Frequent Flyer Miles for Rent Payments - Possible, but Pricey

The website WilliamPaid.com is in the business of facilitating monthly rent payments.

Here's how it works. First, set up an account, linked to one or more credit or debit cards, or a checking or savings account. Next, designate a payee (your landlord). Then establish a payment schedule and amount. And lastly, press the "Go" button and the rent payments will be sent automatically to your landlord, on time, every month. No muss, no fuss.

The site promotes the service as a convenience and as a credit-building tool.

But for rewards-program participants, it also holds the promise of earning frequent flyer miles or hotel points by using credit cards to make those hefty monthly rent payments. (Landlords typically do not accept credit-card payments.)

Should you use a credit card to pay your rent? It all comes down to the costs, of course.

The Value Proposition

While the site promises to "Pay your rent for less than a cup of coffee," that's hardly the case when it comes to credit card payments.

The basic service costs $29.95 for 12 months. Which is, indeed, less than a cup of coffee every month. But that price is for payments made from checking or savings accounts. If you elect to pay with a credit card, there's an additional fee of 2.45 percent of the amount charged to the card.

So if the rent is $1,500, the surcharge to pay with a credit card would be $36.75 per month, or $441.00 per year. Put another way, you would be paying 2.45 cents for every frequent flyer mile earned. That's roughly double the value of the average mile, so you'll be overpaying unless you make it a point to redeem those high-priced miles for higher-value awards.

What's Wrong With This Picture

The problem here—as it is with the companies that charge a 2.35 percent convenience fee for middle-manning tax payments to the IRS by credit card—is the so-called merchant fee that businesses and organizations must pay in order to accept credit card payments.

Merchant fees average around 2 percent, which neither the IRS nor landlords are willing to forego.

So companies facilitating credit card transactions between the IRS or landlords and consumers have no choice but to collect the merchant fee, plus a little extra to provide themselves a margin of profit.

Since that surcharge amounts to 2-plus cents on every dollar charged—more than most miles are worth—these services are doomed to deliver sub-par value for mileage-earners.

Reader Reality Check

Can you justify paying an extra 2.45 percent to earn miles for rent payments?

How much extra would you be willing to pay?

This Fall, Earn Up to Two Free Nights From Marriott

While the name has remained the same, Marriott's recurring MegaBonus offer has taken many different forms over the years.

For last year's fall MegaBonus, Marriott offered 2,500 bonus points after every second and subsequent stay charged to a Visa card.

This fall, Marriott has fashioned its MegaBonus promotion around free nights instead of bonus points.

Offer Details

Between September 15, 2010, and January 15, 2011, members of Marriott's Rewards program can earn one free night after the second paid stay charged to a Visa card. A maximum of two free nights can be earned during the promotion.

Free nights may be taken at Category 1 through Category 4 hotels, between September 15, 2010, and May 31, 2011. Awards are not transferable.

Registration is required, and must be completed by October 31.

(Note: It's standard Marriott policy to have a basic MegaBonus offer, plus a few variants sent to targeted members. So you might receive a slightly different version of the basic MegaBonus offer.)

Deal or No Deal

A free night after two stays. Good.

A four-month promotion period. Good.

A maximum of two free nights. Not so good—frequent travelers will have to look elsewhere for bonuses after their first four stays during the promotion period.

Free nights available only at Category 1 - 4 hotels. Again, not so good. Marriott has eight hotel categories, so the rewards are relegated to the lower-priced half of the portfolio.

The Visa requirement. A potential deal-breaker, if you don't happen to have a Visa-branded card in your wallet.

Overall, this is a solid offer, possibly one of the best available for fall stays.

Reader Reality Check

Bonus points or free nights—what's your preference?

US Airways' Big Mileage Bonus Is for Big Buyers

Score up to 100,000 bonus miles.*

That's the headline for US Airways' upcoming promotion. With that fat, round number as an incentive, it has a nice ring to it. It's an attention-getter, all right.

As is often the case with headlines, this one has an asterisk next to it.  And with this offer, one asterisk may not be enough.

Offer Details

Between September 1 and November 14, members of US Airways' Dividend Miles program can earn up to 100,000 bonus miles by completing 36 eligible transactions with program partners.

