Stop It

I’ve become increasingly annoyed by an expression journalists and commentators use to describe public policy responses to the COVID-19 pandemic in the United States. It seems like every day I read or hear somewhere that there’s “no plan” to deal with the surge in cases and overwhelmed hospital ICU’s, there’s “no plan” to deal with the looming economic catastrophe when expanded unemployment benefits expire at the end of July and the nation is gripped by an unprecedented wave of evictions, there’s “no plan” to provide education or childcare when the school year is supposed to begin in August or September, and so on.

This is a fundamental misunderstanding of the situation. There is a plan, and denying it won’t make it any less horrifying.

Stop saying there’s no plan just because the plan is horrifying

If you spend much time at all around poker players, you quickly learn to identify a kind of charming fatalism: obviously poker players prefer to win hands rather than lose them, but there’s no skill in being dealt winning or losing combinations of playing cards. What poker players take the most pride in is not winning, but correctly calculating their odds of winning, and then betting, calling, raising and folding accordingly.

Poker players, and occasionally economists, tend to assert that this attitude is natural, common and desirable: people do, and should, go through life making calculated bets on various outcomes, and those with better calculators see more success than those who calculate poorly, just as over the course of a week, year, or career poker players who are able to calculate their odds faster and better tend to win money from those who calculate poorly or slowly (or not at all, like most of us weekend poker warriors). The retired player Annie Duke wrote a whole book with this very premise.

There are two related problems with this idea: humans are exceptionally bad at calculating odds, and humans know they are exceptionally bad at calculating odds. If only one were true, there might still be hope: good calculators would rise over bad calculators, precisely as good poker players over time outperform bad poker players. But because people are self-aware enough to know they’re bad calculators, they largely refuse to participate. To put it slightly differently, getting to the final table at the World Series of Poker requires a tremendous amount of skill, but which of the nine highly-skilled players takes a ring home reverts to a matter of luck.

What are sometimes called cognitive “errors” are often adaptations to our self-conscious inadequacy as calculators. For example, “loss aversion” is sometimes used disparagingly to describe the willingness of people to “overpay” for products like life insurance or annuitized income compared to their actuarial value. But it’s at least equally true to say the so-called “error” is a recognition of the difficulty of quickly and accurately calculating the value of those products. Likewise, health insurance deductibles and cost sharing are supposed to encourage people to carefully calibrate the amount of care they need and are willing and able to pay for. Unsurprisingly, people hate them because they recognize the task is beyond their abilities.

For precisely the same reason, rich democratic societies implement income redistribution, old-age and disability pensions, and public service provision not as well-calibrated bets on their likely costs and benefits, but in acknowledgment of the uncertainty of those costs and benefits. It’s better to have SNAP benefits and not need them than to need them and not have them.

I say all this because it gets to the core of the public policy response to the pandemic. It is incorrect to say that there is “no plan” to respond to the wave of death, homelessness, and poverty about to sweep the country. The problem is that the nation’s governing party is attempting to follow Annie Duke’s advice and “think in bets,” perfectly sizing policy according to the weighted average of all the possible outcomes. As we saw in the example of poker, the fact that public policy has failed does not mean the calculation was wrong — even a perfectly sized bet will lose if the cards fall the wrong way. But that is why we do not ask and should not ask our politicians to think in bets: we know, as they should know, that it is not something we or they are capable of doing with any precision.

Over and over again the Republican Party has placed bets on the course of the virus, and over and over again the nation has lost those bets. This does not mean the bets were improperly sized, or the odds incorrectly calculated. But it does mean our leaders were attempting something they should have known they have no capacity to do, and so we pay the price for their hubris.

Stop saying schools can re-open

While the idea of the Senate going on a three-week holiday while the country braces for impact is revolting, I find the best illustration of this problem to be various states’ plans to begin the school year on schedule at the end of August or beginning of September (a bit less than two months away). Perhaps students will alternate weeks of in-person instruction in order to allow for social distancing, or perhaps they’ll attend on alternating days, or perhaps we’ll repurpose recreational facilities or football fields to allow mass instruction on Jumbotron screens.

This is fiction. By October 1, virtually every school in the country will be closed. I can say this with complete confidence not because I know anything about epidemiology, disease transmission, vaccine development, or the latest clinical trial results. Instead, I say it with complete confidence because it is an example of public officials doing something they cannot and should not try to do: perfectly calibrate a policy response so that the downside risks and harms are perfectly matched by the upside risks and benefits.

Again, if you don’t like the outcome of millions of parents forced to choose between working or childcare, paying rent or facing eviction, feeding themselves or feeding their children, living independently or moving in with friends or family, then say so. But don’t say there’s no plan. That is the plan.

Stop spreading the virus

Of course, we’ve known the solution to the pandemic for months, because it has worked everywhere it has been tried: stay at home whenever possible, practice social distancing, wear a face covering over your nose and mouth whenever possible, wash your hands with soap and warm water whenever possible, use a 60%+ alcohol hand sanitizer when soap and water aren’t available.

But note, this is the opposite of thinking in bets. Don’t go to bars or restaurants when they “aren’t too crowded.” Don’t hold parties with “just a few friends.” Don’t leave your face covering at home when you’re just running a “quick errand.” You aren’t capable of making those calculations, and you know it.

Of course, if our rulers knew it, we wouldn’t be in this mess to begin with.

When better-than-free grocery store manufactured spend pours

I don’t think it’s an exaggeration to say we’re in a kind of golden moment for grocery store manufactured spend, with widely-held credit cards like the Chase Sapphire Preferred and Reserve, the Chase Hyatt cards, and the American Express Hilton Honors Surpass and Aspire cards all offering increased earning at grocery stores (in the last case until the end of July), while grocery stores have been sending out volley after volley of negative-cost manufactured spend opportunities.

