A Philosophical Question: Whither to Spend
 

So first post after some unfathomable number of years of sucking the resources of FT dry. Hoping to contribute now.

I'm a researcher, AA EXP, and fly ~2x/mo, but due to some positive new changes in reimbursement policy at my institution I have an option: either be reimbursed for airfare costs post-travel (~6 weeks) or pay for them directly out of research funds. Either way the same amount is being debited from a funding source, but one option I lose the 3x cost RDM, but don't have to float any $$$

Eg: BOS-ORD-PEK is ~15000 EQM -> 30000 RDM and $1150 RT for 4500 RDM extra. But the added weight on my CC bills isn't the most fun, especially when having to float 3-4 of these while waiting for reimbursement on the first. Not floating the $$$ loses about 15% RDM

So the question: to float or not to float? Either way all the miles are free.

I do this all the time though my company policy for reimbursement is every 2 weeks we get the expenses back with our paycheck. Now I do get lazy and file expenses for 3-4 weeks at a time and end up floating close to 6 weeks.

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Welcome to FlyerTalk.

I have transferred your question to the Credit Card Programs forum because your post does not describe a manufactured spending proposition.

If I understand correctly, the question is simple: is it worthwhile using your own money to purchase airfare and wait for reimbursement. The benefit is that you earn miles from a credit card for the purchase. The detriment is that the reimbursements are slow.

Do you carry a balance of the credit card(s) you use to purchase the airfare?

I would float, but it really depends on your income/debt ratio.

I would also consider the financial situation where you are at. Is there any risk that your employer will not reimburse you? I have worked for a company where they could take months to reimburse me, and another unethical employer that I ended up having to sue. Then there is a third situation where the company is at risk of going under and may not be around to reimburse you.

Because of past experience, I use the company card even though they would reimburse me - eventually. Also, I was involved in a hit and run in a rental car a year or two ago (the other car hit me and ran). My company does not take out the separate insurance, and I was glad the rental was on the company's visa - not mine.

Thanks mia, I considered this more MS-y, since it pertains to "buying" miles at no real cost, but I defer.

Typically no balance, but when putting ~$6k+ on cards this can become an issue when there are other expenses. I suppose this is the risk-tolerance part xiKINGix is hinting at.

A Philosophical Question: Whither to Spend
 

Consider whether you can pay the bill when due

If you would carry the balance until reimbursed then the interest charges would not make it worthwhile in most cases. If paying the CC bill when due from a savings account earning pennies then the only real risk is not getting eventually reimbursed

risk of non-payment as an academic is quite low in my opinion, especially if the grants from which the funds come are yours!

i'd suggest taking a--dare i say...academic--approach and assessing NPV of miles vs. risk/cost of float based on CPI, float duration, non-payment risk, etc.

my own $0.02 is that as long as you trust your institution to actually reimburse you, reliably reimbursed MS can only add to your coffers if you're in the habit of signing up for the right credit card bonus offers. a 5-10% internal rate of return on introductory bonuses can be found pretty easily with the right new cards...

As long as you have enough liquidity/savings and expect timely reimbursement (~6 weeks on average, right? 4 weeks to pay the balance once the statement closes, and 2 weeks assuming you're mid-cycle), I would float. I do recognize the emotional/psychological stress this may cause if it's a large portion of your income/savings/etc.

You can always use VR or the like to extend your float ($7.80 per $1k) if you have a cash crunch. I would think particularly with a 3X on airfare card (Amex) you would clean up.

I agree with this approach. Be sure to be very discplined and track reimbursements and if they slow down at all, I might re-evaluate. Risk Reward Equation is different for everyone. I would also think about what horizon you wish to use the miles, as earn and burn is probably the best strategy these days.

Does it have to be all or nothing? Can you float every other trip, and have the company pay for the remaining trips directly?

If you're concerned about used credit to available credit ratio, perhaps you can pay off your cards before the bill is due. -- someone can correct me if paying a bill early does not help that ratio.

If it's a question of not having the cash to pay off that many trips at once, maybe you take the every other trip approach, and in the meantime, start saving the money you would need to be able to cover the remaining trips. --I always recommend having the money you want saved directly deposited in a separate account as your checking account so you're not tempted to use it-- Once you have enough money to cover 6 weeks worth of travel, you'll be setup to pay for all of the trips on your own.

I wish I had this option! I must use my work credit card for all travel related expenses.

The OP's question is a no brainer for me. I would pay for everything except the rental car on personal card. I would not want to assume the risk with the car i.e. use my insurance vice my employers.

The only reasons not to put travel on your own card IMO are if there is risk in not getting reimbursed or not having the funds to pay the bill in full. If it is the later, as pointed out in the previous post it does not have to be all or nothing, put what you can afford to pay on your cc and rake in more points/miles.