All posts tagged Travel lean

How I earn over 4% back on all credit card spending.

By Brad Beckstrom

You read that correctly, over 4% return on credit card spending. This includes rewards points on business and personal spending. Quick disclaimer: if you carry debt on credit cards, or don’t pay your bill off (in full) each month, any gains you have from points will be likely negated by interest charges. Once you have zero credit card debt and are ready to use cards to earn rewards points/cash back, then you’re ready to put together your rewards points plan. Here’s mine.

To keep this simple, I’m going to use Chase credit cards as examples. They have one of the best rewards programs out there that meet both my business and personal credit card needs. This program can be put together with other cards, but my best experience so far has been using a combination of Chase cards to get the 50% point bonuses and benefits, I’ll describe here.

Like many cool things, I stumbled upon the Chase Ultimate Rewards program while reading about travel hacking on personal finance sites. I was consistently seeing the Chase Sapphire cards and their Ultimate Rewards Program listed at the top of most lists for high reward, high credit rating cards.

My Ultimate Rewards set up

My setup with Chase utilizes one personal card and two business cards. The personal card is the Chase Sapphire Reserve that came with a monster 100K point sign up bonus. Normally I would not pay annual fees over $95 for a reward credit card, however, this high fee card applies $300 of the of the $450 annual fee to the first $300 in travel expenses each year. It also includes 3X bonus points on all travel and dining with another 50% point boost when you book travel through Chase. It includes an additional $100 credit for TSA Pre / Global Entry programs, travel insurance, sky clubs, and other perks. So after doing the math, this is a great value. See points bonus calculation red boxes. 

To get the 50% point bonus, I look up flights on Kayak then punch that information into the Chase rewards travel search to make sure I get the same pricing. I generally get better prices on hotels from other sites, but I’ve had great luck with Chase on airfare, so I primarily stick with that. Points can be used any time on any flight, no blackouts, unlike airlines. You can also use points to reduce trip cost, if you don’t have enough for a full ticket. As an added incentive, my Sapphire Reserve card came with a 100,000 point bonus that is effectively worth 150,000 points when you book through Chase. The points can also be transferred 1:1 to airline and hotel partners. The point transfer feature was useful when I needed to add some British Airways Avios points to get to a reward ticket. Chase card sign-up bonuses range from 50,000 to 100,000 points, so every few years if a better card comes along, I simply apply for a new card to replace the old one. Their top-tier cards all have no international transaction fees, airport club access, and trip/purchase protection.

I have two Chase cards that I use for business. The first is Chase Ink Business Preferred. This card comes with great 3X bonuses on travel, cable, telephone and media purchases that include Ad spending on Google and Facebook.  If you spend money on Google Adwords, the 3X bonus really comes in handy effectively reducing your media costs by 3%. That can really add up. This card gives you a 50,000 to 80,000 point sign-up bonus (bonuses vary throughout the year).  For everything else business-related, I use a no annual fee card, Chase Freedom Unlimited, that gives me 1.5% cash back all purchases. This card is great because I can add bonus points with all types of transactions like health care, vendor payments, PayPal, Amazon etc. These really add up, so it’s nice to be making a 50% point bonus on all purchases. In order to really kick this system into high gear, make sure you use vendors that offer automated online bill payment. Points on my health care payments alone add up to nearly $700 per year.

How does this all add up to 4% return?

The secret to this lies in the ultimate rewards program website.  With the three cards linked to my chase.com account I’m earning anywhere from 1.5 X to 3X on all business purchases.  My average shakes out to about 2.6 points per dollar spent. (not including sign up bonuses) Once those points appear in my Chase ultimate rewards account I can then instantly move them to the card with the highest redemption award bonus (Chase Sapphire Reserve). Once the points are in the account, I can use them like cash to pay for airline tickets, hotels. I look for the best rates on Kayak then book the tickets with Chase to get the additional 50% points bonus.

So the current points balance below is worth $6361 in cash towards awards travel. That goes a long way when the average cost of my international plane tickets is about $550, and hotels and AirBnb rentals in places like Lisbon, Mexico City, and Athens, can be had for $60 a night.

Here is the math

2.6 (points average) x 1.5 (bonus rewards multiplier) = 3.9%  The IRS does not tax rewards points earnings, giving me a tax free equivalent return of about 4.8%!  That’s before I add in the 50,000 to 100,000 bonus points per year, which pushes the return well over 6%. One additional travel hack: When I buy tickets, I’m also getting airline points, upping the return by another percent or more. I save all my airline programs in one password so I can easily search and add hotel or airline point programsFor info on some of these cards check out this travel credit card rating tool from the Mad Fientist.  Just click on Chase to see all the cards mentioned here. 