The fact that, yet again, two of my local chains are offering bonuses on the purchase of prepaid debit cards nudged me to think a little more deliberately about the various shapes these bonuses take.

Cash, groceries, or gas

In my neighborhood, I basically have two equally-distant grocery stores: one, a Safeway, participates in the “just for U” (alternately spelled “Just For You”) rewards program, along with Vons, Randall’s, Albertsons, Tom Thumb, Acme, Jewel, and Shaw’s. The other, Giant, belongs to the same corporate structure and shares a similar loyalty program with Stop&Shop and Martin’s, although there are sometimes-significant regional differences. Of course, other folks have access to different chains and loyalty programs, with Hy-Vee, Kroger, and HEB being important regional grocery chains with their own loyalty programs.

Currently, both Safeway and Giant are offering incentives to purchase MasterCard prepaid debit cards:

• Safeway: “Save $10 when you buy $100 or more in Mastercard gift cards.”

• Giant: “Earn 2x points when you purchase any Mastercard gift card with your Giant card.”

Normally these deals hopscotch around each other, so it’s rare (though not unheard of) to see virtually identical deals running simultaneously. The basic value proposition is, you can either save $10 up front (buying a $500 MasterCard gift card for $495.95 at Safeway), or you can earn 1,012 points to redeem later (buying a $500 MasterCard gift card for $505.95 at Giant). Since my market is a “Flexible Rewards” region, those 1,012 points can be redeemed for $10 off my next grocery purchase. In other words, as long as I’m sure to use my discount before it expires, and as long as I’m willing to shop at the Giant, the two promotions should be more or less identical. When they’re offered simultaneously I’ll still prefer Safeway’s upfront cash discount (money can be exchanged for goods and services), but Giant’s grocery discount works for me too.

The wrinkle is, those Giant/Stop&Shop/Martin’s points can also be redeem for per-gallon discounts on gas, and if you drive, you might have a strong reason to favor Giant promotions over Safeway. That’s because, even in markets where gas discounts are capped at $1.50 per gallon (1,500 points), you only need to buy a little under 7 gallons to come out ahead compared to a $10 grocery or upfront discount.

This creates a kind of charming game of rock-paper-scissors:

• A cash discount from Safeway beats a grocery discount from Giant;

• A grocery discount from Giant beats a gas discount if you buy less than 6.66 gallons at a time;

• And a gas discount beats a cash discount — but only if your gas savings are higher than your cash savings.

Of course, this is another way of saying, “the more money you save, the more money you save.” If Giant is already your lowest-cost grocer, then every dollar you save there is worth a dollar. If Shell is already your lowest-cost gas station, then every dollar you save on gas is worth a dollar.

If the need to redeem your savings drives you to a higher-cost grocery store or gas station, that won’t eliminate all your savings, but remember to keep in mind it does reduce them.

Conclusion

Grocery store manufactured spend is one of the most geographically varied techniques out there, with the same corporate parent sometimes having different policies between brands and stores in different regions. For folks with unlimited liquidation capacity, the purchasing side might pose the biggest hurdle to scaling up, while folks with limited (or extremely limited) liquidation capacity may need to carefully select only the highest-earning purchase and redemption opportunities.

In either case, make sure that when you make or refine a manufactured spend strategy you’re comparing apples to apples.

The Plastiq website redesign and a "known issue" with recurring payments

Plastiq occupies a strange space in the world of travel hacking, since almost everyone seems to have strong feelings about it, but for a wide range of different reasons. When Five Back Visa Gift Cards could be used to manufacture spend at eligible merchants, you’d often be left with a “rump” balance on the cards once the cash back posted, which was easy and cheap to liquidate with Plastiq. When certain prepaid debit cards could be liquidated for a 1% fee, it was a convenient way to scale up your volume from home, albeit at a relatively high cost.

But my favorite use of Plastiq has nothing to do with manufactured spend. Rather, it’s been to automate transactions made with bank-issued debit cards, like the 12 monthly charges required to trigger an elevated interest rate on the Consumers Credit Union Free Rewards Checking account, or to maximize deposits to “round-up savings” accounts which can only be funded by making debit card transactions (ideally transactions ending with $0.01, so the maximum amount of $0.99 is transferred to your savings account).

Plastiq broke their website

The beauty of using Plastiq for these transactions is they require minimal maintenance: you can schedule monthly or weekly transactions far into the future, requiring upkeep only when a payment schedule is about to expire or a debit card needs to have its expiration date or CVV code updated.

What I found when I went to restart another 6 months or so of daily round-up transactions was that my Plastiq account had been “upgraded” to their new interface. Most or all of the same features were still there, but they were all a little more annoying to access. Instead of selecting your payment card at the beginning of a payment, you select it at the end. There’s an ambiguous prompt to upload a billing statement or invoice from your payee. But worst of all, when I went to set up more recurring payments, the website returned a generic message: “Sorry, an unexpected error occurred. Please try again.”

There were two odds things about this: I was able to schedule one-time payments for the future, and all my existing recurring payments (for my Consumers Credit Union account) were still active. I just couldn’t configure new recurring payments.

Fortunately, Plastiq has a pretty good live chat feature, so I hopped on the horn with one of their representatives and was told that:

“This is a known issue we are working on fixing. At this time, we recommend making single payments scheduled for future dates. I have escalated your case and will reach out to let you know when this issue is resolved.”

Obviously, not ideal, but presumably the scheduled payment feature with either get fixed or permanently removed eventually.

A “charitable” alternative

A reader e-mailed a few months back saying that he’d set up a public website to help automate transactions like these. This seemed like a pretty good idea (an idea so good long-time subscribers may remember I actually attempted something similar many years ago), but with Plastiq on the fritz, I thought I’d finally cruise over and check it out.

