Our biggest mistakes in the points and miles game
Introduction
One of my core beliefs is that most people do the best they can with their current level of knowledge and resources. That might sound a bit naive, but that positive outlook toward others (and even myself!) has really served me well in life, especially in the points and miles game.
I try not to be too harsh on myself for mistakes I’ve made in the past, as I truly believe I was doing the best I could with the knowledge I had at the time. I believe we learn and grow more by getting out there and playing the game, than standing on the sidelines, nervous about never making a mistake. So, yes, every mistake I’ll list below, I wish we never made. However, we learned a TON from each one, and I hope you’ll learn from our mistakes, so you don’t have to repeat them yourself!
Biggest Mistake #1: Missing a minimum spend deadline
Besides a few credit cards (like the Barclays American Airlines Aviator Red), in order to receive the sign-up bonus, you must first put a pre-defined amount of spend on the card within a designated timeframe. For example, as of writing, to receive the sign-up bonus for the Chase Ink Business Unlimited, you must spend $6,000 in the first three months from the account opening. (Note: The clock starts ticking from the day you are approved for the card, not the day you receive the physical card!)
Here comes probably the biggest mistake we’ve made in playing the points and miles game over the past decade: we missed the deadline for meeting the minimum spend for a credit card sign-up bonus!
I deserve the shame. I know.
But, again, I learned from my mistake and put measures in place to make sure it never happened again!
Here’s how it happened: we opened the Citi AA Platinum Select card a few years ago when it had an elevated sign-up bonus of 75k American miles (it is at 50k at time of writing). However, I didn’t record the fact that the minimum spend for the card was $3,500 over 4 months, instead of the normal $3,000!
About 2 weeks before we hit the 4-month mark, the bonus miles had still not posted to my American Airlines Aadvantage account. So, I reached out to Citi through their online chat feature in my account. I asked them to confirm that I had reached the minimum spend requirement, but I worded it a bit unfortunately. When I asked, “Can you confirm that I have reached the minimum spend requirement of $3,000 for the sign-up bonus?” the customer service agent responded, “Yes, I can confirm that you have reached $3,000 in spend on this card.” I did respond with, “So, I should be expecting the bonus miles to reach my account soon?” The agent replied, “If everything you have mentioned here is accurate, then yes.”
Yes, you can see where this went. Two weeks later, the minimum spend deadline passed and still no 75k miles in my account. So, I reach back out to Citi and this customer service agent informs me that the minimum spend requirement was actually $3,500 and not $3,000. After I explain the conversation with the last customer service agent, I plead for a 1-day extension to meet the minimum spend requirement, because the last agent was not forthright with the spend requirement.
No luck.
I tried to convince an agent (or two!) over the phone. No budging. Even though they did mention it wasn’t the best customer service by the previous agent, they conveyed that, ultimately, it was my responsibility to know the minimum spend requirement, not theirs. And, they’re right.
So, what did I learn from this mistake?
The biggest learning is that the first step I need to take after getting approved for a credit card is go into my Frugal and Free Travelers Points/Miles Spreadsheet (it’s free!) and log the date I opened the card and the minimum spend requirement. I also set a reminder on my phone for about 2 weeks out from the deadline to confirm that I have hit it. Also, since I’m anal about this now, I duplicate all of this info in my Travel Freely app as a fail-safe.
I also learned that I should never fully trust a single customer service agent for key information. I should have trusted my gut and called a live customer service agent over the phone and waited until I heard the exact phrase, “You have reached the minimum spend requirement on the card.”
Biggest Mistake #2: Late Credit Card Payment
I have had credit cards for close to two decades (I opened my first one when I was 18) and had never made a late payment. Until 2020. I would like to blame it on Covid-brain, but I think it’s more because I had never automated the process that I took when I received a new card. Although for close to 20 years, in the first month or two of opening the card, I had remembered to set up auto-pay on the card, to ensure that I didn’t miss a payment, because it wasn’t an automated process, it was bound to occur that it would slip my mind. Especially when we increased our card openings per year by four-fold in 2020, compared to 2019!
I can remember it clearly. We opened the American Express Hilton Aspire card in June 2020, after American Express had announced that the $250 Hilton Resort credits could now be used at restaurants, easily slicing off more than half of the annual fee of $450. I have no excuse for why I forgot to set up auto pay, other than it slipped my mind!
Although I was annoyed with myself for potentially costing myself the interest payment, I was more concerned with the fact that most credit card issuers’ Terms and Conditions state that if you miss a payment during the first few months after opening the card, you may not receive the card’s sign-up bonus!