This all sounds a bit complicated, but really it’s not. Once you have the credit cards linked to Ultimate Rewards and use an online accounting system like Freshbooks or LessAccounting to automatically import and categorize all transactions. It’s really just a new way to bank. Instead of writing checks and taking out expensive lines of credit, the banks now work for you.

 

The Frug

Follow me on Twitter Facebook Flickr Instagram

The Home Swap. A grand experiment in international travel.

By Brad Beckstrom

The proposition I made to my wife was pretty simple: “If you could spend two weeks in Europe every summer, would you be interested?” Of course I got an enthusiastic “yes”, until I brought up home exchange. Home exchange is just what it sounds like. It’s a website with over 65,000 homes in 150 countries. You list your home on home exchange, include all the countries you’d like to visit, and wait for opportunities to appear in your inbox to swap homes in places like Spain, and Italy, Brazil, and all over the world.

It’s vastly different than Airbnb as you are not paying a stranger to stay in their home. With Home Exchange, you are simply staying in their home while they stay in yours: a true exchange. The network is large enough to match up eager travelers from around the world who want to visit your town. Larger homes tend to attract like-minded families, while tiny apartments attract singles and couples. What they have in common is a sense of adventure and openness to meeting new people and trying new things.

As I started to browse through some homes along the Amalfi coast in Italy, or the Le Marais neighborhood in Paris, I started to realize our home is just not ready to attract the type of visitors we would like to exchange homes with for a two week trip. At this point, I am no more near ready to do this than I would be to start renting a room out on Airbnb. There is so much to do before I would even post some photos or create a profile. Sure, our house is in a great neighborhood less than 4 miles from DC, but it’s a big step to make it ready for some long-term visitors.

That is, unless I look at this as an opportunity. The great thing about the opportunity is at the end of the project, my reward is two weeks abroad. Not just this year, but nearly every year. That’s something worth working towards.  It’s also a grand experiment in the sharing economy.  So far we have truly enjoyed our experiences using Airbnb and saved tons of money using UBER and Lyft all over the world.

I was a bit discouraged when I started looking at some beautiful spotless homes in Italy and France, but then I looked up some US properties, even some in our neighborhood. I could spot the familiar clutter that didn’t seem to deter these folks from listing their homes. If we can just get our home somewhere between good and great that would be a start. I’ve always been adept with frequent flyer miles but found that hotels drain them too quickly, especially after you’ve coughed up enough miles for 4 transatlantic tickets. Doing a once a year home swap would be a perfect solution. Adding 14 nights of free accommodations to free airfare can really put some punch behind your travel plans. The great thing is we don’t have to accept any offers for a home swap if we aren’t interested.

Where to start? I don’t know about you but if I’m going to be spending Saturdays replacing toilet seats and cleaning out junk drawers, then I need some damn motivation. I found it in a few articles about people’s experience using home exchange. Since I started seriously considering this, I’ve also stumbled across a few other sites like Lovehomeswap.com with over 100,000 global listings and rave reviews on social media.

I’m going to give myself plenty of time to get this done. Here’s a few steps we’ll be taking, so when we decide to accept that home swap offer from the Amalfi Coast we will be ready.

  1. Check out the website and others experience with home exchange. Look at some alternative sites as well.
  2. Declutter and simplify. Several rooms in our house are in great shape but others are disasters. Instead of just putting a whole room on a list, we’re approaching this one drawer or cabinet at a time.
  3. A fresh coat of paint can do wonders. This can be tackled one room at a time. The biggest job will be outdoor paint, but it’s something that’s been needed for a while.
  4. Freshen up the bathrooms all around including some new toilet seats and fixtures.
  5. Start putting together a great series of wide-angle photos, not just of our house, but of the neighborhood and wonderful parks and trails right at our back door.
  6. Make sure our homeowners insurance is up to date and includes enough liability coverage.
  7. Create a secure owners closet for valuables. Basically just a quality lock on a large closet.
  8. Put together a home binder with instructions on all of our crazy appliances. They can’t be more complex than some of the things we’ve come across overseas.
  9. Put together a neighborhood guide and home information about with everything someone would need to know while visiting Washington, DC.
  10. Think about something that will set your property apart. For us we have three bikes people could use on some of the longest best-kept bike trails in the country.
  11. Add the places you’d most like to go to your profile, but be open to as many destinations as possible. If you find a larger place invite some friends and family along for the fun.

That’s a start. Who knows, I could get through most of this and still not get the type of home swap offers we’d be looking for. We won’t know unless we start the process. In the end, most of the items on my list above needed doing anyway. Now that I know a large Italian family may be invading our home, I’ll have some extra motivation.

The Frug

Follow me on Twitter Facebook Flickr Instagram

Are GPS apps rendering part of your brain inactive?

