Costs:
$500 deposit
$65 for debit card
$10-$14 monthly fee (can be waived with 5 debit card purchases, or $4000 min average balance.)
$25 if you close in the first 90 days
If you want to churn, you're probably going to want to make 5 debit purchases every month. For those who don't easily make those debit card purchases every month (me for example): Assume this will cost about $1.50 per transaction (buying 5 $1.50 items on the net). You will have to do this for 3 months to avoid the $25 penalty.
So $65+22.50= $87.50 out of your pocket.
At this cost point you get 25,000 miles for $0.0035 per mile.
Now assume that it takes 30 minutes to make 5 purchases every month (1.5 hours). Another 1 hour to open the account, 30 minutes to create a new online login, 1 hour to follow up with Chase and OnePass for your points (as many of you have experienced). Assume you get paid $20/hour, then this used up $80 of your time. $80+87.50=$167.50
If you include the cost of your time, then you get 25,000 miles for $0.0067 per mile. (God forbid if you earn more than $20/hour.)
Assuming a value of $336 (SaverPass) for OnePass (as per PlasticIQ) in the end, you end up $168.50. That means that if you earn over $65/hour, it is more profitable to just stay at the office for a couple more hours rather than do this deal.
Seems like the offer for the Personal checking promo is much more interesting. It allows for 1 direct deposit/month to avoid monthly fees, and with these calculations it would "cost" $75 for the 25,000 miles.
Any feedback?
Last edited by hanover.john; Oct 3, 09 at 8:12 am.
Costs:
$500 deposit
$65 for debit card
$10-$14 monthly fee (can be waived with 5 debit card purchases, or $4000 min average balance.)
$25 if you close in the first 90 days
The only real cost is $65. All the other ones are bogus.
Quote:
Originally Posted by hanover.john
If you want to churn, you're probably going to want to make 5 debit purchases every month. Assume this will cost about $1.50 per transaction. You will have to do this for 3 months to avoid the $25 penalty.
So $65+22.50= $87.50 out of your pocket.
$22.50 is also a bogus cost, as U would spend those money on purchases U would make anyway.
Quote:
Originally Posted by hanover.john
Now assume that it takes 30 minutes to make 5 purchases every month (1.5 hours). Another 1 hour to open the account, 30 minutes to create a new online login, 1 hour to follow up with Chase and OnePass for your points (as many of you have experienced). Assume you get paid $20/hour, then this used up $80 of your time. $80+87.50=$167.50
If you include the cost of your time, then you get 25,000 miles for $0.0067 per mile. (God forbid if you earn more than $20/hour.)
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Making 5 purchases would no way take 30 min. I do mine at the gas pump or pay a phone bill online, making a small $1-3 transaction each time. It would take 5-10 min.
It took me 3 minutes to call a Chase branch and open an account. They did it almost instantaneously as I already had a personal account. No follow ups were needed.
So the total cost is still only $65. and time spend on it 30min-1hr.
Quote:
Originally Posted by hanover.john
Assuming a value of $336 (SaverPass) for OnePass (as per PlasticIQ) in the end, you end up $168.50. That means that if you earn over $65/hour, it is more profitable to just stay at the office for a couple more hours rather than do this deal.
For each, the value of a mile is different. If U use those miles on a domestic coach award U can get that value. If u use those miles to build a bigger bankroll U can redeem it much more effectively. It becomes even bigger in the light of fact that Continental is joining *A. Due to that assume for a second that the value of United and Continental miles will be similar (given their almost identical award charts). I was able to redeem United miles on a coach award with a value of over 3cents per mile for my international Asia trip this summer!
So if it took me 1hr, and cost $65 and the value of those miles could be $500-750 (at 2-3 cents per mile), and assuming ur pay rate of $20 per hour, this could potentially be $415-$665 for an hour of work.
Location: Dublin, Ireland & Florida for all that sunshine!
Programs: CO Silver, DL
Posts: 175
Quote:
Originally Posted by friedice
It took me 3 minutes to call a Chase branch and open an account. They did it almost instantaneously as I already had a personal account. No follow ups were needed.
So the total cost is still only $65. and time spend on it 30min-1hr.