During the promotion period, each eligible transaction generates a hit, in keeping with the Grand Slam theme of the promotion. Hits translate into bonus miles, as follows:

• Four hits 4,000 miles
• Eight hits 8,000 miles
• 12 hits 14,000 miles (3,000 of which are elite-qualifying)
• 16 hits 20,000 miles (6,000 of which are elite-qualifying)
• 20 hits 30,000 miles
• 24 hits 40,000 miles
• 28 hits 60,000 miles
• 32 hits 80,000 miles
• 36 hits 100,000 miles

Further complicating matters, there are limits to the number and types of partner transactions that qualify as hits:

• Cards - maximum one hit for each US Airways credit or debit card
• Hotels - maximum six hits
• Hotel transfers - maximum 10 hits
• Cars rentals - maximum six hits
• US Airways Club - one hit
• Dividend Miles Shopping Mall - maximum one hit
• Other partners - maximum of one hit per partner

Registration is required. Transactions completed before registering do not count toward earning bonuses.

Deal or No Deal

The headline-featured bonus is significant, obviously. But very few Dividend Miles members will walk away with the full 100,000 miles.

The question for most is whether they're willing or able to rack up enough hits to still earn a meaningful number of bonus miles.

If so, you'll have 2.5 months to work through as many transactions as possible. And if elite status in US Airways' program is on your agenda, the 12- and 14-hit thresholds would be goals particularly worth pursuing.

Reader Reality Check

Is it worthwhile jumping through so many hoops to participate in the promotion?

If so, how many bonus miles do you expect to earn with this offer?

Starwood Kicks Off Fall Bonus Season With Double, Triple Points

It's almost September and the fall hotel promotions are beginning to trickle in.

First up for review is the following offer from Starwood.

Offer Details

Between September 8 and December 15, Starwood Preferred Guest members can earn double points for up to nine qualifying nights, and triple points for 10 or more nights, including the first nine.

Starwood mentions that the offer is good for stays at "more than 850 participating hotels." But the Starwood portfolio includes almost 1,000 properties, including Sheraton, Four Points, St. Regis, Luxury Collection, Le Meridien, W, Westin, aloft, and element hotels, so travelers will want to confirm that any particular hotel is bonus-eligible before booking.

There's no limit to the number of points that can be earned during the promotion period.

Registration is required, between September 8 and October 31.

According to the FAQ, this promotion is combinable with other Starwood offers, so the bonus can be combined with the free night offer for stays at aloft and element hotels through September 30.

Deal or No Deal

Starwood has dubbed this offer Every Night Counts. Indeed, that's one of the promotion's strong points—you earn something extra beginning with the very first night. (The fall Hyatt promotion that I'll be reviewing in the next few days requires five nights to earn a bonus, and the new Marriott MegaBonus requires two stays.)

On the downside, double points is hardly a stellar bonus, and the triple points don't kick in until the tenth night is completed.

Overall, this is a decent offer but hardly a spectacular one. Before committing, I'd suggest waiting to see whether the bonuses from other major hotel chains offer better value for fall stays.

Reader Reality Check

Are you looking at bonus opportunities for fall hotel stays? How does this Starwood offer compare?

American's Hotel Booking Bonus May Be a Bad Deal

Booking travel has never been easy.

Who has the best deal—the lowest price, the best loyalty bonus, the most customer-friendly terms?

There's no definitive answer to that question. Sometimes you'll find better deals on the airline or hotel websites, sometimes not. Sometimes third-party distributors have the best deals, sometimes not. If there were a reliably superior booking solution, everyone would use it, always, squeezing the other channels out of business.

The confusion, in other words, is a natural byproduct of competition and therefore to be expected.

What consumers also have a right to expect, though, is sufficient information—clearly and simply presented—to make an informed choice among the available options.

This new promotion from American is a textbook case of compounding the confusion by failing to reveal a key aspect of the offer.

Offer Details

Through October 11, members of American's AAdvantage program will earn 500 bonus miles for every hotel stay booked on AA.com and completed by August 31, 2011.

American claims to have more than 60,000 hotels available for sale, and promises to refund the difference if the buyer finds a comparable stay at a lower price.

Deal or No Deal

All things being equal, a bonus is better than no bonus, and a bigger bonus is better than a smaller bonus.

But are all things equal?

When choosing where to book a hotel, there are several considerations, including price and loyalty program bonuses.

It's a straightforward matter to compare the AA.com room rates with those offered on the hotels' own websites, or through such online travel agencies as Orbitz and Travelocity.

If it turns out that the prices are more or less the same, loyalty points could be the difference-maker. And if the American bonus miles are in addition to the points normally earned through the hotels' own frequent-stay programs, booking through AA.com would appear to be the better deal.

