Right now I’m quasi-exiled and as I said, this week I’ll have some pre-written posts. And in the case of today and tomorrow’s posts, I wrote these (as one post) awhile ago and didn’t publish them. Exile is a good excuse to get these out so I can continue to work on my project. Here it is…
Many people explain why travel is not free with one of three ways.
1) They say that they spent a lot of money on a trip using miles and therefore it must not be free for anyone else.
Dumbfounding logic. “I spent money on travel therefore travel isn’t free” is hard to argue with. Like someone telling you why a country you like isn’t safe because they got robbed. Right, so therefore the entire country isn’t safe. You did get robbed, but the country is statistically safe. You spend lots of money… but I have had completely free trips.
2) They quote examples of people calling $200 credit free, or saying a card with a $450 fee is somehow free. I agree, that isn’t free.
And the third will be explained in tomorrow’s blog post. It is the dumbest and most common reason for why travel isn’t free.
But this post is focusing entirely on point 2, bad examples. This community throws around the word free, and it’s giving my blog a bad name.
I’m going to talk about all the ways travel isn’t free, so when people hear me say “anyone can have a two week trip for free” (which I believe and can prove and have seen), no one says, “mileage running and status isn’t free!”. No duh. I don’t mileage run and I don’t have status. I’ve never been a status junkie.
Or for example, someone is mad because they still spent $2,000 on their British Airways First Class flight using the “companion ticket”. I’m sorry, but I’ve never paid fuel surcharges, but I have made profit on flights and hotel stays. If you were going to try to convince me that my BRG (which took me 20 seconds to fill out) that got me a nice club lounge room with breakfast somehow cost me anything… you should see the check that has $25 more dollars than was charged to my card.
But I can’t convince those people, because they have their own experience as proof… and clearly other people in the world don’t have different experiences than them. So I won’t bother.
Instead I want to detour into the field of bad math.
Bad Math
My mind gets boggled up when I hear hypothetical “value” getting pedestaled far above actual costs.
“Value” is probably my least favorite word in this hobby.
A hotel being sold out for a conference could cause a $100 hotel to go for $400 a night. But since you used points, you got “$400 of value”. Value in this case isn’t the amount of money you saved.
You’d be a nutjob to pay for that hotel instead of going across the street to a more fairly priced hotel. So let’s say the hotel across the street was going for $100. You didn’t actually save $400, did you? More like $100.
But this hobby is obsessed with getting the most on paper value possible. Value gets prioritized above experiences, culture, location, etc… And while I don’t mind luxury hotels, I mind the math.
So allow me to target people who have otherwise not thought about these things and try to get an alternative way of thinking, when it comes to “value”. Rather, let me fight math I think is misleading.
$500 credits – $500 annual fee = Not Free
My least favorite math assumption is that an annual fee is covered by travel credits and it somehow equals out to free.
Now don’t get me wrong, this can be the case. But when I got the Amex Platinum card years ago I used the $200 travel credit to get $200 in AA gift cards. I never paid for flights, I never flew for status.
If someone knows for certain they would have spent the money anyways, sure.
But for most people, that’s not the case. The better way of thinking about it is this:
Would you buy those travel credits for the price of the annual fee? Like if $500 of travel vouchers were on sale for $400, would you buy them?
If yes, then neutral it out and just analyze the card bonus, if it’s the right app for that bank for you.
But most people don’t find 20% off the be worthy of jumping on. You coulda got 20% off Marriott vouchers, for example, with DailyGetaways. And I didn’t jump on those.
Yet, when you hear people talk about credit cards, they say, “it pays for itself”. And that’s really only true if you woulda spent the money otherwise. But for most people, it falls into the category of obsessed with a vain definition of value.
Getting $100 dinner credit doesn’t make a $90 hotel free
This again goes back to the obsession with value. “$100 hotel room and $100 dining credit, all that for a $90 hotel… I’m like making a $110 profit!”. No, no, no.
The thing that makes something free… is whether or not any money was spent. That’s it. Despite the arguments in this hobby, the free thing is decided by how much money you spent. Period.
If you spent $90… (I can’t believe I’m explaining this)… then that is NOT free!!!!
Did you get a good value? I mean, maybe. Or maybe the hotel has really overpriced food.
You can’t say your meal was free, and you can’t say your hotel was free. You spent money. All you can say is “$100 is a good deal for a nice room with all this food”. But just because they priced it really high, doesn’t mean it was a good deal.
It’s like some annoying marketing guru who is selling something for $100, but has the old overpriced price crossed out, “$1,000“.
Here’s a secret. Just because they priced it that way, or said it was priced that way, it doesn’t mean it is “worth” that much.
A flight booked with miles isn’t free if you paid to get those miles
Mileage Running
If you paid for flights, those miles aren’t free. They have an actual cost. You can’t then say the flight you used the miles on were free.
You could if your boss paid for your first flights and it was work related. Then shoot, say what you want.
However, many people fall into the trap of “status”. Status provides nothing of value that you can’t get from cash. So your extra cash to a hotel or airline is getting status and only status. The perks of breakfast and upgrades were more than paid for by yourself earlier.
Buying Miles
It surprises me how many people buy miles. Even more surprising is how little it gets disclosed when talking about a redemption.
I don’t buy airline miles.
Which is to say, when you hear that I took a flight using miles, it likely came from credit card miles. That’s it. A few mistake fares is the extent of my “loyalty” for paid flights.
Manufactured spending isn’t always free
This is another touchy subject because people’s experiences fog up their ability for me to be able to have a different experience. “I spend a lot of money!” I can hear people upset at the idea of it being free.
But the fact of the matter is, I don’t MS unless it’s free. There was an opportunity all of last year to do $100k a month online with no fee.
I’d love to hear someone explain how that wasn’t free. Because people are dogmatic about the idea that travel can’t be free, and that earning miles can’t be free… even though it happens everyday.
That being said, if you spent 1% earning miles via MS… that isn’t free. I’m not saying it wasn’t a good deal, I’m not saying you shouldn’t have done it. All I’m saying is that you can’t turn around and say that the flight you booked with those miles is free.
Conclusion
Free has to do with costs. In this case monetary costs.
The origins of your miles matter when determining whether or not your flight was “free”.
What I’m tired of is the marketed “value” of something mattering at all in determining the freeness of something.
Also, your experience isn’t everyone’s experience.
I don’t go around saying “all manufactured spending is free”. Because that’s not true, there are many things that can be a good deal but cost money. But the fact is, I don’t do it unless it’s free or profitable.
On the other hand, there are a lot of people willing to say “manufacture spending is not free”. They don’t say “can be expensive” or “often is”, just it is not free.
I can give countless examples of actually free travel. I’ll give two examples of making a profit tomorrow. One of a friend making thousands of dollars of profit on a flight home. I also have had completely free trips. Many actually. I also have had many free hotel stays, and some where I got paid.