As soon as I realized my mistake, I called American Express Customer Service and asked for mercy since I have substantial credit history with AMEX and had never made a single late payment. Within 60 seconds of being put on hold, the agent came back online and confirmed that they would waive the late fee and interest payments as a “one-time courtesy”.
Queue the relief I felt when I heard that glorious phrase “one-time courtesy”.
So, what did I learn from this mistake?
Now, after I receive a new credit card in the mail, the first two things I do are: confirm with the bank that I received it and set-up auto pay! I took it further and created a checklist, that I put as a sticky note on the desktop of my Macbook, to remind me of the first steps I needed to take after I received a card:
Activate the new card with the bank
Set-up auto pay (first creating a new online account, if I don’t have a card with the issuer)
Sign the new card
Activate new benefits (several credit card benefits, like the Dining Credit on the AMEX Gold, require you to opt-in)
Update re-occurring payments (if the minimum spend requirement for the sign-up bonus is fairly high, I might need to adjust my automatic payments for recurring bills, such as car insurance, cell or internet service to the new card.)
Confirm one more time that the card opening date and minimum spend requirements are locked into my Travel Freely acccount and I have set up reminders for 30-days and 14-days out from the deadline, to ensure I have met the minimum spend for the sign-up bonus.
Biggest Mistake #3: Not periodically putting minor spend on cards that I’ve “moved on” from
There’s no way around it: opening credit cards, meeting the minimum spend requirement and earning the sign-up bonus is the most bang-for-your-buck in the points and miles game. Even as we have tried to diversify the ways we accumulate points (through shopping portals, actual flying and hotel stays, linking our cards to apps like Uber, Lyft and Starbucks, etc.), the facts remains: almost 60% of our points earned so far this year have come from credit card sign-up bonuses. Commonly referred to as “credit card churning”, we often use a credit card to earn the sign-up bonus and then “put the card in our sock drawer” (or for us, more accurately, we put it into our credit card holder!) We then often open a new card and transition spend there.
Every once and awhile, we “cool off” on our credit card sign-ups, and use cards that have great category bonuses (like our AMEX Gold for 4x at grocery stores and restaurants) or are great for everyday spend (like our Capital One Venture X for 2x everywhere). However, even in these “cool off” periods, there are some cards that don’t have solid enough earning rates for us to even touch them (i.e. like our AMEX Delta Business Gold card.) So, there are some cards that don’t get ANY spend placed on them after we earn the sign-up bonus! Then, the annual fee hits and we seek a retention offer, downgrade or cancel the card. And we thank the bank on the way out and no one is the wiser! :)
However, in the past several years, banks have become more observant of customers’ long-term spending habits. Whether you plan to keep a card or cancel it in a year, it’s best to periodically put some spending on each of your cards every once in a while.
We didn’t do this with Courtney’s AMEX cards, and now she’s on American Express’ naughty list and has been ineligible for sign-up bonuses from AMEX the last few years. Long story short: Credit card issuers want you to spend on their cards throughout the year, not spending up to the minimum spend requirement for a sign-up bonus and then never using the card again. AMEX (and other card issuers) want you as profitable customers who are spending and utilizing credit with them, and are less likely to approve you for new cards if you aren’t!
This is what you’ll see if you ever find yourself in American Express “pop-up jail”. The most popular reason for the Amex pop up jail is that you have had that particular card in the last 7 years and earned the bonus.
Another reason for pop up jail is that American Express has marked you as not being a profitable customer. It is often because you are not spending enough on cards and/or you are grabbing the welcome offer and moving on.
Conclusion
I could have listed so many other mistakes we’ve made in this space over the last decade, like:
Closing a no-annual-fee card (30% of your credit score is your credit utilization ratio, which your percent of debt being used versus what you have available. Let’s say you have two cards, each with a $10k credit limit and you have an outstanding balance of $2k, you’re only consuming 10% of your approved credit. If you cancel a card, you’re suddenly using 20%!)
Forgetting what cards have certain perks (Not having a sustainable system to make sure I don’t miss a month of AMEX dining credits, for example!)
However, it’s less about the mistakes and more about the mindset that I hope you have while you play this game: you’re doing the best you can with your current level of knowledge and resources. Try not to be too harsh on yourself for mistakes you’ve made in the past, but give yourself grace! As I mentioned earlier: we learn and grow more by getting out there and playing the game, than standing on the sidelines, nervous about never making a mistake!
