BREAKING NEWS: Southwest Airlines Going to Hawaii!!

Just announced via Twitter: Southwest Airlines announced it will begin service to Hawaii starting some time next year.  This was done in response to another person’s comment, and it’s very exciting news!

Currently there are not any details regarding timing or which routes will be served.  We’ll be sure to keep you up to date with further details as soon as they become available.

For now, get ready to start planning your island getaway for 2018! 🏝✈️

Also, here’s the blog post written by Gary Kelly, CEO & Chairman of Southwest Airlines…

Tip Tolerance & Gift Cards: What you need to know

I experienced a very odd scenario at a restaurant last night at dinner.  The final bill was $175.34.  I wanted to use a $100 Visa Gift Card and put the rest on my credit card, so I provided both cards in the check presenter (that’s the actual name for the large “wallet folder” the waiter / waitress gives you with your check inside).  However, only $83.33 was charged against the gift card instead of the whole $100.  The remaining $92.02 was charge to the credit card.  Why?  –> Tipping tolerance.

Below is an article written by Stephanie Zimmerman and originally published on ABC News (click here for the original).  It explains what tipping tolerance is and what you may need to look out for anytime you want to use a prepaid gift card at a place of business where tipping is involved (e.g. restaurant, bar, hotel, salon, etc.).

ORIGINAL ABC NEWS ARTICLE:

Dear ABC News Fixer: A couple weeks ago I bought my son and daughter-in-law a Visa gift card for their anniversary. It was a $50 card and I paid a $4.95 purchase fee. On the card holder jacket there was a notice that read: “No fees after purchase.”

My son and daughter-in-law used the card at a restaurant. When they paid their bill, they were told that the card was only worth $42. The server told them that Visa gift cards take about 20 percent off the top but had no other explanation.

My son no longer has the card – they left it at the restaurant, figuring it was completely used.

My question is: Where did that 20 percent go? The holidays are coming, and gift-giving is on people’s minds.

– Carol Humble, Glen Ellyn, Ill.

Dear Carol: Yikes. Between the purchase fee and the 20 percent, you spent $54.95 for this $42 gift.

A purchase fee of $4.95 would have been enough for the ABC News Fixer to scrap the gift card and buy something else.

As for the missing $8, we were mystified, until we heard about “tip tolerance.” This apparently happens when consumers use credit card-branded gift cards at businesses where gratuities are expected, such as a restaurant or a salon.

The business, understandably, wants to make sure the card has enough to allow for a tip. Many of these merchants use processing systems that will pre-authorize an extra 20 percent above the amount of the bill. That’s the tip tolerance. If there’s enough cash to pay the bill plus 20 percent, the transaction proceeds. Once the final amount is figured out – maybe the consumer only wanted to tip 15 percent, or maybe he or she decided to tip in cash – that exact amount of money is deducted from the card. If the preauthorized 20 percent tip wasn’t used, the money would eventually go back on the card when the transaction clears.

Your son and daughter-in-law’s dinner tab was about $160. We called Visa, and a spokesman said the restaurant should have been able to circumvent its normal processing system and just apply the full $50 gift card to the bill.

We are guessing the server first handled the gift card and entered in $42 plus 20 percent – not taking into account that they’d be using a second form of payment to pay the rest of the bill and the tip.

The extra $8 eventually would have gone back on the card after the transaction cleared. So it’s too bad they were told the card was used up, which is why they left it at the restaurant.

We’ve heard of other cases in which embarrassed diners had their credit card gift cards rejected because they were too close to the limit. In most cases, consumers can avoid this tip-tolerance rejection by telling the server ahead of time that they plan to tip in cash. For bigger transactions, it’s worth noting that some merchants won’t let you split a transaction between a gift card and a credit card. In that case, you’ll have to charge the whole thing and use the gift card for something else.

Consumers should be wary at gas stations, too, since some pumps automatically pre-authorize $50 to $75, even if you’re only planning to buy $25 in gas. Consumers with credit card-branded gift cards should go inside and have the cashier only authorize the exact amount they wish to pump.

Bottom line: Though they look like credit cards, these gift cards behave differently. To avoid an awkward situation, know your gift card balance and talk to an employee or manager before presenting it for payment.

>>Final Note:  I didn’t think to tell the waitress I would take care of the tip via cash or credit, which would have been the work-around to this problem.  Lesson learned.  I also noticed something else:  I walked out of the restaurant without my gift card because the waitress never gave it back to me (out of sight out of mind).  So even though the gift card receipt said “Avail Bal: $0.00,” there was clearly $16.67 left on it, which was the 20% tip tolerance ($83.33 * 0.20 = $16.67).  Assuming the waitress was “in the know” about how all this works, she walked away with her next dinner on me (or if not then it was probably thrown away) 😐

Here are my receipt images to match with this story…

Free Elite Status with Alaska Airlines for University of Washington Students!

