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042: Optimising your frequent flyer points
725 Plays4 years ago
Dinah and Mia interview frequent flyer expert, Daniel Sciberras, from PointHacks.com on the best way to earn and redeem points for maximum value as well as credit card features that help build your balance fastest.
During the interview we chat with Daniel about:
- choosing which frequent flyer programs to belong to based on your own travel patterns
- understanding the value of your points based on how you will redeem them
- the value of using reward points for routes where there is no competition
- the flexibility of reward flights booking particularly during these COVID times
- the value of frequent flyer points and how it varies
- earning points through spending “on the ground”
- the best way to earn points through premium credit card bonus offers
- swapping credit cards every three to four months to make the most of offers available
- what is a good earn rate for a points-linked credit card
- earning Qantas points while you sleep
- what to say when you call your bank to try to get them to waive the annual card fee
- keeping track of your expiring points and the difference between “hard” and “soft” expiries
- using the Qantas and Velocity shopping sites for online shopping to boost your point balance and keep your accounts active
- hacks to buy points from alliance airlines
- the future of reward points programs
- his spreadsheet to keep track of all his reward points accounts, balances, and expiry dates.
Head to the Life Admin Life Hacks Facebook page to connect with listeners and share your thoughts, questions or suggestions.
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Transcript
Introduction to Life Admin Life Hacks
00:00:00
Speaker
Algunos escuchamos música tropica. Elexus, toca música tropica. Otros, preferrimos música roc? No. Elexus, toca roc Latino. Ferro, con no te atre vez a cambiar de ritmo? Elexus, toca música tropica. Tocadino. ¡Vodie estos taueno. ¡Vas siempre un paso de lante. El completa mente nuevo y redi señado, Lexus RX. Vive lo exa ordirario en tu concesionario Lexus.
00:00:29
Speaker
This is Life Admin Life Hacks, a podcast that gives you techniques, tips and tools to tackle your life admin more efficiently, to save your time, your money and improve your household harmony.
00:00:43
Speaker
I'm Diana Roberts, an operations manager who after this interview signed up for a new credit card immediately. And I'm Mia Northrop, a researcher and writer who has my eye on looming 50th birthday travel extravaganza and doing it on points.
Earning and Redeeming Points with Daniel Skiberis
00:00:58
Speaker
This episode we interview Daniel Skiberis from Point Hacks.
00:01:03
Speaker
Hello and welcome to Life Admin Life Hacks. So we were really curious about what travel is going to look like once this pandemic has gone. Frankly, we've been fantasizing about holidays and planning for distant, epic travel when we can actually leave the country. And meanwhile, our points are just sitting there idling away, slowly ramping up. And we've been thinking about the best way to use them.
00:01:26
Speaker
We reached out to Daniel from Point Hacks and he's taken us through all of the expert tips on the best way to earn points, the best way to redeem for value and credit card features that help you build your balance fastest. If you've been dreaming like we have about international business class flights, listen up. Daniel Skiberis is media spokesperson and frequent flyer expert at Point Hacks, one of Australia's biggest online communities of airline rewards enthusiasts.
00:01:54
Speaker
He joined PointHacks in January 2016 and specialises in the area of credit cards with a background in finance for more than a decade. Daniel is an avid traveller and averages around 500,000 points. Is that per year? Yeah, on average, yeah. Fantastic. And has accumulated through his 10 active airline rewards programs. We are in safe hands today. He takes three to eight premium award flights annually,
00:02:17
Speaker
his savvy approach to point earnings. And I can appreciate the irony that we're recording this in the middle of the COVID-19 pandemic when nobody is really going anywhere glamorous. Borders change, you know, open close on a daily basis and the international border is still not open properly. But listeners, we're all going to be able to get our programs and systems optimized so that when that time comes,
00:02:41
Speaker
We can all jet off in our free seats or our business class upgrades. Daniel, thanks so much for coming on the show today. No worries. Thank you. Glad to be here. I thought we might kick us off with thinking about not everyone being sold on the idea of joining frequent flyer programs. So what do you think are the biggest benefits?
