[00:01:30] How to get a First Class Business Suite for as little as $500.
[00:04:00] Two ways to use points to fly, and the one you shouldn’t use!
[00:06:30] What to look for when choosing a card for business expenses
[00:08:00] When a high annual fee might actually be a good thing
[00:10:00] Steve breaks down the difference between flying with airline partners
[00:20:00] How to get maximum points value out of personal and business expenses
Jody: [00:00:00] Welcome to this episode of Online Confidential. I'm super excited with our special guest today because I love flying, as he says ‘in the pointy end of the plane’. And we are going to dive into that today in this episode of Online Confidential, where we take you behind the scenes of ‘Secret Ad Manager’ business and take you miles high in the sky in comfort in this episode.
So Steve Hui, welcome to this show. I'm so excited to have you as our guest today!
Steve: Great to be with you. Thank [00:00:30] you.
Jody: Now, for those of you who don't know Steve, he's here in Australia and we are focusing more on just Australian talk here when it comes to Frequent Flyer points. But those of you in other countries will also be able to get a lot of inspiration from this as well, and to see how easy it is to actually fly first class.
I don't know about you, but I remember getting onto planes, and you'd go past that little first class section and you're kind of looking down and you're going, ‘how did they do it?’ [00:01:00] And then you go back to your little economy seat with your knees, and then especially when you're flying long haul as we do from Australia to get anywhere else in the world.
And you walk past the first class section where their beds are there, and their mattresses, and it's like, ‘Oooh!!’
So Steve, first of all, I love your background there. Tell us a bit about that. We were talking about that before. That is an amazing setup, guys. Imagine flying [00:01:30] like that!
Steve, tell us about that cabin. It's an actual kind of cabin, isn’t it.
Steve: It is so huge. So think of it, it's basically like a small room where they have a bed set up here permanently, and right behind my head it's a little sort of like sofa chair. So you basically have a bed and a chair just for you, the whole flight, the whole time.
Jody: Oh God. Oh, that is just amazing. When you look at just economy and it's just like [00:02:00] squeezed in. So what are we talking, points wise, to fly like that?
Steve: Yeah. This is the Singapore Airlines A380 First Class Suite, of which there's only six on board.
Steve: The easiest way to get on board, and actually really affordable, is to fly singly to Singapore, one way. And you can get it for about 93,500 points each way. That's the first class saver. 93,500 point and it’s really easy to get [00:02:30] hold of.
Jody: And is there any cash to pay with that as well? Or is that just points?
Steve: That just points. Plus there's a little bit of taxes to be paid. Taxes might be $400, $500 or so. But this flight will probably sell for $5,000 to $7,000 one way.
Jody: For that little suite. Wow.
Steve: Yeah. Seven hours of flight time costing $700. So basically it's going to cost you a thousand dollars an hour if you paid [00:03:00] with money.
Or interestingly. If you do it with points wise, it's only going to cost you 13,500 points per hour, which it’s very easy to get 13,500 points.
Jody: Yep. It certainly is. And for us business owners when you're paying contractors, business expenses and all those kind of things, you rack up those points pretty quick. In January I flew our family of six from Brisbane to LA and back all using points.
[00:03:30] It was brilliant. I'm all for the points and recently we just stayed at a resort in the deluxe room there, again using points. So guys, I want you to tap into the benefits. If you're a business owner, these luxuries that you can have just by paying you regular business bills. So Steve, how do we even get started with this?
Is there a particular airline? Is there a particular credit card? Where do we start?
Steve: Yeah, I think the number one place to start is to [00:04:00] understand how cheap it is to use points to fly. And we talk about just using points to book flights and not an upgrade.
So the upgrade is when you buy an economy ticket and you request an upgrade and you hope for the best and if they give it to you they take points.
Jody: I hate that. I hate that. No, that's fraught with terror for me.
Steve: The lottery. It’s a lottery.
Jody: Yes it is. Okay. So it's not buying economy and then hoping for the upgrade. And then I've also made the mistake of buying the cheapest ticket and then you couldn't [00:04:30] request an upgrade so that really stung. So just going straight off the bat and booking with your points.
Steve: Yeah, that's right. So I think that's first clear because that's a really common misconception of what it is. And then there there's two ways of using points to fly. There's one which they called a reward flight or Qantas called a Classic, and other airlines might call it Saver or Reward, and that's the way to use your points.
The second way, which is the way you shouldn't use it, is Points plus Pay [00:05:00] or pay with points where you convert your points into a really low value. And that is basically what’s paying for your cash ticket at the current market rate.