Alaska Airlines is running a promotion targeted to students at the University of Washington, and it’s AWESOME! 😀

You’ll be able to obtain elite status (for free!) based on your GPA.  The qualification requirements are simple: 

Earn a 3.5 – 3.9 GPA and get 2018 MVP® status

Earn a 4.0 to get MVP® Gold

You will be notified in January when you’re ready to fly with your new status.

All you have to do is sign up or register below with your University of Washington email address, and better yet, Alaska will start you off with 5,000 bonus miles! ✈️

CLICK HERE to be taken to the registration page and register by Oct. 31, 2017.

Airline elite status is one of the best ways to travel smarter, providing perks like priority check-in, priority boarding, access to upgrades, free checked bags, and more.

Be sure to share this with any students you may know at UW!

Amex Platinum Cards: Metal Makeover

Both the Platinum Card and Business Platinum Card by American Express received a metal makeover earlier, and current cardholders are able to trade their plastic versions for the new metal ones.  You can make the switch either by calling the number on the rear of your card and asking for the metal replacement, or by logging into your online account and following these steps: (1) Click on Account Services, then (2) Order a Replacement Card for Damaged, Lost, or Stolen Cards, and (3) Request Metal Card.

Overall, there’s no additional value add with this update.  Rather, the cards simply looks better, have a nice feel to them, and will likely be more durable to last the full 4-5 years before they hit their expiration dates.

Anyone applying for the cards from a new application will receive the metal card by default.

As a final note, if you have a lower-tier card (i.e. Green or Gold Card, either personal or business) and want the Platinum Card, be sure to submit a new application if you want to get the signup bonus (highly advisable).  Simple calling in to upgrade to the Platinum Card will not allow you to receive the signup bonus (which is 60,000 points at the time of this writing and worth $600 at a minimum).

Pictured below: 1st image shows the plastic versions, 2nd image shows the new metal versions

ACT FAST: 1,000 Free Marriott Points!

You can receive 1,000 Marriott Rewards points for simply replying to their question on Twitter, “In what year was the @NFL founded?  Answer with #RewardsPoints by 8pm EDT on 9/24 and score 1,000 bonus points if you get it right.”  Hint: the answer is 1920.

In addition to this opportunity, there are a variety of other ways to earn points throughout the year.  If you participate in all of them, you will have amassed 45,000 points, which can be worth 1 free night at a top-of-the-line property or several free nights at mid to lower category properties.

Start here by linking your social media accounts (this is rewardable with points, too).  Then be sure to participate in the campaigns in the upcoming months to earn free points!

Best Travel Points, Part 1: Chase Ultimate Rewards

SETTING THE STAGE

It’s true:  based on the credit card in your wallet, you could have a HUGE advantage over other people if travel is what you want.

I’ll explain with an example.  Say you want to travel to Hawaii.  You go online to put a sample flight itinerary together to see how many rewards miles you’d need.  In general, you see that the ‘Big 3’ (American, Delta, and United) require 40,000 to 45,000 miles for a round trip flight in economy.  Perhaps you go apply for an American Airlines credit card with a 50,000-point signup bonus.  Sweet…that’s enough for your trip!  But once you use those miles, you’re almost back to 0 again and are stuck with a card that earns 2X miles on American purchases and 1X on everything else.  It’s going to take a very long time to get another 40,000+ for your next flight.  Assuming most of your expenses are non-travel related and fall into that 1X earn category, you’ll have to spend around $40,000 to earn another 40,000 miles…ridiculous, right?

That’s why I generally don’t recommend using airline or hotel credit cards for your everyday spend.  It sounds crazy, but you just saw the problem: once that first-time signup bonus is used, the cards don’t offer a good return on your month-to-month expenses, meaning it will take a very long time to get enough miles (or hotel points) to get you on your next trip.

There are 3 major point currencies out there that are infinitely better, and the one I’m introducing to you today are Ultimate Rewards (UR) points by Chase.

–> By the way, that flight to Hawaii?  Yeah…it can be done with just 25,000 miles.  That means you could have gone on **2** Hawaii trips with 50,000 miles instead of just one.  (The secret involves using Chase points, transferring them to Air’s SKYPASS program, and using those Korean miles to fly on Delta to Hawaii.)  Don’t worry about the details; you’ll learn a lot the more you read and experiment over time.  But for now, let’s focus on Chase 🙂

Chase Ultimate Rewards (UR) points are the points currency used by Chase for a handful of its card products.  UR points are both flexible and transferrable.  Flexible means you can use them in many different ways (e.g. travel, cash back, gift cards, online shopping).  Transferrable means you can convert them into currencies of other programs (e.g. convert 20,000 UR points into 20,000 Southwest Rapid Rewards points).