00:03:01
Speaker
Yeah, look, the benefits are really that you can experience a lot of adventures, I guess, that you otherwise wouldn't either normally be able to afford or be willing to afford. So, for example, you can redeem points for things such as a business class flight or a first class flight, for example, things that are usually out of the price point or price range of most people.
00:03:24
Speaker
There's also a lot of handy practical uses for points as well. Two of the ones that I'm thinking of is when you're flying to those destinations that don't have much competition, for example. So that's a lot of like a lot of your viewers may be in regional centers or even rural areas as well.
00:03:40
Speaker
where there might be just one airline really servicing a route or a few, but not very often. And you find those airfares can be quite high. So somewhere like, let's say, Brisbane to Mount Heiser, for example, or Brisbane to Mackay, et cetera. The use of points on those flights, for example, economy seats, can be, you know, from as little as, you know, 8,000 points and you're going to get a very good value there.
00:04:06
Speaker
The other key one that really stood out, I guess, during this COVID pandemic as well, is that there's a lot of flexibility if you get a reward seat. So for a lot of people that pay cash fairs, they're usually going for, you know, the eSavers and things like that. There's a lot of restrictions. When you redeem points for a seat, they can be quite flexible.
00:04:26
Speaker
So, for example, I had a number of international reward seats in premium cabins that I used points on, and I obviously had to cancel them if they were over. And I got all the points back, plus all the taxes, fees and charges back. So I didn't have to put it into credit or anything like that. So I had a lot more flexibility.
00:04:42
Speaker
That's reassuring. Yeah. The thing I love about frequent flight programs is it benefits a number of stakeholders. Obviously, I've just spoken about members that they can experience things that they otherwise couldn't. But it also benefits the airlines because they're able to fill seats they otherwise wouldn't be able to sell. And even if you think about it even more broadly, that also has a good impact on the environment, for example, as well, because there's nothing worse for the environment than planes going up in the sky with empty seats. So it's just a really good concept.
00:05:10
Speaker
Hmm. And so there are a range of programs out there. How should someone choose which loyalty program to commit to?
Choosing the Right Loyalty Program
00:05:17
Speaker
Yeah, that's a very good question when I get asked a lot. In Australia, if you're Australian based predominantly, the two main ones at the moment are Qantas Frequent Flyer and Velocity Frequent Flyer. I do say at the moment because obviously Rex Airlines is beginning to enter the domestic market from one March.
00:05:35
Speaker
and they've already indicated that there will be an individual Rex Flyer frequent flyer program there as well. But for the moment, especially if you're travelling domestically, it's predominantly Qantas and Virgin. And what I would say there is just take a look at where you fly and which airline services the routes that you fly with the most. Many of the routes, it's both of them.
00:05:56
Speaker
So I'll come to that in a moment. But for example, I've got my sister who lives in Canberra. My parents live on the Gold Coast. Virgin Australia is the only one that flies directly. So that's a good example of one where, you know, velocity might be the preference in that scenario. And of course, there's scenarios where it's the opposite, where it could be Qantas.
00:06:14
Speaker
So convenience is one thing to have a look at. The other one is just how big is the program and who are the partners? So for example, if you find that you're flying internationally and you, here's another classic example in my books is that I've got a lot of relatives in Malta, which is just south of Italy in Europe. Not many airlines fly from Australia to Malta with just one stop. Emirates is one of them. So Emirates is in a joint venture with Qantas. So for me, given that I fly to Malta once a year,
00:06:43
Speaker
of course. Contas points are much more convenient for me than say velocity in order to get to Malta because the velocities partner Etihad doesn't fly to Malta for example. Look at your individual travel patterns is probably the best advice I can give but in Australia we're very very lucky we've got two very very good frequent fly programs.
00:07:04
Speaker
That's good to hear that they compare well internationally. And I guess because they are plugged into those global partnerships with all the other airlines, it does expand the network of where you can go and where you can redeem those points. So what do most people get wrong when it comes to their frequent flyer points, Daniel?
