My 250k Delta MQD Waiver Spend Planning – A basic overview on how I will get this done in 2018!

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I have had so many blog comments, tweets and e-mails that I thought this weekend I would pop up a post with a general overview of how I will in a somewhat simple fashion get the goal completed. But first some disclaimers.

I am not advocating anyone do this. I am doing this because I want to and can and as a Delta focused blogger I want to accomplish it just to have done it. If I did not fly Delta as much as I do, and value my Diamond perks, I would not spend this much money on Delta Amex cards that yield very low value SkyMiles as the reward for all the spending. Clearly, I value the MQMs and MQD exemption much more than ¼ million SkyMiles!

Next, I am personally in a financial situation I can do this and not pay a penny in credit card interest. I never pay credit card interest EVER! I always pay my bill off every month. I do have a business line of credit that I sometimes carry a balance on for a few days now and then but over a year those few days add up to very little cost at all and I factor those fees in with other costs to make points i.e. gift card or money order fees etc.

With that out of the way one of the ways I will knock out about $50,000 of the spend will be via Kiva.org. This takes study to do with little risk to your money. Greg, The Frequent Miler, had a really good part at the FTU in Seattle talking about how once you get to about the 6 month range you can expect about as much coming back to you as you re-lend each month. Sure until the end of the year I will have 25-50k tied up that I could invest in some stock or other instrument that could earn a good return and I am foregoing that to earn 50,000 SkyMiles and knock out some MQD exempt spend. I get some would say this is not wise. OK don’t do it then! 😉

My next big spend will be paying (and over paying) my taxes over the year. I happened to do very well in the stock market this year and sad to say will have a rather mega tax bill. Oh and I will over pay that bill by a bunch as I am happy to let the US Government send me a refund check in Q1 at some point. Yes, I will have to pay a 1.87% fee but since a SkyMile is worth at least 1 cent each I am only net paying 0.87%. Personally I value a SkyMile at a bit more than 1 cent so to me this is close-ish to a wash and will over the year in quarterly payments knock out a sizable chunk of the 250k spending needed.

In January will prepay many bills for the entire year. Cell, Cable, Gas and Electric and so on – all will get what I estimate the entire year will cost me. I get most are not in a financial position to prepay a year’s worth of bills. That is why I am not suggesting YOU do this, it is just what I am doing to help knock out the mega spend needed. Again here, I get that earning 1x SkyMiles vs. putting this spend on cards that offer MUCH better rewards (like 3-5x) is not the best choice. I do not suggest others do this unless you too value the end results with Delta.

So with just the above, I should be close to knocking out about half of the needed spend. That still leaves a sizable chunk left over. I will be using creative spending to get most of that done. Sure the Amex T&C says much of those choices are not approved or will count but for years they have said that and it all depends on how things “code” as to if they will work or not. I will be testing lots of different ways and then use the ones that do over the year.

Lastly, unlike other years where I rushed it, this time I am really not rushing it at all. I am going to take my sweet time as I have until 31 DEC for all the charges to post. Now I can promise you I will not push it THAT close. I plan to be 100% by October range. I want to cross the finish line well before 1 JAN 2019! – René

 

PS – Clear, for 99.99% of those who don’t want to do this – THIS is the best choice for 2018!

 

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30 comments

  1. It seems like you are smart with money. How do you justify sending all this money out ahead of time instead of investing it for short term gains during this same period? For example over paying taxes to get a refund later works for people who can’t or don’t manage their money but letting the IRS use your capital interest free for months and paying a fee to do so seem a bit off. Is Delta status worth as much as you’ll lose?
    For example say I wanted to just knock this out and I pay $100,000 up front in January, am I losing the ability to invest and earn money with that amount I have tied up? And say you don’t mind that loss, would it be as cheap to just book mileage/EQM running trips during the year to enjoy instead?

  2. @DaninMCI – Re-read post. All your questions are answered in the post.

    PS – At Delta we call it and MQD run not EQD (that is another airline code).

  3. Wow. It’s jot even worth it ! Have you flown United or American ? They actually have better onboard products. Also 250,000 Skymiles is where the biggest pain point is. You could have 250,000 MR points. Worth WAY more than Skymiles.

  4. @Ryan (or Mathew as you often comment) – I point out there are much more valuable points that can be earned. I do not feel UA or AA have a better experience – if I did I would fly them.

  5. Rene, Hat’s off for your efforts. I understand why you are doing this mega delta amex spend. You have the desire, need and ability to do it. I’m not sure I even have a need much less desire or ability to do it since I ‘m annual/lifetime gold/skyteam elite +. As you said, for many the best way around shelling out $20K or so in delta spend to meet the Diamond
    MQD threshold is mileage runs on partners. Could you do more posts on that and have a special MR thread for partners if that is not already in your plans? Thanks.

  6. I’ve had DM status for one year out of the 8 or so years I’ve been playing the game. It was kinda neat but flying out of ATL competing with half a gazillion other DMs it just wasn’t worth it for me; I get plenty of value being a PM. But I agree with you, to each his own. Just because I wouldn’t do it doesn’t mean I think it’s wacky for you to do it. Good luck and I hope none of our methods slam shut because of the massive increase in MSing that is about to commence on Jan 1. In the bean counters zeal to thin the herd they have really just exacerbated the problem because some will look at it as a challenge.

