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In our last post we shared how we scored round-trip business class flights for two to the Maldives for $800. This post will share how we stayed in an overwater villa for free with points in the Maldives.

The Credit Cards we used for the overwater villa

Like with our flights, we used a credit card reward point strategy to earn the amount of points we would need to book the hotel nights. While the flights were largely booked using Chase Ultimate Rewards, the hotels were largely thanks to American Express. (Note – some links below are our personal referral links, but you should always search the interwebs for the best available offer!)

• American Express Platinum – $695 annual fee. 100,000 American Express Membership Rewards bonus for signup. (Have been seeing some referrals for 150,000! Try checking from different browsers and using incognito mode) We opened this while planning for the trip and are evaluating whether we will keep it open a second year. (that fee is no joke!)

• American Express Gold – $250 annual fee. Increased 90,000 AMEX MR bonus for signup. (Was only 60k when we signed up) We opened this while planning for the trip and are evaluating whether we will keep it open. It has a medium-size annual fee but some perks and nice 4x rewards categories of restaurants and groceries.

• Chase Marriott Bonvoy Boundless – $95 annual fee. (3) “Free Night Certificates” bonus (35,000 points per night) for signup. (A special promotion for 5 free nights has been available from time to time – make sure and search for the BEST available offer) Clari has had hers since 2020 and with a free award night perk per year plus other benefits, we will probably keep it open. (Update – Within 30 days after the 2022 annual fee hit, we asked for a retention offer. Chase credited us $100 – more than the cost of the fee!)

As our Narrator hinted in the intro paragraph, there’s some unavoidable costs. Because it’s Maldives, a seaplane transfer from the main island Malé to your hotel island is required. For our hotel, that flight was around 60 minutes long and cost $1,200 for 2, roundtrip. As much as I tried, I couldn’t find a way to hack the seaplane fare with points! We paid out of pocket for the transfer.

Totaling it up

You can see from the Excel above how we ended with 370,000 Bonvoy points. The (2) new AMEX cards had large signup bonuses combining for 160k, and the normal spend we put on the cards stacked on top of that to total 220k at the time of transfer. (The introductory 10x on restaurants for AMEX Platinum was definitely used/abused). Because AMEX+Marriott were running a special where 1 AMEX = 1.3 Bonvoy, our 220,000 AMEX equaled 286,000 Bonvoy. (pro tip – if you have concrete plans for a trip, and some time to wait, hang on until one of those promotions comes around before transferring!) We already had 26k of Bonvoy in Clari’s account from previous spending she put on her Marriott Bonvoy Boundless card. This left us at 312k, short of our 370k goal.

Brett transferred the missing 57k over by moving Chase Ultimate Rewards from his Chase account to his Marriott account. Fortunately, to get them to Clari’s account, Marriott allows you to send their loyalty points to any other member at no charge, via phone. That final move gave us the 370k needed. Success, and all thanks to having some spare Chase Ultimate Rewards – never a bad plan.

Was the credit rewards route worth it?

For us, the short answer is YES! But I don’t get charged by the word here on my WordPress blog, so here’s the longer answer.

Like the airlines, to book these hotels, we applied for and opened new credit cards. Then, over a period of 2-3 months, we funneled normal household spending to them to hit signup bonuses, all the while learning each card’s different world of transfer ratios, rewards categories, and other features. Common back-and-forth with my wife conversations were had like “Which card should I pay for the groceries with? (AMEX Gold!) What about for pizza delivery? (AMEX Plat!)”. This took time and effort, much more than clicking “add to cart” your desired hotel at their published cash rate. So I am acknowledging a certain level of effort needed to put forth, which may or may not be doable for your family. And if you’re wondering, what were those retail rates for this hotel that we saved?

$9k for 5 nights! That would be a hefty price tag if you’re footing this hotel bill with cash, and it’s the same story throughout this paradisiacal island nation. From comparison-shopping, this particular hotel does not cost significantly above the masses. So yes it took time (and credit pulls) but it did save thousands of dollars. Plus after all, with a blog titled “Buy Out The Time”, you know we are looking at spending time and money in a deliberate manner!

Out of Pocket cost

We touched on the seaplane earlier. On top of that, the primary credit cards involved in this booking each had annual fees. AMEX Platinum $695, AMEX Gold $250, and Marriott Bonvoy Boundless $95. We consider these annual fees as trip expenses, even though there are perks that touch other areas. But if we assume that no other benefits were gained from these cards, (separate post coming on that later) and treat their combined $1,040 annual fees as a true cost in the hotel booking, then our out of pocket would look like:

When we compare that cost with the retail cash price in the screenshot above, we still only paid 24% of retail price. NOT TOO BAD, PEOPLE! Over time, that’s like taking four trips for the price of one. (BOGOGOGO, you heard it here first) And the value per point would be as follows:

Retail price: $9,163 – $1,200 seaplane = $7,963. (subtracted seaplane since it was not paid with points)

$7,963 / 370,000 points = 2.1 cents per point. 2.1 cpp again comes in better than the 1.25-1.5 cpp by booking through the Chase portal, for example. This math however doesn’t really factor in the 30% transfer bonus we received from sending AMEX to Bonvoy, so in reality we had to earn 54,000 less points than this. New math:

$7,963 / 316,000 points = 2.5 cents per point. So if you can snag a better bonus on your transfer – the redemption improves.

Technically free – but still expensive to be in the Maldives

This section is part disclaimer, part “I’m just in awe.” We did save a ton of money on the booking by leveraging credit card rewards, but by no means is this an inexpensive trip. Just like it took a lot of flight hours (12 to Dubai, 5 more to Maldives) and jet fuel for us to arrive at our island hotel in the middle of the Indian Ocean, the shipping logistics to supply the island with everything needed to run it are also significant.

The entire island runs off diesel-powered generators. Every bottle of Evian water, bag of chips, and cut of 500+Day Grain Fed Tajima Wagyu travels a long way to get there. The staff live on the island in separate housing 24/7, so not only their salaries but their housing costs are borne by the tourists. The villas, boardwalks, and buildings, with the ocean lashing against them every day, require constant maintenance and upkeep. For divers (we are newbies!), what a luxury to have an on-island dive team! But guess what? Their expertise is a valuable commodity that has to be paid for, whether or not they’re offset by a paying guest booking a dive that particular day. All of these premiums are passed along to the consumer.

I may be stating the obvious with all this, but hey it’s a personal finance blog and I felt I had to close the loop here on a post with “Free” in the title. You can certainly shave big dollars off the tab using credit rewards strategies, but it is a destination that one has to count the cost for. That said, I’ll leave you with this: if you are interested in this bucket-list destination… I don’t need to sell you on how it’s worth every penny.