00:07:20
Speaker
not knowing where they can earn their points and not knowing the best way to redeem them. Look, to summarize what I've just said then, it's not knowing the value of a point, to be honest. A lot of people don't realize that there is a value attached to the point. Now, a lot of people who have been in this game for a long time and I've been
00:07:38
Speaker
I've been in frequent flyer programs for over two decades. No, I can't go and sell points to you and get money from you, for example, because if I did that, I'd be breaking the terms and conditions of frequent flyer programs. But that doesn't mean that there isn't a value attached to them. And in fact, a lot of people say that they're the world's second currency. There's more frequent flyer points or miles out there in people's accounts and there is actual physical currency.
00:08:03
Speaker
So knowing what value they have is quite important. So what do I mean by value? For example, if you've had, if you've got a certain amount of points, you can redeem them for a number of things, such as flights and they can be long haul or short haul, or they can be in first business economy, premium economy, et cetera. You can redeem them for things through the online rewards stores. So things such as, you know, inverted commas, toasters is always,
00:08:30
Speaker
But Kettles also gets a good mention, but also gift cards and things like that. So why do I bring that up? Because by far and away, the best value you're going to get is redeeming your points for long haul travel in premium classes. So like business or first, you can get up to at the very best redemption, 14 cents per point.
00:08:54
Speaker
Now, compare that to redeeming your points for a gift card, whatever denomination, $100, $50, you're almost guaranteed to get around half a cent a point. And of course, all the other redemptions or the other redemptions will fall somewhere in between.
00:09:11
Speaker
So, for example, domestic short haul and economy would be around 0.7, 0.8 cents. International economy is around that 1.2 cent mark. Then as you start going up to premium economy business, it starts to go above that. So, business is around that 4 cent mark per point. So, you can see that it can be, you know, between business and a gift card, it's eight times the value.
00:09:32
Speaker
Yeah, that's really important to know. So all those people who are tempted to look at the online rewards shops and buy, you know, Jafel Makers and redeem them for... That's a good one. That's a creative one, because I'll start using that. Yeah, my husband's got AirPods, which I don't think was a very good use of points. Yeah, look, all I'll say there, though, is I don't want to discourage anyone who might be listening. They're going, oh, my God, I just use my points for AirPods.
00:09:58
Speaker
Because there's always value. You know, you got them for free. You got those points for sort of reverting back to that first question you asked me in terms of the benefits. Another good way of looking at it is, well, what is the cost really? You're not going to get an airline ticket cheaper, for example, if you don't put your frequent flyer number in the booking.
00:10:16
Speaker
or you're not going to get a piece of merchandise or some groceries that coals or Woolworths any cheaper if you don't hand out your Flybuys or Woolworths rewards card. So there's no real cost there. So if you're earning the points, redeeming them for anything is gonna get you value, but there are just some redemptions that are just more valuable than others. Yeah, that's a great way to frame it. So you've mentioned the way people might be earning points just by their everyday shopping. How do most people earn points?
00:10:45
Speaker
Is it through flights or other purchases?
Maximizing Points from Non-Flying Activities
00:10:48
Speaker
Okay, so I think most people earn their points. My discussions with Qantas and I know it's very similar with Velocity is most people nowadays actually do earn their points from on the ground transactions rather than flying.
00:11:00
Speaker
Back in the day, early on in the frequent fly game in the late 90s and early 2000s, it was predominantly flying simply because the only ways to earn points were through flying or through credit card. And that was usually limited as well to something like diners. It was very niche. Now you can earn points from anything. Credit card spend, partners, online partners, online retailers, and they don't have to be in Australia. You can earn velocity points, for example, at Macy's.
00:11:29
Speaker
You can earn Qantas points for just sleeping six hours without moving your phone. Yeah, I saw on the Qantas site they have a frequent walker challenge. Yeah, exactly. That's becoming an annual thing in February, every month, but obviously it's on now. But even outside of February, you can earn points for just walking, absolutely. So there's so many ways to earn points and so many of them now are on the ground that it should be no surprise that it's on the ground transactions.
00:11:57
Speaker
A lot of people still earn their points from the everyday spends, you know, through flyby shopping at Kohl's or Everyday Rewards Woolworths, from their credit card spend. But I'm not sure if this question is coming up, but a slight tweak to it is what is the best way to earn the points? Because that's a slightly different question. I suspect most people are still earning them from everyday spend, but that's a very incremental slow burn way to earn those points.
