How do you ensure you don't overspend whilst trying to get ahead in the miles game? - Seedly
 

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MileLion

Asked by Anonymous

Asked on 29 Nov 2019

How do you ensure you don't overspend whilst trying to get ahead in the miles game?

I find my spending has gone up ever since I've gotten involved in the Miles game, does anyone have any tips on how to prevent this? Hacking miles should be about getting more rewards for what I'm already paying for, not spending more to get cheaper Miles right?

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Hey anon,

Please don't overspend when you enter the miles game. Credit is a dangerous thing if not managed wisely, and compound interest on the bills will just totally negate the value of any miles you have earned.

One good way to judge if an item is really needed, is to ask yourself if you would have bought the item if the merchant only accepted cash. If it's still something you would have gone ahead to buy, then just use your miles card to pay for it instead. Buying a fancy gadget like a Google home? If it was cash only, I would have skipped. Then I know it's not something that I really need. Buying a microwave oven because the one at home broke? Even if the merchant accepted only cash, I would have to buy it anyway, so this is where I take out my card to pay instead.

Hacking miles is about maximizing essential spend. (and the occasional wants).

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Aaron Wong
Aaron Wong, Founder at The Milelion
Level 6. Master
Answered on 02 Dec 2019

Absolutely right. We play the miles game to avoid leaving money on the table, not to put more money down.

Your miles cards should be used in place of debit cards/cash on things you would otherwise have bought. That last part is key. I don't buy a sofa to earn miles. I earn miles because I buy a sofa.

So a good sense check is to ask yourself whether you'd have bought an item if you didn't have a miles card. You may also consider the value of voluntarily lowering your credit limit, if you feel you have difficulty keeping within your means.

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Bayle

06 Dec 2019

The exception would be in cases where you are given the opportunity to buy miles at what is deemed to be a "good" price. Examples of such scenarios include: paying for a card's annual fee and paying for your income tax via Citi PayAll. Mile hackers pursuing such opportunities do end up spending more (but of course they also get back more value).
Bjorn Ng
Bjorn Ng
Top Contributor

Top Contributor (Dec)

Level 9. God of Wisdom
Answered on 22 Dec 2019

Hey there,

Please do not overspend. Despite being in the miles game, the main focus should still be based on "spend and miles is bonus" rather than "spend cos I want the miles". Sounds the same but huge difference.

Keep close track of your expenditure. Ensure you know when is your credit card due date and pay it by then. The last thing you want to do is get interest charged on it.

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Jacob
Jacob
Level 6. Master
Updated on 05 Dec 2019

I always remind myself to never overspend out of my means to, and only spend on your needs not your wants. So having the financial discipline to restrict your spending is crucial.

As you mentioned that your spending has increased, it would be worthwhile to study the breakdown of your expenses - for example, could the increase be due to taking more Grab rides? As if so, what is the best possible reward for this? Such as AMEX Krisflyer for 3.2 mpd.

Or could you have been more compelled to hasten the accumulation process of your miles? Perhaps due to the expiry/ ticking timebomb on these miles. To ease your anxiety, it could be worthwhile considering cards with miles that do not expire such as Citi PremierMiles or DBS Altitude card.

Nonethelss, my mantra is that miles collection is a by-product of spending, instead of the reverse (where you wanna collect miles hence you spend more). Cheers!​​​

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SW
Say Wai
Level 5. Genius
Answered on 05 Dec 2019

Never let credit card rewards (miles or cash back) drive your spending. Take any rewards earned as a bonus, not as something you need to get.

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Firstly, understand your own cashflow. Know how much your earning potential is, and track your expenses. Here is a detailed breakdown: https://www.blog.pzl.sg/understanding-your-personal-cash-flow/

Personally, I use an excel to track my income and expense. Accordingly, I will be alerted whenever my expenses increases abnormally.

Next, I will create a budget based on my cashflow. This is the exact method that I am using: https://www.blog.pzl.sg/how-to-create-a-monthly-budget/

Through this method, I am only spending money that I am allowed to spend. This prevents the problem that you have mentioned - spend more than I need to.

Hope it helps! =D

Here is everything about me and what I do best.

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