So the one you use is Reward Seat, and that's when you get awesome value because the magic about a Reward Seat is the number of points to fly is priced based on distance.
It's not priced based on seasonality. So basically 365 days a year, if you're flying the same [00:05:30] distance, it's always the same price, and you can book up to one year in advance. I think the number one thing for people to really understand is, think of it like a different language. Everyone would have had some experience of using points. They would've used it for upgrade, they would've used it for this and that. Forget about all that.
If you run a business, then you can actually make your business a points generating machine and earn points for a specific purpose, and [00:06:00] that's to fly the pointy end, and you can get massive bang for buck. Massive. Especially if you are talking about Facebook ads where you can pay all those ads on your Amex card for zero fee.
You can basically fly what I'm flying or just for the price for taxes, which is like $500. Imagine flying first class for $500.
Jody: Having that right?! That would be amazing! [00:06:30] Oh my gosh. I just want to go to Singapore just to experience that. So, you mentioned Amex cards then. Is there a particular card, is there something that you need to be careful of when it comes to selecting the right cards?
Like some will have a high annual fee. Is it worth it? And there's some that are lower. Let's talk about cards that you should and shouldn't have.
Steve: Yeah, good question. The reason I prefer Amex card, actually I prefer any card that has the highest earning rate. So Amex card earns more [00:07:00] points than a Visa or Mastercard.
So generally, every Australian dollar you put for an Amex card will get you on average about 1 to 1.25 airline points. And I mentioned airline points specifically because you generally earn some reward points first, and then that gets converted into airline points. So on a Visa or Mastercard stage, some cards might earn two or three reward points per dollar.
But then they [00:07:30] convert into airline points that are two or three rate to one ratio. So what I want people to understand is, to compare cards, you want to see how many airline points you earn per dollar, not how many reward points. Because otherwise it's just funny money in the middle. Ultimately it's how many airline points you get.
So I like Amex generally only because I earn more points per dollar. The number one rule of all credit cards is you always have to pay them off in full so you don't incur any interest. Incurring [00:08:00] interest will just destroy the whole value of your points. In terms of the annual fees, it all comes to how much money you spend because annual fees can range from zero to the highest being $1750.
Some people go, ‘well, why would I pay $1,000, $1,700 when I could pay zero?’ It all comes down to how many points you earn per dollar. Because the higher your credit card, which is the higher benefits, the more points [00:08:30] you earn and the points when you seem to fly business class at first, more than pay off the annual fee, like multiple times.
That's always going to be a trade off. I'll say if you spend over $250,000 a year on a credit card, then you can easily pay the highest annual fee and you'll still get more than your money back.
Jody: Awesome. So to recap that, if you had a card that's generally got a zero [00:09:00] annual fee, let's see if I understood it correctly, versus a card that's got a $1700 annual fee, as long as you've got that revenue coming through your business, you will earn more points with that $700 annual fee card. Yes?
Steve: Correct. More points and more airline partners as well. You can transfer points. I'll talk about that in a second, so it’s not too confusing.
Jody: That's great. So if you've got the revenue, the $1700 could well be worth [00:09:30] getting into a first class suite, like that one which I'm sure you would agree, for $1700 who would not pay that for a long haul flight from Australia?
Oh my gosh. Any day.
Let's talk about airlines. We've got Qantas, and we've got Virgin, then we've got their Alliance partners. Is there an airline that's possibly better than the others? Better value points? More airlines to share with?
Steve: Yeah, definitely. Every single airline charges a different number of points to fly to [00:10:00] the same place.
So just like how cash tickets, when you ever price a ticket every single airline will charge a different price. Cash prices normally go up and down based on seasons and demand. When you are looking at points prices, because earlier I mentioned that the points prices don't change based on the same distance.
Every airline has a points price that has already been set. Some airlines charge more than others to fly to the same destination. Let me take, say Sydney to [00:10:30] London as an example. If you’re using Qantas points to fly, Qantas flies to London, so does Singapore Airlines, so does Emirates and so does Etihad, Qatar, Cathay and all these airlines fly there but they all charge a different number of points to fly.
Just out top of my head, because I know these numbers pretty well. A one way business class flight for one person using Qantas points to fly on a Qantas plane is [00:11:00] 144,800 points for one way.
That's using Qantas points on a Qantas flight. And the reason I mention that is because there's only one Qantas flight. Actually, there's only two Qantas flights that fly to London. One from Perth and one from, actually, there might be a couple more. But if you use your Qantas points to fly on a partner, like a oneworld partner, like British Airways or Malaysian or Qatar or Emirates, it'll cost you [00:11:30] more Qantas points, it'll cost you 159,000 points to fly one way.
