Getting the most out of "miles" programs or other FF points

Since I mostly fly United, most of my input is regarding United Mileage Plus program.

1) Join a FF program if you fly. If an airline is associated with an alliance, chose the airline that that hubs at the city where you would do most of your flying in/out of. Example- Since my flights originate at SFO, and I also fly to Chicago and Denver on a regular basis, I'm a United member since they hub at all three cities. If you happen to fly Alaska, but you live in Chicago, you are better off using your American FF account since American is hubbed in Chicago.
2) Get a credit card associated with your primary FF airline. ONLY IF YOU PAY IN FULL EVERY MONTH-(if not interest will become costly). Both my husband and I opened a Mileage Plus Explorer card and received 35,000 miles, 5,000 for adding the other as an additional card member. (80,000 miles total)
3) Use your miles card to buy everything possible. Than pay off in full each month. With United you receive 1 mile for every $$ spent. And if you spend $25,000 in a year you receive 10,000 bonus miles. We buy groceries, gas, gym membership, ATT cable/internet, etc, on the miles cards. Last year we remodeled our kitchen and put every dime possible on our miles card. So both my husbands and my card hit the 25,000 miles for the 10,000 bonus per card. (That's another 70,000 miles). Granted, we won't hit both bonus's this year since we don't have any major household expense planned.
4) For any United purchases where you use the explorer card, you get another 1 mile per $1 bonus. (plane tickets, economy plus, food, etc.) (another 2000 miles)
5) Flights- I travel about every 6-8 weeks on business, so do my best to always fly United or other airline partner. (Another 44,000 miles for my account and 7000 miles for my husbands)
6) If you fly a fair amount, try to use the same airline or airline partners of your "miles" airline. If you reach status, in my case Silver for hitting 25,000 miles, I am awarded another 25% on top of the 44,000 miles-(another 11,000)
7) If you stay at name brand hotels, look into whether or not you can select airline miles or hotel points, or both. Same with car rentals.
Last year Hilton allowed FF to accumulate Hilton points and 500 miles per stay. (So accumulated another 11,000 miles from Hilton and National).

8) Purchasing Miles- Every time you book miles on United, you have an option to purchase double or triple your miles from that reservation. While this would not be a good deal to buy miles to use on a domestic plane ticket. It may make sense to increase your miles totals for trips to Europe, either in Economy, or even better, business. Last year we paid $527 for 25,000 miles for each FF account from our SFO-Italy miles reservation. You receive a lower cost per mile the longer your trip is (even if booked on miles). While this would be an expensive domestic ticket for that price, we just look at as funding the upgrade to business.
9) During 2013, my miles balance increased by 180,000 and my husband's balance increased by 100,000 miles (he only flew 7000). Our combined miles was enough for 2 RT business tickets (100,000 each saver fare) to London in Sept with 80,000 miles for the next trip.
Total Out of pocket costs-SFO-LHR ($95x2 CC annual fee, $1054- miles purchased, plus taxes of $700 (would have been $500 in economy) = < $2000 for two RT business tickets.

I have an American Express card (the traditional green travel card, not a credit card). The rewards program lets me buy miles on multiple airlines FF programs, so I can add to the one that is closest to a free trip.

For those who are unaware, a frequent flyer mileage card runs as a non-qualified card for merchants. That means that they run at a higher discount rate, and the merchant pays more to run that card. As a general rule, a FF card will be around 4% rather than a more usual qualified rate of about 2%.

So, if you used your card for all those everyday expenses that you list, and ran up $50,000 in one year, and figuring that costs the merchants approximately 2% extra, that means that it costs those merchants approximately $1000. Just to add to your mileage account. Does that seem fair to you?

Frequent flier miles are not "free" miles. Not to you, not to me, not to your local grocery store or utility. A merchant either eats that fee as an irritating cost of business, or, more likely, ends up passing on the higher costs to all consumers.

OK, Rant of the Day is over. I should go have my coffee.

Keep an eye out for promotional offers. I picked up a decent number of Southwest points a while back just by letting them sell my e-mail address to Dish network, which was easy enough to send directly into my spam filter after the first advertising e-mail. I've also managed to pick up 5K+ a year in IHG points literally from bottle caps because they've occasionally showed up as a redemption for My Coke Rewards. (Enough for a night's stay if you can find something on the Point Break sale list that suits your need)

If you don't mind selling your opinions and some demographic informaton, e-Rewards will send you surveys once or twice a week and you can eventually cash out for assorted airline and hotel programs (I usually redeem for IHG there because those points count toward elite-qualifying for some odd reason- made gold last year without leaving my couch) Opinion Miles Club is good if you're a United flyer- I've picked up 30K+ miles from them since July doing surveys while the spousal unit is watching tv at night.

You will probably not earn enough miles through airline or general shopping portals for a useful ticket, but they can supplement nicely. I'm going to pick up another 7.5K or so United miles this year by taking advantage of assorted double & triple miles promotions for things I was going to buy anyways.

Ditto Karen from Santa Rosa. All of our trips to Europe in the past decade or so have been on United Mileage Plus points.

