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The Defense Travel System Manufactured Spend

How I Used DTS for Manufactured Spending

On a recent TDY to undisclosed, secret squirrel locations the Middle East, the DTS TDWise Guy missed a flight due to mission requirements. This is how he discovered a manufacured spending pathway within the DTS system.

What Is Manufactured Spending (MS)?

This blog has, and always will, err on the side of churning caution. We do this to avoid slaughtering the proverbial golden goose that is waived annual fee credit cards and the perpetual benefits they provide US Service Members. As such, you will read very little about MS here for two reasons: it looks a heck of a lot like money laundering and it pisses off banks.

MS is the process of using your credit cards to purchase financial devices that can be liquidated to cash and then used to pay off your credit cards. It generates credit card spend points without actually spending money. The popular path goes something similar to this: gas station sells visa gift cards, you use a credit card that gives 3x points at gas stations to buy visa gift cards, you then use the visa gift cards to buy money orders, you then use the money orders to pay off your credit card and profit 3x points per gift card dollar.

Money Laundering and Structuring

I’ve looked into it, it can be lucrative if you have the patience and approprate pathways in place. It can also be a massive pain and not worth your time or the risk of clerical and point-of-sale errors. Regardless, you generally have to buy bulk gift cards, typically daily, in order to generate worthwhile points. Buying that many gift cards and subsequent money orders looks a heck of a lot like money laundering. Even if you are not doing anything wrong, your activity will start to be tracked. If you attempt to avoid that tracking by keeping spending below the tracking trigger amounts, thats called structuring and is a felony regardless if the origional spending is legal or not. Hard pass from this blogger but your mileage may vary.

Banks are Friends Not Food

The other reason MS might not be the best path forward is that banks will shut all your fun down if they notice this pattern. I’m not too sure why credit card companies care since they profit from the tractations like any other, but the accounts you deposit into take great offense and you will not get warnings when they’ve had enough. Perhaps its because you force them to file the tracking paperwork and no one likes doing more than they have to.

Anyways, Back to DTS MS

The above discribed cycle is rough to navigate, but MS via normal spending means is a lot safer. Such avenues could be using a credit card to fund a new bank account or buying US currency and depositing it directly into your account. Then theres DTS.

Most international airlines will not reticket you for a missed flight with the same ease we are accustomed to with the major US carriers because of a lack of free market capitalism. ‘Murica. Even though I was flying on a Y Class (full fare) ticket. After dealing with a significant language barrier, because why have customer service speak the common language of Earth, I called the CTO emergency line and had them book a new ticket and request refund for the unused segment. I made the new flight, 20 days went by, and it was then time to complete my travel voucher.

No Refund For You

I checked the Citi government card website and didn’t see a refund from the airline.  I called the local CTO office and they assured me that I would not get refunded for that ticket due to the carrier’s terms of service.  So I filed the voucher, added an explanation to the approving official on why I was expensing two tickets to the same destination, and attached both tickets along with a copy of my government travel card statement as substantiating records.  Fortunatly, I serve in an organization that cares about Soldiers and the voucher was paid with quickness.

Nevermind, Here’s Your Refund

A few weeks go by and I received a system generated email that my refund on the missed segment for $246.50 had been approved.  Because DTS already paid for this ticket, career jepardizing ethics suddenly became a part of this equation.  Valuing this great country and my paycheck, I created an amendment to my voucher and thus a debt due to the United States. Once the approving official approved the amended voucher, a weeklong process began that eventually resulted in an email explaining the debt, a 30 day deadline, and a link to a payment website where the debt can be settled. Since minimum spend is always happing, this situation created a manufactured spend of $246.50 with no surcharge for using a credit card.

Overall the process was rather seamless compared to typical transactions with the local finance office. Unfortunately this was the cheapest flight of my trip, but the potential has been realised. When foreigners screw up your government funded flights, you have a path to knock out some minimum spending.

How I’m Taking A Cruise Every Year For Free

Free Disney Cruise Strategy

Gosh, this looks stress free

Cruises are the ultimate in stress-free vacationing. Change my mind.

All I have to do is get myself to port via airline with relaxing lounges on layovers and free uber rides from the terminal. Then I check-in and locate my room aboard a floating all(ish) inclusive resort, unpack, and literally not worry about a single thing until it’s over.