The website is called Automate To Donate, and as the name suggests, it configures repeating payments which go, not to your student loan, mortgage, or HELOC, but instead to a charity called “Giving to the Givers.” Now, this charity does not appear to have any public presence whatsoever, so this is absolutely not an endorsement of any kind, but it does at least appear to actually exist as a “DOMESTIC NOT-FOR-PROFIT CORPORATION” in New York State, and is listed by the IRS as a “Public Charity,” so let your tax preparer know if you’re eligible to deduct charitable contributions.

Conclusion

Hopefully Plastiq will work out the kinks in their new website soon, but in the meantime, if you have trouble setting up recurring payments, you should still be able to schedule one-time payments for the future. I’ll probably just set mine up a week at a time until the problem is resolved, which isn’t the end of the world. Alternately, you might try out Automate to Donate in order to configure recurring transactions in variable amounts. Just be sure that your transactions are actually counting towards your requirements; in the past, I’ve seen PayPal transactions processed as “PIN-less debit” and not count towards my 12-transaction requirement.

Interest rates on rewards credit cards are all over the place — act accordingly

In the range of hobbies between croquet and wingsuiting, most people recognize that travel hacking is on the more dangerous end of the spectrum. Not because you’re likely to be turned into a red blotch on the side of a mountain, but because signing up for credit cards, manufacturing spend, or buying and reselling merchandise or giftcards can expose you to substantial financial risk.

Of course, some commonsense advice helps to mitigate those risks: start slow, make sure you understand a technique from beginning to end, don’t be afraid to lose small amounts of money while you get familiar with a new area, location, or technique.

And one of the most common pieces of advice is, “never carry a balance,” since the interest charged on a single month’s balance can easily exceed an entire year’s rewards. This is good advice, until it isn’t: I’m a big fan of the Chase Slate $0 balance transfer fee and 15-month 0% APR signup offer, particularly since at the end of the promotional period you can request a product change to another valuable Chase product like the Freedom or Freedom Unlimited (note that the Slate seems to be currently unavailable for new applications). The Discover it currently has a slightly less generous 14-month 0% APR balance transfer rate, with a 3% balance transfer fee.

If it’s a cliche that more valuable rewards credit cards have higher interest rates than other credit cards, I got to wondering: just how high are the interest rates? And it turns out, they’re all over the place, so I thought it might be interesting to compile all the interest rates on my credit cards in one place. Note that these rates are based on “creditworthiness,” so they’re purely illustrative: your interest rates will certainly be different on the exact same cards. These are also variable rates, so they’ll change along with the prime rate.

My credit card purchase interest rates, from high to low

• Chase Slate: 20.74%

• Discover it: 19.99%

• American Express Delta Platinum Business: 19.24%

• Barclaycard Arrival Plus: 18.99%

• Citi Double Cash: 18.99%

• Chase Freedom(1): 17.24%

• Chase Hyatt: 15.99%

• Chase Freedom(2): 15.24%

• Chase Ink Plus: 15.24%

• American Express Hilton Honors Surpass: 15.24%

• US Bank Flexperks Travel Rewards: 14.99%

• Fidelity Rewards: 13.99%

• Bank of America Better Balance Rewards: 13.24%

• Chase Freedom Unlimited: 12.99%

Four observations on my credit card interest rates

I’d never laid out my interest rates like this before, but once I did, I immediately noticed four things.

First, the Chase Slate and Discover it, the two cards I had singled out above as low-cost balance transfer cards, ended up with the highest interest rates after their promotional periods elapse. This is strong evidence (although I don’t know why you would need evidence) that Chase and Discover use those low-interest introductory periods to encourage customers to incur high balances they’ll have difficulty paying off in time. That highlights the need to have a plan to pay off your entire balance before your introductory period expires.

Second, the same banks, and even the same products, offer different interest rates. For example, I have two Chase Freedom cards, one of which was a product change from a Slate card, and the other from a Sapphire Preferred. I believe each Freedom “inherited” the interest rate terms from the previous card, and my previous Sapphire Preferred account inherited a higher interest rate than my previous Slate card.

Third, there’s no obvious connection between the value of a credit card’s rewards and its interest rate. My Freedom Unlimited, which I consider one of the most valuable workhorse cards for unbonused manufactured spend, charges the lowest interest rate, while my Delta Platinum Business card, which is barely worth its annual fee, charges the third highest.

Finally, the difference between the highest interest rate and the lowest interest rate charged by my cards is enormous. In the personal finance world there’s a somewhat pedantic controversy over whether it’s better to pay off your highest-interest debt first (saving the most on interest) or your lowest balances first (in order to “generate momentum”). In my opinion, for people with low balances and relatively similar interest rates, it simply doesn’t matter much. If you want to “optimize” your repayment, pay off high-interest debt first. If you want the psychological satisfaction of zeroing out balances, pay off low balances first. Who cares? But as the interest rate spread above shows, if you’re carrying balances on multiple credit cards and you see a spread like the one illustrated above — almost 8 percentage points — then the decision becomes a lot simpler: the higher-interest balances have got to go first.

Conclusion

Every dollar you pay in interest is a cost incurred against the profit of your travel hacking strategy. The less interest you pay, the more profitable your strategy is. But (especially during a global pandemic and economic crisis!) I’m not going to shame anyone who needs or wants to carry a balance on their credit cards. Fortunately, travel hacking also gives you the tools to easily (and even profitably) move balances from one card to another. So if you do find yourself carrying a balance on one more credit cards, it’s worth going through the above exercise and making sure you’re paying as little interest as possible on those balances.