So you see that that's roughly about 10% difference. But if you usually use your Singapore Airlines points to fly, it'll only cost 161,000 points for the same flight. And then lastly, if you use your Virgin points to fly on, say Etihad or Qatar, it's only 178,000 points.
The numbers get to you after a while.
Jody: There's a lot of numbers. [00:12:00]
Steve: I guess I just want to demonstrate to you that every single airline charges slightly at different points to fly there. And then we come to the taxes as well. Every airline charges slightly different taxes and fees. So the magic is if you are flying to London a lot, you want to focus on an airline that charges you the lowest points to fly with the lowest taxes, and, and then create a structure or system that earns you those points in the most effective way, and then you're basically [00:12:30] always flying for the lowest price.
Jody: Awesome. So it's not so much about choosing the right credit card that you're going to pay all your company bills on. It's a matter of finding which airlines are ones that you may prefer. Maybe ones like, for me, being in Brisbane, I would look at who flies out of Brisbane to locations that I might want to go to rather than having to go down to Sydney or Melbourne.
And then which is the [00:13:00] the most value of points like you said, because there was a bit of a difference there between, what was it, the Virgin one actually was less points if you're flying under Etihad versus some of the other ones.
Steve: It’s actually a 20% difference in value. I think what you said is exactly right. That means that everyone's a little bit different because people live in different states. They want to go somewhere different. So therefore, I've talked about the London example, but then if someone wants to go to Los Angeles a lot, then [00:13:30] there'll be a whole different bunch of airlines, each with their own price.
And then if you want to go to Asia a lot, it's about finding a sweet spot that works just for you.
Jody: Awesome. So then for myself, I'm a Qantas girl, so we've got the Qantas company over here, and that's where we are getting points and we book things there.
We use the Amex and we get whatever points, then transfer them over to us personally. Am I doing the right thing there?
Steve: Well, [00:14:00] you're doing the right thing because I think if you are able to find flights on Qantas towards where you want to go then that strategy works.
So there's some credit cards, what they’re called is direct earn. So the credit card generally has the Qantas logo on it. That means every single dollar you spend on that card, all your points will go to Qantas, and then that's where you book flights. And if you are successful booking flights, then that strategy works.
But if you are someone who wants to go to [00:14:30] different places, but don't know if Qantas is the best airline for you, or has the flights for you, then there's another system where you can earn points like the Amex Rewards program that can then transfer later to Qantas or Virgin or Emirates. And then that gives you much more variety of flexibility because how some different airlines charge different points.
Actually, different airlines will also have different [00:15:00] inventory. Where Qantas may not have seats, maybe Singapore Airlines have seats on the dates to your destination, or you can mix and match. Fly Qantas one way because they’ve got seats. Fly Singapore or Virgin another way because they’ve got seats.
That strategy gives you way more options because you just never know where you want to go.
Jody: Exactly right. And, like you said then, if you do want to go somewhere different, it's like, ‘oh, well who flies from here?’ [00:15:30] So that's where I was going to go. Should we have different cards?
Should we have for example, Virgin points, Qantas points, is that diluting things down? But what you said there was that there could be Amex rewards that pools it all in there. And then you can use them on the airline that you choose. Is that actually a better option rather than saying, I've got my Qantas, I've got my Virgin?
Steve: Yeah. For me, generally, it all comes down how much [00:16:00] you can earn because if you run a business that can put a lot of money through a card then the way I think of it visually, I'm not sure if everyone follows this. It's like a train. It's like a train or train carriage. It has to be full before it takes off.
So what I mean is if you're looking to fly, say four people somewhere, you don't want to have a little bit of points here, a little bit points there, because then you can't combine them. And if you want to [00:16:30] fly four people you need four times the points needed to fly one way to that destination.
You don't want it to be a little bit points here, a little bit of points there. So maybe that's a long way to answer your question. But generally, if you can put a fair amount of money through, then having a flexible program works better. Because then you can then transfer your points to somewhere else later.
But if you don't put much money through, then you want to stay with the one program because then you can earn points through your credit [00:17:00] card. You can earn Qantas points through shopping, earn them through maybe home loans or different bits. So therefore, then all your points get collated in the same bucket, and then you can use them.
So I think that when people start spending more money, then the strategy gets a little bit more advanced because then you're trying to optimize more flexibility, more efficiency and just with airlines that are more likely to have the number seats that you are looking for.
Jody: [00:17:30] I love that. Then you can go to other places because at the moment if I've got Qantas points, then I wouldn't be able, is Singapore Airlines affiliated with…
Steve: No, you can't.