And I know many people personally who earned miles and hotel points for free (some by doing dead simple things with zero costs) and then have a 1 week vacation completely free.
I know a number of people that took an award flight to a short vacation to an all-inclusive points hotels. Free flight and free hotel that even included the shuttle and food. Not only was the travel free, the entire trip was free including food. They probably saved money by going.
All that to say, I have experienced completely free travel, but despite my URL, I don’t go around saying that you can’t experience anything but free travel. It would be absurd for me to tell you that you didn’t pay for a flight because all travel is free. It probably could have been, but I’m not dogmatic about it.
However, people tell me all the time that travel isn’t free because they paid money. Huh? You paid money therefore my trip wasn’t free? Did the hotel secretly charge my card?
So I’ll be persistent that travel can be free… but why don’t you try saying, “travel can be expensive”. Or, “when I travel it costs me a lot of money”.
Again, I don’t tell you all travel has to be free. And don’t tell me that no travel is free… because it’s non-sense. Because… people have different experiences than you.
![Nick of FM on #40kFarAway [TIF Podcast]](https://travelisfree.com/wp-content/uploads/2019/10/travel-is-free-podcast-nick-40K-120x86.jpg)
Bam! Right on, Drew. Waiting for the OMAAT response 🙂
😀 I wouldn’t mind a response.
Although, to be clear, I wrote this post a month ago, and I hear all these points all the time. It’s not a response to Ben in anyway, although clearly we disagree on the subject. 😀
My fear is that these posts will make half the people I know think, “is he responding to me?”. So many people have commented or said these things… especially the concept from tomorrow’s post.
Well, even if your response is not timed, it is timely given the discussion in our little community. You raise a good point on redemption value – even at FTG (who have a similar view to yours), you will see success stories of people who got a “$20,000 vacation for free.” When you finish reading the story, you realize it’s more like a “$5,000 vacation for $500.” Still a great deal, but it goes to show that the notion of value is overly focused on the retail value of the exact replica of the trip funded by miles/points, not a comparable out-of-pocket expense you’d incur.
Yea, the value thing is funny. I wrote a post just on that too, but I won’t post it as I kinda just summed it up here.
But despite all the thought into “value”, I find myself still saying “the hotel was going for $500”.
And I think the reason we do that is because 5 star hotels are an experience we wouldn’t normally have. I wouldn’t ever pay $500 a night for a hotel. I’ve never paid half that. Barely paid half of half and I was only doing for points. 😀
But yea, at the end of the day; retail value is not worth. And it is definitely not savings! And that’s when it bothers me is when retail value can be subtracted as if it’s savings. Like dining credit doesn’t get subtracted from the cost. Same with annual fees and travel credit.
Quoting retail value just seems like falling into a really bad marketing ploy. “$1,000 worth of value for 50,000 points” based on some hyper inflated price just for the marketing copy.
May I express an interest in a hint or description of the 100k MS opportunity that has now (presumably) died?
Well… http://www.flyertalk.com/forum/manufactured-spending/1656854-prepaidian-delaware-boys-girl-club-card-issued-metabank.html
Last year we got it and could load $75,000 a month for free. We each had one (so $150k), but got locked out early on oddly enough for address changing.
I had a few of these cards as well….The stated terms were great, except they did not follow their own stated terms. Credit card loads were limited to $250 from my experience.
That was only after the change that happened at the beginning of the year, I think.
Another way to make stuff “free,” which is my plan BTW, is to MS cashback to cover the costs, or do card or bank bonuses for cashback. If it costs me 1% to MS, then I can MS 1000 points and then MS $10 in cashback to even everything out.
Sure, that could be free money at least.
The accounting gets odd if you determined to call it free, which I’m not always determined to do… but when you make more than you spend, that’s essentially free.
While that is a great scenario, the problem with the logic is that if you sold the points and kept the points you would have $10 extra (or whatever the selling price was)…..So by using the points you are spending cash by proxy.
Points are merely an alternate currency, one which is pretty easy to convert to USD.
Love this. I’ve only been at this game 6 months and already I am starting to scratch my head and skip considering many “great” ideas. Great value does not mean free in my world. I’m a cheapskate.
Great “value” doesn’t even mean it’s a good deal. So maybe the perspective change is based on how cheap you are.
My free standards are set to $0 and below. 😀
The way that people use the word “value” on travel blogs is totally ridiculous. Everyone is always pushing business and first class. One of the biggest reasons I think people do it is to get some good old fashioned click bait. Like the Derek Low’s post on medium where he gets “$23,000 value” on Singapore airlines.
Most of the time I’m just trying to get from point A to point B and have a clean place to sleep.
Yea, I think that’s a good example. If you can actually think it’s $23,000 of value, your anchored to a higher price point. Which is ironic, because now you are probably willing to pay more for travel! You’re probably willing to pay $2,000 to get enough points for $23,000 of value.
I believe people spend more on travel than they would without times because of that. Not joking.
But if you anchor yourself to free as the goal, you can actually spend less. It’s a perspective shift, and it’s hard when everyone touts $23k for this other pricey redemption.
There are only two ways to live your life. One is as though nothing is a miracle. The other is as though everything is a miracle.
If you go down the ‘it’s not free’ path then you need to think that none of this is free, there’s always a counter argument. Even the Boys and Girls club card you mentioned, it’s not free because you took time to load it and unload it. You only really start diving into opportunity costs when you hit gold like that.
For example, if I had a card like that and could earn Marriott points on, and say a load is $2500 – so I earn 2500 pts for free… but lets pretend it costs me a buck to load. Am I now buying at a really cheap price, or am I actually paying $39 for 2500 pts, as I could have used a 2% card instead?
The way I see it certain things are ‘use it or lose it’. Such as those airline credits – they perhaps seem to be free to me, because if I don’t spend that ‘free money’ it vanishes.
I had to read and re-read this post a couple of times. I usually find that I agree with what you write, Matt, or, at least, it’s thought-provoking.
But this one is not your best work. I can’t follow your thoughts from paragraph to paragraph. Maybe on your own blog you can expand on your thoughts here and make it clearer (for those like me!)
If you’re saying in the first part that people have to defend their world view, position, or the fact that they paid money… I’d agree.
In terms of opportunity costs, it really isn’t relevant to me for a number of reason. One is that while I’m obsessed with maximizing, it doesn’t really matter what you could have done with points if they were still free. So I think it applies some places more than others.
Nice filler post, you should run this down to the Darden School at UVA and see what those guys think about traveling for free. Nothing is free, plain and simple. Planes, trains, and ships cost money to build and operate. You may be getting a “free ride” but your fare is just passed off to the other consumers and share holders.
So when I pay $0 for a hotel, that’s what I mean by free.
That example is indeed free travel. I’m not making a business statement, or trying to imply that airlines don’t have operating costs. The question of this blog is: can someone get a hotel, flight, or trip for $0 (aka free).
The reality is, it is never free when including opportunity costs.