I didn't realise this was possible...do you close the other a/c then? I figure there's no point in continuing the older one and incurring the other annual card charge.
Programs: UA 3K, DL Plat, bmi Gold, AA Gold, PC Plat, IC RA, Hilton Gold, Marriott Gold, SPG Gold, AMEX Plat
Posts: 23,480
1.2 cents per mile is on the low side for Continental miles, especially with them joining the Star Alliance. Agree with the above, though -- besides the $65 fee and the time it takes to open the account, everything else is bogus. I use the card for purchases I would make anyway.
I didn't realise this was possible...do you close the other a/c then? I figure there's no point in continuing the older one and incurring the other annual card charge.
I haven't closed the other account yet. It's just sitting there for now. I'll be sure to close it by the time or before the annual fee comes.
Do they pull a credit report for this? I'm asking because I'm looking at refinancing over the next couple of months, and don't want any extra credit inquires. Thanks.
The only real cost is $65. All the other ones are bogus.
$22.50 is also a bogus cost, as U would spend those money on purchases U would make anyway.
Making 5 purchases would no way take 30 min. I do mine at the gas pump or pay a phone bill online, making a small $1-3 transaction each time. It would take 5-10 min.
It took me 3 minutes to call a Chase branch and open an account. They did it almost instantaneously as I already had a personal account. No follow ups were needed.
So the total cost is still only $65. and time spend on it 30min-1hr..
The cost would be bogus to you, but they would certainly not be to me.
1. I do not currently spend the money I would make on purchases anyway. I would have to go out of my way to make the purchases on the net or otherwise.
2. I do not currently have a Chase account, so the process they described for me is quite lengthy. If what you say is true, then hopefully the process will be much shorter the next time.
Quote:
Originally Posted by friedice
For each, the value of a mile is different. If U use those miles on a domestic coach award U can get that value. If u use those miles to build a bigger bankroll U can redeem it much more effectively. It becomes even bigger in the light of fact that Continental is joining *A. Due to that assume for a second that the value of United and Continental miles will be similar (given their almost identical award charts). I was able to redeem United miles on a coach award with a value of over 3cents per mile for my international Asia trip this summer!
So if it took me 1hr, and cost $65 and the value of those miles could be $500-750 (at 2-3 cents per mile), and assuming ur pay rate of $20 per hour, this could potentially be $415-$665 for an hour of work.
Thanks for the interesting answer. Can you please explain what you mean by bigger bankroll? What do you mean by "redeem it much more effectively"?
How were you able to redeem for a coach award at 3 cents/mile for an international flight? Was it a promotion? (If so, then even if the CO award chart and UA charts are similar, then you can't assume that CO will offer the same promotion.) Will everybody be able to get 3 cents/mile once CO joins Star Alliance? How are you coming up with a value of $500-$750 for 25,000 onepass miles?
Programs: UA 3K, DL Plat, bmi Gold, AA Gold, PC Plat, IC RA, Hilton Gold, Marriott Gold, SPG Gold, AMEX Plat
Posts: 23,480
Quote:
Originally Posted by hanover.john
1. I do not currently spend the money I would make on purchases anyway. I would have to go out of my way to make the purchases on the net or otherwise.
You don't make any small purchases at all right now?
Quote:
Originally Posted by hanover.john
Thanks for the interesting answer. Can you please explain what you mean by bigger bankroll? What do you mean by "redeem it much more effectively"?
Coach awards aren't the best value for burning miles. The best value would be an international premium cabin award. For 105,000 miles you can get a business class ticket to Europe which would otherwise cost you $5,000. Not that you would value it at $5,000, but most of us value premium international cabins at some kind of a premium. In general I'd say 1.5 cents per mile is a more reasonable value for miles.
1. I do not currently spend the money I would make on purchases anyway. I would have to go out of my way to make the purchases on the net or otherwise.
So U don't spend money at all? Wierd.
Quote:
Thanks for the interesting answer. Can you please explain what you mean by bigger bankroll? What do you mean by "redeem it much more effectively"?
How were you able to redeem for a coach award at 3 cents/mile for an international flight? Was it a promotion? (If so, then even if the CO award chart and UA charts are similar, then you can't assume that CO will offer the same promotion.) Will everybody be able to get 3 cents/mile once CO joins Star Alliance? How are you coming up with a value of $500-$750 for 25,000 onepass miles?