Jody: See, aghh, I can't get on that suite! Whereas having them in the Amex thing, then that's a much smarter way to be able to go on those airlines. Is there an airline that you particularly love that is like, ‘Yes! This one is just like whole next level’?
Steve: Oh yeah, so like this one for [00:18:00] sure. This is one of my favorites. Yeah, Emirates First Class is another one. Obviously, the first class products of every airline is always better, but you get things like having the ability to shower at 30,000 or 40,000 feet, which is a unique experience because you never know when the turbulence hits.
Jody: That could be really nasty if you have a fall in there.
Jody: Oh my gosh. Is there a[00:18:30] lap sash or a seatbelt in the shower in case you do hit turbulence or there's just handle bars you gotta hold onto?
Steve: I think you just hold on because you do have a shower and the thing is that the shower water, you only have limited amount of time of water.
Steve: So you can start,stop, start, stop the water actually to lather up and things like that. But no, what goes through my mind is always what if you are just got like shampoo your hair and the plane hits turbulence.
Jody: That's right. Yeah. Coming out. Shampoo in your eye. Trying to [00:19:00] find your seat.
Steve: That's right. But it’s an experience that's worth having.
Jody: Absolutely. It is. And it's perks like this because running a business is hard work. So if you can have perks like this where you can, I was going to say do the upgrade, but don't do the upgrade. Just get it with your business point straight away. Lock in that business seat. Enjoy that. It's just makes some of it all worthwhile, right.
It's just an experience that you can enjoy. And then when you can share it with your [00:19:30] family members, like I was recently able to it is just absolutely amazing. So we've covered favorite airlines, Singapore Airlines is amazing. Your recommendation for points, and having the different cards for our businesses, possibly looking at Amex rewards.
What about personally then, as we spend money on personal things, are there any personal cards that are any good? I've got the Qantas debit card and I try and use that. It's linked to my points and [00:20:00] everything, but I know the points aren't as high there. I think it's like 0.25 points for every dollar spent.
So like you were saying before, you get a dollar for a flight point or whatever for a dollar spent. Great value four times more. So what can we do with our personal stuff that's going to complement business expenses?
Steve: Perfect. Yeah, I think the key is complement because you want your business points and your personal points really going to the same bucket.
Because the whole idea is try to have as many points that you can use to fly and not [00:20:30] have all these different buckets everywhere. So on a personal side, there obviously is Amex cards and Visa and Mastercards as well. But on the personal side of Visa and Mastercards are not too bad because you can get some Visa cards that earn you one Qantas point per dollar for the first $10,000.
So then the decision comes down to how much money you spend in your personal life to match the caps. So credit cards don’t have a cap, but [00:21:00] what happens is that the first $10,000 earn you one Qantas point per dollar, but then it earns you half a Qantas point after that.
So if you're spending just under $10,000, then that card will earn you great points, but if you're spending $20,000 per month, then that card's not that good because only the first 10 gets one and the second 10 gets half a point. So then that's when you come to a little bit deeper science into picking the right card, depending on your spending habits, whether you pay school [00:21:30] fees and rent.
You can even pay things like that actually through your credit card these days, even if they don't take the credit card directly. You can use these third party payment aggregators and then they'll pay it for you and they'll charge you a fee. So ultimatelym what I see as an accountant in the background, is it all comes down to how much does it cost you to get these points?
And then how much value are you going to get when you use those points? And generally you get [00:22:00] double or triple value. So if it cost you 1%, then you basically can get 3% value back.
I guess what I didn't mention is, I believe using points to fly is the biggest perk in the world because points are really just designed for flying.
You can use your points, you get gift cards and stuff like that, but you get really bad value.
Jody: I was going to ask about that, yes. I got a robo vac or something, [00:22:30] and it's 150,000 points or something like that. I could have had that suite over to Singapore for less than that.
Right. And that robo vac is like maybe $400 worth.
Steve: That's the thing. So the way I sometimes say to people to make them understand, it's like having a hundred dollars note, but only getting $10 of value from that because you're not getting the maximum value. So when you've got points, [00:23:00]points are designed for flying.
So business first class is where you're going to get the biggest bang for buck and I might have only met one person that flew business in first and said, ‘ah, it's not such a big deal.’ But everyone else is like, ‘yeah, this is wonderful!’ this is how you want to fly.
Jody: You can't go back. You cannot go back. And like I said, especially here in Australia where you've generally got at least an eight hour flight out other than New Zealand and a few little islands, it's a long haul flight. So you [00:23:30] want to be comfortable. It's an amazing experience. Awesome.