Like Matt mentions above, you time is worth money, whatever the personal valuation you put on it is.
More importantly, cashback can be put into your saving and miles/points/etc can be sold..
Miles/Points are merely an alternate currency, which in most cases can fairly easily be converted to cash. Anytime you use miles or points there is a pretty clear cost to that redemption, which is the price you could have sold the points for.
I’m in total agreement that something being a good value, or a great decision has little to do with whether it is free or not…But the fact is if you would monetize those points and save that cashback you would have more money in your pocket at the end of the day.
A good analogy would be this…
If you took a week of unpaid leave for a trip, would you not could the lost wages into your cost calculations?
I fully understand what opportunity costs are… but I’m not taking off work for this. No one I know is taking off work to apply for a card or two.
Also, I’m not concerned with best card possible, cash back, the 3% card over the 2% card…. what I mean by “free” is, “did you pay money for it”. If the miles were free, it’s free.
The “work” in question is not showing up to a job. The “work” is selling the points to a broker. You are losing income by using them, thus costing money. Which is the equivalent of taking unpaid leave from work in my earlier example.
If you could sell the points for $100, or redeem for a hotel room, the cost of the hotel was the $100 you could of had.
Only chumps pay retail. Life is cheaper on the backs of people too dumb or lazy to reduce their own costs. If I get things cheap and other people have to pick up the cost, thank god for the people “willing” to do that.
Stealing money from IHG by being reimbursed more than you spent is plain messed up. You need an ethics class.
lol, I didn’t have a say in the matter. I had no idea they sent extra money to cover foreign exchange costs… which I didn’t incur. Not sure how that’s stealing anyways, as it was their decision without my approval.
No different than using my free night cert, I’m not stealing a free night, they gave it to me.
I’m not totally convinced that this comment isn’t a joke… but if not, I’m guessing you just didn’t get what happened.
My philosophy is “travel is subsidized”
If I can travel international first class for coach prices, I consider it a win.
That’s prolly true and likely applies to a lot of things in life.
That’s my philosophy too. I take multiple awesome vacations for the price of a single average vacation. It’s not free, but it works for us.
Since getting into this hobby, I probably spend more on travel overall than I used to, which I think is what the banks and travel purveyors want. They don’t care that I get four trips for the price of one, as long as I spent more money than I did last year.
I think you are wound up a little too tight on the word “free”, most likely because it’s in your blog title and you feel you have to defend it.
As others have implied, “cheap” or “affordable” would be better adjectives to use than “free”.
Well, it’s a blog post. 😀
Cheap or affordable are also obtainable goals and more desired goals for most people. Other people in this hobby care about free a lot.
I have 2 thoughts here: Right on! and No No No!
Right on: “retail” is not true value. True value is comparative to what YOU would pay for a certain service. I value miles tix at the coach price for the same dates, regardless of what class I’m flying, because I would PAY for coach. Ditto for hotels.
No No No: Time has value! Nowhere in your “free” equation do you place any value on your time spent.
I’m almost with you Dia, on the “I value miles tix at the coach price”.
But what I’ve recently come to think about is that the miles are actually worth LESS than the coach price.
First reason: you can often find a competing flight on another airline for far cheaper. Example is flying from Madeira to Lisbon for 20K points using UAL partner TAP…*or* paying $70 to fly EasyJet. No way should you value the 20K points at the TAP retail price (of $200) when there is a $70 alternative.
Second reason: Award travel more-often-than-not requires some ridiculous routing or other contortions, just to get the damn flights. For example, doing a 20 hour layover in a connection city because the same day flight was not available.
These are just two reasons that I would argue that the value of points are actually *less* that the paid coach price.
I would agree with this. I use my airline miles so I can fly in the front for the price of the back. I’d rather not pay YQ, but if it means I can fly to FRA in LH F for $600 r/t instead of $200 for UA J then I consider it money well spent.
So my next post addresses the cost of time a tiny bit, but I’ll go ahead and answer here assuming people probably won’t read the other post. 😀
1) When I say “free” I am talking monetary cost. So someone could 10 hours a week doing this, and if they spend $0… that’s still free. In a monetary sense… For most, because….
2) Not everyones free time has a monetary value. That’s not a condescending thing at all, it’s a fact for most people.
Most people get off at 5pm, and no matter how much they work or don’t work, they won’t get paid more or less money. So doing this from 5pm to 9am, or on the weekends, their time should be valued at $0 (since this about monetary value). So let’s do that math in that scenario.
If a Bob spent 10 hours a week for 12 weeks straight (120 hours) to get enough hotel points for their vacation. All the points were earned with no costs for the miles, so we’ll calculate the time.
So far we have “$0 + [value of time] x 120hrs = cost of hotels”.
And Bob does this when he is off of work and could not possibly be making any money. So his lost opportunity is making $0. So zero dollars an hour. The cost based on value of time would be… Well first $0 x 120 hours = $0.
$0 + $0 = $0.
Now if Bob coulda been working and making money, we can change the equation a little. And your right, that wouldn’t be free… but for those people they are probably trying to get a deal. If they can get a vacation for less than the straight retail cost, it’s worth it. Or maybe they are going for premium products.
However, that’s not everyone. So that’s my point. Not everyone has a monetary value of time and not everyone should include it in their cost. Perhaps for you, it’s really important figure out what the time value is.
But I actually think MOST people don’t have a monetary value of time outside of work. Which doesn’t mean they don’t value it, but I’m only talking monetary value when we’re talking “free travel”.
But I agree that there are still MANY people who have to think about that.
The problem with this logic is the denial that someone could earn money during time not spent at their primary job. There are always part time jobs, side gigs, heck even Mturk.
Now the argument can be made that MSing/churning is more enjoyable than work etc. which I would agree with. But it is an untenable position that some people time has no value. Mturk/Surveys etc, while extremely low, is something anyone can do in their spare time.
Just because one can come up with a hypothetical situation of how you could be making money on a “side gig”… doesn’t actually mean that your free time is therefore “valued” at that hypothetical money.
Most people only have 1 job, and many can only have 1 job.
Everyone has a brother-in-law that would make us rich if we just went into his realestate idea with him. It’s like he said, “they aren’t making any more land, and the price of land is only going up.” And by his guesses you’d be a millionaire in 5 years…
so therefore based on your brother-in-law’s hypothetical estimation of your $1million share of the realestate business that your currently forgoing… Your time should be valued at least at $100 an hour.
Although, this doesn’t really take into account the fact that your applying for credit cards happens at night, browsing the web in bed. Time you woulda spent doing nothing with your spouse, and watching netflix anyways.
So let’s be honest, the miles and points time doesn’t have to overlap with the real estate business that your brother in law is waiting on a partner for (and some seed money since you have a better credit score).
What you are ignoring is the fact that points are either redeemable for statement credit or easily sold.
Applying for credit cards IS the second job.
