Sapphire Preferred card and the Amex Everyday card. I knew for a fact that my Chase profile had me pre-approved for the CSP (my Chase Banker told me that). Funnily enough I got a pending status and a call to recon told me I need to walk in to the nearest branch and provide an address proof. I was fairly surprised considering I have 3 credit cards and 3 bank accounts with them. All the same, I did as told. And later in the day I was approved for the card. For Amex Everyday card I had to call in again. The agent informed me that for security reason, they do not approve more than one CC in one day on the same social and I can expect this card to be approved 5 days later. 5 days later, I was declined. No reasons given. Was asked to wait for the letter in the mail and if I disagree, I could ask for reconsideration, but that would mean another credit pull. I wanted this card for 2 reasons- 1) I am going to soon cancel my Amex PRG card and I needed to transfer my MR points somewhere and, 2) I try and apply for one no fee card every time I do an AoR, thus ensuring that I can keep them forever and add to my account age. I can’t describe how disappointed I was at this. Score 4/6 and 0/5.

At this point I had to decide to what to do with my other 4 applications. I was already rejected for 2 cards and so far only 2 cards were approved and 3 were technically still pending (remember – at that point I did not know the decision about my Amex Everyday, Citi AA and Chase SP). I decided to play them one at a time.

I started with US Bank FlexPerk Travel Reward card. I got a pending msg and a call to recon did not yield any result. They simply asked me to wait for a few days for the decision. 48 hours later a status check revealed I was approved for the card. But unfortunately when I received the card, it turned out to be the Flex Perk Select Card and not the Travel Reward card I had applied for. Was quite bummed. The only good thing was this is a no fee card, so it takes the sting out of not getting the Amex Everyday card, for improving the age of my credit account. Score 4/6 and 1/5.

I was still quite bummed about the overall scene. But having learnt my lessons from my First AOR and Second AOR, I decided to move along. I applied for the CHASE IHG Card and after a quick call to the recon line I was approved for this card. Score 4/6 and 2/5. At this point I decided that it’s enough for one AOR. Considering the recent debacle in the MS world, I am not sure how I would meet the hefty spend requirements and so I was not going to apply for a card that I wouldn’t be able to meet the spend requirement on. The two cards I let go were the US Bank Avianca Airlines card and the Capital One Venture Travel rewards card. Final Score was 4/6 for the primary cards and 2/3 for the optional cards.

Overall, I was not very satisfied with my day. If I meet all the spend requirements on these 6 cards, I would be richer by 252,500 points/miles. But somehow, missing on 50,000 UA points, not getting a fee free Amex card plus 10,000 MR and being stuck with a 10,000 Bonus Flex Perk card was not what I had envisioned at the start of the day.

How are your points and miles balance shaping up? Did you do your AOR for this year yet ? Tell us in the comments.

Tuesday, April 8, 2014

Redeeming Amex Membership Reward Points and Avios for a Holiday

I am on a roll here. My miles redemption practice started with helping out my friend last year to plan his honeymoon using Avios and then I planned a spur of the moment trip to San Francisco for the MLK weekend, using Avios again. Earlier this month I decided to go on a holiday for my second marriage anniversary and my wife and I decided on Miami. And the points and miles redemption began again.

Over the last one year I have accumulated a small stack of points and miles, thanks to the AoR on my account and my wife’s account. So I decided to first use these for the holiday booking rather than spending money. 

Here’s how I went about it and the end result.

For the outgoing sector, the cheapest option was Delta at $96 per person. For 2 person and assuming just one luggage it was coming to $ 217. The next best was Southwest for $111 per person, so it came to $222 for 2 people. However, the only problem with these options was that they were all for reaching after 2.30 pm, robbing half my Saturday. Redeeming miles on Delta wasn't turning out a good option as they would charge miles for a return flight – which I wouldn't opt for as I wanted to fly out of MCO.

I decided to put my stash of Avios to good use and we found flights from AUS-MIA via DFW for 12,000 Avios and $5 tax per person. But since this was a connecting flight, we would still reach in the afternoon and we wanted to make full use of Saturday. This is where a little bit of flexibility bailed us. I found an early morning flight from DFW and IAH for 7,500 Avios and $2.5 that would bring us to Miami at 9.20 am in the morning.

The additional money we would spend on renting a car was more than compensated by the 9,000 Avios and $5 we saved and by the points we earned for the Hertz rental (I love Hertz points) and by the fact that we would now reach at 9.20 in the morning and not late in the afternoon. I quickly did some search and found a one way rental from Austin to Houston for $40 and we were set to go to Miami. I could have used my Hertz points to get a free car too, but since Hertz charges double points for one way rentals, I decided to pay with money instead. I did some calculation on milevalue’s calculator and found that I got a value of 1.35 cents per Avios. Anything above 1 cent and I consider myself a winner !!!

The return flight was slightly trickier. We would travel to Orlando and I wanted to fly out of MCO and not have to drive anywhere for the flight. A quick search on Kayak showed that Jetblue is the only airline with direct flights and the other option was using Avios for AA via IAH again. Or flying till IAH and driving. I opted for the former. My closest friends are HUGE Jetblue fans and they have always asked us to try them. I had a small stack of MR points that transfer to Jetblue, though not at the rate I would have liked. All the same, I quickly checked for flight availability and point’s requirement. It took 18,500 MR points and just 5 minutes to transfer from MR to my Jetblue account and before long, we had direct flight back from MCO on our preferred date and time. I could have also used the travel option on Amex MR to book the ticket and earn points for this flight, but for some reason, the price was showing at a higher amount and would have costed 22,000 MR points, while earning me JetBlue miles. I decided to save my MR for now.

So the net result is for 15,000 Avios, 18,500 MR points and $ 21.50 (there was a transfer charge by Amex), we had ourselves 2 tickets for the anniversary holiday booked. The return tickets with luggage charge, in cash, would have been almost $450.

Next up was hotel booking – Look out for the next post..