When should you optimize for spontaneous, planned, or predictable expenses?

I like to generalize travel hackers into three broad categories, although none describes any individual perfectly.

Roughly speaking, I think of opportunistic travel hackers as people who keep an eye on signup, referral, and manufactured spending opportunities in order to maximize the value of their earnings throughout the year. I doubt this is the largest category, although it receives the most attention from mainstream blogs, so in some ways it’s the easiest to get involved in. Frequent Miler, for instance, hosts a simple page indicating what current signup bonuses are available and how they compare to previous offers.

The flip side of opportunism is that because it’s opportunistic, it’s unlikely to directly or even closely correspond to your needs. For example, take a look at how Gary Leff is currently promoting the Citi American Airlines business credit card right now: “70,000 by the way is what it costs from the US to the Mideast, India or Maldives on Qatar. You can even fly Qatar’s Qsuites, which may be the best business class in the world.” Fair enough, but what does that have to do with me? The message delivered by and for opportunists is “apply now, earn now, figure out what to do with the miles later.”

The second bucket is tactical travel hacking, which is roughly what I did for our stay at the Grand Wailea: I had a plan for the Aspire signup bonus, a plan for the resort credit, and a plan for the Amex Offer for $70 off $350 in spend at Waldorf Astoria resorts, and as soon as I’d used them all, the card was closed.

Just like opportunism, tactical travel hacking has tradeoffs. By focusing on individual awards, you’re more likely to earn the miles and points you actually want to spend, reducing the chances of orphaned miles in random accounts. On the other hand, if you’re concentrated on a specific award, you’re subject to award availability for that precise award space. This comes up most frequently when looking for premium-cabin airline award space, but limited hotel award space is an increasing problem, especially at premium properties that play games with blackout dates, variable pricing, and of course what qualifies as a “standard” room; while writing up this post I couldn’t find a single date with standard award nights available at the Grand Wailea!

Lately I’ve been thinking a lot more about what I think of as logistical travel hacking. Rather than focusing on the highest signup bonuses (which I may never redeem, or redeem at a fraction of their supposed value), or individual high-value trips which may or may not have award availability when I need it, I’ve been focusing on rewards that I am highly confident I’m going to be able to redeem, even if I don’t know when or where.

This has resulted in a subtle transformation in how I go about earning and redeeming miles and points. For example, I’ve written extensively about how companion tickets like those offered by the American Express Delta credit cards and the Bank of America Alaska Airlines credit cards didn’t offer significant savings when compared to manufacturing spend on higher-earning credit cards. And I still think that’s true, as far as it goes. But the higher your confidence that you’ll be able to redeem your companion tickets at something close to face value, the smaller that trade-off becomes.

Take, for example, the Alaska Airlines companion fare. For roughly $121, plus a $75 annual fee, you can book a second passenger on any Alaska-operated economy ticket, including destinations in Mexico, Alaska, and Hawaii, and including some pretty zany routing rules. The same $196 spent on, for example, office supply store prepaid debit card activation and liquidation fees might earn 100,000 Ultimate Rewards points on a Chase Ink Preferred card, worth $1,250 or $1,500 in airfare, depending on your local opportunities and the frequency of in-store and online in any given year.

From an opportunistic perspective, the companion fare makes no sense, since it would be trivial to get more than $196 in value from 100,000 Ultimate Rewards points. From a tactical perspective, you can imagine signing up for the card when you have a specific, expensive Alaska-operated ticket in mind. But the logistical perspective is different: if you always buy Alaska-operated tickets with your companion fare, then you have the opportunity to optimize the rest of your earning and redemptions around the remainder of your travel needs.

Conclusion

I’ve always said, the point of travel hacking is to spend as little as possible on the trips you want to take, and the least valuable point is the one you don’t redeem. That’s still true, but a few years of travel restrictions have managed to convince me that it’s at least partially incomplete. From the opportunistic perspective, if availability suddenly opens up on a premium carrier or at a prestige property, you need to have the points available to redeem immediately. From the tactical perspective, you grind out the points, miles, and status you need to book the trip you want. But from the logistical perspective, you might choose to cover predictable, recurring expenses with tools like annual free night certificates and companion fares even if you might have short-term opportunities to spend less for the same night or flight. As the joke goes, the Pentagon overpays for toilets but they get a great deal on F-35’s.

Like a lot of people getting started in travel hacking, I first dabbled in opportunistic strategies but found I just didn’t care that much about stockpiling points it would take me years to eventually redeem, at uncertain value. Over the course of a few years, I shifted over to tactically earning bonused points in the currencies I was planning to redeem for specific trips: Chase Ultimate Rewards, Hilton Honors, and US Bank Flexpoints, in particular. And in the last few years I’ve increasingly been focused on logistics: if I know I’m going to book a ticket for two on Alaska Airlines or Delta, or stay at a Hyatt or Hilton, then what those companion tickets and free night certificates do is take those redemptions off my mind, letting me focus on the rest of the pieces of a trip, like deciding when to book through Hotels.com and when to book directly.