You are just spending your wage (points) on hotels instead of converting to cash.
I’m not ignoring it, I published an entire post on the subject of “opportunity costs”. http://travelisfree.com/2015/07/23/stop-using-the-phrase-opportunity-cost-poorly/
It’s very simple. If I redeem my chase points for Cash or United flight, it doesn’t change the fact that I didn’t actually pay any money for them. That’s what I’m talking about, how much money did it cost me? In that example $0.00. Free. Nothing.
Could I redeem the points that didn’t cost me any money for cash? Yes, and then that cash would be free as well.
I mean really, if I redeem the points for cash is it suddenly free money? Or it an opportunity cost of forgoing the miles? Not that it matters, at the end of the day I didn’t pay for the points, regardless of what I do with them.
As far as time goes, of course if I were paid my salary for the time I spent finding a way to spend $0 instead of $550 for transportation to place I wanted to go (true story), the transportation would have cost me nearly $400. HOWEVER. At the end of the day, the charge on my CC is $0. I can choose to spend time making this happen and creating money out of thin air. I can’t take my time spent and march up to the window with my x hours to use as payment. When I want/need to use that $550 to buy backpacks, new shoes, and Starbucks 😉 for my family of six — and stay out of debt — and travel… Clearly when one must CREATE $ in order to make it happen, the argument about the cost in time spent becomes a silly exercise in economics.
Exactly.
This is horrible logic and economics.
Everyone values their time at something. If they didn’t suicide would probably be a lot higher.
If I told you I would pay you $1 to do a trivial task for me that took an hour, and you said no, then clearly you value your time at more than $1.
Arguing that you do stuff off the clock or not at work doesn’t make your time worth $0. It just doesn’t.
I can buy your talk of it being free from a monetary perspective, but you can’t say it’s free when you take into account the time. That is unless you don’t value pursuing hobbies, time with family and friends, relaxing, etc.
Drew maybe you should rename your blog Travel Isn’t Free then!!! 😛
Or “travel can be free”… but it just doesn’t have the same ring to it.
My big pet peeve is the $450 annual fee but you get $200 calendar year credits ($400). We take 2 trips a year and we rarely buy airfare, so the airline gift card credits are not “free” for me. We don’t buy meals onboard, etc. One time, we did need to purchase extra baggage on an airline and I tried to use my Wells Fargo Propel credit and the airline did not take American Express! Gah!
lol, Yea, I did an AirBaltic flight (used Citi points (no one judge)) and I showed up with the same bags we carry on everywhere and they said they were too heavy (as if they are lighter checked).
Anyways, we had to pay to print tickets and check our bags. It cost us more than the tickets. Sometimes they win.
I agree most of what you said. For example, I got ~20cents/mile in economy flight to Europe or upgraded to a room with value of 48cents (not 4.8) for 5 people with free full breakfast + Room service. I will would have never paid or that out of my pocket.
The question each one of us has to answer: 1) How much “maximum” will one pay for this experience, 2) What is the average going rate for this Hotel/Flight?
#1 will be on the high end of value (used sprodically) and #2 will be the avg value (for most calc and MS). Also whether you “trust” the particular Milegae programm (i.e. Hilton or Delta).
For example, going forward, I will never MS for Hilton or Delta.
Yea, ultimately I get the appeal of luxury hotels (I will be going to the lounge in an hour :-p). I get the appeal of having something you wouldn’t have had. So I think your question is still relevant for a lot of people. Although not everyone values the luxury experience, and so it’s entirely in contrast to whatever the cheapest option without points would be.
It’s post like this one that make me keep reading your blog over and over, nice one!
Thanks. 😉
Can’t believe how negative some of these comments turned. I feel like you perfectly put into words the things I have been thinking about certain other people in the blogosphere.
I read all of your posts and can’t wait for part 2 and whatever you’re working on this week.
I think it’s interesting how people had issues with your logic here, but don’t seem to be bothered when every credit card advertised on other sites gets an added $100 in “value” for the signup bonus because it reimburses Global Entry, even though you can only use that once for yourself and maybe a few other times for other people every five years.
I think you come at this hobby from a totally different angle from most of the other bloggers and sometimes it takes more than one read of your posts to fully understand your points because I’ve been subconsciously convinced of something by other blogs I read.
I loved your post the other day on what cards are worth keeping for the annual fee. You totally changed my idea about hotel cards and I realized I was just following the consensus that getting a “free” night each year for ~$75 was a good deal, when actually $75 is more than I’d be willing to pay for all but the best hotels.
Just wanted to say thanks.
I sincerely appreciate hearing about how in a practical way you found the post helpful or applicable.
I don’t take the comments as negative. Especially when you consider that [so far] 7 disagreeing comments are the same person. 😀
You make some good points about the valuation of credits, etc, but I have to disagree with you on your definition of “free”.
Points and miles are a type of currency, so any time you spend that currency the thing you are buying is no longer free. You are still trading something of value (points/miles) for something else of value (flights/nights).
Sure, you could get points/miles for “free” through MS/signups, but you can also get cash for “free” in the exact same ways. Hell, with that logic I don’t pay my employer for my job, so I guess the cash I get from them is “free” too. EVERYTHING IS FREE!
I’ve been reading your posts for a few months now and I sure agree. My husband and I have only been doing points/miles for a little over a year now. We have done pretty good but I’m glad I waited a bit to decide how to use our hotel points from two different hotel chains because if I’d used them right away, I may have fell into the “oh look”, you can get this hotel that costs $658 a night for 35,000 points, and all that. The reality is, I rarely pay more than $100 for a room and only a few times $200, which was in an overpriced resort town. While these expensive rooms might be nice, I found an all inclusive for the same amount of points. They aren’t as nice, but hey, free food, free drink free room, free flight (except taxes of course), leaves us with transportation to and from the airport at the destination, not all free but we would spend that amount of money, if we were home. On the other hand we are going to Belize on points but the area we are staying doesn’t have any large hotels, but it is dirt cheap. We will pay for that and not even use a statement credit on a credit card, because we will still be getting a vacation for a really good price. I’ve decided to not go anywhere, we really don’t have a desire to go and while I want the most value out of the hotel points, some expensive rooms may not be the best value, overall.
Posting from the Intercontinental Hong Kong, on a Bali & Hong Kong trip that will cost us around $2000 out of pocket for 4 (including food & activities) before redeeming Arrival points: travel can be as inexpensive as you care to make it. Including $0 or less. I like less!
Maintaining finances orderly is surprisingly not as common knowledge. This hobby exists thanks to his phenomena. Europeans are not easily tricked, so the amazing offers don’t exist there. If we see miles and points as currencies, obviously a certain target group will not be able to understand the concept well and maintain properly. This is the perfect target group for credit cards sign ups and base on what we see if works very well. More of a concern whether things are free or cheap I believe will be flashy clowns such as Ben Schlappig. While it does not concern me whether people pay or not while traveling as I have my own strategies and use the best advice such as yours, the very nature of this business may come more and more under scrutiny in near future.