Noting the post from Karen of Fort Wayne, IN, this is very interesting information. I've known this for American Express cards but I've never known this for the regular bank cards of which my Chase United card is one. However, I don't have one spec of guilt for the merchant paying more for me to swipe my Chase United credit card. The merchants do not say anything, they don't refuse to take my card and they smile and say thank you when I use it in their stores. They simply have worked this into their product pricing. I know of no merchant that accepts credit cards that refuses to accept my credit card because it's a Chase United card. Many refuse to accept American Express of which my Hilton card is one.

This is not about accumulating miles, but the related topic of using them. We were being pretty consistent about flying Delta and using their Amex card. Over the years, however, they became more and more restrictive; and we became less able to use our miles for flights or upgrades. While not as good as free int'l or business class tickets, in the past two years, we've been able to get some benefit by using points for hotel stays. For example, we had three free nights in a really classy hotel in Dubrovnik, I wouldn't have dreamed of spending the $900 or so that it would have cost, were we paying in money. Delta also lets you use miles to reduce the cost of tickets. When we needed to go to a wedding in Baltimore, the one-way price was $225. We each used 20,000 miles to get the cost down to $25.(10,000 = $100). That was better than a free ticket, which would have cost 40,000 points. If you need to make short flights between European cities, checking alliance member lines may yield a possibility for free tickets without the hassle or restrictions of budget carriers. For example, we found a flight to get us from Berlin to Dubrovnik on United's partner, Croatia, for which we used our Mileage + points. Saved us more than $500.

For about the last 10 years, I have been "churning" FF-mile credit cards. I will open a card to get the bonus miles, spend whatever necessary to earn those miles, transfer the miles (if needed) to an airline, then cancel the card after 11 months, before the annual fee comes due. My husband and I generally each have 2 or 3 active cards, with various airlines and hotels. I will admit that this is getting more difficult; the card companies seem to be cutting back on the more lucrative offers. One year we earned 550,000 miles from credit card offers; the last few years, we've averaged about 250,000 miles, plus some hotel rooms. Flyertalk.com is a good place to learn about new offers. I only recommend this method for those of you with plenty of time to create and maintain a spreadsheet to keep everything straight. I set up all the cards on auto-pay, but they still need to be monitored. You don't want to have a late payment and pay the high interest rates that often come with these cards. And you don't want to miss your 50,000 mile bonus because you missed the spending requirement by $100.

We've been using Karen's methods on United for several years: two "free" tickets to France last fall! However, I've read recently that the airlines plan to change their FF programs to reward people who buy more tickets from them (rather than those who buy gas, groceries and utilities). This will certainly be a sad day for me, who travels regularly but rarely actually purchases an airline ticket.

@Karen Fort Wayne.... I am not sure if some vendors pay more, but I am a merchant and I do not pay a higher percentage for those cards. I pay the same percentage on all the cards I accept.

Terry Kathryn-you should be able to see on your merchant services statement the different qualified, mid-qualified, and non-qualified rates. Not that they make those statements easy to read. It's possible that if all of your transactions are non-swiped ones, that you pay one single, higher rate than card-present swiped transactions. Not sure about that.

Larry-yes, a clerk will smile and thank you for the business. Should they snarl at you instead? If merchants are forced to increase prices to cover increased rates, we all pay for that.

Banks and Visa/MC have figured out that people love earning miles or points. Oooh, points. I swear, they could start offering gold stars and people would be happy. So they get to make more money from enhanced cards, and they know that not all of the miles or points get redeemed. It's a racket, and the banks and card providers are on the winning end. But don't just believe me. Walmart has a $5 billion suit against Visa over their practices.

I know a lot of people will continue to use their enhanced cards. I would just like them to be educated about the costs.

I use a points card for everything I can - groceries, gas, bills and pay off at end of month. I have purchased cars on them & several other large ticket items.

Several of the FF programs also have dining programs - I know United's does - just register your cards at United Mileage Plus Dining and use them at participating restaurants for miles earned for your meals.

Flying home from Europe first class on saver miles - worth its weight in gold!

Never once felt guilty for paying with card.

Karen from FT. Wayne - not sure what your agenda is? Merchants are big boys & girls and should enter their merchant agreements with their eyes wide open and full knowledge of the cost accepting credit cards. Of course it is built into the sales price of their product - as it should be - as it always has been - time was merchants paid high dollars in bank fees for the large volume of checks we used to write them - they've just traded the check processing fees (which were much higher if the merchant belonged to a check guarantee program), bad check collection fees and the high fees charged to a merchant for a returned check for the fees charged for debit & credit cards - which are a whole lot easier for the merchant. JMHO

I make sure to watch the promotions on my FF website every few days. There are always a variety of promotions available, but you quite often have to hit the register button to take advantage of them. Many times, I've already been booked on flights they are giving extra points for, but if you haven't registered for the extra points you don't receive them. Hotels will often advertise bonus points as well but again you need to register to take advantage of it. I also try to book hotels and car rentals with companies that give points to my FF program. Like others mentioned, I use my cc for everything and as long as you can pay your balance off each month, it's a great way to collect points. I'm with Air Canada's aeroplan program. They also offer online shopping with a wide variety of well known retailers such as Sears. If I plan on shopping online for something, I always go into my FF program and connect through them to see if the retailer is registered with them and it then takes me to their websites and collect points on my purchases. If I went to the retailers website directly and purchased I wouldn't receive the points.

