Difference between revisions of "Airline incidental credits"
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<ul class="simplelist"> | <ul class="simplelist"> | ||
| − | *Ticket change/cancellation/redeposit fees. Sometimes these are unavoidable and they are quite expensive. When you can't avoid them, these are the most likely fees that will use up your credits. | + | *Ticket change / cancellation / redeposit fees. Sometimes these are unavoidable and they are quite expensive. When you can't avoid them, these are the most likely fees that will use up a significant amount of your credits. |
*Onboard food and beverage purchases. Many people buy the occasional snack, meal, or drink. | *Onboard food and beverage purchases. Many people buy the occasional snack, meal, or drink. | ||
*Checked bag fees. Assuming you don't have a credit card or elite status to waive these fees. | *Checked bag fees. Assuming you don't have a credit card or elite status to waive these fees. | ||
*Seat selection fees. But, not the higher fees to upgrade to a better class of seats. | *Seat selection fees. But, not the higher fees to upgrade to a better class of seats. | ||
| − | *Lounge passes and memberships. If you decide to pay the high | + | *Lounge passes and memberships. If you decide to pay the high price for access. |
*Pet and phone reservation fees. If they apply. | *Pet and phone reservation fees. If they apply. | ||
*WiFi bought from the airline. But, in most cases you are paying a 3rd party like GoGo, and these payments won't count. | *WiFi bought from the airline. But, in most cases you are paying a 3rd party like GoGo, and these payments won't count. | ||
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What works and what doesn't work (outside of the officially approved "incidentals") can change at any time. | What works and what doesn't work (outside of the officially approved "incidentals") can change at any time. | ||
| − | FlyerTalk has a set of | + | FlyerTalk has a set of threads dedicated to discussing what other types of charges work with various airlines. |
| − | |||
<ul> | <ul> | ||
*[//www.flyertalk.com/forum/american-express-membership-rewards/1300459-airline-fee-250-200-100-reimbursement-reports-only.html Alaska Airlines] | *[//www.flyertalk.com/forum/american-express-membership-rewards/1300459-airline-fee-250-200-100-reimbursement-reports-only.html Alaska Airlines] | ||
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'''Up until recently, the most common way to "hack" airline incidental credits was via gift cards.''' | '''Up until recently, the most common way to "hack" airline incidental credits was via gift cards.''' | ||
| − | Even though gift card purchases are explicitly excluded in the terms and conditions, in practice, credit was often issued for purchases of low denomination airline gift cards (from some airlines). It was easy to spend the entire amount of the credit on gift cards and then either use the gift cards to purchase airline tickets (right away or at some later date) or sell the gift cards on the web. This trick allowed the entire value of the credit to be used on airplane tickets or a high percentage of the credit to be received in cash. | + | Even though gift card purchases are explicitly excluded in the terms and conditions, in practice, credit was often issued for purchases of low denomination airline gift cards (from some airlines). It was easy to spend the entire amount of the credit on gift cards and then either use the gift cards to purchase airline tickets (right away or at some later date) or sell the gift cards on the web. This trick allowed the entire value of the credit to be used on airplane tickets, or a high percentage of the credit to be received in cash. |
Obviously, purchasing gift cards, and remembering to use them later, was a nuisance. But for many people, it was better than letting part of their airline incidental credit expire unused. | Obviously, purchasing gift cards, and remembering to use them later, was a nuisance. But for many people, it was better than letting part of their airline incidental credit expire unused. | ||
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Over time, the set of airline where this would work got smaller and smaller, so that it was only working on American Airlines, Delta Airlines, and Southwest. There were different rules for each airline on exactly how the gift cards needed to be purchased. | Over time, the set of airline where this would work got smaller and smaller, so that it was only working on American Airlines, Delta Airlines, and Southwest. There were different rules for each airline on exactly how the gift cards needed to be purchased. | ||
| − | In mid-2019, this stopped working for Amex cards (Platinum and Hilton Aspire). | + | In mid-2019, this stopped working for Amex cards (Platinum and Hilton Aspire). In some cases, it still works for airline incidental credits from credit cards from other banks. |
=== Some other potential ways of getting value from your credits === | === Some other potential ways of getting value from your credits === | ||
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==== Low priced airline tickets ==== | ==== Low priced airline tickets ==== | ||
