10
May

How 10 Minutes Can Save You $4,231: A Real-Life Case Study!

Posted By Trav

For those of you making over $423 a minute, or $25,386 an hour, don’t waste your time reading my article or learning about frequent flyer miles.  Don’t even waste time brushing your teeth!  Just do keep doing whatever the heck it is you do and enjoy taking baths in your money.

Everyone else, continue reading.

A month ago, I wrote about the Joy of Miles and how frequent flyer miles were giving my parents the opportunity to visit me in Japan and to even fly home in first class.  Now, I’m getting an even better surprise:  My sister will also be joining them in Japan as one stop on her around the world itinerary.

My sister’s a missionary who will begin serving pilgrims on the Santiago de Compostelo in July, so you know she’s not rolling in money.  So how’s she able to jetset to visit friends in New Zealand and then come see me and Heather in Japan before flying over to Spain?

Simple:  MILES!

The first thing I always hear when talking to people about travel is “I’d love to go to ________, but I don’t have the money.”

Ok, no problem.  I introduce them to the perfect solution:  collecting frequent flyer miles.

They listen, usually intrigued but still skeptical, and the next thing I usually hear out of their mouth is “but I don’t have time to learn about all that.”

Really?  What if I showed you how 10 minutes of your time could be worth $4,321?

10 minutes? Yeah, right!

Go get a timer (iPhone, egg timer, count “mississippi’s in your head…it doesn’t matter). Set it to ten minutes, hit start and..

1.  Go to the Best Current Deals page and click on the link for the Citi/AAdvantage cards (it’s the #1 deal, so you can’t miss it).

2. Open up one tab for the Mastercard application and one tab for the Visa application.

3.  Fill in the information and hit submit simultaneously.

Did that take you more than 10 minutes?  I didn’t think so!

Want more proof that it takes less than 10 minutes?  My sister followed this same procedure last June, has done nothing extra since, and has a bankroll of 150k AA miles in her account (you’ll be receiving 100k AA miles because the current deal is for 50k miles a card, not 75k like when she signed up).

Ok, so what about this $5,000 you promised?  That’s got to be exaggeration, right?

Wrong!

Again, let’s look at my sister Gale.  Her itinerary looks like this:

June 9th:  New York (JFK) to Auckland, New Zealand (AKL).

June 22nd:  Auckland (AKL) to Tokyo, Japan (NRT)

July 4th:  Nagoya, Japan (NGO) to Santiago de Compostela, Spain (SCQ)

Her cost in miles:

JFK-AKL in economy class:  32.5k AA

AKL-NRT in economy class:  30k AA

NGO-SCQ in business class:  35k AA

Total:  97.5k AA miles.

I’m no math major but even I know that 97.5 < 100 (your signup bonus for the two Citi cards).  The ten minutes you just took to get those 2 Citi/AAdvantage cards could net you a trip EXACTLY like my sisters!

Now let’s take a look at how much it would cost for her to take the same trip if she paid for her tickets.  I’ll be using the prices I found on the ITA Matrix, the website travel agents use to find the absolute best prices for airline tickets and the #1 go to for flying experts when looking to purchase tickets.

Flight #1:  JFK-AKL in economy

The cheapest ticket she’d be able to find would be $1,131, flying Air New Zealand and AA.  While not the exact same ticket that she booked with miles, all the important parts are comparable (duration, time departing, etc).  Her actual ticket on Qantas would cost $1,431, so if she was actually buying tickets, she’d save the $300 and book the cheaper one.

Flight #2:  AKL-NRT in economy

Because the flight departs from New Zealand, prices are shown in NZD. I’ve converted the prices to US dollars below.

The cheapest ticket is $836 US dollars (1,063 NZ dollars) but takes 21 hours because of a layover.  The actual ticket she booked with miles is with Air New Zealand is direct and costs $858 USD (1,091 NZD).  Saving 10 hours for only $22 more?  Ummm…yeah!