00:12:24
Speaker
Yeah, I would love to hear how you can sort of optimise your points earning capability. Yeah, and by far and away, the most lucrative way to earn points very quickly. And if for people who are sitting there wondering it, when you're reading my intro, how does he know? We're on the edge of our seat. Yeah, just building it up here.
00:12:45
Speaker
How does he earn 500,000 points every year on average? The most lucrative ways for credit card bonus offers or sign up offers. And by far and away, these have improved tremendously over the years. So back in the day, you know, 30,000, 35,000 bonus points.
00:13:00
Speaker
a good deal. Nowadays, if it's not bordering or even past the six figure mark, it's not a great deal. So depending on the card, of course, so those top tier cards, the blacks, they come out with such creative names nowadays, I remember when gold card used to be the top card, but you know, black, titanium, etc.
00:13:19
Speaker
They give bonuses of 100,000, 120,000 bonus points for signing up successfully on that credit card. A lot of them do require you having a minimum spend, but it's usually quite an achievable one. So something around $3,000 to $4,000 in three months. So that's about just over a grand every month. And so as long as you meet that minimum spend and you get approved,
00:13:42
Speaker
you're going to get like 100,000 or 120,000 points in one hit. Think about how much grocery shopping you need to do to get that many points, right? So that's why it's quite lucrative. We've currently got a deal on a mid-tier card, which is a Platinum card. It's the ANZ Frequent Flyer Platinum card. It's an exclusive deal that we've got running this month at point hacks. And you can get 75,000 bonus Qantas points. There's no annual fee on the card in the first year.
00:14:10
Speaker
Because it's a mid-tier card, a platinum card, it's open to a lot of people. So the income requirements is $35,000, for example. So it opens it up to a lot of people. So if your viewers are sitting there going, oh, I don't know if my income is good enough or anything like that, just take a look at the site, but that's 75,000 Qantas points in one hit. That's the most lucrative way by far and away to earn those points.
00:14:31
Speaker
That's a substantial bonus. And how often can you swap credit cards to take advantage of these bonus point promotions? That's a good question. The technical answer is you can do it as often as you like, but there's a very good chance that you'll get declined if you do multiple applications in a very short period of time.
00:14:47
Speaker
So what we normally recommend is, is to at least leave between three to four months between applications. If you are looking at, you know, trying to maximize those points, there will always be a record of an inquiry on your credit report every time you put in a request for a new credit card. So that's why you don't want to do too many in one go, because what happens then is if you apply for one credit card and then the following week or even the following day, I've heard of some people do this.
00:15:17
Speaker
apply for a different credit card. Well, that second lender's gonna look at you and think, oh, is this person desperate for credit financial problems? So he or she in financial issues. So yeah, so that's why you wouldn't want to do that. So you want to be sensible about it.
00:15:30
Speaker
How often do you swap? Look, I try around every three to four months, but as long as the deal is right. So by that, I mean there's many levers that these offers can take. So you can have, you know, the higher the bonus points, yeah, that's good. But sometimes they might reduce the annual fee, for example. So it might be a $450 annual fee to get 100,000 bonus points. And then you sort of need to weigh up. Is that worth it or not?
00:15:56
Speaker
Now for me, because I always redeem most of my points for those more lucrative redemptions, a lot of the time it is. But everyone's different. So for example, I've got family members who would be more than happy just to fly an economy to LA to take the family over to Disneyland, for example. Obviously that redemption value is going to be less than my business class to Europe. And therefore that equation of, was it worth paying $450, for example, to get bonus points might be different for them.
00:16:24
Speaker
But if you're redeeming for those high value, it's usually going to always be worth it. But there's always bonus offers that usually offer discount annual fees and things like that as well. So you've just got to look at the whole entire offer before you just jump into any of them. So what are the credit card features that people should be looking out for, particularly if their main way of earning points is through purchases?