Steve: We're talking about Amex, but not because I particularly love Amex, it’s because they offer the highest points. So it's always about the numbers.
Jody: Like you say, it comes back to if you really want to get granular and if you really want to know are you getting ahead with your points, which I think as a business owner, we ultimately will be, but there is typically that extra charge for Amex, [00:24:00] which in the personal sense, if you're using an Amex card, you're going to get that little bit of a fee extra every time. But if you can contribute that into your points to get these upgrades, to get like an $8,000 flight just using your points that's probably outweighing those little extra Amex fees.
Steve: That's right. I've even done the whole calculation from end to end.
Jody: I’m sure! You've got an accounting background too. You just said so, [00:24:30] and you're the points guy. You know the numbers!
Steve: I worked it out that on average as a business, if you paid all your things with your card and you pay all your fees, and then you use those points to fly business class, it works out that basically, you’re flying business class for half price.
How that works is the cost of getting the points and paying those fees is half the price of buying the [00:25:00] same ticket with money. That's why I'm still so into it because what else can you get for half price?
Jody: Right. Who doesn't love a deal? We all love a great deal.
And then a deal like this where you can fly at that pointy end of the plane turning left instead of turning right. It is amazing. It's amazing, guys. The little pre-takeoff drinks, all the stuff. It's awesome. It's awesome.
Steve: The hot towel, sometimes they give you a hot towel. [00:25:30]
Jody: Yes. Anything you want, it's all there. Well that's been awesome. Steve, where can people go and learn more about you, learn more about the services you provide so that they can be most effective when it comes to using their points and making sure they've got the most bang for their buck with their points and with their flights?
Steve: Yeah, so my website is iflyflat.com au and I guess what we do is we offer two services.
One is, it's a flight [00:26:00] concierge. So if you have points already but you just can't find flights or work it. We have a team, which is like the travel agency, but only points.
And we only book international business or first class flights. So we do a booking fee on that. And the other service is actually flight advisory, points advisory, how to earn the points for your business that's tailored to your travel needs and your spending style.
So we have a video course and we have a one-to-one session [00:26:30] and all that's designed so if you are a business that's probably like 2 million plus turnover, then you're definitely spending the money that if you have a structure around points, then you basically would never fly economy again because flying business class is so cheap.
So find me on iflyflat.com.au or if you're on Insta I'm on Instagram @iflyflat, but even better is LinkedIn at Stephen Hui. You find me there and I'm always on [00:27:00] LinkedIn.
Jody: Awesome. And guys, I’ve just gotta give you a heads up. We've just had April Fools here at the time of recording and for the last couple of years I've seen Steve do these amazing, a lot of effort April Fool things, they're a lot of fun.
So there's a heads up for next April Fools if you’re here going, ‘oh, wow I can earn points while I'm on hold on the phone?’ If only! I was on hold for an hour the other day with someone, I was like, ‘ah, you're killing me’.
Oh, [00:27:30] and I did just want to emphasize here, so to be clear with everyone, so while you may have a business and you’re accumulating these points for business, through your business, you don't have to use these points for business flights. Right, Steve?
Steve: Yeah, you can use them for any flights. The key thing is having the points. In the past I've had business owners ask me, ‘well, I'm not planning to fly a lot or all that stuff.’ Or maybe sometimes using [00:28:00] points to fly is a little bit difficult, but it's all the chicken or the egg.
If you don't have the points, then you never get a chance to fly for cheap. And then the problem of can’t get on a flight doesn't exist, but you’ll never be able to fly a $7,000 flight for $500 if you don't ever have the points.
Jody: That's right. And then that $7,000 point flight can just be one where you just want to go away and that's your holiday. It's your holiday with your [00:28:30] partner.
You're going off to some amazing location. You don't have to spend thousands on the flights because your points that you are accumulating through your business have done that for you, so then you can have that personal getaway and recharge. All of us business owners need to come back refreshed and enjoy an amazing experience like that suite.
Absolutely love it.
Steve, thank you so much for your time today. This has been a lot of fun. A bit different to our normal kind of business kind of talk, but this is [00:29:00] so important. I wanted to share this with other business owners to really tap into. This resource that's right at their fingertips as they're spending on their business, one of the perks that we can enjoy from it.
So guys, go check out Steve, find him there on LinkedIn. Check out iflyflat.com.au. Thanks again, Steve. Oh, man, ‘get your points ready to fly’. Absolutely. I could just go and lie back on that little bed there at the moment.
So it was amazing. Thanks everybody. Thanks [00:29:30] everyone. That's it for today.
Bye for now.