How to vastly improve your experience with maps and keep your head from getting lost in the map on your smartphone.

By Brad Beckstrom

640px-Claudius_Ptolemy-_The_World

Cartography –  The study and practice of making maps.

maps thefrug

Remember paper maps? I’m talking about the big unfolding kind they used to give you at tourism offices, AAA or full-service gas stations. How about the slick plastic coated ones that you could access with one hand on the steering wheel trying to navigate in a city like Rome or Washington, DC? Or the jumbo 50 page city or county map books they used to sell at office supply and convenience stores for about 18 bucks, still popular with some realtors and salespeople who work in remote areas or haven’t jumped on the smartphone bandwagon yet. Or the mother of them all, The Rand McNally Road Atlas hundreds of pages just waiting to be explored. I always had a thing for maps. I was always up for exploring out-of-the-way places, and maps helped me get there.

The frug globe

When my boys were younger, we used to play a game called “spin the globe”, wherever you land, you have to go there. I remember once my oldest son spun the globe and landed on Yakutsk, Russia generally considered to be the coldest inhabited city on earth with average temperatures of -58°F. He immediately added the city to the weather app on his phone and kept an eye on the place, occasionally sharing the sometimes ridiculous low temperatures. I don’t think I’ll ever see Yakutsk but I have a feeling he might.

Once GPS came along I knew I was hooked. (Finally an answer for my lack of direction in life.)   I played around with some of the earliest handheld GPS units, the kind where you had to load a CD onto your computer then somehow transfer maps to the GPS unit. These early units were popular with boaters because it’s very important to know where you’re going on the water. You also need to know about a third dimension, the depth of the water so you don’t end up on a sand barge, as I occasionally did.  At least I can blame the fricking GPS unit versus my lack of preparation with paper navigation charts. Read more…

If you’re traveling on a budget, plan a trip to a 4 star resort on a Greek Island.

IMG_8950 (1)

By Brad Beckstrom

Wait, The Frug hanging out at a four-star resort in the Greek Islands? That doesn’t sound very frugal. The fact is, it’s never been more frugal. This has a lot to do with the strength of the US dollar versus the Euro which is regularly hitting 10 year lows, but it has more to do with Greek  hospitality and choosing the right time and the right island to visit.

Location, Location, Location

While I was researching Greece, I was a bit disappointed to see pictures of summer crowds in places like Santorini and Mykonos. One website even included photos titled “perception” and “reality” showing a photo of beautiful whitewashed houses and windmills on Santorini next to a photo of the same spot, covered in tourists, with every alleyway bursting at the seams with dreaded shoppers and selfie stick wavers.

From the start, I wanted to avoid the crowds. That was going to be tough as our kids weren’t getting out of school til late June and, like many other families. we’d all be hitting the highways and airports about the same time. The strategy we came up with was to visit a few Greek islands that most Americans have never heard of, Paros and Antiparos.  We talked to some Greek insiders including a celebrity chef my 14-year-old son had been chatting up on Twitter and got the scoop on these two islands. They’re in the same Cyclades chain of islands with Santorini and Mykonos, but because Paros is a ferry hub, it’s often the first stop coming and going on the ferry from Athens. This would be our destination.

IMG_8958

Timing

The other key element in our plan was timing. Read more…

The Freedom of Limited Options

bow

By Brad Beckstrom

I’ve been busy lately, limiting my options. Nope, not talking about stock options. I’m pursuing a simpler lifestyle built around fewer possessions and more experiences. The idea is simple, stop spending time and money accumulating, storing, and caring for stuff. Get rid of it, starting with the small stuff, knickknacks, unused toys, clothing then moving on to larger items, eventually cars and houses. With each box of things we get rid of, each closet we empty out, there’s a sense of lightness. With each thing we wear out, then don’t replace, there is a feeling of freedom.

The closer you move to this limited lifestyle, the more things improve. If you limit your wardrobe, you’ll spend less time picking out what to wear every day, less time in the store replacing cheap sweaters and shoes. If you limit your diet to exclude crap foods and monster menu items, the payoffs include your finances and your health. Those “vintage” clothes will fit better. Even the best restaurants serve crap food. If they don’t get you with the heavy-handed ingredients, they will get you with the portions. I do miss my weekly visits to the local BBQ joint with 100 different sauces. Now, when I stop in, maybe every few months, it’s more of an event, something I look forward to. My gut has not missed the weekly three meat platter at all.

hotsauce

Limiting options does not just apply to clothing, diet, or the number of cars you own. It’s something you can apply to any part of your life with benefits. I’m learning to master investing by knowing less about stocks, bonds, and mutual funds and more about simplified micro fee index investing. Read more…