00:16:47
Speaker
The earn rate is always a good one if they're looking at keeping the card for a longer term. And look, I always suggest that everyone has some form of a base card to work off because even just practically, if you've got direct edits and things like that on it, you don't want to be changing that every five seconds. But the earn rate is definitely the thing to have a look at. Look, a good earn rate is usually one point per dollar. Some cards have that, such as the top tier cards with ANZ and NAB, for example.
00:17:16
Speaker
Other ones are around that 0.75 to 0.5 points per dollar. And with that, it all depends on what type of card it is. So if it's a top tier card not earning one point per dollar, it's probably not the best deal around because those top tier cards should. But if it's more of that cheaper mid tier card, then something like 0.75 points per dollar is going to be a good earn rate for you as well.
00:17:37
Speaker
And you mentioned that sometimes during promotional periods, they'll drop the annual fee, but are there ways to get that annual fee reduced or waived once you're an ongoing customer? Yeah, look, it's happening less and less, to be honest, but it does still happen. And you've just got to ask, really, but you've got to
00:17:55
Speaker
frame it correctly because there were new rules that came into play in 2019, I think it was, in July 2019, which put obligations on financial services providers where if someone simply rang up and said, look, I'd like to cancel my card if I can't get an annual fee reduction, then they were almost obliged to cancel the card because the person said, I want to cancel the card. So they can't really throw offers out like they used to.
00:18:22
Speaker
But if you were to something like, oh look, my annual fee is due and I'm considering all my options and all the offers that are out there. Are there any offers that you could give me to stay with the cards such as that annual fee reduction or waiver? Then they're able to offer you things like that because you haven't said I want to cancel the card.
00:18:42
Speaker
Unfortunately, most consumers just really don't know that. We've read the fine print on what the obligations are. So hopefully, your viewers will get something out of that. But it always pays to ask. Now, having said that, there are, of course, no obligations to do that. And a lot of the time, they won't just be prepared for that. But yeah, definitely ask.
00:19:00
Speaker
If you don't ask, you don't get. Absolutely. That's the way it is, isn't it? It's like giving them an ultimatum and word it a bit more generously. You might have a chance. That's great advice. Yeah. So I think something that's happened to me in the past and certainly has happened for my kids is that points have expired. So what's the best way to keep track of expiring points and what can you do about
Managing Points Expiration and Account Activity
00:19:23
Speaker
it?
00:19:23
Speaker
So firstly, knowing what the exploration policy is is always important. I'm not saying that to be flippant or funny. A lot of people just really don't know what the exploration policy is. And what I would say is most programs have some form of exploration policies.
00:19:38
Speaker
There are a few that don't, outside points never expire. But in terms of our main ones here in Australia, which is Qantas and Virgin, they both have what's known as a soft expiry policy, which is a generous one. So what it means is with Qantas, as long as you earn or redeem just one point once every 18 months, the expiry resets for another 18 months.
00:20:00
Speaker
So technically, you can have a points balance, do nothing in your account for 17 months, buy a pack of chewing gum with your Quanta's credit card earning card, earn three points, and your whole points balance resets for another 18 months. So that's what a soft expiry is all about.
00:20:16
Speaker
With Velocity, it's a soft expiry as well, and that's 24 months, so it's a bit more generous. There are some programs, though, like Singapore Airlines Chris Flyer, which have what's known as the hard expiry policy. So no matter when, whether you have activity or not, your points will expire after a set amount of time. And with Chris Flyer, it's after three years. So there'll be a rolling expiration based on when you earn your points.
00:20:41
Speaker
Really, it does pay to make sure that you are active in your accounts, but there are so many ways to earn points or redeem points nowadays. No one should be losing any points. So even with Qantas members, for example, and there's, you know, there's over 12 million members. I'm sure some of you viewers are Qantas members. Download the Qantas Wellbeing app and start walking or put your phone down when you sleep and don't move it for six hours, which you probably won't be doing if you're sleeping anyway, and you're going to earn
00:21:10
Speaker
Not much, only like around one point a week, but who cares? That's enough to keep your account active.
