🛫 Travel, Points and Miles in 2022 (+ BlockFi Update)
All the Hacks 2/24/22: Upgrade Your Life, Money & Travel
👋 Hi all, Chris here! Thank you so much to everyone who took my recent survey. One big learning was that many of you don’t actually listen to the podcast or prefer reading, which means you might be missing out on content from the show. So I’m going to do my best to make sure I share the best from each platform on both platforms going forward. I’ll try to make sure to add some organization to it all, so even if you’ve heard some of this, it’s still valuable to you. As always, please respond to this email with any feedback you have!
📆 Travel, Points and Miles in 2022!
In a few short weeks, winter will officially be over and if you’re like me, you’re looking forward to the hope of things getting closer to normal again and travel to get back to normal. Conferences and festivals are already being announced left and right and after last years booming holiday season, those credit card reward points you racked up might be burning a hole in your pocket. So, it seems fitting to take a moment to look at some of the changes happening in the travel, points and miles world recently.
💳 Card & Loyalty Program Changes
Covid has caused a massive disruption in travel over the last three years. That disruption has a cost and airlines, hotels, travel companies, and everyone in between are all too eager to make back. That means some big offers to entice travelers for some programs and a devaluation of points for others, so I wanted to share some of what’s happened lately.
Free Southwest Companion Pass is one of the best travel hacks there is, giving you the ability to name a person to fly free with any ticket you purchase, even if you bought it with points. All you pay is the taxes. You usually have to earn 125,000 points in a year but right now, through any of their consumer cards, you can get Companion Pass free through Feb 2023 by opening a new card and spending $5,000 within the first three months. You can support me and All the Hacks by checking this offer out here.
American AAdvantage totally revamped the requirements to earn elite status, switching to a focus on earning “Loyalty Points” instead of flying a certain number of miles. Why is this good news? Because you can earn loyalty points from spending on an AA credit card or using their shopping portals. That means you could actually earn status on American (even their highest tier) without ever stepping on a plane. Now if you’re not flying, then status doesn’t do much for you, but in a post-pandemic world with much less regular travel, I’m excited to see more ways to earn status without flying so often.
Richard Kerr touched on offer stacking in this week's podcast episode and it’s one of the easiest ways to get the most out of your rewards points (and becoming more common in recent years). The idea is that in addition to loading Amex or Chase offers to your card, you can use shopping portals (I find the best deals at CashBackMonitor) and other coupons/deals too. FrequentMiler has a detailed post about taking this to the extreme if you want to explore further.
Hyatt Award Chart Changes - While Hyatt still boasts one of the best hotel rewards programs, a recent change to their award chart update is a little disappointing for those of us who like booking at their high-end properties. As of March 2022, 70 of Hyatt’s hotels are moving to a higher award category. This means you need to use more points per night. That said, even with this changes, I think redemptions at places like Park Hyatt Kyoto or Ventana Big Sur are worth the extra points.
Marriott switches to dynamic pricing - The reason I love the points game is that the number of points or miles you need for some of the most expensive flights/hotels is usually fixed, so you can get incredible deals at the higher end of travel. That was especially true with Marriott Bonvoy, but they recently announced they’re switching to a model where the points required for booking will be based on market rates of their rooms. While they haven’t shared all the final details, this is about the worst news you could get and likely means I won’t be trying to accrue Bonvoy points going forward. Despite the Hyatt changes above, I’m all-in on Hyatt Rewards for 2022 hotels.
Chase Sapphire Reserve and Amex Platinum might be losing their luster - I recommend you check out this weeks podcast (specifically at 27:30), where Richard Kerr and I discuss whether these cards are holding up to the test of time. Their annual fees have gone up to $550 and $695 and it’s started to feel like you need to use their coupon book of benefits to recoup that value. And that’s all while other Chase and Amex cards are increasing their value proposition with a much lower fee (e.g. Chase Sapphire preferred is now 3x dining and 2x travel for $95/year). With so many cards offering lounge access through priority pass, I’m starting to wonder how many of these top tier cards I need to keep holding.
🌎 Where can you go?
Despite that many countries were on track to open up last year, the Omicron variant put a hold on the reopening plans for many countries. Given how often these things change, I wanted to share a few resources I have bookmarked to be able to reference before planning a trip. This NYTimes article is my go-to for country-by-country guidance on travel restrictions, but I also enjoyed ThePointsGuy’s post on the same topic, which is organized by region (much more helpful for trip planning).
However, in the last few months, many of those plans to open have either happened already or been announced, so I wanted to highlight a few of the recent changes I’m most excited about:
Australia is now open to international visitors. My trip here deserves a longer story some day, but it was the highlight of my 2015. In fact, I remember asking almost every person I met “Why doesn’t everyone live here?” I highly recommend a trip and if you’re up for an adventure, hire a guide and go rock climbing in the Blue Mountains. Specifically climb the Sweet Dreams route, which is one of the easiest and most beautiful climbs I’ve ever done.