So, are the AAdvantage miles combinable with the points awarded by the hotel programs? I searched AA.com in vain for 15 minutes looking for an answer to that question. If it's there, I couldn't find it. Which means that others can't find it either. And that suggests that at least some travelers are booking on AA.com under the assumption that they'll earn both AAdvantage miles and hotel points for their stays.

They'll be disappointed.

In response to my query about the combinability of the AAdvantage bonus with Marriott's upcoming MegaBonus promotion, a Marriott representative said this: "If you book and pay for your stay with a third party, including AA, then it is not eligible for points and MegaBonus." That's the policy of other hotels as well.

Language to that effect should be posted prominently on AA.com—and in the hotel-booking sections of the websites of Continental, Delta, United, and any other airlines that sell hotel room nights.

While full disclosure is always a best practice, it's especially important today. This is a period of particularly vigorous hotel promotional activity, so taking advantage of the American bonus could preclude your participation in a significantly more valuable promotion from the likes of Hilton, Marriott, or Starwood.

Bottom line: Be sure to consider both the price and loyalty points when comparing the value propositions offered by AA.com and other travel suppliers and distributors. And unless you have evidence to the contrary, assume that loyalty points from the airline or hotel cannot be combined with bonuses offered by third-party distributors.

Reader Reality Check

Have you ever booked a hotel stay on an airline website?

Did you assume you'd earn the normal points awarded by the hotel loyalty program?

Did you earn them?

Hate the Airlines' Bag Fees? Stay at an InterContinental Hotel

According to SmarterTravel's Ultimate Guide to Airline Fees, flyers could be charged as much as $80 each way, $160 round-trip, to check two bags. (That's on Delta, for airport-checked bags on international flights.)

That's a considerable expense. And with prices to check just a single bag typically in the $20 to $25 range, each way, it's expensive even when it's not that expensive.

Whether it's the money or something less tangible, the bag fees have proven to be a considerable irritant to travelers—they were the number one complaint in a recent Consumer Reports survey.

Apparently sensing an opportunity to capitalize on travelers' discontent, the InterContinental Hotels Group has placed the airline bag fees squarely at the center of its upcoming promotion.

Offer Details

Between September 1 and December 30, travelers who complete weekend stays charged to a Visa card at any of 4,500 InterContinental family hotels will be reimbursed up to $50 for checked bag fees associated with their trips.

Among the promotion's key provisions:

• Qualifying stays are defined as two consecutive weekend nights, Fridays, Saturdays, or Sundays.
• Reimbursement is in the form of a Visa Prepaid Card that may be used wherever Visa debit cards are accepted.
• Bag fees must be documented, and flights must be within three days of the hotel stay.
• There's no limit to the number of times the fee reimbursement may be earned during the promotion period.

Deal or No Deal

This offer is obviously moot if you routinely carry your bags onboard with you.

It's also moot if you don't spend weekend nights at hotels—the promotion targets leisure travelers.

But if you're a weekend traveler who normally checks a bag, you're paying between $40 and $50 round-trip. And getting that money back is good for the budget, and perhaps for one's sense of fairness and decency as well.

Aside from its limited applicability, the promotion has two notable downsides. First is the process—it requires a fair amount of work to collect and supply the required documentation.

And second is the use of a prepaid card as the reimbursement vehicle. While debit cards are nominally worth the same as cash, in practice they're more difficult to use, and have a tendency to be forgotten and expire. A check would have been better. Or, since Visa is a promotion co-participant, it should have been possible to simply apply the reimbursement as a credit on the hotel charge.

Reader Reality Check

Any takers?

Or is this too focused (weekend stays, bag fees) to be of use?

Southwest's New Frequent Flyer Partner Is Starwood Hotels

If you're a regular reader of this blog, you know that one of my recurring criticisms of the low-cost carriers' loyalty programs is their relatively sparse partner lineups.

Members of American's program, for example, can earn miles when purchasing goods and services from more than 1,000 companies, representing just about every industry segment. But members of AirTran's A+ program can earn points only for flying on AirTran, using the program-affiliated credit card, renting from Hertz, and buying from a handful of miscellaneous other partner companies. In terms of opportunities to bolster your mileage-account balance, the former obviously trumps the latter.

Bigger beats smaller on the awards side of the programs as well. With American's long list of airline partners, AAdvantage miles can be redeemed for free flights to every corner of the world. AirTran credits are redeemable for flights to, well, anywhere AirTran flies.

Although some of the discount carriers have made noteworthy progress in expanding their frequent flyer partnerships—Virgin America is a shining example—Southwest has been a conspicuous laggard, especially considering the airline's growth into one of the country's largest carriers.