00:21:16
Speaker
Yeah, that's that's good advice because I did my daughter's account. The points expired because my credit card's linked to my account. So I'm, you know, pitching and stuff constantly. But my accounts, because we hadn't flown for so long, especially last year, there hadn't been any activity of 18 months and she lost all her points were lost. And I also realized that you can't just transfer points in or out. You really have you have to actually earn or redeem
00:21:45
Speaker
Yeah, that's a very good point. Transfers between accounts don't classify as qualifying activity. The other thing I'll tell your viewers is just get into a habit when you're doing, especially if you're doing online shopping.
00:21:57
Speaker
Get into a habit of going to Qantas Shopping or Velocity eStore first to see if the retailer that you're going to buy from is a partner of Qantas Shopping or Velocity eStore, because you'll be able to earn points, additional points through that transaction by just logging into Qantas Shopping or Velocity eStore, putting your details in. And then those sites will take you to the online retailer directly, but it will track your purchase and you'll be able to earn points on top of, you know, any points you might earn from your credit card, for example.
00:22:27
Speaker
And that's exactly what I did with my kids' accounts. I logged in as them with their frequent flyer details and bought, like, Moisturizer or something. Absolutely. But at least their accounts got a little top-up and will be set now for the next 18 months or so. Yeah, absolutely. And there's so many retailers, like, I don't want to be singling out any because I've got no affiliations with them, but one that I've recently done as well is Discount Chemists Warehouse, the Velocity eStore. Like, I just, what I do now is I just go through there, do the purchase, and then drive down to the shop half an hour later and pick it up.
00:22:57
Speaker
And there you go, I've entered some velocity points, my account's going to stay active, I've entered the points, and it's all great. Yeah, so many stores are doing such a better click and collect service. And it also stops you from impulse buying, I reckon, because you've bought what you needed and you don't get sucked into buying, you know, something else as you want to the aisles. You have time to think about it before you press confirm or confirm purchase online.
00:23:22
Speaker
So that makes me wonder, actually, does it ever make sense to buy frequent flyer points? In the Australian context, the Australian programs, I hazard a guess and say the answer is not, well, it's not hazard a guess. I do know the answer. The answer is generally no, simply because the cost per point to purchase a point is around that three cent mark or even more, 3.3 cents, depending on how many points you're buying. Obviously, the more points you buy, they give you a bit of a discount.
00:23:47
Speaker
on there, but it's still quite a high cost. Remembering that, as I said earlier, a lot of the redemptions for economy seats, for example, will not top two cents per point. If you're paying three cents per point to get to buy miles, it's not worth it. Now, when is it worth it? It can be worth it when, for example, you're looking to redeem this awesome long haul premium class reward seat. It's going to get you great value, but you're a thousand points short.
00:24:14
Speaker
If that's the case, do it, because even though it might cost you a little bit more to get those thousand points, you're going to get the value from that redemption. In terms of international programs, there's a few programs that constantly give bonus offers for buying miles or points.
00:24:30
Speaker
And they're usually ones like United Mileage Plus, Avianca Life Miles, British Airways Avios. Depending on, you know, where you fly, they can make sense.
Additional Resources and Future of Frequent Flyer Programs
00:24:40
Speaker
So, for example, I'm a member of Avianca Life Miles. It's a Colombian airline. I've never flown them in my life. I never planned to. I'm not disrespectful to them, but we're in Australia for starters. We couldn't be further away. But they're a Star Alliance member.
00:24:52
Speaker
So they're one of the three global airline alliances, and there's 27, oh, I think it's 26 now, actually, 26 member airlines within the Star Alliance. Some of them include Singapore Airlines, Thai Airways, Eva Air, Air New Zealand, a lot of airlines that fly to Australia. So I can use, I can buy miles cheaply through AV Anchor Life Miles, redeem my AV Anchor Life Miles on Air New Zealand or United or Eva Air or whatever.
00:25:21
Speaker
and take the trip I want. That's brilliant. That's the beauty of just because an airline is in Colombia nowadays, it's not 1972. It doesn't mean that it's irrelevant to us because there's all these partnerships and alliances that are going on. That email course, a free email course on Point Hacks.
00:25:39
Speaker
Tell us about what that covers. Does this uncover little gems like that that you just mentioned? It's due for actually a rewrite. It's still a very good course. It covers all the basics in terms of things such as what are frequent flyer programs, what are the best ways to earn the points. One of the key ones we haven't touched on, the difference between what's known as a direct earn card and a flexible program card.
