Introduction
A reader asked me this last week:
I read that you’re MSing for Hilton points for the Seychelles. Hilton is offering 144,000 points at $.055/each for $800…I know you don’t buy points, but how do you value your time and the opportunity cost of MSing for ostensibly more valuable points (or cashback) in the evaluation process?As in, if you valued your time + opportunity cost at $100/hr, but you hypothetically knew it would take 16 hours of labor (I’m making numbers up here) and effort to generate 144,000 Hilton points, would that threshold be sufficient versus simply buying the points outright and saving 8 hours?
How many trips to a grocery store?
So let’s assume we have the AMEX Surpass and get 6X at grocery stores. For 144K points, we’d need to spend $24,000 at grocery stores. I know for me, Safeway won’t let me buy VGC with a cc, but YMMV. The best grocery store would be Kroger and they limit you to $1,999.99 per day. That means I’d need to make 12 separate trips to a grocery store.
Time it takes to liquidate
As many trips to the grocery store, it’ll take as many trips to wherever to unload these cards. I won’t say where, but you should know already. So let’s say worst case, it takes you 12 separate trips to wherever you go to unload.
Time for each trip
This depends on where you live and how far out of the way you have to go. You can calculate it like this. If it normally takes you 30 minutes to drive from your house and work, but if you stop by a grocery store and a Walmart, it takes you 60 minutes, then that “MS run” took you 30 minutes. Let’s just guesstimate and say it takes you 15 minutes per trip to any destination. So 24 separate trips * 15 minutes = 360 minutes. THAT’S 6 HOURS OF YOUR LIFE!
What is your time worth?
I wrote about this a long time ago, but you really should calculate what your time is worth. Just remember that you may value your ‘on the way to work’ time less than if you decided to make a run at 8pm, leaving your wife and/or kids at home. Or if you are in school with no job, you may value that time at close to $0 (although I would at least value it at $10/hr since I know of an online job that you can make $10/hr clicking web sites (no really, I did this once. It’s super mind-numbing-ly boring, but hey it paid money! So I’m going to throw a number out there and let’s say you value your time at a low $25/hr.
Adding up the math
So our current equation is:
([trips to grocery store] + [trips to liquidation]) * minutes per trip * value of your time + $285 in VGC fees + liquidation cost
In our example, we have:
(12 trips + 12 trips ) * 15 minutes * $25 / hr = $150 + $285 = $435
Now I know some people will value their time higher than that. So let’s say you value your MS time at $80/hr. If you do that, that math then comes out to be $480 + $285 = $765.
Lessons Learned
So while $800 sounds an outrageous price to pay for 144K HH points, it’s not quite as outrageous when you calculate all the time you spent making runs to grocery stories and liquidating the gift cards. For some people who have more money than time, that $800 may be a good option vs wasting 6 hrs of their life doing MS.
Realistically, you should pay the $800 and use those 6 hours doing other MS (like using a 3% or 5% card.)
Also, if your redemption isn’t worth more than .55c, then you may as well have paid cash (to also earn pts for paying cash.) This exercise was assuming you needed the points to use AXON or the 5th night free booking.
In my experience, Hilton redemptions usually yield 0.5cpp.. How is the Seychelles hotel redemption stacking up? Use fully refundable rate to calculate since that is one of the benefits of using points redemption..
Haven’t really thought about it much. Need to get the regular Hilton and maybe the VA card. I’m hoping to mostly get the points via cc signup. Then top up with Surpass.
5 nights at the Seychelles right now for 5 nights is $1790 (refundable all inclusive). 70K per night * 4 (5h night free) = 280K. Yields a 6.4c pt redemption. I most likely won’t buy the points because I’m stubborn and want to do it all using cc.
Are you sure points redemption is eligible for all-inclusive privilege (they use the term full board – lunch/dinner included on top of diamond breakfast)? Is what what you meant when you said all inclusive? In that case 70k per night is an awesome deal
..
No, I meant all taxes and fees included in that $1790.
The $800 purchase would also get you at least $16 back with a 2% card or get you most of the way to a $1000 spend sign up bonus like Hyatt or IHG etc.
Very true. Man, I don’t want to go down this rabbit hole any further…
Haha very true…you can justify anything if you try hard enough!
if bought with Amex Surpass, you could maybe also earn 12x HH on that $800? terms and conditions state that 12X is only for purchases charged with a participating hotel, but possible Hilton.com purchases still count? never bought Hilton points, so don’t know.
I haven’t bought from them before either, but most of those points purchases go through a 3rd party like Points.com, so I doubt you’d get 12X HH on the Surpass.
Not to mention MS costs. $5.95 per VGC, plus whatever you pay to liquidate (if anything.)
That’s another $285 +liquidation to the original $150. Suddenly the costs are more than half just buying the points.
I’d argue buy the points, and MS with better return somewhere else 🙂
Ah I can’t believe I left that out. I’ll update. Thanks Leith.
I was just going to say that too. I have a King Soopers (Kroger) 5mins away, but the closest WM is 30mins in each direction. I would probably buy those points too unless you can find things to resell.