With 2019 kicking off, I thought it would be useful to review the big-spend bonuses and benefits available on our credit cards and give you our thoughts on each of them. We’ll break them down into:
- Yes, Definitely;
- On the Fence;
- Probably Not, But Intriguing; and
- No Thanks
For each big-spend bonus/benefit, we’ll identify the bonus or benefit, let you know the spend required to get it, and let you know whether it’s a calendar-year or cardholder-year bonus. For cardholder-year bonuses, the time window for earning the reward should start and end on your anniversary date of the particular card. This, of course, will be different for each person.
We’ll also identify the approximate “net cost” of obtaining each bonus. If you’re interested in hearing our exact methodology for determining “net cost,” we’ve inserted a paragraph at the bottom of this article. For now, we’ll just say that we believe our “net cost” calculations are conservative and lead to solid decision-making.
Amex Hilton Ascend – Free Weekend Night Certificate for $15k Spend (calendar year)
- Net Cost to Earn:
- Gross cost = $15,000 * 2.5% = $375
- Earnings on spend = 3x Hilton Honors (HH) points/dollar * $15k = 45,000 HH points, times 0.5 cents per HH point = $225
- Net cost = $150
For us, we find this an easy call. We will use Hilton Free Weekend Night certificates in our normal course, without changing our behavior (“with unmodified behavior”), to obtain a value easily in excess of $150. The Hilton Free Weekend Night certificates can be redeemed for a standard room on a Friday/Saturday/Sunday night at any Hilton hotel in the world, subject to availability. (In fairness, there are certainly some Hilton hotels that play games with standard-room availability, but to me, this doesn’t materially impact this analysis.)
For our 3 Hilton Free Weekend Night certificates in 2018, we got far more than $150 in value. We used one at the new Waldorf Astoria in Beverly Hills, where the paid rate would have been more than $750. We used the other two at the Hilton Nashville Downtown, for rooms where the best paid rates were $475 and $645.
We also think there may be an interesting upgrade/downgrade play between our Ascend and Aspire cards, where we might be able to upgrade the Ascend and downgrade the Aspire. By doing so, we might be able to get a second big-spend Free Weekend Night certificate in 2019. We discuss this strategy a big more in our recent “Keep or Cancel” article on the Amex Hilton Ascend card. If this works, we’ll gladly spend another $15k for the second certificate.
Chase World of Hyatt Visa – Free Category 1-4 Night Certificate for $15k Spend (cardholder year)
- Net Cost to Earn:
- Gross cost = $15,000 * 2.5% = $375
- Earnings on Spend = 1x Hyatt points/dollar * $15k = 15,000 Hyatt points, times 1.5 cents per Hyatt point = $225
- Net cost = $150
For us, this one in general would be a closer call than the Hilton certificate because the Category limitation places somewhat of a cap on the amount of value you can get out of this certificate. But we still lean toward making the spend to get the certificate.
One way to look at this one would be to say that a Category 4 Hyatt hotel would cost 15,000 Hyatt points for a redemption night. Because we give Hyatt points a baseline value of 1.5 cents per point, 15,000 points would be worth about $225. That’s more than the net cost of $150.
Of course, that’s all theoretical; the true value of the certificate comes from its actual redemption. We’ve tended to stay much more often at Marriott/SPG or Hilton properties than Hyatt because of higher elite status. But, we certainly wouldn’t mind staying with Hyatt, and I think we’ll at least have Explorist status soon. Looking at the Hyatt Category 4 list, we see hotels in several places that we regularly visit – California, DC, Miami, Chicago, Las Vegas, and Seattle. We also see possibilities amongst the handful of European Category 4 hotels, and we hope there will be more to come as SLH properties continue to integrate into the World of Hyatt charts.
If nothing else falls into place, the presence of the 3 very nice Seattle hotels on the Category 4 list – the Grand Hyatt Seattle, the Hyatt at Olive 8, and the brand new Hyatt Regency Seattle – ensures that we’ll have an easy organic stay at a rate that will easily exceed $250. For us, this locks down the decision to go for this big-spend bonus.
Finally, I’d note that this decision is even easier for new cardholders like ourselves. We needed to spend $6,000 on our new World of Hyatt card anyway, in order to qualify for the full sign-up bonus. So it’s really just an extra $9,000 in spend for new cardholders to also get the Category 1-4 Free Night certificate.