Total cost so far:  $1,131 + $858 = $1989

Flight #3 NGO (Nagoya, Japan)-SCQ (Santiago de Compostela, Spain) in economy

A list of possibilities with prices in yen. 83 yen = $1

The decision to fly out of Nagoya instead of Tokyo was made because Nagoya airport is closer to my home in Japan and easier for my sister to get to.  I checked Tokyo tickets just to be thorough and the prices were the same.

The cheapest possible ticket is $1,630 (130,410 yen) but this is a bad option since it takes 35 hours.  My sister’s actual ticket booked with miles will take 20 total hours, so I found the cheapest possible ticket with a comparable duration.

A list of flights that have durations somewhat close to 20 hours.

The best ticket for both price and duration is a China Southern and Finnair ticket for $2,242 (179,420 yen).  While it takes almost 23 hours, as opposed to 20, and makes 3 stops instead of 2, I’d prefer this ticket to what her actual Finnair + Iberia flight would cost (see below)

The out of pocket price for her ticket would be $7,915 (633,260 yen)! That’s insane!

Ok, so let’s look at our total costs:

Total cost for the cheapest comparable flights: $1,131 + $858 + $2,242 = $4,231

Totals cost for purchasing her exact same flights:  $1,431 + $858 + $7,915 = $10,204

If we add it all up, we get 10 minutes of your time = $4,231.  

Still believe that you “don’t have enough time” for frequent flyer miles?

Those of you who are already converts, have you had trouble convincing friends and family of the awesomeness of frequent flyer miles?  What are the best trips have you taken with miles that you’d never be able to afford to pay for?  Comment below!

(image courtesy of Delwin Steven Campbell)

25 comments

  1. Steve says:

    Great post. Keep up the good work on the blog.

  2. jerri arlan says:

    hi! i just applied for the citi aa advantage visa worth 50,000 points. (and was approved) but no where on the app does it say anything about it being worth any points at all! is this still in effect? let me know. thanks!

    1. Trav says:

      @Jerri Arian- It won’t say it anywhere, actually. In order to verify that you are getting the bonus and what the minimum spend is, you’ll have to call in and ask. If you applied with the links on this site, then you should be getting the 50k offer.

  3. Janet Wehrer says:

    My husband and I used Frequent Flyer miles when we planned a trip to Italy. We have used them also to fly us in to Boston. We rented a car and had a great trip through the northeast. We also used them to pay for three nights in London as part of our trip to Ireland last year.

    1. Trav says:

      @Janet Wehrer- Awesome! The truly are the best way to get to your dream destinations for super cheap!

  4. christina says:

    How would I start if I have no credit or current employment, are travel credit cards different? I really want to go to Asia (Beijing) and see if I can do it on 100 or so, is that even possible?

    1. Trav says:

      @christina- That is going to be very hard. You’ll need to show proof of employment usually to get a credit card. I’d recommend looking in to getting an easier credit card to get approved for first, then building up your credit, then going for the best travel credit cards. You may want to consider the Chase Freedom, that is a good one for people with limited credit history.

  5. Ben says:

    I’m no financial buff but tell me if I’m wrong when I say I’m pretty sure each time you sign up for a credit card, your credit score takes a hit. Also, would anyone in any country be able to sign up for these cards? My wife and I hope to go to Chile some time in the next year so this would be fantastic.

    1. Trav says:

      @Ben- Your score does take a small hit, yes. But it bounces back up after a few months, and in the long run, it usually actually helps your score to have more cards open. Of course, you should be tracking it. Here is the case study I did: http://www.extrapackofpeanuts.com/credit-card-affect-on-credit-score/.

      Only US citizens can do this deal, but you can get the cards if you are living in another country. When I was in Japan, I just used my US address, signed up, had them sent there, and then had my parents forward them to me in Japan.

  6. Desserae says:

    What about all the taxes and fees? I’m trying to book travel with points. We do have the AA Citicard and it’s awesome. However, the fees still add up to 2700.00 for our family of four. Is that typical?