Making the decision to keep my Delta Platinum Business card

I wrote last month about a little experiment I was running with my American Express Delta Platinum Business companion ticket. By booking a ticket before May 31, 2020, for travel before September 30, 2020, I should be able to move the ticket to any dates before September 30 with no difference in fare, or use the ticket value towards travel anywhere on Delta after that date. Additionally, since my annual fee appeared on my May statement, this would allow me to get my last companion ticket “free” by cancelling my card and having the annual fee refunded (in some states American Express is required to pro-rate annual fee refunds so residents of those states needn’t feel the same urgency).

Against my better judgment, I ultimately decided to keep the card for another year.

American Express gave me an “Appreciation Credit”

As I wrote back at the beginning of May, American Express increased the earning rate on the consumer Delta credit cards to 4 Skymiles per dollar spent at grocery stores through July, 2020. That’s a pretty good earning rate, and if I had a consumer card I’d be hitting it hard. Unfortunately, they didn’t extend the same courtesy to business card holders, so it didn’t affect my decision to close my card.

However, at the end of May, I refreshed my Mint account and found a pleasant surprise: American Express had credited my account with a $75 “Appreciation Credit.” Doctor of Credit had shared some information about the similar ($200) credit for Business Platinum cardholders, but American Express never communicated anything about it to me, by e-mail or in my online account, so I simply don’t know whether I would “keep” the credit if I cancelled my card and had the annual fee refunded. In other words, was the “Appreciation Credit” a retention offer, which in effect lowered my annual fee from $250 (itself an increase from the previous $195 fee), or a free statement credit like the ones provided through Amex Offers, in which case closing my account would produce a negative-$75 account balance and (eventually) a refund check.

Ultimately, I decided to treat the credit as an annual fee reduction, and that the card was worth keeping for another year at $175.

Is the Delta Platinum Business card worth $175 a year?

There are four potential sources of value from a Delta Platinum Business card (as mentioned, the consumer card has the additional temporary benefit of increased earnings at grocery stores):

• a domestic (lower 48 except for residents of Hawaii, Alaska, Puerto Rico or the United States Virgin Islands whose flights also originate there) companion fare;

• free checked bags for the cardholder and up to 8 others traveling on the same reservation;

• access to certain Amex Offers;

• bonus Medallion Qualification Miles at the $25,000 and $50,000 spend thresholds.

The list above is roughly in the order I value the benefits in.

Domestic companion tickets are most valuable when simply sold to someone who is willing to pay some fraction of the fare’s value. For example, someone who would otherwise pay for two $500 fares in cash should be happy to buy a companion ticket for $250, wiping out your annual fee and letting you enjoy the other benefits for free. Unfortunately, unlike Alaska Airlines companion fares, the Delta offer is strictly limited to the cheaper fare classes, making that kind of win-win exchange hard to arrange; no one likes to be told what flights they have to take based on fare buckets!

If you’re going to use a companion ticket for yourself, then you should value it well below your nominal savings — you should value it at what you would other pay for the same tickets, either with a traditional mileage redemption or using a cheaply-earned currency like US Bank Flexpoints or Chase Ultimate Rewards. For that reason, I value Delta companion tickets much more conservatively than many travel hackers, perhaps $100.

Free checked bags, on the other hand, I value more or less at face value, because I don’t have elite status anymore and I really like checking bags! Delta now charges $30 for your first checked bag (and $40 for the second!), so two travelers making 2 round-trips per year with one checked bag each will save $240 just on those fees. We don’t fly Delta quite as much as we used to since our families are now easier to reach on Alaska and American, but between trips to see friends and domestic vacations I’m very comfortable valuing our free checked bags at $120 per year.

The third source of value, Amex Offers, used to be more valuable when each offer could be added to and redeemed on multiple cards; having more American Express cards mechanically increased the savings available to you. That’s less true now, but there are still some offers that are only made available on business or Consumer cards, so having at least one of each gives you the maximum likelihood of being targeted for the most valuable ones. Since my Delta Business is my only business American Express card, I’d assign perhaps $50 in value purely to the additional Amex Offers I receive.

Finally, since I don’t travel on Delta more than once or twice a year (and 2020 will be even less than that), I don’t assign any value to the card’s ability to earn bonus Medallion Qualification Miles. Until we move somewhere with more convenient Delta service, I won’t be coming close to earning even Silver Medallion status. The value you assign to this feature should depend on both how necessary it is to earn status (does it make or break your ability to achieve the status you’re chasing) and how you value that status (how frequently do your upgrades clear, etc.).

So in my case, the $270 in value I conservatively get from the card clears the $175 annual fee hurdle comfortably enough that I reluctantly decided to keep the card for another year, while if I had to pay the entire $250 annual fee, I would have proceeded to cancel the card.

The annual fee isn’t the only cost!

That was my calculus: the card is a little bit better than a wash, so I’ll keep it around and see what develops. I still plan to cancel it next May, but I’m equally prepared to be surprised on the upside as the downside.

Besides assigning the above benefits different values than I did (for example, if you have a particularly high-value companion fare redemption or a good opportunity to sell or gift the companion fare), your cost calculus might also be different than mine. For me, the annual fee is the only cost of holding the card. But since the Delta Business card is a credit card, it counts against your four-card (or five-card) limit with American Express. If you already have four or five American Express credit cards, then an additional cost of holding onto any one card is the inability to open additional American Express credit cards.

That means if your Delta Platinum card is your least valuable American Express credit card, then it is by definition the one keeping you from signing up for additional American Express credit cards, whether your intention is to trigger a signup bonus or add new, different, or more valuable bonus categories to your manufactured spend strategy.