Citi AT&T Access More – 10,000 ThankYou Points for $10k Spend (cardholder year)
On this one, we don’t think the “net cost” methodology makes as much sense. The Citi AT&T Access More card earns 3x ThankYou Points (TYPs) per dollar of spend for online purchases, which is best-in-class for almost all online retail purchases. Thus, if you have at least $10k in online retail purchases, it won’t cost you a thing extra (save for the annual fee, I suppose) to get this big-spend bonus.
For us, we won’t have to go out of our way one bit to hit $10k in spend on the AT&T Access More card during our cardholder year. In fact, we’ll spend $17.5k within the next 6 months to max out the awesome retention bonus Citi just gave us. This one is a very easy “yes” for us!
On the Fence
American Airlines Co-Branded Cards – various big-spend bonuses for EQMs, EQDs, and Companion Certificates
The three big-spend bonuses where we’re on the fence are all American Airlines co-branded cards. We’ve used most of these big-spend bonuses to help Philly and me reach Executive Platinum status in each of the past 2 years; we wouldn’t have made it either year without the credit card benefits. But this year, there are two big negative changes that impact our decision on whether to go for Executive Platinum again – AA raised the Elite Qualifying Dollar (EQD) requirement to $15,000 EQDs (from $12,000), and it scaled back the ability to earn EQDs with the Barclays AA Aviator Silver card (now $3,000 EQDs for $50k spend; previously $3,000 EQDs at $25k spend plus an additional $3,000 EQDs at $50k spend).
We are quite unhappy with these AA changes, as we wrote in our recent article, “American Clamps Down on Executive Platinums.” As a result, we’re taking much more of a wait-and-see approach toward AA status earning this year. We’ll see how it goes organically for a few months, and then make more concrete plans later in the year. As I said at the conclusion of our earlier article, we surely enjoy having Executive Platinum status, but I’m not sure we can afford to keep it.
So, we’re on the fence about these big-spend bonuses:
Barclays AA Aviator Silver card (personal):
- $20k spend earns 5,000 EQMs (calendar year)
- $40k spend earns an additional 5,000 EQMs (calendar year)
- $50k spend earns $3,000 EQDs (calendar year)
- $30k spend (cardholder year) earns a 2-person Companion Certificate – purchase a paid fare for a domestic economy flight, and up to 2 companions can fly for $99 plus taxes each (generally about $135 each); some blackout dates apply
Barclays AA Aviator Business card:
- $25k spend earns $3,000 EQDs (calendar year) – but this does not stack with the EQD bonus on the Aviator Silver personal card; you can only earn a maximum of $3,000 EQDs
- $30k spend (cardholder year) earns a 1-person Companion Certificate – purchase a paid fare for a domestic economy flight, and 1 companion can fly for $99 plus taxes (generally about $135); some blackout dates apply
Citi AA Executive card (personal):
- $40k spend earns 10,000 EQMs (calendar year) – these EQMs do stack with EQMs earned on the Aviator Silver card; you can earn all of the bonuses, which gives a person holding both cards the opportunity to earn up to 20,000 EQMs through credit card spend
It’s also worth looking at the net cost for these various bonuses. Let’s look at it on a net-cost-per-$10k-spend basis (and you can scale it up depending on which big-spend bonus you’re evaluating):
- Net Cost for $10,000 in spend:
- Gross cost = $10,000 * 2.5% = $250
- Earnings on spend = 1 AA mile/dollar * $10k = 10,000 AA miles, times 1.25 cents per AA mile = $125
- Net cost = $125
For now, we’ll stop the AA analysis here, as it becomes complex beyond the scope of this article. It’s difficult to quantify the dollar value of the various level of status. (The Points Guy tries, but I find his values inflated and not consistent with my own experience and preferences.) There are trade-off choices – If you want $3,000 EQDs, is it better to spend $50k on the Aviator Silver personal card and also earn 10,000 EQMs and a Companion Certificate along the way, or is it better to just spend $25k on the Aviator Business card but earn no other bonuses? How do you account for annual fees (a hefty $195/year on the Aviator Silver personal card) in the calculation? All of these are questions for another day.
Probably Not, But Intriguing
Chase World of Hyatt Card – Globalist Status by Earning 2 Elite Nights for Each $5,000 in Spend (total big-spend requirement depends on number of Hyatt hotel nights
This one is a very fun thought experiment. Top-level Globalist elite status with Hyatt requires 60 nights in a calendar year. We’ve never had it personally, but all accounts are that Globalist status is great. Listed benefits include room upgrades up to standard suites, Club lounge access and/or full breakfast on all stays, waived resort fees, extra points earning, and other benefits.