Thailand reopened its doors to vaccinated international travelers without needing to quarantine, thought their “Test & Go” program still has a few rules to follow. Amy and I loved our time in Thailand and look forward to going back one day. I highly recommend all the street food you can handle and a few days at the Railei Beach Club.
While Japan’s limited reopening is only for students and business travelers, it’s the first step towards a broader reopening for tourism. There is no country I’m more excited to re-visit than Japan. Despite having been to Japan four times already (certainly the most of any international destination outside of Mexico), I’m ready to go back to eat all the ramen, relax in the most amazing hotels (Satoyamo Jujo and Park Hyatt Kyoto being two of my favorites) and spend time with some of the nicest people in the world.
Finally, if you’re planning on traveling internationally during the pandemic have questions about travel insurance, check out my post from two weeks ago.
📺 Video: How Airlines Quietly Became Banks
If you’re at all interested in points, miles and/or airlines, this video is a must-watch. It breaks down just how valuable the loyalty programs are to airlines and why you should really think about an airline more like a bank than a travel company. It also starts to help make sense of why American would make the changes I shared above.
Note: Since publishing this newsletter BlockFi has restricted customer withdrawals and the crypto I have there is not accessible. I can no longer recommend BlockFi and only hope that the situation is resolved and money is available to account holders.
I’ve talked about BlockFi a lot in the past and personally have a lot of money in my BlockFi account, so wanted to address their big news last week. But before I do, I want to clarify that everything here is my own opinion, I haven't consulted with BlockFi on it and they certainly didn't ask me to write this.
Ok, so the main headline is that BlockFi has agreed to pay $100m in a settlement with the SEC over their High Yield Interest Account and they have finally been provided with some clarity on a path forward to offering their product in a compliant way. Here’s BlockFi’s announcement as well.
What does it mean for users of BlockFi’s high yield interest account? Well, in the interim, they are halting all Interest Account opening for new customers and preventing existing customers from making any additional deposits. However, any existing balances will continue to earn interest.
As part of this process they will be registering their new high yield product "BlockFi Yield" with the SEC, in line with this new guidance, and plan to make it available to everyone soon. If you're not in the US, good news, you can still sign up and make follow on deposits.
This whole thing reminds me a lot of Uber, Lyft and Airbnb, except that the SEC takes things a bit more seriously than other local regulators. They believed that their product lived in a bit of a grey area as to whether it needed to be a registered security, and best I understood, they even sought guidance from regulators, but never got a clear answer until they started getting some cease and desists. Fortunately for them, they seem to have tried to work with regulators and we rewarded by being able to continue their operations until all parties involved could all agree on a plan going forward (and this announcement is that plan).
They did also make some misrepresentations about the degree to which their loans were overcollateralized (#22 here), meaning if someone was borrowing against their bitcoin, how much more bitcoin did they have than they were borrowing, but given how often financial firms are fined for misrepresentations, $100m seems quite egregious, and while misrepresenting things is never good, fortunately those misrepresentations never ended up affecting consumers deposits.
But one more thing that I think is really fascinating, is that despite this ruling from the SEC, Hester Peirce, one of the four SEC commissioners, published quite an interesting letter in dissent on the SEC website that said:
"Lurking behind the legal analysis, however, is an important question: Is the approach we are taking with crypto lending the best way to protect crypto lending customers? I do not think it is, so I respectfully dissent.
As an initial matter, it is difficult to understand how the civil penalty will protect investors. BlockFi will pay the SEC $50 million, and will pay another $50 million in connection with state settlements for the same conduct. While penalties this size are intended to deter bad conduct, here there is no allegation that BlockFi failed to pay its customers the money due them or failed to return the crypto lent to it. BlockFi’s misrepresentations about over-collateralization are serious, but the combined $100 million penalty nevertheless seems disproportionate."
"Working with an earnest desire to reach a prudent, properly calibrated regulatory outcome is important for a number of reasons. First, these products matter to people. A program that allows people—and not just affluent people—to keep their crypto assets, while still earning a return is valuable to many Americans, as evidenced by the programs’ popularity in the United States to date. The investor protection objective of today’s settlement will be poorly served if retail investors are ultimately shut out from participation in these products. Second, our process speaks volumes about our integrity as a regulator. Inviting people to come in and talk to us only to drag them through a difficult, lengthy, unproductive, and labyrinthine regulatory process casts the Commission in a bad light and thus makes us a less effective regulator. Third, a company that tries to do the right thing should be met across the table by a regulator that tries to get to a sensible result in a reasonable timeframe. For the sake of the American public, our own reputation, and the companies that heed our call to come in and talk to us, we need to do better than we have so far at accommodating innovation through thoughtful use of the exemptive authority Congress gave us."