Conclusion

Obviously there are some cards so valuable that this exercise isn’t worth going through in such fine detail, like the Chase Hyatt and legacy Ink Plus and Ink Bold cards. But for most cards with an annual fee, seeing that fee hit is as good an opportunity as any to take a step back and evaluate exactly what role the card is playing in your travel hacking strategy, and whether it still belongs there.

By default, your answer should be “no:” an annual fee is a hole you have to climb out of over the course of the year. Some cards make it relatively easy to get out of that hole and some cards make it relatively hard, but if you’re not digging up, you’re digging down.

Pro tip: using the 1Password iPhone browser to painlessly add just for U offers

On the occasion of a new Safeway offer for $10 off $100 in Visa gift cards, I thought I would share my preferred technique for adding these offers to all my just for U accounts.

Logging in and out of just for U is a pain

Like all such services, just for U is designed to keep you logged in as long as possible. If you use the internet in a tracked browser window (i.e., not in “incognito” or “private browsing” mode), then just for U will load you up with cookies that even logging out may not completely clear.

This is inconvenient if you manage multiple just for U accounts and want to add these single-use coupons to each account. Even if you use a private browsing mode which clears your tracking cookies, you then can’t use the same window for anything else simultaneously or the cookies will still be retained!

Using the smartphone app for your local stores is an alternative, but it still requires remembering usernames and passwords, or constantly flipping back and forth between the app and your password manager.

The most elegant workaround I’ve found is the built-in browser in the iPhone app of my password manager, 1Password.

Configuring the 1Password browser

I’m sure all password managers have a similar tool, but since 1Password is the one I’m familiar with, here’s how I use it.

1. For each just for U account, enter the URL of your store’s login page in the “website” field so that clicking on the website takes you directly to the login page.

2. Click on “Settings,” then “1Password Browser.” I set the User Agent to “Safari (Mac)” so that the browser loads the desktop version of the website.

3. Click “Clear Web Data” so you don’t have any cookies lingering around.

Adding just for U coupons to multiple accounts

Now you can easily add coupons to multiple accounts with just a few clicks:

1. If you have a standard naming convention for your accounts, you can click on “Categories” and type the name into the search bar, e.g., “Safeway.” This will pull up all your just for U accounts.

2. Click on the first one, then the website bar, and the 1Password browser will open and automatically enter your login credentials.

3. Add the relevant offer, and press “Done” in the top right corner.

4. Press settings, then “Clear Web Data” to reset the browser.

5. Press “Categories,” and repeat steps 2-4.

Using this technique it takes 30 seconds or less to add offers to each account, and doesn’t require messing around with my desktop browser settings.

Conclusion

1Password is a paid product, but the version I have doesn’t require an ongoing subscription. I believe there are other free or “freemium” password managers on the market, and they all should have some kind of similar functionality. The important thing is simply to put in the time up front to configure your login credentials. Given the “better than free” nature of these gift card deals, as long as grocery stores are willing to keep printing money that investment is almost certain to pay off in the long run.

The more you know: earning secret Giant gas and grocery points

I’ve been doing most of my grocery store manufactured spend lately at Safeway, since they’ve had great offers recently for better-than-free Visa and MasterCard prepaid debit cards. When these deals come along it almost doesn’t matter what credit card you use, but the best options are obviously cards that bonus grocery store spend, like the Chase Freedom this quarter, the Sapphire Preferred or Reserve in May and June, or the American Express Hilton Honors Surpass or Aspire cards, with their uncapped 12 points per dollar spent at grocery stores through July.

As a reminder, you typically have two weeks to redeem these Safeway promotions, but they are only available to “add” to your Shop Your Way account during the week they appear in the app, so be sure to add them to all your accounts immediately when the promotions go live.

The other model of grocery store discount is the one preferred by the Giant/Stop & Shop/Martin’s grocery store chain, where you earn bonus gas points on prepaid debit cards instead. In some areas, including mine, these points can now be redeemed for credit towards a future grocery purchase, so they are much more “cash-like” than they used to be. Still, given the choice, I prefer a slightly smaller up-front discount than the hassle of trying to perfectly match up my grocery bill with my store credit.

Strange, but true: earn bonus gas points even when your store doesn’t advertise them

Word typically goes around Twitter and the blogosphere quickly once a new grocery store promo goes live, which is extremely convenient if you’re like me and either don’t receive or instantly trash your weekly circular. The circulars are available online, so it’s easy to plug your ZIP code in and see whether your local stores are participating.

Or so I thought.

Earlier this week, Stephen Pepper over at Frequent Miler mentioned in passing:

“If you live near Giant or Stop & Shop stores, this deal isn’t appearing in your weekly ad. For some reason, that’s been the case for the last couple of months or so – gift card deals are displayed in the weekly ad for Martin’s but not Giant or Stop & Shop. This offer is still available at all three chains though despite not being listed in all weekly ads.”

I’ve been travel hacking long enough to know that as bizarre as this sounds, that’s no reason to doubt it — the very existence of travel hacking is so bizarre most people have trouble believing it really exists. But I wanted to make sure, so I trundled over to my local Giant, which did not list the promotion in this week’s circular, to find out for myself (and, obviously, my beloved readers).

Embarrassingly, I’d moved so much of my grocery store spend over to Safeway that the entire Giant store location had been redesigned since my last visit, and I was almost afraid Giant had stopped selling prepaid debit cards altogether. It turned out they had moved the gift card center to just inside the store’s one-way exit, so you conveniently now have to walk all the way through the store, past the checkout lanes, then re-enter the store to make your purchase.

Since I had not yet maxed out the $1,500 cap on one of my Chase Freedom cards, I used that to buy the prepaid Visa debit card, knowing I’d come out ahead whether or not I earned the bonus gas points. Fortunately for me, and for you if you’re in an area served by Giant, Pepper was right and I did earn the bonus points.