Using Drews arguments I could also argue, that the money I make in my day job is “free”, because I only “spend” time to obtain it. No one in his right mind could argue like that.
Of course everyone’s time has always had and will always have value. Regardless if it is spend watching Netflix on the couch, or whatever. This at the very least has a recreational value.
So, when one considers whether or not his or her travel was “free”, you just can not ignore the opportunity costs. This is just economic nonsense, plain and simple. And everyone under every circumstances has opportunity costs. It blows my mind, that someone even tries to argue for the contrary. The fact that time has value and money today is worth more than money tomorrow is a backbone of economic theory (as someone with a masters in economics I know what I’m talking about here).
But, having said that, of course there can be opportunities for free travel, even when accounting for opportunity costs, because sometimes you can bank a profit when traveling, as Drew mentions.
Amen.
I think the people who are ignoring this are doing so because they don’t want to deal with reality and start to question how much their time spent in the “hobby” actually costs them. I probably used to be the same way, then I questioned what the F I was doing filling out surveys that take 10 minutes for 50 miles. Total waste of time unless you value your time at like $6 an hour and in that case I’d say you’re doing it wrong unless you live in Bangladesh (unless for example you needed to keep miles alive with some activity). I know it feels way more awesome when you think you got it for free and you can brag to your friends, but that’s a total fantasy.
What’s the logical fallacy where you say what someone is saying, that they aren’t saying, and then prove them wrong?
Because I mostly agree with you, except in what you say I’m saying. There are opportunity costs and time have a value.
If you are referring to my post on opportunity costs… your one click away.
If you read it, I state that there are opportunity costs but not all examples commonly given are. It’s choosing between something limited and not limited. Or something not limited and not limited. Like having an opportunity cost at the buffett, just get both 😀
Also, many trade offs aren’t economic. So even if its an opportunity cost, it doesn’t prove travel isn’t free. Transferring instead hyatt instead of United hardly proves that it isn’t free of money.
The only decent arguement is “opportunity costs” [bla bla] “you could redeem your points for cash” [bla blah]. And that is like 2% of the miles possibilities. And yet, the statement is used to show how all travel isn’t free.
You can’t redeem AA miles, united, british airways, marriott, hilton, hyatt, etc… The majority of my points are not in bank points.
First of all, Thank you Drew for taking the time to respond. My comment is actually in regard to both of your posts (“terrible math” and “opportunity costs”, as the discussion in the comments of both articles goes in the same direction).
My point is not, that travel can not be free, because it obviously can. My point is, that most of the travel you say is free, just isn’t, because you didn’t take into account the value of the time you spend getting the points and researching and learning about this stuff. And everyone’s time has substantial value (even if it is outside of 9 to 5 eben if it is spent watching Netflix)! This is just an economic fact, as well as a fact of life. And like I said, it blows my mind that this isn’t common sense and that anyone even bothers arguing for the contrary.
If you reject this argument, than following this logic, my salary in my day job would also be “free money” and any travel I buy from my salary would be free travel, which no one in their right mind could claim. If your point is, that some people (falsely) value their time at zero, then we are on the same page as far as this statement goes. But the fact remains, that any definition of “free” based on this flawed logic is flat out economic nonsense, plain and simple.
So, if you take into account the value of the time you spent and your travel is still free or even makes a profit; go ahead and say that travel was free. But most travel (probably including most of your travel) just is not free.
I mean… I still basically agree.
Time is valuable. However, giving it a hypothetical monetary value doesn’t meant that this is the value. Just because not everyone’s time has a monetary trade off, despite how valuable it is.
So sure I paid hours of time and $0.
Also, I want to emphasize, the other post wasn’t really inpired by the time argument as much as the miles vs miles argument… which I see much more commonly. I coulda redeemed my miles for cash, applies to such a small number of examples, and yet it’s used as a blanket statement to go “wow, miles and points aren’t free”.
Why do you think that not everyone’s time has a monetary trade off?
If we’re talking opportunity costs and you’re same time has a monetary value… that makes sense if you can trade the thing you were going to do (like collect miles) with something that makes money.
You can’t otherwise say, “that costs me 10 hours which is worth $200” and not have been able to make $200 with that time.
And why can’t everybody trade the time they use for collecting miles with something that makes money? There is absolutely no reason they can’t.
Sure. But that’s not how we value things. “I bet I could make ____ if I did ____, therefore my time is worth _____”. I assume we try to use facts or data.
If you were to take the opportunity costs of any product, it would be based on a realistic price determined by the market. Market sets value, not hypothetical reasonings. You having a job that pays you so much per hour and at what times is the effect of market for your job/skills. To use something other than market or data is just wishing or guessing.
Like the market determines the value of my business, not me with a calculator going, “why not get $_____?”.
But just because you did not actually “supply” your labor on a market (in this case your free time), does not mean it has no monetary value, only that it is harder to quantify. It absolutely is a miscalculation to say, I don’t supply my item of valué on a market, therefore it is worth nothing. Or would you do this kind of valuation for physical goods, say your stamp collection or something like that? propably not. And the best proxy for the value one could demand on a market for labor in his free time is the money he or she makes in his or her day job.
Again, I’m not saying it has no value, but you can’t possibly make a monetary value argument on something that doesn’t exist. It a null not a zero. But in dollars that is a zero.
Tell me how much would you value (in dollars) an hour of time that is not in labor but hypothetically could be if they changed their job?
Seriously, what’s the formula for that. x is the hours not being worked, y is the income that doesn’t yet exist… what’s the magical thing that turns this formula not into a zero? Because with a job, it’s because you get paid $x in 1 hour. Very easy formula.
My answer is not to give it a monetary value if there is no monetary exchange available. We don’t value things based on hypothetical possibilities. That’s the difference between a business model priced by supply and demand and one done by a brother-in-law on his calculator.
*For the record, I enjoy the discourse you’ve created. I’m a weirdo who enjoys being disagreed with more than agreed with (although be careful what you wish for applies to the last two posts.), and find your responses thoughtful. That being said, obviously your wrong, because we disagree :-p*
Your time at your job (or whatever you do to survive and support yourself) partially determines the monetary value of your time. It’s not a null just because you’re not at work. There is still some value on that time. You can argue about how you should value it, but not about whether or not it has value. It does.
You can figure out what that value is by doing a thought experiment (and it will be different for everyone). Say I would offer you $10 for an hour of your time to do a task that you neither liked or disliked (you’re just indifferent about the task itself). If you wouldn’t take my $10, then you value your hour at more than $10. Proceed until you find the threshold. Finding an exact value isn’t really that important as long as you know an idea of what ballpark you are in ($5, $25, or say $100 an hour).
Surely Bill Gates’ free time isn’t worth ‘null’ just because he’s not at work, just like yours doesn’t either.
It’s that simple.
