Originally Posted by
sxpsxpsxp
Thank you all for the thoughtful answers and lots of math.
In fact I am currently able to buy Marriott points at 0.83 cents per point.
If you can buy Marriott points for .83 cents per point, you already know the answer to your spend question. You should not spend $60K on the brilliant at a fixed cost of $900 for the spend. It only becomes worth it at a 0.967 Bonvoy point valuation but it makes no sense to value it that high when you can purchase them for 0.83 cents per point. Unless you’re maxing out those purchases, just buying the points and opening up another Brilliant is more advantageous for you.
Originally Posted by
sxpsxpsxp
Now we have the question of the additional spend and what to do with it. Everyone has been looking at me spending $60k on Brilliant and saying how that's a terrible value, but you can't look at it that way. Assume there's a base $30k spend that's going there anyway (see above), and what I'm dealing with here is an extra $30k. This spend also would not earn any category bonuses, and at the end of the day I don't feel strongly about which bank gets it. Currently it is coming directly out of my bank account -- so no cost to me and no points earned. But, it's slightly annoying because I have no control over when it comes out of my bank account and have to keep an eye on timing and running balance. So my thought was -- what if I put this spend on a credit card instead? I've looked at this many time before, and have always come to the conclusion that the points I would earn, whether just cash back or various award points, would not be worth the incremental cost of putting this spend on a credit card. But then it hit me that the Brilliant card now has this new earned choice FNC, and I started recalculating, because while I would never hit $60k on the Brilliant organically, this extra spend could just get me there. My primary goal here is to consolidate my spend so that I have more control over when the money leaves my bank account in a way that either doesn't cost me anything (or very little) or maybe actually earns a return. I very much appreciate the suggestion to go the Hilton route, and I need to look into that more carefully.
So here's how I'm looking at it, and please tell me if my math is totally wrong or I'm missing something very obvious (I'm not looking to churn cards every year for the sign-up bonuses -- it's not worth the hassle to me):
I have $30k/year that currently doesn't go on any credit card. I could put it on a credit card at an approximate out-of-pocket cost of $900. How do I recoup the $900?
The thinking here is not correct, as explained by the math above.
Originally Posted by
sxpsxpsxp
With the Brilliant card I get 60k Marriott points and, assuming the extra $30k gets me to the $60k threshold, an 85k FNA. At a 0.6c/point valuation that was given by some of you, that's a face value of $870, so basically a wash, with an opportunity to get a better value. I know some of you are saying there's a cheaper way to get the 85k FNA (e.g. with another Brilliant), but I am not looking at it that way because that would imply organic spend, not this additional spend I'm dealing with.
Getting another Brilliant does not imply normal spend. That is your alternate cost for getting an 85K FNC. If you can buy something for $X, it is foolish to pay $X+$Y for that thing. In this situation, your base case for getting another 85K FNC is through a Brilliant. Until that is no longer an option for you, it makes no sense to pay more for an 85K cert than what you would pay to get it through a Brilliant (or Ritz but there are more restrictions here).
It is also questionable to value FNCs at their full point value. We do not do that here because FNCs are less flexible and liquid than true points.
Nonetheless, the math totally does not make sense here. If you value your points at 0.6 cents per point, you are saying the incremental 60K points earned are worth only $360. Your cost is $900 so you are spending $540 for the 85K free night certificate. That is silly when you could spend as little as $150 for an 85K FNC. Even with the Brilliant you would be spending $300-$350 for the 85K FNC. There is just no way for the math to work out where this is worth it.
Originally Posted by
sxpsxpsxp
Are there other options I should be looking at, given the programs that I participate in?
Simply do not spend $900 in fees for this additional $30K in spend. You do not wish to churn (which is the most common case where people willingly pay these fees) so there is not much of a point. Credit cards are great for returning spend you would be making otherwise. You are paying extra money for credit card spend and, by your metrics, not getting a fair value out.
I think you should take the time to honestly just go through the math. A lot of what you’re posting is contradictory. If you walk through everything step-by-step, it should be apparent that the math here just does not work out. Even if you ignore the VERY high opportunity cost for the spend, you are still losing out inherently. I mean even your own estimate (which is overly optimistic as explained above) shows you losing in this scenario by $30. And that does not consider your alternative path to receive the same outcome for a cheaper price. I honestly can’t understand why you are even considering it.