The Chase World of Hyatt card gives each cardholder 5 elite nights annually just for holding the card. This knocks the Globalist requirement down to 55 more nights. In addition, the World of Hyatt card gives 2 additional elite nights of credit for each $5,000 in spend. So, theoretically, even if you never stayed in a Hyatt hotel, you would earn Globalist if you spent $140,000 on the card during a year. That is, you’d be spending $5,000 28 times, thereby earning 56 elite nights, which would give you a total of 61.
Of course, it makes no sense to spend your way to Globalist status if you never stay at a Hyatt property. But let’s say you would stay 25 nights at Hyatt organically, and you could use the Globalist benefits at nice properties where suite upgrades, lounge access, and full breakfast would be valuable. At that point, you’d be looking at 30 nights earned (25 from stays and 5 from holding the card), and you’d need to spend your way to 30 more. Now, we’re looking at 15 * $5,000, or $75,000 in additional spend.[For simplicity, I’m going to set aside the additional complexity of the fact that you’d earn a free night certificate along the way or that you could spend some of the points you’ve earned to generate additional nights.]
- Net cost for $75,000 in spend:
- Gross cost = $75,000 * 2.5% = $1,875
- Earnings on spend = 1 Hyatt point/dollar * $75k = 75,000 Hyatt points, times 1.5 cents per point = $1,125
- Net cost = $750
Now, this is pretty intriguing. When you achieved Globalist status, you’d also receive a Category 1-7 Free Night certificate (good at any Hyatt hotel in the world). And along the way, you’d also receive two Category 1-4 certificates – one when you hit $15k in spend, and another when you reached 30 nights. But even excluding these free nights, you’d “only” be looking at an additional $30/night to get Globalist benefits for each of the 25 Hyatt nights we assumed you’d be staying organically for the following year.
For us in particular, I’m not sure we have 25 organic nights a year with Hyatt that would benefit from Globalist status. We usually only have 10 or so organic nights a year, and the majority of those are Hyatt Place/House or through MGM properties in Vegas. Plus, we already have top or near-top elite status with Marriott (Platinum Premier) and Hilton (Diamond). So, it’s not for us, unless we decide to migrate our loyalty. And honestly, it’s a little tempting to move from Marriott to Hyatt.
Amex SPG Business – Marriott Rewards Gold Elite Status for $35,000 Spend (calendar year)
- Net Cost to earn:
- Gross cost = $35,000 * 2.5% = $875
- Earnings on spend = 2 Marriott Rewards points/dollar * $35k = 70,000 Marriott points, times 0.75 cents per point = $525
- Net cost = $350
No way on this one. We wouldn’t spend $350 for a mid-tier elite status that doesn’t get us free breakfast and puts us in line behind a bunch of Platinum-and-up elites for room upgrades. And if you can generate $35k in spend on an Amex card, please do it on a Blue Business Plus card and earn 2x Membership Rewards points!
In addition, Marriott Gold status is available as an automatic benefit on at least 4 cards – Amex personal Platinum, Amex Business Platinum, the Amex SPG Luxury card, and the Chase Ritz-Carlton Visa.
For us, we’re already 2 levels above this in Marriott Rewards – Platinum Premier – and our organic stays (plus 15 nights as a benefit of several Marriott/SPG credit cards) will easily get us back to at least Platinum (50 nights) if not Platinum Premier (75 nights) in 2019.
Chase Ritz-Carlton Visa or Amex SPG Luxury card – Marriott Rewards Platinum Elite Status for $75,000 Spend (calendar year)
- Net cost to earn:
- Gross cost = $75,000 * 2.5% = $1,875
- Earnings on spend = 2 Marriott Rewards points/dollar * $75k = 150,000 Marriott points, times 0.75 cents per point = $1,125
- Net cost = $750
Here, let’s start with our personal situation. As we mentioned with respect to the Amex SPG Business card above, we’ll easily get to at least Platinum status with Marriott this year with organic stays plus 15 nights from credit card benefits. So for us, this big-spend benefit is an easy “no.”