I have said that your time has value over and over and over.
However, you don’t determine monetary value by doing thought experiments, you do it by market: supply and demand. What are you willing to pay, what are others willing to pay for a good or service. Value is determine by “price” (related to how much one is willing to pay) and has little to do with hypothetical as it’s tangible.
It’s a thought experiment only because I’m not going to actually offer you $10 for your time, but if I did, that would determine in the market (between you and I, or anyone else and you) how much your time is worth. It’s recreating a market, for your time. This is what people do in economics.
You keep fighting this one, but you really just need to admit that time is a cost that can be expressed in monetary terms.
This part is just all wrong:
“1) When I say “free” I am talking monetary cost. So someone could 10 hours a week doing this, and if they spend $0… that’s still free. In a monetary sense… For most, because….
2) Not everyones free time has a monetary value. That’s not a condescending thing at all, it’s a fact for most people.”
1. If you want to say they didn’t pay anything out of pocket, that’s fine. But you can’t say it’s free. It’s not, they paid with time, which has a monetary value.
2. Wrong. It’s not a fact for anybody. Everyone values their time at some tangible monetary value.
I get it, you need to defend the name of your website. I could care less about that part, I don’t think you need to really defend it. But you do yourself a disservice by trying to defend it with bad logic and economics.
I totally get what you are saying Drew, but I still disagree. I mean (and I say that without wanting to brag or anything) but as an economist who works in Asset Management, I at least like to think I have a pretty good understanding of how markets work.
Our disagreement, in my opinion, is in the following: You say, that I want to assign some hypothetical value to free time and say that is what free time is worth, but in reality, this is actually your approach to this topic, because you (randomly) value free time at zero. But this is just not a valid approach. When someone does not supply his free time on a labor market, the value of the free time is not zero. It is only harder to quantify. For example, everyone could educate themselves in his free time to increase his value and pay in the day job. how much is the NPV of that?
Just because something is not as straightforward to value as dividing your salary by your hours at work (in fact there is an entire area of financial economics, whose sole purpose it is to value securities where markets are (almost) non existent – just ask people working at the option pricing desk at your random asset manager).
But like you I absolutely enjoyed this discussion and hope you keep responding to this comment as well as the ones by Matt on this post and the other one. So regardless, thank you very much for this interesting discussion.
One addition regarding the formula: I can not give you an exact formula to value your time. of course not. but again, this does not mean, your time (or anyones) time has a value of zero. it just doesn’t. So, if you spend a couple hours and 0$ out of pocket your travel isn’t Magically free, just because you can not exactly quantify the value of the time. All we know is, that it has a positive monetary value and therefore your trip was not free! And this applies to every single human being on this planet.
Your trip can only be free if you make a profit on this trip via a kickback, a bump voucher or something like that.
@Phil
There have been net-profits at times. 😀
But do you think this formula applies to everyone? I mean the basic concept at least. That anyone could be making money with their free time and therefore the calculations of opportunity costs for doing something might not just be “it cost you 8 hours”, but instead, it cost you $__?
Also, I mean null not to say zero, but meant it as “your providing nothing to calculate”. So we should talk in hours and not dollars if that’s more applicable.
Although, I feel the conversation is in the ditches compared to the road I was aiming for. 😀 Although if this is where you disagree it’s what there is to discuss.
My main points are again, that the examples commonly used as non-free travel are choosing points over other points that have no monetary trade opportunities.
@Matt
“You may think you don’t place any value on it, but I guarantee you do”
I think I’ve said that your time does indeed have a value at least a dozen times in the last two days. 😀
“You keep fighting this one, but you really just need to admit that time is a cost that can be expressed in monetary terms.”
I’ve said nearly the exact same thing over and over.
You keep saying time is money as if it’s an economic law… and it’s not. It’s been said a lot and probably put on memes, but that doesn’t make it “good economics”.
Insisting time is money and says that it’s true for “everybody” (with zero exceptions), that it’s a “disservice”, “bad logic”, and “bad economics” to disagree… Take it easy. I see no reason it should be so offensive to disagree with this meme friendly economic non-fact stated to be fact for the sake of argument.
And again, I agree time is valuable and can have large economic value. No price is determined by pondering, but instead by market.
I mean, I don’t want to ramble off hypotheticals, but it’s quite assuming to say “everyone” must have access to the same financial opportunities as me.
“Not a fact for anybody”, and “everybody values their time at some tangible monetary value”… These are big blanket statements based in no economic law I’m familiar with.
One could say that a day wasted is a passed opportunity to make a days wages. That’s an opportunity cost… but only if that person could have made a days wages instead of doing that. That is a fact, although I know you don’t agree.
Is it true for a child young enough that he legally can’t earn money in our country? Is it true for someone who can’t find employment and can’t make any money (or do these people not exist anywhere in the world?)? Is it true for someone who can’t physically work anymore? Is it true for someone who works a job that forbids them from having a second job?
These people all value their time even if they can’t make money. You keep saying that I say that these people’s times are unavailable because they can’t make money… and I find that harsh.
Still, it’s absolutely true that time could have an opportunity cost of money, but that doesn’t mean it does for everybody all the time. It’s just not an economic fact…
Agree to disagree I guess. 😀
Your examples almost seem good on the surface, but dig in to them and your premise falls apart.
For the child, his time is worth some monetary value because if he goes to school and educates himself he increases his future earning potential, whereas if he does nothing, he doesn’t.
Or how about someone who is unemployed? Well there is some value associated with their time because they could spend it looking for a job that would bring future income. And if there is no value associated with this persons time, why wouldn’t they just work for free anyway? The market determines the price right? Well there are lots of people that are willing to pay you $0 to do work for them, and if a lot of people were valuing their time at $0, surely the market would ensure that transaction happens, right?
“Is it true for someone who works a job that forbids them from having a second job?” YES! The value of their time outside of work is dependent on their hourly wage while at work amongst a host of other factors.
Going by your theory, women or men who stay at home to take care of their children should value their time at $0, but obviously that’s not the case. http://www.businessinsider.com/value-of-stay-at-home-moms-2013-5
Just because you don’t get paid an hourly wage for something you do, doesn’t mean there isn’t a dollar value attached to that hour.
But since you seem to want to stick to your position, I’m not going to fight you on it anymore. Instead, I’ll pay you $10 an hour to earn miles for me. On your off time. Deal? Since you value your time at $0, then surely you would be crazy to not take my amazing business opportunity that I’m offering you.
Let me know how to send you the money and I’ll send my account information where you can deposit my earnings.
“Since you value your time at $0”
Never so frequently have I benn quoted as saying things I haven’t said.
I never quoted you. I made a statement based on the following statements that you made where you seem to imply or directly state that you don’t put a monetary value on your time, so I can only assume if your time has no monetary value, it’s $0.
And now I am quoting you:
“Their time from 5pm to 9 am has a monetary value (remember that’s what we’re actually discussing here) of $0.00 (zero dollars and zero cents). Nada.