My food is always in the same known locations unless I feel frisky and want to change it up. I don’t have to make cuisine decisions in a back and forth “well what do YOU want to eat?” downward spiraling argument. I don’t have to worry about transportation anywhere since the resort moves with me. Entertainment is there if I want it and bars are there if I don’t. It cannot get better from this burned-out logistician’s viewpoint.

No, I don’t want to explore new cities and take social media pictures by tourist traps and rely on public transportation and constantly have an eye out for security. I want to walk into a little slice of floating paradise, float my happy behind on over to another little slice of paradise, not worry about logistics, rinse and repeat. I’m relaxed just thinking about it.

Disney Cruises

I, for one, welcome our new mouse eared overlords

Of course, there are varying degrees of cruising experience. We can’t be blowing precious leave time on Carnival, the Best Western’s of the cruising industry. But top-tiered cruising experiences are admittedly not cheap and the king of not cheap cruising slaps two round mouse ears on everything they do.

Of course, for your pretty penny, you get a grand experience in attention to detail and a surprising amount of adult-only space for a travel company fashioned around kid’s movies. I was not a fan when my then-fiancee (now wife of five years) wanted to get married on a Disney cruise — but I have since been convinced of the merit in cruising with the mouse.

Quality wise, Disney far surpasses any other cruise line I have sailed with. The food is better, the rooms are larger and nicer, the employees are friendlier, Castaway Cay is superior to any other private island, the entertainment and activities are always a notch above, and the clientelle is frankly just more upscale (I don’t want no scrubs). Contrary to popular belief, it isn’t just a floating cartoon themed playground — everything is upper crust, and there are designated areas for kids with (almost) around-the-clock childcare, and plenty of adult-only locations as well. It’s the perfect cruise for families, singles, and DINKs alike, and I have never once questioned whether I was getting my money’s worth.

And thus, my enduring yearly stress-free vacation will be cruising the Disney seas in an everlasting pursuit of conch coolers at Castaway Cay. Why they don’t serve those on the ship, I will be forever bitter about. I also used to be bitter about having to bite the cost bullet. Our first Disney cruise (wedding) and subsequent cruise (honeymoon) cost a moderate $1723.70 and $1597.34 respectively, for two of us at five nights each in a veranda stateroom. That same 5 night, 2 person veranda room is an extravagant $3833 this year. How is that a sustainable yearly vacation?

I’ll Take The Free Option, Please

Travel credits are best credits

Of course, the answer is credit cards. No, I do not mean to say we charge it and drown in interest-bearing debt for years. I mean to say that this sweet game we call churning will pay for my cruise tickets, year after year, so long as I maintain active duty service.

The spouse and I have the following annual fee waived credit cards: Chase Sapphire Reserve (CSR) x4, US Bank Altitude Reserve (AR) x2, and the Citi Prestige (CP) x2. With the $300/year travel credit per CSR, $325/year travel credit per AR, and $250 travel credit per CP, holding these cards nets us a cool $2350 per year, every year. That’s free travel dollars that will auto reimburse my Disney cruise charges. Granted, it won’t cover another veranda 5-night itinerary, but we can slum it on the inside of the ship for $2440 on a 7-night voyage.

In the future, I plan to snag us each a Korean SkyPass Select card, netting another $200 credit per card, bringing the yearly Disney cruise fund to a respectable $2750. How do you like them apples with mouse ears carved into them?

Starting From Scratch

Would ya just look at it? She’s a real beaut.

If this is your first toe-dip into the credit card game and perpetual free Disney cruising (or perpetual free anything) has piqued your interest, here’s how to get to this point. CAUTION: while this is the fastest avenue to stacking travel credits, it is NOT the best path to building the optimal card portfolio. See our guide here for that path.

First, you’ll want to get the Chase Freedom and Freedom Unlimited card. It doesn’t matter in which order, just grab them both and meet whatever lousy sign up bonuses they have at the time. Then do the same for your spouse. Also at this time, open a joint checking account with US Bank. They often do new account bonuses so you might even be able to snag $300 for your efforts.

31 days after your first Chase card get the Chase Sapphire Reserve. Meet the sign-up bonus (probably 50k UR points after $4k spend in 3 months). Rinse and repeat for your spouse. You should now be somewhere around 6 months in and holding 6 credit cards.