If you have the ability and stomach for $75k in spend and a fair number of Marriott stays where you could use Platinum status, we could make a case for doing this big-spend bonus. [In fact, we did it ourselves in 2016 when I still had significant spend in connection with my law practice, although in hindsight it was actually a mistake.] The main benefits of Platinum status are:
- 50% points bonus on paid stays
- “Guaranteed” late checkout for 4:00 pm, subject to availability (don’t get me started on this oxymoronic phrase in the Platinum benefits)
- “Do our best” upgrades to enhanced rooms, including select suites (with a lot of weasel-word caveats)
- Breakfast (at most properties)
- Lounge access (at the higher-end hotels that have lounges)
Maybe there’s a person that this makes sense for, but the circumstances would be very narrow. First, you’d have to have a person that has enough nights at higher-end Marriott/SPG hotels to get more than $750 in value out of the Platinum benefits. Second, note that if you have one of the cards with this big-spend opportunity (Chase Ritz-Carlton Visa or Amex SPG Luxury), you will already have 15 elite nights of credit. You’d earn Platinum by reaching 50 nights total – that is, 35 actual hotel nights. If you’re staying 35 nights, you don’t need to “buy” the status. But if you’re spending fewer nights, is it really worth it just to get the incremental benefit from Platinum over Gold for those few nights? Maybe there’s a person who would be spending 20 nights in St. Regis hotels with lounges and good upgrade chances, and the big-spend deal would work for this person. But this seems like an inordinately narrow set of people.
So, for almost everyone, this big-spend bonus should be a pass.
Amex Hilton Aspire – Free Weekend Night Certificate for $60k Spend (calendar year)
- Net Cost to Earn:
- Gross cost = $60,000 * 2.5% = $1,500
- Earnings on spend = 3x Hilton Honors (HH) points/dollar * $60k =180,000 HH points, times 0.5 cents per HH point = $900
- Net cost = $600
As much as we loved the Hilton Free Weekend Night certificate when we could get it for $15,000 in spend with the Ascend card (see above), we don’t see any way the certificate justifies $600 in net cost. As we said, we think we can easily get more than $150 in value for a Free Weekend Night certificate, but there’s no way to reliably get more than $600.
As with some of these other “no thanks” offers, though, we suppose there’s a very narrow circumstance when it might make sense. The Aspire card is best-in-class for Hilton stays, at 14x HH points/dollar (7% points rebate). Imagine a true road warrior or Hilton luxury property fanatic who was spending at least $40-45,000 on the Aspire card organically for Hilton stays. This person, if they exist (which seems pretty unlikely), might want to crank out the extra spend to get to $60,000 to get the Free Weekend Night certificate. But even if such a super Hilton road warrior exists, probably the last thing that person wants is yet another night in a Hilton hotel!
This big-spend bonus seems like a “no” for everyone.
Citi AA Platinum card – $100 AA flight discount for $20k Spend (cardholder year)
- Net cost to earn:
- Gross cost = $20,000 * 2.5% = $500
- Earnings on spend = 1 AA mile/dollar * $20k = 20,000 AA miles, times 1.25 cents per mile = $250
- Net cost = $250
This one is self-evident – no one should be spending $250 in order to get a $100 AA flight discount voucher. And if people are spending this much organically on an AA Platinum card, they need to get a new card!
End Note – “Net Cost” Methodology
Here is our “net cost” methodology and explanation: First, recognize that for each of these cards that offers a big-spend bonus, we generally wouldn’t be spending the amount of the bonus on the card. For most of them, we have other cards that would offer better returns for our ongoing spend. Thus, we’re going to look at the “net cost” of creating the spend to hit the bonus. For the gross cost, we’re going to use 2.5% (that is, 2.5 cents per dollar of spend). The reason for that number is that pretty much our “worst case” highest-cost scenario to generate extra spend would be to use Plastiq with a 2.5% fee. Against that, we’ll offset the baseline value of the points we’d earn. So, for example, for a card that earns 1 American Airlines (AA) mile per dollar of spend, the offset is 1.25%, because we give AA miles a baseline value of 1.25 cents per mile. Thus, the “net cost” in this example is 2.50% minus 1.25%, which equals 1.25% (or 1.25 cents per dollar). We believe this methodology results in a net cost estimate that is, if anything, higher than our “actual” cost. Therefore, we think these are conservative estimates. And, if our expected benefit from the bonus easily exceeds this net-cost estimate, we can be comfortable that it’s worth it to us to hit the spend requirement for the bonus.
We hope you’ve enjoyed our article on big-spend bonuses, and we hope you can get some free hotel night certificates, extra points, and maybe even an airline status bump from some of these benefits!
What do you think of these big-spend bonuses and our analysis? Please share your thoughts with us and other Middle Age Miles readers in the Comments!
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