I respect Hester for a bold statement the SEC for allowing her to publish it.
As for what I'm doing with my BlockFi account, my money is staying put and I'm excited for the launch of their BlockFi Yield account. If you’re looking to earn a higher yield on cash in the meantime, I don’t have a great answer yet, but one product I’m looking into is Stairs by GROUNDFLOOR. I haven’t done enough research to endorse it at all, but I’m interested because they pay 4-6% APY, backed by real estate debt securities, but still offer similar liquidity to a savings account.
🥳 Big Listener Win
I got the email below from Zach and it made me so happy that I wanted to share with everyone here. If you have a similar story, or a hack you want to share, please send it my way and I’d love to feature it in a future podcast or newsletter.
My name is Zach. I'm a medical student currently finishing up my second year. As you can imagine, money is incredibly tight for a medical student. However, my girlfriend (not a medical student) and I put some of your credit card signup bonus and flight/hotel point hacks to work and we were able to use almost exclusively credit card points/miles to cover roundtrip flights and 4/5 star hotels for a 10 day trip to Europe to celebrate our four year anniversary in a few months. We ended up turning 350,000 points / miles from credit card signup bonuses and other necessary purchases into flights and hotels that we calculated equals about $7,200 of value. I think this is proof that what you're talking about works for literally anyone, even a medical student who has basically no money. Thanks again for what you're doing and I look forward to listening to more episodes of All the Hacks in the future.
Zach, congrats on your anniversary and have an incredible trip!
🎙 Recent Episodes
Each newsletter I’ll highlight a few recent episodes, as well as a favorite from the archives that you might have missed.
#45: Travel, Hotel, and Credit Card Points Strategies for 2022
#45: Points expert Richard Kerr discusses airline, hotel, and credit card loyalty points, including changes/expectations for 2022, which credit cards and loyalty programs you should avoid, how to assess whether a signup bonus is worth it, and the hottest redemptions in the market today. Thank you to Starship for sponsoring this episode!
#43: Why 50/50 Doesn't Work: A New Model for Happier Relationships
Relationship experts Kaley and Nate Klemp, Ph.D., join Chris and his wife Amy to discuss how to create balance in a relationship. They explore why perfect equality is unrealistic, why you shouldn’t aim for fairness, how to share feedback with your partner without it turning into a fight, and how to sustainably maintain a life of radical generosity.
#5: Finding Cheap Flights to Anywhere in the World
Cheap flight fanatic Scott Keyes joins Chris to talk about getting the best deals on flights around the world. They discuss when and how to find and book the cheapest flights, making the most of flight cancelations or delays and lots of travel hacks to maximize happiness on all your trips.
💭 Parting Thoughts
Thank you so much for reading! How’d you like it?
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Your feedback will help make it great, so I’d love to hear your thoughts/suggestions. Please feel free to respond to this email and I promise to read and respond to every one. If there’s a topic you’d love me to dig into in an upcoming issue, please let me know!
Thanks for reading!
Today, I’m grateful for the support of our partner UpgradedPoints.
Chris Hutchins works at Wealthfront. All opinions expressed by Chris and his guests are solely their own opinions and do not reflect the opinion of Wealthfront. This newsletter is for informational purposes only and should not be relied upon for investment decisions.
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Hi Chris, Not sure where to direct this but I'd love to hear your or one of our expert friend's thoughts on elite statuses with airlines. What statuses do you use or find best. What are the best hacks to earn status on different platforms like OneWorld and Star Alliance. I'm a long time AA member but I live in London. With the new AA loyalty programme it's hard for me to earn status because most of my flights are on partner airlines. A recent $700 flight to Frankfurt on BA got me 564 points, but would have been 2100+ points if I'd booked an AA flight! (Good news since I booked through Chase's Portal I got 7K Saphire points.) I'm AA Gold and half way to Million Miler but considering starting over building status with BA Avios. I desperately want to get back to OneWorld Saphire. What's the best way to do that? Kudos on the great newsletter and podcasts, especially the recent one where you broke down how you actually booked your baby moon! And biggest congrats of all on the baby!
Hey Chris! It's been 4 years since I got a Chase signup bonus so I'm thinking of getting a new Sapphire Preferred. I noticed the sign up bonus has dropped down to 60k from 80k or even 100k. You think it's worth waiting until they go back up? Or should I lock in the points while I still can? The last pod w/ Richard Kerr alluded to the high acquisition costs and had me wonder how long these perks would be around. I know you don't have a crystal ball but would love to hear your thoughts! Thanks again for all this great info.