| − | With some airlines, low priced flights (generally under $100) are treated as incidentals, allowing you to receive the credit for actual airline | + | |
| + | With some airlines, low priced flights (generally under $100) are treated as incidentals, allowing you to receive the credit for actual airline ticket purchases. | ||
<ul class="bulletlist"> | <ul class="bulletlist"> | ||
| − | <li>''' The typical limit is $100 per ticket'''. Depending on your travel patterns, you may wind up needing to purchase an occasional inexpensive flight. The set of airlines where this works | + | <li>''' The typical limit is $100 per ticket'''. Depending on your travel patterns, you may wind up needing to purchase an occasional inexpensive flight. The set of airlines where this works depends on the card and may change at any time, but you are most likely to have success with Alaska, JetBlue, and Southwest. Check the links above for more up-to-date information. </li> |
| + | |||
| + | <li>'''If necessary, you can split the cost of a ticket between gift cards and your credit card to lower the purchase amount to below the limit'''. Let's say you need to take a flight that costs $175 each way. You could use $100 worth of gift cards to lower the credit card charge to $75, which may then trigger the incidental credit, letting use the credit to offset at least part of the ticket price. </li> | ||
| − | + | On Delta airlines, the additional charges are treated as a special "additional collection fee" rather than a regular purchase, and these fees have triggered the credit. | |
</ul> | </ul> | ||
==== Cashing out your credit via cancellations ==== | ==== Cashing out your credit via cancellations ==== | ||
| − | You can often "cash out" credits by booking a flight that has additional fees, and then cancelling the reservation. When the flight is booked, you'll receive credit for the extra fees. When you cancel the flight, you'll receive the fees back, but the credit won't be reversed. This essentially turns the credit into cash. | + | You can often "cash out" credits by booking a flight that has additional fees, and then cancelling the reservation. When the flight is booked, you'll receive the credit for the extra fees you paid. When you cancel the flight, you'll receive the fees back, but the credit won't be reversed. This essentially turns the credit into cash. |
<ul class="bulletlist"> | <ul class="bulletlist"> | ||
| − | <li>'''The fees that work depend on the airline and the credit card'''. Depending on the combination, award booking fees, pet fees, seat upgrade fees, or even low-priced tickets may work. For this strategy to work, the fee has to trigger the incidental credit, and needs to be refundable when the underlying ticket is cancelled.</li> | + | <li>'''The fees that work depend on the airline and the credit card'''. Depending on the combination, award booking fees, pet fees, seat upgrade fees, or even low-priced tickets may work. For this strategy to work, the fee has to trigger the incidental credit, and the fee needs to be refundable when the underlying ticket is cancelled.</li> |
| − | For example, if you book a fully refundable ticket with a $75 pet fee, the pet fee will mostly like trigger the incidental credit, giving you a $75 credit on your | + | For example, if you book a fully refundable ticket with a $75 pet fee, the pet fee will mostly like trigger the incidental credit, giving you a $75 credit on your statement. Then, if cancelling the flight also cancels the pet fee (beware, it might not), you can fully reverse the original charges, and essentially keep the $75. |
Award ticket fees tend to trigger the credit on Delta, Southwest, and United. If you can cancel the award ticket without penalty, this can be an easy approach, especially for international flights that have higher fees. Once again, check the links to get the latest information. | Award ticket fees tend to trigger the credit on Delta, Southwest, and United. If you can cancel the award ticket without penalty, this can be an easy approach, especially for international flights that have higher fees. Once again, check the links to get the latest information. | ||
| − | <li>'''You need to be able to cancel the underlying ticket without any change fees'''. This works for everyone on fully cancellable fares on any airline and any fare on Southwest Airlines (except that you'll only receive future credit with Southwest). This sometimes works for elite | + | <li>'''You need to be able to cancel the underlying ticket without any change fees'''. This works for everyone on fully cancellable fares on any airline and any fare on Southwest Airlines (except that you'll only receive future credit with Southwest). This sometimes works for people who have elite status with other airlines, because they sometimes can cancel paid and/or award tickets without penalty.</li> |
</ul> | </ul> | ||
Revision as of 18:21, 8 August 2019
"Airline Incidental Credits" are a potentially valuable feature of several credit cards. But, you may not naturally generate enough qualifying "incidental" charges to fully take advantage of your available credits, especially if you only have a short period of time, such as with a calendar-year credit that you receive towards the end of the year.
