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Now until December 31, 2014 any Flight Booked on Southwest is Buy One Get One Free!

You read the title correctly folks, for the next 16 months any flight that I book on Southwest will include a free ticket for my wife!  Unfortunately, this does not apply to everyone, but only applies to very valuable customers such as myself.  As I have tried to make clear throughout every post of this blog, I am not particularly affluent.  I do enjoy traveling, but the fact is that I have not been on an airplane in about 8 years and my wife has never flown.  This makes having the ability to fly so inexpensively even more exciting for me.  Yesterday, I signed into my Rapid Rewards account and found the following:

Southwest Companion Pass Earned

 

As the above photo states there are two ways to earn a “Companion Pass”.  Method A, requires making 100 “qualifying flights” during one calendar year.  As I have already stated, I have made 0 flights in over 8 years.  The other method is slightly more attainable.  Method B, requires you to earn 110,000 rapid reward points over the course of one calendar year.  That is the one I did.  As you can see above, I have accrued 110,519 points.

 

How did I do it?

Obviously that sounds like a ton of points and it is, but there are definitely some shortcuts to take to get you there quickly.  The first thing that I did was sign up for two Southwest Credit Cards, each one had a 50,000 point bonus.  After meeting the $2,000 spending I had 104,000 points in my account!  Gathering the next 6,000 was not quite as easy.  I continued to use my credit cards to gather points at a rate of 1 point per dollar spent.  This earned me 2,116 additional points (I would have much rather signed up for another credit card and received a nice bonus).  I also used the Southwest shopping portal this earned me 303 extra points.  I could have really maximized this method, but it seemed that I always waited too long when a great reward came along.  Some of the best included 9 points per dollar at Staples and 6 points per dollar at sears.  I was going to buy a TV from Sears and that would have earned me the 6,000 points no problem.  I messed around waiting for a big reward total and then feared I would miss getting the pass in time for my flight.  Although transfering points from Chase Ultimate Rewards do not count toward the pass, transfers from Hyatt do count.  I transferred 8,000 points from Chase to Hyatt, then those 8,000 points turned into 3,600 Southwest points.  Not a great ratio compared to Chase’s 1 to 1 ratio, but still earned my pass.

I booked my flight for October back in June when the prices got very low.  With the 110,000 points in the account I was able to book flights from Louisville, KY to San Diego, CA for 18,000 points round trip.  If my wife and I were the only two flying we could fly across the country for 18,000 points total.  We spent another 18,000 points for my daughter’s ticket, but it’s still pretty amazing that a family can fly across the country for 36,000 points especially when those points all came from signing up for a couple credit cards.  Each card had a $100 fee, so we will be able to take 3 round trip, cross country trips for $200 bucks.  If we leave the kids at home we would get even more value.

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How I earned 6% Cashback and 20 points per dollar on Spending this year

 

“Daddy, can we fly on a plane someday?” A simple question set forth by my daughter January of this year. As a father and husband I wanted nothing more than to book a flight to some beautiful destination at that moment. Unfortunately, in my capacity as the personal financial planner I am much less flexible. Absent a wealthy philanthropist deciding to sponsor our family sometimes we will not be afforded certain luxuries.

 

 

A few days later my brothers returned from a ski trip and my mother suggested that we take a big family ski vacation during Christmas Break. In the same way that my daughter’s idea to fly on a plane sounded fun, this also sounded great. However, my mind slipped back into the “how can I make this happen” mode. Obviously to even consider this kind of endeavor we would need to tighten our purse strings and save as much money as possible. We would need to purchase at least 3 plane tickets, which would cost at least $300 each. At this point I stumbled upon credit card offers that may help my family out.

 

 

I have been a long time user of a couple different cashback reward cards and feel that these are fantastic. The first card I signed up for was an American Express Blue Cash Preferred Card that would earn me $200 sign up bonus and 6% cashback on any grocery purchases. At this point I figured that I would buy gift cards from Kroger and use the extra $200 bonus to pay for these. This card also has a 0% intro rate for 12 months so it was nice. This card is very nice, but is only part of my overall spending strategy. It seemed that the more I looked into credit card offers the more benefits I found.

 

 

After that card I found the Chase Sapphire Preferred Card which has a 40,000 point signing bonus which can be used as a statement credit and be worth $400! I signed up for this card as well, met the spending and got the bonus points.

 

 

My biggest score of the year I will be writing in more detail about in a few days, but I was able to sign up for 2 Southwest credit cards. This netted me 106,000 points which are good toward about $1,908 worth of flights, but it actually gets better. When you earn 110,000 points in one year you earn a “Companion Pass”, this allows me the opportunity to bring a companion (my wife) along with me for free on any trip I book. Even if that flight is booked and paid with points. This effectively doubles the value of my points.

 

 

So far this year, as of 7/30/2013, my wife and I have racked up many miles, points and cashback. These have been earned through cashback portals and credit cards. In cashback alone we earned more than $775 in cashback. Even after paying the $75 annual fee on my AMEX we have earned over $700 cashback this year on our AMEX, Discover, Gas Reward Card and TopCashBack. We earned nearly 6 cents back on every dollar spent. We used this money to purchase a computer, which I built.