If they spend an hour online applying for cards or booking a ticket, it isn’t not a monetary opportunity they missed out on. Period.”
“I agree that time outside of a job has value. Didn’t say it didn’t. But for most people it doesn’t have a monetary value.”
“So while everything cost time, that doesn’t mean that someone else’s time has a monetary value. And in that sense, it can’t be used as an “opportunity cost” proving that travel isn’t free.”
“It’s not that time doesn’t have a value, it’s that it’s not a monetary value.”
You talking about time spent MSing:
“Right, that’s a trade off, but not an economic/monetary trade off… which I address in the post and recapped in the beginning of the post.”
“A BRG that gives me a free night doesn’t cost me anything, regardless of accounting cost, economic cost, or opportunity cost.” It cost you time, so therefore you must value your time at $0 since you say it didn’t cost you anything in economic terms.
“But the fact of the matter is, I don’t MS unless it’s free.” – So apparently you either don’t MS or value your time at $0.
“Not everyones free time has a monetary value. That’s not a condescending thing at all, it’s a fact for most people.” – I’m assuming you’re lumping yourself in there since you seem to think that’s true for most people.
“So doing this from 5pm to 9am, or on the weekends, their time should be valued at $0 (since this about monetary value)”
“So sure I paid hours of time and $0.”
“But in dollars that is a zero.” (speaking about the economic value of time)
From all that it seems like you’re saying the economic value of your time and most others is $0.
I’m OK with that if you are, which brings me to my previous business proposition. I’ll pay you $10 an hour to help me MS and earn points. I’ll also hire anyone else you can find who will work for me too. And that shouldn’t be hard for you since most people value their time at $0, so I’m being super generous as you can see since I’m paying an astronomical, even incalculable, amount over the market rate for people’s time. So what do you say? Let’s make a deal. We both win.
Strawmanning at it’s finest. Dear lawd, I still never said I value my time at $0.
Plus, this is providing an opportunity to make money. At that point me passing it up as an opportunity cost of $10/hour, that we can agree on. That’s how opportunity costs work. Passing up the ability to make money, in this case it has a set value. I’m not sure what you’re arguing against with that paragraph given that I never said I value my time at $0… I personally don’t. And providing a monetary value… provides a monetary opportunity cost.
The things you actually quoted I stand by. The thing you then said I’m saying… I didn’t say. That’s happened over and over now. I’m afraid I can’t continue saying that I didn’t say what you said I said much longer. https://yourlogicalfallacyis.com/strawman
“Is it true for a child young enough that he legally can’t earn money in our country? Is it true for someone who can’t find employment and can’t make any money (or do these people not exist anywhere in the world?)? Is it true for someone who can’t physically work anymore? Is it true for someone who works a job that forbids them from having a second job?”
yes, yes, yes and yes. For example via education they can increase their pay in the future. how is this not a monetary opportunity cost for them? iI is totally irrelevant whether or not they are actually doing this. And also, don’t confuse the fact, that you can not exactly quantify this with the monetary value being zero.
Of course you can say, why does this hypothetical person doesn’t do everything (educating themselves, MSing, cooking at home to save on eating out etc.). But with time being a limited resource, you have to chose between opportunities like that, and therefore are subject to opportunity costs.
Of course you could say, that someone who has to lay in bed all day and can not lift a finger really faces no monetary opportunity costs when collecting miles/points in their free time. okay, that may (or may not) actually be the case (fortunately I don’t know this exactly), but people like that aren’t exactly in the target demographic of this blog, are they?
So yes, maybe there is an extremely niche group of people (like in 0.01% of people) who maybe would have no opportunity costs for MSing etc, but these are exactly the kind of people, that aren’t capable of traveling in the first place, and thus just aren’t valid examples of how the people face no monetary opportunity costs when collecting miles/points.
Phil, I’m surprised we disagree on this, albeit a very minor point off in the bushes. “Time is money” is not an economic principle. Seems really driven to make everything have a dollar value. Isn’t it just okay for something to cost hours? It’s really getting into the philosophical weeds to figure out how ever money of every adult and childs time is worth a monetary value. A bit philosophical and hypothetical for me to keep up.
Drew, the problem is you keep dismissing the argument that your time has an economic value associated with it, but that’s exactly the kind of information we need to decided whether we should or should not do something.
When I offer you $10 to MS for me, and you say your time is worth something and don’t want to do it, then clearly an hour of your time is worth more than $10 an hour. We created a market and just proved that to be the case.
It’s the same for everyone else. Their time has some dollar value associated with it. It might be small, but it’s not zero.
I guarantee if I asked to pay anyone in America 1 cent for an hour of their work, they aren’t going to do it.
And no, that wasn’t a straw man. You clearly said time has no economic or dollar value many times. So it’s not a straw man. That is the argument you’ve made (though your argument has shifted a lot during these two posts as people have pointed out the holes in it).
I just think your argument that ‘most’ of us should not be taking into account the economic value of our time when doing things for miles is about as wrong as you can get. If you’re trying to make rational economic decisions (which is what we should all strive for, especially in this hobby), the value of your time is probably near the pinnacle of importance.
“You clearly said time has no economic or dollar value many times”
I’m speechless.
Trust me I thoroughly understand what you think my problem is, you’ve repeated it thoroughly.
And yes, I am dismissing it, because “time is money” isn’t an economic principle… it’s just being stated as one. Agree to disagree, but it’s not.
I don’t make everything have a dollar value, *everything* HAS a dollar value. And I don’t make up the economics either. It seems like you are just to caught up on not being able to exactly quantify the value of free time and therefore say, recognizing it has a positive monetary value is “assigning a hypothetical value”. No it’s not.
Drew, just forget “time is money” that is just a catchy phrase, but the underlying notion, that time is a scarce ressource which has a value that can be stated in monetary terms is a valid economic approach and in no way hypothetical or philosophical!
“Everything has a dollar value” is not an economic principle, but it seems to be stated as one.
It’s not a matter of “caught up”, it’s just that you believe this to be a true economic law, and it’s one it’s unfamiliar with, nor can I find outside of the comments here.
At this point I think it’s a real agree to disagree. 😉
This is a post about “free travel”, right? So what I absolutely believe to be true is that everyone who is able to travel in the first place, does face monetary opportunity costs for their free time.
The following activities clearly have a monetary value (although admittedly it might be hard to quantify exactly):
– MSing / collecting miles and points
– educating yourself to earn a higher salary in the future
– cooking at home to save on eating out
– …….
and a thousand other things, that in my opinion in one form or another apply to everyone in the above mentioned group (people that are able to trabel).
And once again, given the fact that time is a limited ressource, one can not do every possible thing to earn more /save money and thus has to chose between opportunities and therefore is subject to monetary opportunity costs. I just don’t get how this is philosophical or hypothetical?