If you can't use your Airline Incidental Credits naturally, there are some tricks that can allow you to take advantage of the full credit amount, maximizing the value of getting or holding onto the credit card.
Even if you'll eventually generate enough natural expenses which qualify, you may find it easier to "take care of the credit" using one of these approaches, and not need to worry about making sure to use the appropriate card for your airline incidental purchases over the course of the year.
Jump to
Jump to:
What should always work
By the official terms, the following types of purchases are considered "incidental purchases":
- Ticket change / cancellation / redeposit fees. Sometimes these are unavoidable and they are quite expensive. When you can't avoid them, these are the most likely fees that will use up a significant amount of your credits.
- Onboard food and beverage purchases. Many people buy the occasional snack, meal, or drink.
- Checked bag fees. Assuming you don't have a credit card or elite status to waive these fees.
- Seat selection fees. But, not the higher fees to upgrade to a better class of seats.
- Lounge passes and memberships. If you decide to pay the high price for access.
- Pet and phone reservation fees. If they apply.
- WiFi bought from the airline. But, in most cases you are paying a 3rd party like GoGo, and these payments won't count.
Depending on the airline and the credit card, you might also get credit for seat upgrade fees and award booking fees. But the terms specifically exclude Airline Tickets, Award Tickets, Upgrades, Points Purchases, Point Transfer Fees, Duty Free Purchases, and Gift Cards.
Checking for up to date information
What works and what doesn't work (outside of the officially approved "incidentals") can change at any time.
FlyerTalk has a set of threads dedicated to discussing what other types of charges work with various airlines.
Other credit card companies are sometimes more lenient about what works on their cards, but there are less people reporting information on the web. Flyertalk has threads for the Bank of America Premium Reward card, the the CNB Crystal Infinite card. Frequent mile has a good article about what may work with the no-longer-available-for-new-signups Ritz Carlton card.
Gift cards
Up until recently, the most common way to "hack" airline incidental credits was via gift cards.
Even though gift card purchases are explicitly excluded in the terms and conditions, in practice, credit was often issued for purchases of low denomination airline gift cards (from some airlines). It was easy to spend the entire amount of the credit on gift cards and then either use the gift cards to purchase airline tickets (right away or at some later date) or sell the gift cards on the web. This trick allowed the entire value of the credit to be used on airplane tickets, or a high percentage of the credit to be received in cash.
Obviously, purchasing gift cards, and remembering to use them later, was a nuisance. But for many people, it was better than letting part of their airline incidental credit expire unused.
Over time, the set of airline where this would work got smaller and smaller, so that it was only working on American Airlines, Delta Airlines, and Southwest. There were different rules for each airline on exactly how the gift cards needed to be purchased.
In mid-2019, this stopped working for Amex cards (Platinum and Hilton Aspire). In some cases, it still works for airline incidental credits from credit cards from other banks.
Some other potential ways of getting value from your credits
There are some other tricks that can help get full value from your airline incidental credits. These can be particularly valuable for Amex cards because it is harder to naturally use your credits when you are limited to only a single airline (and because gift cards no longer work).