Why flexible & transferrable currencies are best:  You start with a diversified portfolio from the get go.  Rather than locking yourself into earning air miles or hotel points with one program, you can transfer your points to a variety of partner programs, giving you the flexibility to put your points where they can do the most good for what you’re trying to achieve. You’ve probably noticed that airfare and hotel pricing varies drastically.  A room that normally goes for $200 per night could be $350 on a different night.  However, a lot of airlines and hotels set fixed redemption pricing for their points based on award charts or categories / levels.  So that hotel room could be a fixed 15,000 points per night while the cash price fluctuates.  That’s where transferrable points often show the most value – when you redeem them in the program during times when prices are high and yield a solid ‘cent-per-point valuation’ (e.g. 15,000 points for a $200 night means your points have a redemption value worth 1.3¢ each, whereas a 15,000 points for a $350 night gets you a 2.3¢ per point valuation…much better).  I always go through this mental math when choosing a redemption.

The general baseline for Chase points is 1¢ per point (e.g. 50,000 points = $500).  Depending on the card you have, your points can be worth more toward travel on the Chase Ultimate Rewards travel portal portal, or even more via those transfer partners.

 

CHASE ULTIMATE REWARDS TRAVEL PORTAL

Chase has its own equivalent of Expedia, Travelocity, Kayak, etc.  You can book flights, hotels, rental cars, cruises, and experiences through the portal at a fixed point value.

You can book through the portal and pay with your Chase credit card (i.e. to earn points), or you can pay with Chase UR points at a fixed rate (use them to cover all or part of your total cost).

When redeeming for travel, some Chase cards will give you 1¢ per point in value (50,000 = $500), others will give you 1.25¢ per point (50,000 = $625), and another will give 1.5¢ per point (50,000 = $750).

Here are the current Chase cards that earn UR points and are available to apply for online:

Redeeming points via the portal can be good when: (1) your chosen airline or hotel is not a Chase transfer partner (2) you want to book rental cars or smaller / local hotels or airlines that do not participate in a loyalty program, or (3) when a partner program requires more points than the portal (explained in the next section below*).

CHASE TRANSFER PARTNERS

Chase currently has 11 transfer partners: 7 airlines and 4 hotels.  They are pictured below.  Chase UR points can be transferred to any of these programs at a 1:1 ratio (e.g. 10,000 UR points = 10,000 Marriott points).  Note that Hyatt’s loyalty program has changed its name from Gold Passport to World of Hyatt.

Why are these so great?  In some situations, transferring UR points to other loyalty programs and booking directly on their websites can yield even higher value per point than on the portal.  Example:  Say ‘Flight X’ is going to require 40,000 UR points on the Chase travel portal, but that same flight can be booked for only 30,000 United Airlines miles on United.com.  Clearly you’d want to use only 30,000, so you transfer 30,000 UR points from Chase to your United MileagePlus account where they’re converted to United miles.  You then book your flight there and save 10,000 points to put toward another trip.

The same could be true for hotels, so always price out your trip on the Chase portal and also on the airline / hotel website to see which option requires the fewest number of points.

Of course, the advanced part of this strategy involves understanding the 3 airline alliances and using air miles from one program to book on another (like the earlier example of using Korean Air miles to fly Delta to Hawaii).  That can be discussed in a future post.  For now, keep things simple and recognize that using the portal vs. using transfer partners can yield different results depending on the trip.

CARD STRATEGY:  POOLING

I’ll close with a final tip.  Since all 5 of those Chase cards above earn the same type of points (UR points), the points can be pooled together.  If you have the Sapphire Reserve card, you’re earning 3X on travel and dining, but only 1X on everything else.  So for those non-travel and non-dining purchases, put them on the cards that will earn you more than 1X.  For example, it would be wise to put your gym membership, drug store purchases, department store purchases, misc. bills, etc. on the Freedom Unlimited card to earn 1.5X.  Then all those points from the Freedom Unlimited card can be moved to your Sapphire Reserve account where they will instantly be worth 50% more on the portal and have access to all the transfer partners.  In addition, the regular Freedom card earns 5X in different categories that rotate each quarter (so when supermarkets earn 5X for 3 months, use the Freedom), and the Ink Business Preferred earns 3X in a bunch of categories, including: internet, cable, and phone.

CONCLUSION

Chase-branded credit cards that earn Ultimate Rewards points are some of the best cards on the market if you like to travel.  Using 2 or more of them together can yield a high return on your spend while giving you a variety of favorable redemption outlets.  Other hotel and airline credit cards have their place (benefits / perks), but typically should be avoided for everyday use.

Cover image source: UpgradedPoints.com

Recent Comments