00:26:02
Speaker
Most Qantas cards are direct-earned cards, meaning that if you take out a credit card and you say, I want to earn Qantas points, then you're locked into earning Qantas points. Whereas a lot of credit cards are part of what's known as proprietary rewards programs, like ANZ rewards, NAB rewards, American Express rewards, where you can earn rewards points, but then you can choose which airline program you want to redeem those points for. And they're generally the preference because that just gives you more flexibility.
00:26:30
Speaker
But we go through that in our email course. Yes, we do go through when it makes sense to buy points or not. So we go through that example, either when you're just short of points or for a good reward, or buying them on and off through a foreign frequent flyer program, but then using those points with a partner or an Alliance Airline member. So a good one for me, for example, is I use Avianca Life Miles to redeem on Lufthansa, which is a Star Alliance member between Frankfurt and Malta.
00:27:00
Speaker
in the show notes. Yeah, that's like next level for me. That's why I limit what I say on that because I could talk for another half an hour just on that. So you obviously, you know, geek out on frequent airline frequent flyer points, Daniel, but there are other reward schemes. You know, there's hotel reward schemes, grocery ones, flyer buys. Which ones of these do you also think that are worthwhile?
00:27:27
Speaker
all of them simply because they're usually free to use. So as I mentioned earlier, in terms of, for example, you're not going to get your groceries any cheaper by not throwing out your flyby's card or your everyday rewards card from your wallet. You're going to get points, so you may as well do it. Same with hotel reward points. The only thing with hotel rewards, so let me just start on the hotel ones. The hotel ones, they can be a bit limiting.
00:27:52
Speaker
So, for example, to earn the points, you generally have to book directly with the hotel. And this is what catches a lot of people out. So, they might book through, well, whatever, Trevago or, you know, all these different third-party sites. If you do that, you're going to be excluded from earning points.
00:28:09
Speaker
So just be aware of that if you go down the hotel point path. But look, a lot of the time, booking directly through the online channel can be quite competitive as well. But do your shopping around when it comes to hotels because you might get a better deal without earning the points. With things like flybys and everyday rewards and that, yeah, absolutely. If you're not a member, join. It's free to join.
00:28:31
Speaker
you can earn points. If you don't like flying, you can redeem them for those, you know, those products, the kettle, anything like that. You can redeem cash now. Absolutely. So with fly-bys, for example, and same with everyday rewards, for every 2,000 points earned, you get $10 off your groceries. Now, again, I would say that's not the best value redemption because you can work out the mass there. That is an easy half a cent per point in value.
00:28:56
Speaker
With fly buys, for example, you can redeem 2,000 fly buys points for 1,000 velocity points. And then of course, if you redeem them for the, you know, business class flights, et cetera, you're going to get more than half a cent per point. And with everyday rides, if you choose Qantas.
00:29:10
Speaker
All right, and I'm making some adjustments. There was something very... There's changing your earnings preferences right now. That's good, that's good. I've heard a lot of you... It just felt simple about getting cash, but I hadn't really thought about, as you said, the value of the actual points. Yeah, absolutely. So with everyday rewards, the way they flybys and work slightly differently in terms of practicality with flybys, it's more the traditional earn the points and you can manually transfer them to velocity, for example, or you can do an auto transfer nowadays. I've just started that.
00:29:37
Speaker
with everyday rewards, you select what you want to do. Do you want to earn everyday rewards points to then get the $10 off? Or do you want to earn Qantas points? And if you choose Qantas, then it becomes an automatic transfer the minute you get 2,000 points. But yeah, you can definitely get much better value that way. Doing it. What do you have to do with right now?
00:29:56
Speaker
So we've already talked a little bit about some of the changes around credit cards. So what other trends do you think there are in points for the future? Where do you see all these points programs going?
