Earlier this year I asked people for some suggestions about wedding venues in the Sonoma/Napa wine country. Megan and I headed down there to check out some places, and although we found a few we liked, in the end the difficulty coordinating and financing such a wedding from afar seemed too difficult. Still, we think we will be able to do something quite fun and interesting with the venue we found in Seattle.
Megan’s parents have been extremely generous in agreeing to pay for the wedding and reception (within reason, of course). But to a travel-obsessed guy like me, asking “how” to pay means something entirely different than where the money is coming from. Which card will we use? Can we get bonus points for this or that? Does the caterer count as a restaurant? What if we get all the guests to let us book and pay for their travel for them. Oh my! This last one is probably just in my dreams, but the others are important questions. Weddings can be stupidly expensive, so you might as well get out of them what you can.
There are several strategies for making large but planned purchases that will be spread out over a year:
- Meet the minimum spend requirements on credit cards and keep applying as usual.
- Identify cards with category bonuses and allocate expenses appropriately.
- Identify cards with large annual bonuses for reach certain spending thresholds.
Megan and I already used approach #1 to make our down payments. Once we found a venue, church, and wedding planner that we liked, they all needed to be booked very quickly. Summer is only so long in Seattle, and the good dates are tacken quickly! 😉 It was even worth paying the extra 3-4% PayPal fee, although the points earned for the purchases themselves (not the sign-up bonuses) just about balanced out the cost. However, we’ve already been doing pretty well with sign-up bonuses with our existing spending patterns. I’m not sure this is going to be a good long-term solution.
We did reach our targets a bit early before we finished paying all the deposits. Anything leftover went on my United Club Visa, which earns 1.5 miles per dollar on generic transactions instead of the usual 1 mile or point per dollar with most cards. It has a hefty $395 annual fee, but it includes several other perks. And who can argue with a 50% bonus on all those purchases that don’t fit anywhere else?
Approach #2 is to allocate our spending to different cards based on category bonuses. For example, the Chase Sapphire Preferred offers 2X Ultimate Rewards points on all dining and travel purchases, plus a 7% annual bonus. That works out to 2.14 points per dollar on a pretty wide swatch of purchases that can be converted to Hyatt, Marriott, Priority Club, United, Southwest, and Avios.
We aren’t hosting any of the events in a hotel, so that really just leaves restaurants. Our two preferred caterers do operate separate restaurants, so maybe we can process the charge that way if the caterer isn’t already classified as a dining establishment. It’s certainly a question I’ll ask during the interviews.
It still might make sense to see if we can try to put at least some rooms on our card. For example, the wedding party will need a dozen rooms or so, and the Hyatt Olive8 is likely to be our pick. I like Hyatt points and am inclined to use my Hyatt Visa because I’ll earn 3 Gold Passport points per dollar instead of 2.14 Ultimate Rewards points with the Sapphire card. Gold Passport points are worth a bit less, but I’ll get more. Maybe I can even talk the hotel into extending some benefits like WiFi or breakfast if we book a large block.
Several credit cards also offer bonus points each year (either a calendar year from January to December, or an account year that begins with the date you opened your account) based on how much you spend. Usually these are large targets. For example, you might earn an extra 25,000 miles if you spend $20,000. That’s a big number, and certainly not one I can swing given that I am trying to apply for other cards, too, and don’t really earn a whole lot. Daraius covered several of these cards over at Million Mile Secrets while I was working on this post, so I won’t go into all of them. However, the one card he didn’t mention and which I think might work for us is the British Airways Visa.
This card provides 50,000 Avios points (British Airways’ loyalty program) upon first use. You earn an additional 25,000 Avios points after spending $10,000 in your first year as a cardholder, and an additional 25,000 points on top of that after spending a second $10,000 in your first year. This means you can get 50,000 points for making a $1 purchase, or you can get 100,000 points for spending $20,000 in your first year.
100,000 Avios is a lot. I have a guest post coming up to teach you all about how to use them and why Avios may be a good program for you. Basically, instead of using them for international flights on British Airways, you can redeem them for domestic American Airlines flights for as little as 9,000 points roundtrip! That’s a great deal.
Furthermore, if you spend $30,000 in any calendar year (meaning January to December) you’ll get a “travel together” certificate good for a second, free award ticket when you use your points to pay for the first one. It’s like turning 100,000 into 200,000 assuming you use the points to cross the pond to Europe in business class. The wedding alone won’t get us to $30,000, but if we combine it with our normal expenses next year, then it might just work.
What NOT to Do
Megan originally suggested to her parents that they could open a Southwest Rapid Rewards Visa and list us as second (and third) cardholders so they could pay the bills directly instead of reimbursing us. Let me be clear that if they want to keep the points, this is fine. I’m of the opinion I know how to use them better, but they are paying for it in the end, so they can do what they wish.
However, I jumped out of my chair and shouted “NO!” when I heard this. My dad asked a similar question when he was booking flights to come up for my graduation in a couple weeks. He’s flying Southwest and wanted to know if he should use his Sapphire or Southwest credit card. Again, I said, “no.”
Southwest offers only 2 points per dollar on Southwest purchases and 1 point per dollar on everything else. In contrast, the Sapphire Preferred card offers 2.14 points per dollar (with that 7% bonus) on ALL travel and category bonuses on several other purchases, too, as I described above.
You can still transfer those Ultimate Rewards points to Southwest, so why would you want to use a card that offers fewer, more restrictive points when the Sapphire is so much more generous and flexible? The Sapphire is a keeper and duplicates or exceeds many other travel-oriented credit cards. Now my dad is canceling it and keeping his Sapphire after originally being skeptical. Hopefully I can convince Megan’s parents to avoid it, too. At least for the duration of the wedding planning!