But that’s not all.

Stranger, but still true: earn bonus gas points even when they don’t show up on your receipt

When I sat down to write this post, I was expecting to write the exact opposite of the above. I was planning to share a contrary datapoint, concluding that while there may be some stores where bonus points are earned regardless of whether the promotion is advertised or not, you shouldn’t count on it, and do your own research instead.

That’s because when I checked out, the bonus points did not appear on my receipt. Whenever you check out at Giant using a rewards card, there are two lines on the bottom portion of the receipt, “Points this visit” and “Points total.” The receipt reported that I had earned 0 points on the card, and that my points total was also 0.

It was only when I sat down to write this post that it occurred to me to double check using the Giant app, and as soon as I opened it, there they were: 1,524 points, redeemable for $15 in free groceries.

Conclusion

There’s no reason to believe there’s necessarily a connection between these datapoints. It may be the fact prepaid debit card deals aren’t printed in some stores’ circulars is one error, points nonetheless being awarded is a second, unrelated error, and awarded points not appearing on receipts is a third, also unrelated error. Likewise, it’s possible each error will be fixed independently of the others.

What I can say is that, based on my experience during this promotion, it is probably worth at least finding out whether your own stores are awarding gas points, whether or not the promotion appears in your circular.

Three notes on Chase Sapphire Preferred and Reserve grocery statement credits

I haven’t had a Chase Sapphire card in a long time, having downgraded my Preferred years ago to a second Freedom card and replacing it with an Ink Plus card to maintain the flexibility of my Ultimate Rewards points and the ability to redeem them for 1.25 cents each towards paid travel through the Ultimate Rewards portal.

Still, I’ve obviously been following with interest the news that Sapphire Preferred and Reserve cards will allow Ultimate Rewards points to be redeem for 1.25 and 1.5 cents each, respectively, for “grocery, home improvement, and dining purchases.” That stacks with the accelerated earning on up to $1,500 in monthly grocery store spend on Sapphire cards through the end of June.

I wanted to share three quick notes on this new opportunity.

If you ever redeem points for paid travel, redeem them for groceries

There are three basic value buckets for Ultimate Rewards point redemptions:

• bank account direct deposit and credit card statement credits at 1 cent each;

• paid travel booked through the Ultimate Rewards portal at 1.25 cents (Sapphire Preferred and Ink Bold/Plus/Preferred) or 1.5 cents (Sapphire Reserve);

• travel partner transfers at higher — potentially much higher — redemption values for premium travel.

If you redeem, or plan to redeem, most or all of your Ultimate Rewards point balance for high-value transfers to Chase’s travel partners, then this opportunity doesn’t affect you at all; save your points, transfer them to high-value partners, and make high value redemptions!

If, on the other hand, you think of Ultimate Rewards points as a useful reserve account for paid domestic airline tickets, and were already happy to redeem them for 1.25 or 1.5 cents each for airfare or hotels when award space wasn’t available, then you should be eager to redeem them for the same value as statement credits against eligible grocery purchases. After all, once you’ve redeemed the points for a statement credit, you can use the same cash to buy the same tickets with a different credit card, and earn miles, points, or statement credits on that card!

A word of warning: statement credits aren’t “payments”

I wanted to flag one issue for folks who are planning to hit this deal especially hard. Most responsible travel hackers will tell you not to carry a balance on your credit cards, in order to avoid interest charges that can easily overwhelm the value of any rewards you earn on purchases. The “statement credit” is one way credit card companies have developed to charge fees regardless of how carefully you monitor your balances: according to the terms and conditions of most, if not all, of my credit cards, statement credits are not treated as payments and do not decrease your minimum payment due.

This doesn’t matter if you diligently pay your credit cards off before each statement closes, but one of the nice benefits of travel hacking and manufacturing spend is having several weeks of float to earn interest, meet minimum spend requirements, and spin up other opportunities. In that case, even if you pay off your entire statement balance with statement credits, you may get hit with a late payment or interest charge on the minimum payment. This shouldn’t apply if you reduce your balance to $0, but if you have made additional purchases during the month, your credit card company may consider those purchases to be subject to interest charges since your remaining previous balance was merged with your new balance.

This isn’t an extremely common situation, but I wanted to flag it for folks seeking to redeem tens or hundreds of thousands of Ultimate Rewards points towards grocery store purchases: go ahead and make your minimum payment in addition to any statement credits you redeem, to make sure Chase doesn’t decide to ding you for missing a credit card payment (and take a closer look at your account activity).

Apply or upgrade to Sapphire for redemptions?

Finally, this new opportunity raises the question whether you should upgrade an existing Freedom, Freedom Unlimited, or Sapphire card to a Sapphire Preferred or Sapphire Reserve card, or apply for a new card, in order to take advantage of these new statement credit redemption opportunities. Here, I don’t have a strong feeling either way.

If your credit history made you eligible for a Sapphire Preferred or Reserve offer prior to the new redemption opportunity, then it was probably already worth applying. It’s unclear to me that the new redemption opportunity should change your application calculus.

On the other hand, for folks with an existing large Ultimate Rewards balance held on Chase Ink cards, the new ability to redeem those points for statement credits may well justify upgrading a Slate, Freedom or Freedom Unlimited card to a Sapphire Reserve in order to cash out that existing Ultimate Rewards balance for grocery statement credits while travel redemptions remains a distant prospect.

Conclusion

I have to had it to Chase in making a fairly crafty calculation with this new redemption option. Existing members with large existing points balances, but who found themselves unable to redeem their points during the pandemic, might be tempted to simply cash out and cancel their accounts. Instead, Chase offered them the opportunity to both earn bonus points on their everyday purchases and redeem their Ultimate Rewards points at their “full” 1.25 or 1.5 cent value against them. That both directs spending towards Chase products and reduces the attrition of their “travel” clients during a period when travel is impossible.