 

 

Even more amazing is our return on points and miles! We have earned over 400,000 miles! Even if you value these at only 1 penny each this means we have $4,000 worth of travel in our future. However, 235,000 of these miles can be used toward Southwest, which means they are worth about 1.8 cents per mile (doubled to 3.6 cents per mile with Companion Pass)! If we used all of these for flying Southwest we could get as much as $8,460 worth of travel on those 235,000 miles. Most of these points and miles came from bonuses and they all came from spending money normally. We earned nearly 20 points per dollar spent. That is like getting a 20% (or more) discount on everything we bought, even after finding the lowest prices.

 

 

In order to maximize our points per dollar spent we focus our credit card spending on those cards that provide the biggest payoff. I have a 6% Grocery Card, 5% Gas Card, 2 points per dollar on restaurant and travel. Even with these bigger returns my focus is on meeting spending limits on individual cards that offer big bonuses. If I need to spend $5,000 in 3 months to earn 60,000 points this is far more lucrative than the 5% or 6%. So if I am at the grocery and have not hit my $5,000 amount I will use the card with a spending goal rather than a 6% grocery card.

 

 

Using credit cards has been very lucrative for us this year and we look forward to taking many enjoyable trips at a deep discount. The use of credit cards inappropriately can be very dangerous. If you do not have the money to spend in cash, then using a credit card for spending is out of the question as well. We pay off our bills every month and have not paid any credit card fees over this amount of time. Also be sure to not bite off more than you can chew. For instance if you spend $1,000 a month normally do not sign up for cards that will require you to spend $4,000 each month in order to get the bonus.

 

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Going to Walt Disney World on a Budget (Part 1)

Walt Disney World

 

In February of 2011 my wife and I started discussing taking a trip to Walt Disney World.  This trip would be the third trip for me and the first for my wife and daughter. Our goal was to have a quality vacation while going to Disney World on a budget.  A trip to Disney World will never be cheap, but there are ways to incorporate more value into the proposition.   Initially our interest was sparked by low priced fares to Orlando, but eventually we decided that we had better options.  The biggest part of saving money is taking the time and energy to slow down before making financial decisions.  Spending $350 to fly 3 people to Disney World seems like the obvious best choice.  Then we needed to evaluate all other expenses that exist based on the flight.  In order to get the discounted pricing we had to fly into Orlando’s Sanford Airport which is located further form Disney World, thus requiring transportation.  If we flew we would need to either take a shuttle or rent a car in order to move around the world.

Ultimately, we chose to extend our existing June road trip to Panama City Beach.  In total, this would be an 1,800 mile round trip, compared to 1,200 miles to simply drive to Panama City Beach.  We decided that the extra 600 miles driving would be the more affordable option.  We stopped on the way down and visited my cousin which really worked out well.  With this option we drove our own car, packed everything we needed and spent a little more than $100 in gas.

The most important part of the transportation aspect is figuring out how much each decision is costing you on your trip.  Even if the cost of flying and driving was exactly the same there are other factors that must be considered when making a decision.  Bags may cost extra on some airlines, but as long as your automobile is big enough you can pack whatever you want.  No need to rent a car or rely on shuttles.  One warning about relying on shuttles if you are staying off property at Disney World be sure to check the shuttle schedule.  We had considered taking a shuttle to the Disney Parks every day, but it turns out that the shuttles only run at about 4 am and noon.  So you either need to be the kind of person that arrives at the park super early or super late.  I love to get to the park before it opens, but during our time there I did not find it necessary to arrive too early.

Although we loved driving and found it very convenient for us  especially when we arrived we are still evaluating our options.  Just to drive from our house to Walt Disney World is 1,700 miles round trip.  If we get 17 miles per gallon in the SUV, that works out to 100 gallons of gas or between $350 and $400.  The most interesting way that I am considering for our next Disney trip is to fly Southwest.  They offer flights for about $220 per ticket, which is $660 for the 3 tickets we would need.    Another way to do this is by using Southwest Rapid Rewards for 13,600 points per ticket, which is 40,800 points for the 3 tickets we would need.  Unfortunately for me I have not flown in years, my wife and daughter have never flown.  How would such a limited traveler even consider using frequent flyer miles?  This is where using a credit card bonus comes in handy.  I signed up for a Southwest Airlines card from Chase with a Bonus of 50,000 points!  This means by simply applying for a card my family will be able to take a trip to Walt Disney World.  Sounds like a pretty great trade.

Even if we fly for free we will need to make arrangements.  We will need to rent a car making sure to use a shopping portal and searching for any promo codes.  An inexpensive car can be found for the week and cost less than driving to Orlando.  Another great method is if you stay at a Disney Hotel you get free transportation from the airport.  This includes picking up your bags and delivering them to your room for you!

In Part 2 of Disney on a Budget I will evaluate how we decided on our lodging in 2011 and the ways in which we might change our methods going forward.  Should we stay at the park or out of the world?  Should I buy the dining plan option?

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