Low priced airline tickets
With some airlines, low priced flights (generally under $100) are treated as incidentals, allowing you to receive the credit for actual airline ticket purchases.
- The typical limit is $100 per ticket. Depending on your travel patterns, you may wind up needing to purchase an occasional inexpensive flight. The set of airlines where this works depends on the card and may change at any time, but you are most likely to have success with Alaska, JetBlue, and Southwest. Check the links above for more up-to-date information.
- If necessary, you can split the cost of a ticket between gift cards and your credit card to lower the purchase amount to below the limit. Let's say you need to take a flight that costs $175 each way. You could use $100 worth of gift cards to lower the credit card charge to $75, which may then trigger the incidental credit, letting use the credit to offset at least part of the ticket price.
On Delta airlines, the additional charges are treated as a special "additional collection fee" rather than a regular purchase, and these fees have triggered the credit.
Cashing out your credit via cancellations
You can often "cash out" credits by booking a flight that has additional fees, and then cancelling the reservation. When the flight is booked, you'll receive the credit for the extra fees you paid. When you cancel the flight, you'll receive the fees back, but the credit won't be reversed. This essentially turns the credit into cash.
- The fees that work depend on the airline and the credit card. Depending on the combination, award booking fees, pet fees, seat upgrade fees, or even low-priced tickets may work. For this strategy to work, the fee has to trigger the incidental credit, and the fee needs to be refundable when the underlying ticket is cancelled.
- You need to be able to cancel the underlying ticket without any change fees. This works for everyone on fully cancellable fares on any airline and any fare on Southwest Airlines (except that you'll only receive future credit with Southwest). This sometimes works for people who have elite status with other airlines, because they sometimes can cancel paid and/or award tickets without penalty.
For example, if you book a fully refundable ticket with a $75 pet fee, the pet fee will mostly like trigger the incidental credit, giving you a $75 credit on your statement. Then, if cancelling the flight also cancels the pet fee (beware, it might not), you can fully reverse the original charges, and essentially keep the $75.
Award ticket fees tend to trigger the credit on Delta, Southwest, and United. If you can cancel the award ticket without penalty, this can be an easy approach, especially for international flights that have higher fees. Once again, check the links to get the latest information.
Be warned. When Amex cracks down on loopholes, they sometimes come after points or credits, even if has been months since you've earned them. For example, Amex may credit award fees on certain airlines now, and then come back sometime in the future and "take those credits away", essentially putting a new charge on your current statement. So, there is always some risk when using your credit for anything except the standard set of incidental expenses.
Taking advantage of credit card company policies
There are several ways that you can take advantage of the credit card company's policies to improve the value proposition of travel credits. We avoid these approaches, because we feel like they unfairly take advantage of consumer-friendly credit card policies. Plus, banks don't like when you cancel or convert your cards too quickly, and may decide they don't want to do business with you. But, some people may feel differently.
- If you get a new credit card in December it is typically possible to "triple-dip" any calendar-year credit. As long as you cancel most cards within a month or so of your annual fee posting, the fee will be refunded. So, you could sign up in December, take advantage of the credit before the end of the year, take advantage of another credit the following year, and then take advantage of the credit a third time in January, just before you cancel your card. All with only paying a single year's annual fee.
- After the initial year, you can often downgrade your card, once you've used your credit, to get a partial refund of your annual fee. Most cards with credits have significant annual fees. Once you've used your credit, you can often downgrade your card, and receive a partial credit against the annual fee. Then, the following year, you could conceivably upgrade the card, take advantage of the credit another time, and then downgrade again. You typically can't do this in the initial year, due to banking regulations.
- You can sometimes cancel your card, after you've used your credit, and get refunded part of the annual fee. For calendar-year based credits, you can still take advantage of two different credits, while only paying a fraction of the annual fee. Not every bank will pro-rate the annual fee for cancelled cards. You'll need to do some research online.