I agree with Karen's "rant" (Fort Wayne Karen). As a merchant, we pay about 2.25% for MC/Visa and 3 or so for AMEX. Bank card fees are one of our largest expenses after rent and payroll. When we quote a project, we assume that the client will pay with a card, and so we build that into our price. In general, you cannot charge extra for someone using a card, but you can give a discount for payment by check or cash, which we note as well in our proposal. All this free stuff ain't free; we all pay eventually. We pay the fee when we buy something, because the merchant has baked it in, and then we "get it back" in the form of "free" stuff.

"....All this free stuff ain't free; we all pay eventually...."
http://oi57.tinypic.com/2h361cz.jpg

George, I understand and I agree with you, we are all very into our cards, and for my business, we will offer a cash discount, as I said. However, I am not suggesting to do away with or refuse credit cards, that would be foolish imho-we do let the consumer make the decision. All I'm saying is that we are all paying the fees, and some of us are are getting something back-but it's not free.

And Michael-thanks for that! You are hilarious ;-))

To the OP:

I belong to the Advantage program for American Airlines. My tricks:

1. I only buy tickets on American Airlines (or sometimes Southwest). It's not always the cheapest ticket. But I want to accumulate more miles with one airline instead of less miles with a bunch of airlines.
2. Book tickets as far in advance as possible. I think you can book 180 days in advance for most airlines. The cheaper award seats book up faster than the others. I have booked many round trip tickets to Europe using 40,000 miles total which I think is pretty good.
3. Be willing to fly the "scenic route". Cheaper award flights are rarely direct.
4. Refrain from using miles unless it is really worth it. If there is a fare sale, I would rather buy the ticket and get the miles. I think you win out in the long run.

@Karen- Fort Wayne... I have a very simple company now for my credit cards, after years of paying statement fees, transaction fees,monthly minimum fees etc.... I fired that bank. Now I pay one rate for all card present swiped cards (all of them..Visa, MC, Amex and Discover) and slightly higher fee if the client is not present with their card. I get an email shortly after running my transaction telling me how much money is going into my account minus the fee. I am happy to pay that fee because most people spend more when they are able to charge it...

I also use my Amex for everything...even that Latte from McDonalds:))

I was thinking about what we did before we started using our United miles CC for almost all purchases. We used our debit cards (with a MC logo) as a credit card. Before that we wrote checks, but it became such a hassle to write checks- Drivers license, telephone #, first born, etc, that we now only write checks if there's no option, or if there is an additional charge for credit card use (IRS, State of California, Property taxes, etc.). We just don't use/carry cash at home much. And I agree that most people probably spend more with a credit card than paying cash.

I don't really have an agenda, and I'm not trying to start a fight. Like others here, I am sharing my experiences with FF programs, but from the other side. Yes, I'm a grown-up and can decide our business's policies and prices. As Dave from Ventura said, free is not free, and someone's paying somewhere.

A few years ago, shortly before the Frank-Dodd financial reform bill took effect, we saw a huge jump in processing fees. It turned out that banks and card issuers, in advance of the law, had been pushing customers into rewards cards because they made more money off of them. The money they make comes from the merchants. Instead of approximately 60% of our transactions running as the lower, qualified rate, about 60% were running at the higher rate. The difference was about $200-400 a month. That's real money, out of my pocket, off of our bottom line. That's my plane ticket to Europe.

I know sounding b1tchy doesn't help my "agenda." But maybe the next time you're at your small, local store about to run $100 on your FF card, at a cost of about 3-4%, instead you'll pull out your debit, put in your PIN, and cost that merchant only $.75. That helps the local shops.

I am now taking a personal vow to never read another thread on FF. You're welcome!

I have been trying to fit in two trips this year. Transportation is my main cost because I go business (It seems perfectly reasonable to leave the plane to Hawaii 'just for a few minutes'!) So I've driven myself even crazier trying to use miles, get a rate that's not more that 20% more than last year's. It's tough, and I'm probably not up to the challenge.

I've joined some frequent flyer sites. I meant to get USAirways miles or American Miles during a promotion, but I forgot. Good thing I did because they gutted the value with new charts. My ONLY advice is to plan it out and pounce the moment you are ready. People who bought miles on day one and tried to ticket on day two lost value, like a bitcoin dip.

It's not my advice - it's from the math wizards over at the frequent flyer miles sites.

Karen has a valid point about hurting the small local merchant. Don't do that!! But it is still possible to accumulate lots of miles by using your card at big online retailers. Some of them ( Nordstrom, Apple, REI, etc.) actually encourage you to use the card by offering extra miles in certain programs. So if I buy a $100 pair of shoes at Nordstrom, I get 3x miles plus the $100 on my card, or 400 miles total. We also use the card for groceries ( big chain grocery store), gas, hotels, Insurance payments, and large charitable contributions. I don't use the card at my locally-owned bookstore or yarn shop.