Originally Posted by
kdinino
Been doing similar math in my head as well and can't seem to figure out why anyone would do this
Originally Posted by
kyunbit
You are probably overvaluing Hilton points..
Originally Posted by
ORD-TGU
This is very creative, if you value points that high, go for it.
As a reference, you can buy directly from Hilton at $.01 per point.
I value at half of that.
You can also apply for a couple credit cards that are fee free and and get the same 100K for no out of pocket expense (just credit pulls)
Or if you spend that $737.50 on actual stays at Hiltons on relaxing vacations, pay using the surpass and having gold status plus the current 3x Weekend promo plus my way, Amex booking bonus, GG 40% sale, Gold bonus, etc, you will end up with around 50K and have plenty of nice memories of your stays. (plus th current Surpass 50K sign up promo if you dont have it)
WP is certainly not the most cost effective way to accrue points/miles on a spending basis, but, it can work at times.
Last 'Black Friday', Citi Ran a promotion that gave 2 extra AAdvantage miles per dollar spent on that day. At the time I also happened to have 2 retention offers, one for one extra mile per dollar spent, capped at $5K spending. The other being an extra 750 miles for each month I spent $750. Overall that 2.45% (grandfathered into old rate) fee netted 4 AAdvantage miles per dollar, plus 750 extra AAdvantage miles. Looking at the 4 AAdvantage miles per dollar alone, I'd say that the mile is worth the 0.6125 cents. Also note, this was on Citi Executive card that is still accumulating 'million miler' miles, and has a bonus 10K EQM's if you spend $40K in a year. All this helps.
But, I digress... one can still make this work even if promotions aren't running on your specific card.
Big Crumbs can subsidize part of this fee. Buy an AMEX GC first through big crumbs using your miles/points earning card, pocket the 1.4% (or better) cash back from them, and then unload the AMEX card via WP. Net fee is 1.05% (or less) per point (assuming 1 point per dollar). Personally since there are other perks for various cards I have after large spending, and heck that AMEX Buiness Visa requires $10K spending just to collect thier 75K bonus, this just gives another avenue to rack up 'low cost spending' than just AP, Serve, and what-have-you.
Unfortunately, the fee being 0.5% higher for new accounts, does, definitely change the math on this -- for the worst.