If you’ve been a frequent flyer for a while, you’re probably pretty well on your way to understanding how the whole thing works. For those folks, there are some great blogs out there showing you how to use miles for a 3-hop, 3-continent jaunt using multiple airlines you’ve never heard of. That’s great, and lord knows I’ve learned a ton from them. But the more I chat with people I know, the more I realize that people who don’t know much about the world of miles are intimidated by it. Their understanding seems to begin and end with knowing that for 25,000 miles they can supposedly get a free ticket, though the flight they want never seems to be available, and it takes them 3 years to earn 25,000 miles. I had a co-worker say to me last week, “One day I’d really like to be able to fly in one of those beds they have on international flights, but I don’t see how I’d ever be able to afford it.” That pushed me over the edge.
Over the next couple of days I’m going to write a few posts about how to get started with all this, because if you never get that first couple of hundred thousand miles (and I promise, you’ll EASILY get that in year 1), you’ll never care about how to put together a multi-city tour of Asia using your not-so-hard-earned miles. I’ll start with earning miles, then we’ll move on to how to spend them efficiently.
Also keep in mind: everyone has different travel needs. Some people need first class trips to Africa every year, some do not. Don’t listen to people who tell you you’re wasting miles by using them for a domestic coach trip. If you won’t be traveling internationally, or are limited in how you use miles because you have children, then by all means use them in a way that makes the most sense for you. I always feel like there’s an underlying tone to some of the frequent flyer blogs out there suggesting that you’re a fool if you’re not creating crazy itineraries with your miles. Don’t listen to that. We all have different needs, and for plenty of people, saving $500 on a trip to Florida is a great way to spend 25,000 miles. Go for it.
Here we go…
You Do Not Need to Fly to Earn Lots and Lots (and Lots) of Frequent Flyer Miles
If you read nothing else, read that sentence twice. I probably have about 2 million miles sitting around right now (I should know exactly how many because I have signed up for Awardwallet.com, and so should you, as it will show you all the miles you have on one screen. It’s free). I bet 10% of them are from sitting in a seat (or what we call “butt in seat – BIS – miles”). That’s why I’ll talk about non-flight ways of building your mileage balance first – because if you’re already flying a ton, you’ve probably already been thinking about this stuff.
Bar none, credit cards are the easiest way to earn miles quickly. You’ll see people refer to “churning” credit cards, which just means you’re opening and closing credit card accounts faster than, say, a normal person would. I’ll get into that, but you’re probably thinking to yourself: do I have the credit score and finances necessary to open multiple credit cards? I’ll answer that for you: If you have to ask yourself that question, you do are not a good candidate for using credit cards to pile on the miles.
Applying for a credit card will ding your credit score by a few points, though over time you’ll earn those points back by paying on time. You’ll also gain points by having available credit (at least an amount of available credit that makes sense for your income). Having too much available credit and not enough income is not good either. These days you should probably have a credit score above 700 (if not 725-750) before playing around with credit cards. Plus, if you plan on taking out a mortgage in the next 18-24 months, then churning is a bad idea. Why risk not getting a mortgage (or having to pay an extra 1/8 or 1/4 percent, which could equate to tens of thousands of dollars) because you want frequent flyer miles? Be prudent.
If you’re just reading this now, you’ve missed the golden age of credit card churning. For a few years, Citibank would allow you open 3 American Airlines credit cards at a time (basically), generally giving you 35,000 miles each after a minimum spend on the card. Your spouse could do the same. After you closed the cards, you could then apply again and get that 35,000 mile bonus again. Ad infinitum. It was literally printing frequent flyer miles, and plenty of people were racking up 300,000 – 400,000 miles per year between them and their spouse.
You’ve probably guessed at this point that that’s not a great move for Citibank, and, indeed, about a year or so ago they put an end to churning (well, not an end – turns out you can get the bonuses again if you want 18 months between applications). Bummer. Chase, which handles credit cards for a bunch of airlines including United, Continental and British Airways, has not allowed churning at all, and typically does not allow you to apply for more than 1 Chase credit card within 30 days (even if it’s for two entirely different cards).
Let’s say you get a card (and I’ll get to which cards I think you should get in a moment), how long should you keep the card open? I generally recommend if you’re churning to keep the card open 11 months. This will allow you to benefit from having the available credit to make up for the small hit you took from opening the card in the first place. Also, some card issuers frown upon opening and closing cards too quickly; United, for example, says they can take their bonus points back if you close the card within 6 months.
Finally, if you are turned down you should always call and ask to be re-considered. Sometimes you were turned down because you have too much credit open with one bank (this seems to be a popular problem with Chase). Just ask them to lower the credit limits on cards you have, which will allow you to open another card with a small credit limit. American Express, too, will deny you if you have too many cards open; if this occurs, simply close down an open card — they’ll generally give you the new card once the old one is shuttered.
So, the big question, which cards should you get? We’ll discuss that on Monday…