00:30:08
Speaker
I think they're just going to keep getting bigger and bigger. I always say that nowadays these airlines are not so much transport companies as they are loyalty and data businesses because that's really what they are. That's where they get a lot of their revenue from nowadays and a lot of their profitability. So I remember people asking me the question I got asked so often last year was
00:30:32
Speaker
Why would anyone pay three point something billion for Virgin when they're making losses year in year? Because of the velocity frequent flyer program in the main. That's where they kind of get a lot of their value from the new owners down the track. So where do I see them going because of that?
00:30:48
Speaker
And it's not just for Virgin or Qantas, frequent flyer businesses are usually one of the most profitable, if not the profitable division of most airlines. So they're only going to get bigger and bigger and bigger. So the opportunities to earn points I think is going to keep growing. I know with some of my discussions, I won't say exactly which frequent flyer program because that will be coming out soon, but going to be more focused on earning points from the more everyday spend type transactions.
00:31:15
Speaker
That reflects the fact that if it's more of the everyday transactions, more people will get involved, which will then make them even more profitable. I think the opportunities to earn will become greater and also to redeem, and technology is going to play a big part in that. So, for example, some of the limitations, for example, for a corner store to be
00:31:34
Speaker
able to offer frequent flyer points is the IT limitations, for example, to feed into the airlines frequent flyer programs to record a member who has purchased a milk from the corner store and to get allocated points. It was just all too expensive.
00:31:49
Speaker
But as new technology comes into play, such as blockchain technology and things like that, those things are going to become very cheap and easy as well for even for any retailer that wants to become a partner of these frequent flyer programs to help them apply new customers as well through the allocation of points.
00:32:07
Speaker
Wow, I do have one last question. I'd just be so keen to understand you've obviously got lots of different frequent flyer accounts and keeping track of all those points. I'd love to know what systems you use to be able to remember all the passwords and keep track of what point balances you've got all over the shop.
00:32:24
Speaker
Well, I've created my own Excel spreadsheet and I don't expect everyone to do that. But I realized I did need to do that because you do lose track. You can lose track. For me, it wasn't so much the balances. I always had a good idea as to where I was with most of my programs. It's more those expiry, especially with the hotel frequent guest programs where, for example, if you don't.
00:32:44
Speaker
stay at a hotel, for example, within a 12 or 18 month period, your points expire. So for me, it was like, at least I know if I haven't stayed there for 11 months, next time I need to go for a business trip or a leisure trip, I'll try and stay at that branded hotel. And a lot of these hotel chains, for example, have so many brands nowadays, you've always got to find a good deal, the right price point generally. So I have an Excel spreadsheet that I use that I update maybe once a week or something like that.
00:33:11
Speaker
And yep, with expiry dates and things like that. And I mean, look, I used to be an equities analyst in my past lives. So I've built like little formulas in there as well that automate everything for me. But even if you don't have that skill set, you can just put them in manually and you can just see them. And, you know, there'll be a trigger there for you to think, okay, well, these points are expiring or this is how many points I've got in this account. And it can be good because sometimes you do forget, especially if you're inactive in one of the accounts for quite a while.
00:33:38
Speaker
I'm a bit of an Excel freak myself, Daniel. So maybe we can geek out offline about our Excel spreadsheets. It's a lot of fun seeing those balances grow.
00:33:51
Speaker
Some people who have been sitting on the fence and kind of ambivalent about frequent flyer programs and whether they were worthwhile, right? I think we've had enough evidence in this episode to be convinced that, yeah, it's something for nothing, essentially. Current memberships, but could be tweaking the way that they're earning.
00:34:09
Speaker
and redeeming for more value. So this has been a really insightful conversation. Thank you. That's good. And just one final thing I'll say is just like anything in life, you just do a bit of research on these programs, go to the program's websites, because the more you know about it, the more you'll get out of it. And the people who usually find a negative towards these programs, the people who just haven't really looked into it and didn't really know the best ways to use their points or earn them for that matter.
00:34:33
Speaker
Thanks so much, Daniel. Such a pleasure chatting to you today. Where should our listeners to go if they want to dig deeper into maximizing their frequent fire points? Of course, I'm going to say point hacks. www.pointhacks.com.au So it's point, a singular point, and hacks because there's like points hack as well, which is not us.
00:34:55
Speaker
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00:35:24
Speaker
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