Well, I redeemed a 65,000 saver coach award to Asia on United and *A partners, which included one stopover and one "ministopover" (less than 24hrs), which in real money priced out to $2350, and I wasn't able to find anything cheaper. So it did come to about 3cents/mile. Since Continental is joining *A, hypothetically I would be able to book the same exact award. Based on that redemption, these 25,000 can be valued at $750, but of course the valuation varies from award to award.
Quote:
Originally Posted by lucky9876coins
Coach awards aren't the best value for burning miles. The best value would be an international premium cabin award. For 105,000 miles you can get a business class ticket to Europe which would otherwise cost you $5,000. Not that you would value it at $5,000, but most of us value premium international cabins at some kind of a premium. In general I'd say 1.5 cents per mile is a more reasonable value for miles.
Yes I realize that. I just tried to give another example to show how the miles can be used very effectively. Also, where as the valuation of miles for biz awards varies from person to person, the value I got from the miles on my economy Asia award was real: that's the cost in real money, can't get it any cheaper, alternative dates cost the same, can't choose a class of service lower than coach.
You don't make any small purchases at all right now?
Actually I'm mostly out of the country- so making international purchases on my debit card just to churn a deal isn't very economical. Any internet transactions you recommend to fulfill the debit card purchases quickly? (Preferably an automated method of making the purchases...)
Quote:
Originally Posted by lucky9876coins
Coach awards aren't the best value for burning miles. The best value would be an international premium cabin award. For 105,000 miles you can get a business class ticket to Europe which would otherwise cost you $5,000. Not that you would value it at $5,000, but most of us value premium international cabins at some kind of a premium. In general I'd say 1.5 cents per mile is a more reasonable value for miles.
Ok I understand the part about the biz class having more value/mile. But for myself, I don't care about traveling on business or first class--- all I care about is getting as many trips as possible for my miles. Any recommendations on how I can do this?
AND- in view of the fact that I won't be travelling business/first class, how worthwhile is this promotion for people like me?
Quote:
Originally Posted by friedice
Well, I redeemed a 65,000 saver coach award to Asia on United and *A partners, which included one stopover and one "ministopover" (less than 24hrs), which in real money priced out to $2350, and I wasn't able to find anything cheaper. So it did come to about 3cents/mile. Since Continental is joining *A, hypothetically I would be able to book the same exact award. Based on that redemption, these 25,000 can be valued at $750, but of course the valuation varies from award to award.
Your example is a bit confusing. Did you get the other 40,000 miles from the promotion too? Is the value you calculated a result of the added stopover? Are you saying that I can get 3cents/mile for regular coach trips too (return trip, no stopovers)
I'm just looking to squeeze as many trips into miles as possible- and that is how I would calculate the value/cost of the promotion. (If I can fly twice to Europe for the same miles as one business trip, then I'd rather fly twice. I'm thinking quantity, not "quality" ) Any thoughts when you look at it from this point of view?
Dont forget if you sign up for the mileathon and both personal and business and do a few other transactions you will get at least 10k bonus miles. IMO, this is a no brainer. I get my 5 transactions by going through the self checkout at the grocery store and ring up 5 separate things that I would buy anyway.
__________________ My Flight Memory 2009 CO EUA's = 39/45 (87%) AA = 6/25 (24%) 2009 Bump Vouchers-$1,800
CO Lifetime EQM (est. 2006)-221,384
Your example is a bit confusing. Did you get the other 40,000 miles from the promotion too? Is the value you calculated a result of the added stopover? Are you saying that I can get 3cents/mile for regular coach trips too (return trip, no stopovers)
Other miles I got from a credit card signup and purchases and other promos. But that was for United. I was just comparing United redemptions to future possible Continental ones given the fact that both are going to be part of the same alliance and have similar award structures. And yes, it was a result of the added stopovers. If U do a simple roundtrip, it might be possible to get 3cents/mile, but I can't be sure. Those places will probably have to be hard to get to or not very popular places. More realistically though it would be 1.5-2 cents/mile on a simple roundtrip.
If what you say is true, then hopefully the process will be much shorter the next time. 