But however clever Chase is, it’s still up to you to make the important decisions about how, when, and where to redeem your points.

How I'm thinking about traveling safely

It has been interesting, to say the least, to see how the travel industry has responded to the present crisis so far.

Air travel, for example, never fully shut down as it did in the days after September 11, 2001. Routes were cut, which, perhaps counter-productively, meant the few remaining flights were fuller than they would otherwise have been, increasing passengers’ chance of exposure to the novel coronavirus.

Hotels in the most affected cities have been closed or converted into quarantine shelters for those without other options, as in Washington, DC, where residents of crowded group shelters that test positive or are exposed to coronavirus-positive individuals have been moved into private rooms at places like the Hotel Arboretum.

Likewise, Amtrak reduced the frequency of their most popular Northeast Regional service, and suspended some long-distance services, while reducing capacity to 50% on the remaining trains — quite a change from the typical procedure, where conductors frequently demand you move your bags off unoccupied seats because “every seat will be occupied.”

Finally, car rental companies have seen their own troubles, with Hertz already filing for Chapter 11 restructuring after finding itself unable to service its staggering $17 billion in debt, although it will continue to operate, at least for now.

From a traveler’s perspective, most of us are making the simplest, easiest decision to stay in place until the virus is in retreat. But there’s a lot of room between sheltering at home and flying to Missouri for a weekend pool party. Here’s how I’m thinking through the situation.

Are you the vector or the victim?

By now it seems most people have internalized that the reason we take precautions like social distancing, mask-wearing, hand-washing, and contact-free payment and delivery is not to protect ourselves, but to protect those we come into contact with. A highly contagious disease with a long, asymptomatic incubation period means once you’ve contracted the virus, you can easily transmit it to others whether or not you ever develop symptoms.

This provides a useful frame of reference: taking for granted that you’re following best practices, are you more likely to be exposing others to the virus or to be exposed yourself? To give the simplest example, someone traveling from Rhode Island or Massachusetts, which have high and rising case numbers, to Montana or Alaska, which have low and flat numbers, should consider themself a potential vector of the disease. They pose much more risk to the population in their destination than the destination population poses to them.

This principle works in reverse as well: if you’re traveling from a relatively unscathed area to a coronavirus hotspot, then you’re much more likely to contract the infection than spread it.

Again, obviously you should not be traveling long distances and you should certainly not be having close contact with strangers. But if you have to travel, this is one way of thinking about whether you pose a bigger risk to others, or they pose a bigger risk to you. Traveling from a coronavirus hotspot and visiting a crowded bar or restaurant that has remained open in an unaffected region is one way to make sure that region doesn’t stay unaffected for long.

One extreme version of this exists for folks who have already received a confirmed COVID-19 diagnosis, recovered, and received a serology test indicating the present of antibodies. Due to the possibility of false positives, I wouldn’t be confident that I’d had the disease and recovered unless I’d received at least two positive results (i.e., two positive coronavirus results, two positive antibody results, or ideally one of each).

I wrote about getting pneumonia in February, when COVID-19 was already present in the community but was still believed to be only affecting folks who had recent travel to Asia or who had come into contact with them, so I was never tested for the coronavirus (I was also uninsured, which didn’t help). To find out whether I had actually contracted COVID-19, I’d now need to get a serology test, but since I don’t have any symptoms (or travel plans) there’s no plausible medical reason to get one, although apparently there’s a clinic down in Virginia that will give one to anybody, if they’re willing to pay for it.

Safest: dispersed camping with your own gear

The safest way to take a trip while minimizing the risk to yourself and others is to avoid them, which is possible in large parts of the United States through what’s known as “dispersed camping.” Essentially, it is free and legal to camp for up to 21 consecutive days on National Forest land where there are no amenities and services. So-called “developed” National Forest recreation areas have their own rules.

Unfortunately, the National Forest website appears to have been designed in the early 1990’s and hasn’t been updated since, so it’s a bit of a struggle to navigate. To save you some trouble, this is the method I found to find nearby options:

1. First, visit the National Forest interactive map, and poke around to see what options might interest you. Don’t click on any of the camping icons, since those refer to developed campgrounds, not dispersed camping areas.

2. Once you’ve found some areas of interest, go to the Forest Service homepage and search for the National Forest you’re interest in using the dropdown boxes on the righthand side.

3. That will take you to the page for that specific forest, where you should be able to navigate to the “dispersed camping” page, like this one for the George Washington & Jefferson National Forests.

The term “dispersed camping” is a bit funny to me because it’s what I grew up calling “camping.” You go for a hike, set up a tent, cook some beans, and go to sleep. It usually rains. Only in adulthood did I realize that people in other places call it “camping” when you go to a big park with cleared ground, showers, toilets, and even firewood for sale. That’s not meant to disparage that experience (I had a great time on Madeline Island at a lovely campground), it just happens to be different than what I grew up doing.

Less safe: drive somewhere alone and maintain distance

Last year my partner and I rented a car and drove to Harpers Ferry, West Virginia, which is a few hours drive from Washington, DC, depending on traffic. We stayed at a fairly rundown Quality Inn that appeared to only have a single employee, and spent most of our time wandering around the site of John Brown’s raid on the national armory and the West Virginian portion of the Appalachian Trail.

During the present crisis, this trip would obviously not be risk-free, for all the reasons discussed above. Renting the car and checking in and out of the hotel would present two obviously unnecessary interactions — unnecessary in the sense that if we didn’t take the trip, we wouldn’t have them. West Virginia has a much lower prevalence rate, for now, than the District does, so if we were asymptomatic carriers we might run the risk of introducing the virus there, while also running the somewhat smaller risk of contracting it there and introducing it to our building or neighborhood.

