What are Points Actually Worth?

Valuing Hotel Points and Airline Miles – What Makes Cent$?

In the Free Travel Game, one of the most important things to remember is the concept of ‘VALUE‘ – Compared to simply accumulating points because they seem like a high sign up bonus.  For example, 40,000 Hilton Points may SOUND like a lot, but in many cases, thats just enough for one night hotel stay in a big city.  Conversely, 25,000 Hyatt Points can get you into an All Inclusive (Drinks AND Food!) Resort in the Caribbean.   The same goes for Airlines.  Many have a static redemption based on which cities you are flying to & from – but a few like Delta and SouthWest have more Dynamic pricing.

A Quick Example:

The Following is some of the Airlines that are 25,000 for a Round Trip Flight with in the Continental US:

  • American Airlines
  • United Airlines
  • Alaska Airlines

Alternatively, Southwest and Delta will fluctuate based on the season, # of connections, and demand for a specific flight.  This can actually benefit you, as one who is flexible can simply opt for the ‘best value‘ flights, and do a search with a ‘Flexible / Calendar View’ to pick out their optimal dates.  Additionally, many airlines neuter their points programs by only offering the ‘Saver Seats‘ at less than ideal times, or making good flights less available with points.

International Flights are similar, though every airline has a slightly different cost in points for getting from  the US to your end destination.

So How Do We Determine ‘Value?’

Simple:  It’s Cost of the Flight in Dollars, divided by the Number of Points Required:

Cost $ / Points = Value

Example:  a $400 Flight that costs 25,000 points will be worth $.016 , or 1.6 Cents Per Point.  This is the basis for which you’ll  decide if something is a good deal or not.  Since every program values points differently, how do you know if you’re getting a good deal or not ?   Fear Not, someone else has already done the benchmarking work for us!

 

Property of Pointimize.com

For Airlines, the values are a bit more nebulous depending on if you’re doing domestic vs International travel, Biz/1st Class or Econ.  I don’t try to re-invent the wheel, so here’s one sample of what average ‘Travel Hacking’ Bloggers thing various miles are worth:

Property of View From the Wing

As you can see, even the ‘Pros’ disagree to some extent… I think SW Points are actually pegged to 1.5 or 1.6 cents per mile, and tell people a flight’s ‘value’ should be around 1.4 if all goes well.

With that being said… In the end, the only number that really matters is how valuable it is to YOU!  If you’re flying on a limited vacation adventure, you probably want to pay more (in miles) for a better flight that will save you hours on an airport layover that would cut into your travel time.  We chose sending 75,000 of our Chase Ultimate Rewards Points to United for example, since getting a NON STOP flight to San Francisco from Cleveland was more VALUABLE than then traveling 8.5 hours with a toddler.

 

Another example of how to find the best VALUE on Hotels
Another example of how to find the best VALUE on Hotels

Do you have questions about how to squeeze the most value out of the airline points you already have?  Ask them in the Comments Below!

 

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