Then, apply for a US Bank Altitude Reserve card. Meet the sign-up bonus (likely 50k Flexpoints for $4500 spend in 3 months). Rinse and repeat for your spouse. You should now be somewhere around 12 months in and holding 8 credit cards.

This sunset is a subtle wink that the post is ending

Finally, go ahead and apply for a Citi Prestige. Meet the sign-up bonus (likely 50k ThankYou points for $4000 spend in 3 months). Rinse and repeat for your spouse. You should now be somewhere around 18 months in and holding 10 credit cards.

Make a call to Chase, upgrade your Freedoms and Freedom Unlimiteds to Sapphire Reserves and voila, you now have 6 Sapphire Reserves, 2 Altitude Reserves, and 2 Prestiges. That’s a grand total of $2950 travel credits and about 325,000 various points worth a respectable $3250 cashback at their lowest redemption value. If you want to be a hero and get Korean Skypass Selects, add another $400 to that travel credit number. 18 months is a very conservative timeline and this can likely be done much sooner if you can meet the minimum spends faster. Just remember to wait 366 days to upgrade Chase cards.

Let me know when you finish and I’ll tweet the deets for our yearly TDWise Disney Cruise meetup!

 

The Updated Chase Ritz Carlton Card

The Old vs New Ritz Carlton Cards

With the ever-changing game of travel hacking and credit card churning comes the eventual demise of once-great credit card products. The Ritz Carlton card ended up taking a hit with the Bonvoy merger in terms of physical appearance but actually ended up a being a better product in the military travel hackers lineup in terms of yearly benefit.

To start, I’ve got a pictorial comparison of the Old Hotness Ritz card and the New and Busted Ritz card for your viewing pleasure.

New and Busted
Old Hotness
Not so much anymore.
The Ritz Card came with one of the most lavish welcome packages.
A solid metal slab of credit dominance.
Metal core between plastic, meh.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

As we can see, the welcome package took a serious hit and the card design went from the most impressive hand feels on the market to the business-as-usual metal core design of the other high-end Chase cards. You can also see where I failed to take the time to set up appropriate lighting conditions in my photo studio (iPhone X and dinner table). I suppose this was the logical step to take for a card that is no longer offered for application but, gosh, that old solid metal style was a poster child for extravagance.

New Perks!

Luckily, the bad is out of the way and we can focus on the good: annual perks.  Every card you get should have a tasty signup bonus with a minimum spend that slows your card acquisition timeline to just barely tolerable by the banks.  This is all well and good to start but recurring annual perks are what makes a card worthy of collection space in the military churners lineup. The old Ritz card was no slouch with its $300 airline incidental reimbursement, 3 club level upgrades, and $100 airline ticket discount (but only on paid flights and, really, none of us should be paying for flights anymore).

The new card kept those perks but added a free Ritz night (capped at 50k points) annually. Jackpot. With this new addition, my wife and I get 3 Ritz nights, 9 club upgrades, and $900 in airline incidental reimbursements across our 3 annual fee waived Ritz cards, every year.  The hand feel may have downgraded but I’ll take a free night over aesthetics any day.

Sweet, sweet reimbursements

Remember, the Ritz card is still attainable by getting a Chase Bonvoy Boundless card, waiting a year, and requesting a card upgrade.  Do your future self a favor and start that countdown today.

As always, please consider using our referral link to get yours.

TSA PreCheck and Global Entry for Active Duty

I would hope this is a widely known benefit but SCRA and MLA aren’t so I’ll post just to make sure.

If you add your DODID to the “Known Traveler” number when booking air travel, you will be granted TSA PreCheck.

If you want to elevate your travel game with a Global Entry card then you can get the $100 fee reimbursed by any of these credit cards with waived annual fee’s: Amex Platinum, Amex Bonvoy Brilliant, Chase Sapphire Reserve, Chase United Explorer, Chase IHG Premier, Chase Ritz Carlton, Citi Prestige, Citi AA Executive, US Bank Altitude Reserve

Points and How to Use Them

Think of Credit Card Points as Another Currency

There are generally 3 types of points you can earn from credit cards: partner-specific points, bank-specific points, and convertible points. These points can be spent like money to travel or like currency exchange to convert to US dollars.