Riskiest: go somewhere safe, quarantine, and stay

Finally, on the other extreme, you might decide to relocate permanently or semi-permanently to a relatively safe destination. Here I am not talking about taking a vacation to Singapore just because Singapore has its outbreak under control. Doing that simply risks introducing the virus to Singapore anew. I mean that if you are retired, unemployed, or able to work remotely, you might consider relocating to a destination that has re-opened or is in the process of re-opening, taking into account the fact that you are a potential vector for the spread of the disease.

14 days in quarantine sounds like a lot, but if you’re already observing a stay-at-home order in the United States, then spending the same amount of time in a hotel with decent wi-fi might not seem like such a high price to pay, if at the other end you emerge into a society with the amenities or human contact you need to maintain your sanity.

Conclusion

Right now my household is staying on the side of extreme safety. Even if we both happened to be tested and discovered we had COVID-19 antibodies, flying across the country to visit our families is off the table for now, so short drives to isolated nearby locales are likely the extent of our travel for the next few months. This disease is a killer, and we don’t want to die or expose anyone else unnecessarily.

But I understand everyone’s risk calculus is different, so hopefully this helps you develop your own framework for when and how you’ll be traveling again.

My COVID-19 Delta companion ticket experiment (and one weird datapoint)

Most people aren’t in a position to plan travel these days, but like me, you might be in a position where you need to book travel. In my case, that meant making a companion ticket reservation using a card I plan to cancel.

News to me: Delta companion tickets are linked to your co-branded credit card, not your Skymiles account

I only have one Delta Platinum Business credit card, so I only get one companion ticket a year, which means it takes some time to collect datapoints (and they’re stale by the time the next one comes around). For that reason, I was not aware of a curious development: Delta companion tickets are now automatically charged to your co-branded Delta credit card.

This may not seem like a big deal at first glance, since if you have a Delta co-branded credit card in the first place you’re probably fine earning bonus Skymiles on your purchase, and you might even be working your way towards a $25,000 or $30,000 high spend threshold anyway. Otherwise, why have the card?

It is, however, a change: in the past, Delta companion tickets could be booked with any American Express card, even cards that weren’t issued by American Express, like the Fidelity 2% cash back card, which used the American Express payment network before eventually moving over to Visa.

I wasn’t trying to be that clever, however. I simply wanted to pay with my American Express Hilton Honors Surpass card, since I plan to cancel my Delta card in the next few days. The payment was accepted, and my e-mailed receipt shows the last four digits of my Hilton card.

But the charge was put on my Delta card anyway, even though my Delta card isn’t even saved to my Delta wallet! I hope you’re as astonished as I am: not only did they charge a card I didn’t authorize them to charge, they charged a card that wasn’t saved to my account.

In my case this didn’t end up mattering, but do keep it in mind if you are planning to put a Delta companion ticket on a different American Express card, for example to meet a minimum spending requirement, high spend bonus, or to trigger an Amex Offer.

Book Delta speculatively by May 31 for travel before September 30

There are two slightly different rules on the Delta website that I’m hoping to take advantage of which led me to make this reservation the way I did:

• “Tickets originally purchased between March 1 and May 31, 2020, can be changed without a change fee for up to a year from the date you purchased it.”

• “for travel within the United States originally scheduled to depart March through September 30, 2020, all change fees are waived; You can rebook your trip to the same destination for travel departing before September 30, 2020, with no difference in fare applied."

Since, if epidemiologically possible, we’re hoping to take a trip to New Orleans in the fall, the way I read this is that I could book the cheapest possible flight to New Orleans departing anytime before September 30 and be able to change it to any date before September 30, at any price, while paying no change fees and no difference in fare.

By booking before May 31, I also have the backup option of using the price of the ticket towards any other Delta ticket up to a year after the date of purchase.

So, it is worth it?

In my case, I had the icing of being able to redeem a companion ticket that would otherwise be lost when I close my Delta card, but it’s worth considering who else might want to take advantage of this opportunity.

The clearest case is if you have a trip you know you need take on Delta before September 30, since according to my reading of these rules you can book the cheapest dates on the calendar, then simply change your flights to the correct dates without paying any fees or difference in fare. Delta appears to be saying all flights between two given airports, departing before September 30, are now priced at the lowest fare available anytime before September 30 between those same airports. Nice of them!

Another option is using the pre-May 31 change fee waiver as a kind of travel bank to liquidate fixed-value points on cards you plan to cancel, or to trigger airline fee credits. For example, the American Express Platinum cards offer a 35% rebate when you redeem Membership Rewards points for certain premium cabin tickets. Booking an expensive first class Delta flight, receiving the rebated points, and then using the value towards flights you actually plan to take might be one way to lock in that increased value.

I don’t carry any cards that offer annual airline fee credits so it’s not a sub-field I follow particularly closely, but if you can find some sub-$50 Delta fares, they might automatically trigger credits on cards like the American Express Platinum or Chase Sapphire Reserve.

Conclusion

Let me close with a word of (gentle) warning. The actual financial mechanism here is that you, the passenger, are making an unsecured loan to Delta, a troubled airline. That doesn’t mean you don’t have rights: you have a lot of rights! But if the pandemic lasts longer than expected, or Delta manages the aftermath worse than expected, then your rights are going to have to get in line along with everyone else’s rights: employees, bondholders, shareholders, airports, suppliers, etc.

I don’t mean to come across as pessimistic. I think Delta is an unusually well-managed airline! I just mean to say that, as in all these games we play, this is not a case of “pulling one over” on Delta, it’s a case of making a calculated bet, and your calculation may well end up being different than mine.