And I don’t “believe” that to be an econonic law. As an economist I know the laws of economics. 🙂
The other post on opportunity costs, as I said, is really about addressing things that aren’t opportunity costs despite being commonly used as examples. Things that aren’t limited resources.
We’re now discussing something else… which is fine.
I took 30 seconds to apply for a card the other day. I will get a fair chunk of miles from it.
I have many friends that could care less about reading blogs and they message twice a year “what cards should I get right now, I have big spending coming up”. And then I say “[this one] and [this one]” and they take 30 seconds to get the card.
Either we’re really concerned about giving a really small dollar value to that 30 seconds to prove travel isn’t free… or we’re sticking to examples that are more clear like MSing. If it’s the first… I’ll just leave it be. For the sake of coming to an agreement, I’ll say that if they had spent that 1 minute of time looking for a second job, that minute could potentially be valued at 50 cents. In which case, travel isn’t free for them.
“Uncle!”
If it’s the second and you want to use other examples that commonly apply to you and that don’t have to apply to the example I just used (or other people)… then I concede! I did many times in regards to choosing a card and many other things. One of my main points is that this hobby isn’t the same for everyone. Some people genuinely don’t spend much time worry about their miles, like my friends.
So agreed, you can come up with many examples of opportunity costs… which would be a great counter argument had I said that “no one can come up with a valid opportunity cost argument ever regarding anyone”.
but in your example you obviously made the research for them and spend way more time. If you are now able to “bang out” card recommendations like rap lyrics it is because you are drawing upon (probably) hundreds if not thousands upon thousands (or maybe even way more, i don’t know) of hours of research and experimentation.
And also, my point was not so say that one or all of my examples applies to everyone, but I think they are valid examples that apply to a lot of people and we can probably agree, that there are many many more activities like that, one of which probably applies to “almost” anyone in the travel group.
And as I am from Germany, I can’t really comment on how long a card application takes in the US, but here in good ole Europe it is way more than 30 seconds…
So their miles weren’t free to them because it cost me time? Cost me 10 seconds but because I’m educated on the subject that 10 seconds was more expensive? Even though often I get paid.
This is proof that their miles weren’t free? Same with all the people who go to “top credit cards” and get 50,000 miles just by picking whats at the top of their favorite blogger’s list?
I think I understood the Matrix more clearly.
They take me less than 30 seconds, I was rounding up for the ease of math. My audience is almost entirely from the US too. The scenarios I’m coming up with don’t apply to you, but they do for most of whom I write to on a regular basis.
Okay, if it is really possible to generate enough miles for trips *on a regular basis* in 1 minute per trip of extra time, then the monetary opportunity costs (while they still exist) really are very low.
So maybe this is the smallest common denominator we can agree upon and call it a day! 😉
But I still think most people in this hobby spend way more time than that on collecting miles and points and still claim their travel is free (which I still think is bogus).
Bat we can absolutely agree upon, that travel can be free (which I said from the beginning of this discussion)
lol
As I said, we agree on most of it… especially because we’re both (mostly me) using words like “sometimes” “some people” “can” “possibly”.
So I agree on both. You can in theory bat out apps in 30 seconds each. I really did spend a couple minutes the other day for both of us to do a ton.
However, I’d also agree that I spend a ton of time keeping on top of deals, and I knew exactly the redemptions I wanted for each card. I imagine most of my readers also spend time reading blogs.
Is what we call the middle?
If so, you have to watch the video someone else commented about. https://www.youtube.com/watch?v=VVp8UGjECt4
While I still think we disagree on a few things, we seem to agree on a lot of others so let’s leave it at that! 😉
I’ve had the privilege to see Yoram Bauman at my university in Bonn, Germany a couple of years ago in my econ undergrad studies (yes he really tours universities 🙂 ), so I’m a fan!
And of course I also had (more than) my fair share of the original pricipals by Greg Mankiw… 😉
Video of you doing a credit card application in 10 seconds (or even 30) or it didn’t happen.
And what about minimum spends? Do you only get cards that have no minimum spends? Most of the cards with good bonuses have multi-thousand $ minimum spends which takes time, effort, and sometimes money to meet.
““Everything has a dollar value” is not an economic principle, but it seems to be stated as one.”
That’s kind of the foundation of economics. That everything has some value that can be associated with it that can also be expressed in terms of whatever currency you operate in. Economics is all about resource allocation, and your time is definitely a resource.
It’s the fundamental underpinning of what economists refer to as “utility”.
https://en.wikipedia.org/wiki/Utility
And another:
http://www.wsj.com/articles/do-you-know-what-your-time-is-really-worth-1437500727
Like Phil said, thought it’s not super easy to say “my time is worth $x”, that doesn’t mean it’s a null or $0. The dollar value of your time can be determined and it’s extremely helpful in making day to day choices in your life.
A video or it didn’t happen?
Matt… I believe this is crossing over into trolling.
I’m not trolling you. I just doubt that you could apply for a credit card in 10 seconds or even 30. Even using Last Pass to form fill I don’t think I could come even close. So either you know something I don’t, have a script that does it for you, or you’re vastly underestimating the time it takes to do this.
I’m just trying to point out that you aren’t accounting for your costs Drew. Time is a cost. It has a dollar value that you can account for. You are one of the thought leaders in this space, but this is a glaring weakness in your analysis. And for some reason you think it’s OK to dismiss it. I think encouraging your readers to not value their time is a big misstep. Time is one of the most valuable things we have (in dollar terms).
I think Phil and I have both spoken our peace regarding your ignorance (and I’m not saying that to be mean or troll, since you are truly ignoring the costs) of economic principles. I understand you have some skin in the game and feel the need to defend your “travel is free” moniker. But rarely is anything truly free. I think your blog name is fine though, having some qualifiers isn’t a bad thing and I don’t think you really need to defend it. But you also shouldn’t try to defend valuing anyone’s time at $0. That’s my only point (and one that is surely backed up by economic principles). Ask any economist and I guarantee that they will tell you most peoples time is not valued at $0.
Sounds like we’re disagreeing on how long it takes to fill out a form… on like the 12th comment, so… I think that qualifies.
Welp. Time to pack it in. Good try Phil, we did our best.
Great post! I completely agree with you. I look at this hobby as stretching my travel budget to get better quality and greater quantity from the same money.
I keep pretty precise records of all of our spending. Any fees – credit card annual fees, gift card fees, taxes on miles flights, etc – go against the “Travel” line item in the budget. Hubby and I run reports twice a year to see where we are. Since getting seriously into this hobby 4.5 yrs ago, we spend less on travel, go more places, in more luxury.
We used to pay for cheap hotels with cash. Now we stay in 5-star hotels on points that cost less to generate than the cheap hotels. I would never pay $50K for 2 first class flights to Japan. But I’ll use 240,000 miles that I paid $100 to generate.
Some of these bonehead , borderline neurotic commenters give me a headache . You know who you are ! Get a life!