Partner-Specific Points

The first category, partner-specific points, are points that you earn through the use of a credit card that are automatically deposited into a partner reward account. These can range from airline miles to hotel points and redeemed through their respective partner accounts. Their redemption follows the same rules as regularly earned points or miles. For example, The Chase United branded cards will deposit United frequent flyer miles into your account that can be used for free flight redemptions with United or other star alliance airlines.

Bank-Specific Points

The second is less common and typically used by smaller banks comparatively, but they still very much have a place in your wallet. These are bank-specific points or miles. Don’t let the name confuse you, whatever your bank calls them they are generally redeemed as statement credits for travel purchases. These points will have a set dollar value per point and then you can select travel purchases already made on your card to essentially cancel out with your points. For example, the US Bank Altitude Reserve card will offer you a 50k point sign up bonus redeemable for $500 in cashback (or $750 if you book travel through their travel portal).

Convertable Points

The third and most lucrative category are convertible points. These points combine the best of both worlds and let you either redeem for cash back (although typically at a value of 1 cent per point or less), redeem through a bank-specific travel portal, or transfer to partner accounts. The values vary and are worth more depending on your travel or financial needs but generally, Chase has the best rewards program, followed closely by Amex and finally Citi. Notably, Marriott Bonvoy points fall into this category and have the most transferability of any point system out there, but are not worth as much in the transfer.

If you don’t have any specific travel plans or want to focus on getting cashback, stick to the convertible points. They offer the greatest flexibility and are obtainable from numerous cards per bank. If you have a specific vacation or travel in mind then plan your trip, figure out how many points would be needed and focus on cards that can make that trip free and in business class seats to boot!

Continue to Game Changer: SCRA and MLA

Credit Card Rewards Theory

How Credit Cards Earn You Rewards

Credit cards come with some very impressive monetary rewards that generally come free if you play the game right.  The rewards can vary from status at hotels and airlines to thousands of dollars in cashback and travel.  There are some catches but we will dive into this process and show that with some self-discipline you can generally realize these rewards just by changing the way you pay for everyday expenses.

Credit Card Reward Catagories

Credit card rewards come in two general categories.  The first comes in the form of a sign-up bonus.  These are generally the most lucrative and come with requirements to earn.  The requirements vary card to card but typically, you will be offered an upfront point bonus for spending a certain amount of money in the first 3 months.  This spending requirement, or minimum spend, will range from $1k to $5k depending on the bank’s valuation of the bonus.  For example, if you signed up for a Chase Sapphire Preferred (CSP) you would be given 60k Chase Ultimate Rewards points if you spent $4k in the first 3 months of account ownership.  The American Express Platinum Card comes with 60k Amex Membership Rewards Points for $5k spend in the first 3 months.

The second form of rewards comes with ownership of the card account itself.  At the most basic this usually means points or airline miles earned per dollar spent but premium cards offer status at various hotel chains, airlines, and rental car companies.  Most offer travel protection insurance, price protection insurance, trip interruption insurance, and the list goes on, for all purchases made on the card.  Some go as far as offering airline and travel reimbursements from $100-$300 per year.

Credit Card Annual Fees

The major catch with premium cards is they usually come with annual fees.  I get it, it seems absurd to pay to own a credit card.  Get over it.  If you absolutely cannot stomach paying an annual fee then just use the rewards to pay it for you.  50k chase UR points are directly redeemable for a $500 statement credit.  That means after the $95 annual fee on the CSP you are still $405 in the green.  The points are usually worth more when redeemed for travel but even at their least valuable (cashback), you are making money by signing up for and using credit cards as opposed to cash and debit.

Minimum Spending, or ABC (Always Be Churning)

All this to say the most lucrative way to play the credit card game is to always be working on a minimum spend.  We all have a certain amount of money that we spend each month on bills, food, entertainment, etc.  If you just divert all of that spending to one credit card at a time until a minimum spend is met you can open another and repeat gaining 10’s of thousands of points along the way.  All you have to do is spend what you normally would on different little rectangles.  That’s it, that’s the big secret. There are no downsides, there is no fine print, there is just signing up for credit cards and diverting normal spending to them in regimented intervals.  We’ll dive more into the nuanced strategies per card in later articles.

The Number One Rule of Churning

Just remember, the first rule of credit cards is to never, ever pay interest.  If you aren’t paying off your statement in full every month, you will be charged interest.  If you pay interest then you start paying for your rewards and all of this is for naught.

Continue to Points and How to Use Them