  7. Renee- Why not put the spend on a card that will yield you higher points earning? For 250K let’s say you only get 250K delta miles. Instead let’s say you get a min of 1.5 points. Let’s say these are chase points and then you can use them for travel. Take the extra 125K worth of points and redeem it for travel on delta at 1.5x in the portal. You can use that flight to gain the EQD waiver by actually flying a business class trip worth the 2K in travel. Just thinking that would be more useful for your spend. 250K is a ton of spend and yielding an extra half point or more can really be way more valuable.

  8. I applaud your initiative and drive. I would love it if you kept a log of your actual “costs” to reach your goal. That would be interesting to all of us.

    I used to play the game when Bluebird was around before that horrible day in Jan last year or the year before. Good times. And my other means of reaching the $25,000 waiver dried up recently. So the $250,000 waiver is definitely out of the picture. But what is? Doing a couple of MQD runs on MU to SIN. That alone will cover the $15,000 in spend for just a couple of thousand dollars. The rest of the MQM’s are rollover and then we wash rinse and repeat next year.

    The value of the Diamond status is not in the upgrades as I never buy economy anymore. But it is in the service we get during IROPS and such, and the global upgrade certs. I still find space with them and take friends and relatives around the world. And the DL Reserve is good for the First Companion Pass, and now the lounge. And I use the Platinum Amex for the 5x spend and Centurion. I want to thank you for all your advice over the past few years. You have helped me to make my flying experience so much more fun and hassle free.

    Please keep up posted on your progress.

  9. How do you not spend enough on flights to cover that requirement instead of relying on the waiver?

    The opportunity cost of spending $250k on cards is eclipsed easily. It’s only $15k on DL flights to meet the req. If you can prepay all those bills, why not just buy a couple expensive flights in addition to what you already spend? How far away can you be from 15k based on how much you fly?

  10. Rene,
    Thanks for the tip about running quarterly taxes through AMEX. This I have never considered. You are right. If the fee is less than 2%, it would be a wash for me. I’m stingy with my Skymiles and almost always get 2 cents per mile or better.
    Also, thanks for your previous post concerning Kiva. I had never heard of it before; but over the past year, I’ve helped fund many sanitary toilets and hog farmers in the Philippines. It makes me feel good and get Skymiles too!
    I also don’t have a problem with prepaying for services or overpaying my taxes. Sure I’m tying my money up with no return, but I don’t care.
    The stock market is really scary these days! If it all hits the fan, at least I’ll have my taxes paid.

  11. How much do you spend on Delta flights to reach 125,000 MQM? How many MQS you fly in 1 year? Being based @MSP I find impossible to fly 125,000 MQM and not soend $15k in Delta.

  12. @Santastico – I fly any year from 50-150 segments. I have over the years gone from over 10k per year to 3-5k per year in MQD. Again, I do not want to reward $DAL with my larger spend when they do not reward those most loyal.

  13. For me it’s interesting but not essential to get the greatest return on my choices. My goal is to have fun within my budget and to afford experiences that I would not otherwise pay for (e.g. international business or first class).

    I applaud you for taking on a challenge that interests you. Obviously you are weighing the cost/benefit to you. Cost/benefit isn’t just about the $$$$$$.

    Enjoy your challenge! If it doesn’t suit you, you can change course.
    I enjoy your enthusiasm.

  14. Does this mean the new tie breaker for upgrades will be $250,000 spend? And our dashboards will be updates to 250,000 as the goal?

  15. Between my four am ex cards I charge $220K a year. I figure it will only cost me $570 to do $30K to the IRS. I do a good job at estimating my taxes and usually end up owing or getting back less than $1K but figure I’ll stop my withholdings for the year and do a $30K payment online.

    If you are using the IRS strategy just make sure you had enough withheld throughout the year so you don’t get hit with a penalty.

    A little OT but why would anyone use any of the other payment providers that charge a higher fee? I find it odd the IRS has multiple providers that have different fee amounts. It makes no sense to pay 2 percent to a provider when another is charging 1.87

  16. The level and number of special circumstances that have to be present to make this “worth it” is comical. I mean the guy above that already spends $220k a year, and has $30k of tax liability that he can pay with a credit card, ok. Even then, if you are that big of a spender and have this level of tax liability, are you really wasting time and effort to do this as opposed to buying a couple more or more expensive tickets to make the waiver moot? I realize Rene is doing it to prove a point, and maybe for those very few that it does make sense for. That said, this seems to be for people that like to play a game, not save time and money. @Rene keeps saying that he doesn’t want to reward Delta by just getting DM with MQDs. To what end? Your entire post acknowledges that doing this is not wise (i.e. it costs a lot, opportunity or directly). Seems like that cost almost certainly has to be more than the MQD-$15k delta for those flying 125k or more MQMs. At the end of the day, aren’t we all here to maximize our experience for the dollars that we pay?

  17. I originally thought it was crazy to do the $250k spend, but now I can see the benefit if you do a ton of segments like you, Rene.

    I am curious to see what “enhancements” Delta is going to offer for next year.

    Rene, do you think after they thin out the Diamond herd they’ll boost the benefits to encourage more ppl to try to spend their way into the DM group? With less ppl in the DM group, there should be more money to spend for each person.

  18. The overpaying taxes and getting the refund is something I have thought about in terms of meeting minimum spend requirements, do you have experience as to how fast the tax refunds come in if you file electronically? I am assuming you would pay your Q4 2017 estimated tax sometime in mid January and then immediately file your 2017 tax return to minimize the amount of time that you wouldn’t have the cash available? Do you think one would be able to get the refund in time to help pay the bill itself?

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