While Southwest's website boasts "tons of partners," that's hardly the case. Rapid Rewards members can earn credits at most major rental car companies (Alamo, Avis, Budget, Dollar, Hertz, Thrifty) and for stays at many of the major hotel chains (Best Western, Choice, Hilton, Hyatt, InterContinental, La Quinta, Marriott, Wyndham). But except for the obligatory program credit card, dining program, and a forlorn online florist (teleflora), that's it. No other airlines. No mileage mall. No miles-for-mortgages.

Given the program's strengths (hotels, rental cars) and weaknesses, Southwest's latest addition to the Rapid Rewards partner roster is more redundant than it is a real program enhancement.

Effective immediately, Rapid Rewards members can earn a half credit for eligible stays at around 1,000 Starwood family hotels (St. Regis, The Luxury Collection, W, Westin, Le Meridien, Sheraton, Four Points by Sheraton, Aloft, Element).

As a launch promotion, members can earn double credits (one credit per stay) at Four Points hotels between August 18 and September 30. Registration required.

New opportunities to earn credits are always a good thing, of course. But Rapid Rewards members already enjoyed plenty of options for earning credits for hotel stays.

And it is a zero-sum game. There are only so many hours in the day of the Rapid Rewards partnership team, and the time they devoted to bringing Starwood onboard was time that could have been spent addressing the program's weaker areas.

Reader Reality Check

Did Rapid Rewards really need another hotel partner?

What company (or type of company) should Southwest add to the Rapid Rewards program?

Business Class to Europe: $1,375 With US Air Mileage Sale

Potentially lucrative mileage sales have become a semi-permanent feature of US Airways' Dividend Miles program.

Most recently, the airline offered to double the number of miles purchased between June 1 and July 31, the fourth such offer in just the past year.

Apparently US Airways was pleased with the results of that promotion, and of its predecessors, because they wasted no time in launching a new one.

Offer Details

Between August 16 and September 15, Dividend Miles members will receive a bonus of between 25 and 100 percent on miles purchased on US Airways' website, either for their own accounts or as gifts for other Dividend Miles members. The bonus depends on the quantity purchased, as follows:

• Buy or give 1,000 - 9,000 miles, receive a 25 percent bonus
• Buy or give 10,000 - 24,000 miles, receive a 50 percent bonus
• Buy or give 25,000 - 39,000 miles, receive a 75 percent bonus
• Buy or give 40,000 - 50,000 miles, receive a 100 percent bonus

There's a limit of 50,000 miles that may be bought, which would amount to 100,000 miles with the bonus.

Miles are normally priced at 2.75 cents apiece, plus a 7.5 percent federal excise tax.

One important caveat: "Dividend Miles accounts less than 12 days old are not permitted to Buy, Share or Gift miles."

Deal or No Deal

With the value of a frequent flyer mile averaging 1.2 cents by my calculations, buying miles at around 3 cents each is generally a losing proposition. But there are the occasional opportunities to squeeze decent value from purchased miles. And this is one of them.

To illustrate, a business-class award ticket to Europe on one of US Airways' Star Alliance partner airlines is priced at 100,000 miles, which can be purchased through this promotion for $1,375, not including taxes.

A quick check using Kayak.com showed business-class fares on Lufthansa between Los Angeles and Frankfurt priced from $6,405 in early September.

And there you have it: Using miles purchased for less than $1,500 to buy a $6,405 ticket amounts to an eye-popping 78.5 percent discount.

Yes, you'll still have to wrestle with the capacity controls that make award travel a hit-or-miss proposition.

And yes, there's always the "real" value question: Is a business-class ticket truly worth 10 times as much as a coach ticket?

But even adjusting for the hassle factor, and assuming that business class is somewhat overpriced, the deal is compelling.

Reader Reality Check

Ultimately, the value of this or any other miles-for-sale promotion depends on the availability of award seats. What's your experience been with US Airways miles—readily redeemable, or not?

Is a business-class ticket to Europe worth $1,375 to you?

The Best Hotel-Points Options for Penny-Pinchers

I'm cheap.

Even when traveling on the company dime, the ritzy top-end hotels rarely get my business.

When attending travel industry conferences, I've been known to bypass the "official" hotel (with the supposedly "special" rates for conference attendees) in favor of the modest motel down the street.

My idea of luxe accommodations is a Courtyard by Marriott. Free Internet access. Free parking. A swimming pool. And I earn points in a solid frequent-stay program, Marriott Rewards.