    1. Trav says:

      @Desserae- No, that’s not typical. You’re probably getting hit with a massive fuel surcharge. Are you using your AA miles to fly on British Airways? If so, it’s a fuel surcharge. You need to find flights that don’t charge you them. Here’s everything you need to know about fuel surcharges: Fuel Surcharge 4 Part series.

  7. Maria says:

    Hi there! I am so excited about the prospect of using frequent flyer miles. My partner and I want to go to New Zealand for an extended amt of time from the USA – should we make NZ the destination or a long stopover? Or an open jaw and go elsewhere after it..then book a flight out of some other country? Ideally we would be hopping around Oceania and SE Asia – so much we want to see there. Any advice would be SO helpful!

    Thanks,
    Maria

    1. Trav says:

      @Maria- It depends what miles you are using. If you are using United, yes, you could stopover and open-jaw. Or if you are using USAirways miles. You can start with this post, it’ll tell you all about stopovers and open jaws.

      However, if you are using AA miles, you might just want to book one-way ticket there, and then book smaller tickets while you are there. You can get cheap Air Asia or JetStar tickets within the region.

      1. Maria says:

        Hi, sorry I should have clarified. Yes, I have some United miles and plan to sign up for a card for more. Is there a limit on how long you can be at the destination? If we wanted to make NZ our destination since we want to be there for a half-year, are there restrictions? Did you or anyone you know do this kind of trip? And if I travel with their partner, Air NZ, is that an open jaw or is that still part of my trip?

        1. Trav says:

          @Maria- The restrictions are that you have to finish your travel within 365 days. So, in essence, you could stay at the stopover for 364 days, go to the destination for 1 day, and then fly home. This post is all about stopovers and openjaws on United and will answer a lot of your questions.

          If you want advice on which cards to open next to get some United cards, feel free to fill out this form: Free Credit Card Consultation and I’d be glad to help.

          As far as anyone who books these trips, we actually do that here at EPoP. So if you’d like someone to book the trip for you, fill out this form: Award Booking Service. It’s $150 for the first person, $100 each additional person.

  8. Jesse says:

    I only see the Mastercard version of the AAdvantage card. How do you apply for the Visa version?

    1. Trav says:

      @Jesse- Nowadays, there is only version. Back in the day, there were two. If you need help finding the best card, fill out this form and I’ll help you out: Free Credit Card Consultation

  9. Julia says:

    What is your suggestion for when you’ve cruised through all of the credit card offers and collected all those point perks? How can we keep earning large quantities when the card bonuses are no longer an option?

    1. Trav says:

      @Julia- Well, it does become tougher. But there are new cards that pop up, or cards that aren’t as good but still worth it (like hotel points for me). Also, some cards you can get again if it has been 2 years since you opened them. So you can get it again if you haven’t opened it in the last 2 years and it has been closed.

  10. Rob says:

    Trav,
    How old is this post? The Citi/AA card I see on their website has no free points at subscription, only some optional points that you receive if you spend a huge amount of money within the first month’s of having the card…. ? Thanks a lot again!

    1. Trav says:

      @Rob- This is an older post, but the Citi AA card still does have a 50k offer for spending $3k in 3 months. Just click the “travel credit cards” tab at the top of this site and it’ll take you to an updated page. Then scroll down and look for the Citi Advantage Platinum card. You’ll see the 50k offer.

      DON’T confuse it with the Citi Advantage EXECUTIVE card though – that has a $395 annual fee.

  11. Claire says:

    I’ve discovered your site while looking for info on fuel surcharges, and have found a lot of interesting tips on here! Only I get superfrustrated about all the great deals you can get by using travel credit cards…as a European resident, we don’t have those so all advantages that come with the travel miles are non-existing to us :( not fair! Have you heard of anything similar for non-US residents?

    1. Trav says:

      @Claire- Yeah, you can still do it, just not as lucrative of credit card offers. Depends where you live, as well. U.K traditionally has better deals than other European countries. Where do you live?

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