Something for Nothing

Let’s face it–not everyone thinks that personal finance and investment strategy is an interesting subject. Therefore, in an effort to be more inclusive and entertaining, I have decided (this week) to write about something we can all get excited about–FREE STUFF.

Ever since I was a little kid, I have been interested in money (earning it, saving it, investing it, and spending it wisely). Over time, I have discovered various ways of maximizing value with minimal investment.

As mentioned in a previous post, one of my hobbies is collecting reward points by signing up for various credit card, bank account, and investment account promotions. In fact, one of my goals for 2012 is to accumulate 1,000,000 points/miles (excluding those obtained via daily spending). As of today, my tally is just shy of 800,000–I think I’m going to make my goal. There’s not enough space in one post to go into all the details, but perhaps the following example will give you a taste of the possibilities.

This week, my wife and I will escape the Texas heat and fly to Buenos Aires for a little R&R. I love to travel and experience new things, but I enjoy the adventure just a little bit more when traveling for free. Here’s the details on the retail cost of flight and hotel reservations versus our cost:

Delta Air Lines (Austin to Buenos Aires with a stop in Atlanta). List price for two roundtrip, business-class tickets is $15,952.

Our price: 200,000 Delta Skymiles

Park Hyatt Buenos Aires  is rated one of the top hotels in the city and lists for $496 per night ($1,984 for a four-night stay).

Our price: 4 nights of Hyatt vouchers

How did we do it? Whenever I see an attractive rewards promotion for opening a credit card or new account, I apply for once for myself and again for my wife. She isn’t a rewards geek like me, but she does enjoy the perks. Earlier this year, Delta was offering 25,000 miles to sign up for an AmEx Delta card. You also had the ability to earn an additional 25,000 miles if you charged at least $1,000 during the first three months. Fifty thousand miles times two cards equals airfare for one to Argentina. The card has an annual fee, but the first year is free and there is no penalty to cancel the card. Other perks that came with the card are 2 free lounge passes and baggage checks. The current AmEx Delta Skymiles credit card sign up bonus is down to 30,000 miles – I would wait, a better promotion is usually just around the corner.

In order to come up with the remaining miles (and the opportunity to join my wife on this trip), I opened and funded a Fidelity brokerage account in my individual name. In order to earn the maximum 50,000 miles, I had to transfer a minimum of $100,000 to Fidelity. After the miles hit my account, I opened a new Fidelity account in my wife’s name and transferred the same $100,000 to it. The 50,000 bonus miles landed in our Skymile accounts just a few days after the initial deposit. The Fidelity promotion is still available (scheduled to expire on 2/14/13).

We obtained the hotel vouchers by simply applying for two Hyatt Visa credit cards. Each new account holder receives a free two-night stay. There is a $75 annual fee, but you receive a $75 statement credit after your first purchase.

So, for a minimal amount of work, we’ll be enjoying a vacation with a retail cost of $17,936. Never in a million years would I pay that kind of money for a vacation, but I will certainly savor the experience and time together with my wife. If you have a similar story, please share it with us. We’d love to hear from you!