But when I'm on the road for family reunions, weekend getaways, and the like, I'm perfectly happy to hang my hat at a Best Western, a Motel 6, or whatever independent Dew Drop Inn happens to have a flashing Vacancy sign and a $39 rate.

While I'm a fan of cheapie hotels, I'm by no means an expert—I typically look at location, price, and amenities, and let the chips fall where they may, regardless of brand or, for the most part, loyalty points.

Because I'm not an expert, I was intrigued by the results of the recent J.D. Powers 2010 Hotel Guest Satisfaction Study. The report was based on a survey of more than 53,000 travelers who rated hotels on seven dimensions: reservations; check-in/check-out; guest room; food and beverage; hotel services; hotel facilities; and costs and fees. The results were then grouped into five price-point categories—from Luxury at the high end to Economy/Budget at the low end—plus extended stay hotels.

Among the Economy/Budget hotels, the results were as follows (ratings based on a 1,000-point scale):

• Microtel Inns & Suites (737)
• Howard Johnson Express (700)
• Red Roof Inn (697)
• Days Inn (684)
• Econo Lodge (666)
• Travelodge (664)
• Americas Best Value Inn (656)
• Motel 6 (653)
• Rodeway Inn (643)
• Knights Inn (610)

It probably goes without saying that there's no inherent relationship between the study results and the quality of the hotels' loyalty programs—the extra value provided by loyalty programs simply wasn't among the criteria considered. But it raises the question: Is there any correlation between the best budget hotels and the best frequent-stay programs?

Here's the same list, showing the frequent-stay programs associated with the hotels:

• Microtel Inns & Suites - Wyndham Rewards
• Howard Johnson Express - Wyndham Rewards
• Red Roof Inn - RediCard
• Days Inn - Wyndham Rewards
• Econo Lodge - Choice Privileges
• Travelodge - Wyndham Rewards
• Americas Best Value Inn - Value Club
• Motel 6 - n/a
• Rodeway Inn - Choice Privileges
• Knights Inn - Wyndham Rewards

Strikingly, one program, Wyndham Rewards, is linked to five of the ten budget brands. But apparently proving that the relationship is more incidental than fundamental, Wyndham Rewards is the program of both the highest- and lowest-rated hotels in the category.

In fact, the Wyndham Rewards program received runner-up honors in the SmarterTravel Editors' Choice Awards 2010: Best Hotel Loyalty Program. Our take on the program:

For a small business owner, for example, traveling on his own dime and planning to reinvest points for future business stays, Wyndham's Rewards program encompasses more than 6,000 hotels, including such value-oriented brands as Baymont Inn & Suites, Days Inn, Howard Johnson, Knights Inn, Microtel Inn & Suites, Ramada, Super 8, Travelodge, and Wingate by Wyndham.

Dominating the budget category so convincingly, perhaps we should have pointed out that Wyndham Rewards would be a solid choice not just for small business owners but for anyone who chooses to travel on the cheap.

Reader Reality Check

Any comments on the J.D. Powers study results?

The Wyndham Rewards program isn't among the most prominent hotel loyalty programs. Is it on your radar? Should it be?

Southwest Hops on the Boston Bonus Bandwagon With Double Credits

It's been a good summer for frequent flyers who either live in the Boston area or fly there.

Delta got the bonus ball rolling with a triple elite-qualifying miles promotion for its Shuttle operation, including New York-Boston flights, through August 31.

American responded to a portion of Delta's promotion with its own triple elite-qualifying mile bonus for American or American Eagle flights between New York and Chicago O'Hare or Boston, also through August 31.

JetBlue is offering triple points for flights between New York and Boston through August 31, and for flights between Boston and Los Angeles through October 31.

And now, on the eve of the first anniversary of its service to Boston, Southwest has added its own Boston promotion to the mix.

Offer Details

According to Southwest:

In celebration of one year serving Boston, Southwest Rapid Rewards is offering double credits for members who fly into or out of Boston Logan, Manchester, or Providence between August 12 and October 31.

With the bonus, Rapid Rewards members earn two credits for every one-way flight, four credits for each round-trip.

Registration is required and must be completed by September 15.

Deal or No Deal

Southwest's offer isn't as generous as the other Boston bonuses. But those promotions are limited to specific routes, and most end on August 31.

Double credits, for two and a half months, for any Southwest flight to or from Boston Logan or two nearby airports. That's a decent bonus, on offer for a comfortably long period, for plenty of flights.

'Nuf said.

Reader Reality Check

Boston, anyone?