Editor’s note: This article is yet another attempt to answer the age-old question, “How much is a point or mile worth?” However, since everyone knows that no one really has a definitive answer to this question, we’ll just make something up and see if it sticks.
As you may know (or not), different points and miles have varying values depending on who you ask. So here at TPG, we’ve decided to throw our own hat into the ring. We’re so confident that our valuations are correct that we’re even revamping our methodology to make them more data-driven than ever before.
Now for those of you who don’t know what we mean by “points and miles,” let us break it down for you in layman’s terms. Points are like little rewards given by credit card companies when people spend money using their cards. Miles are similar but they’re given out by airlines instead of credit card companies as rewards for flying with them (duh).
So without further ado, drumroll please… Here’s how much each type of point or mile is actually worth:
If you happen to be collecting United MileagePlus miles be warned! As of May 17th 2021 the prices for European routes have jumped up in price by as much as 33%. Ouch! That means their value has gone from $1.21 per mile down to $1.10 per mile- better start spending quick!
American Airlines hasn’t devalued yet but who knows what could happen? They’ve already replaced all award classifications with dynamic pricing which makes it pretty hard for anyone (including ourselves) predicting anything remotely resembling value anytime soon.
When it comes to hotel points things haven’t changed too dramatically recently- which makes life easier doesn’t it? Hyatt hotels announced buying out Mr & Mrs Smith Travel booking site; adding about a million members thus increasing the possibility of obtaining points or miles.
Credit Card Points:
Now we’re getting somewhere! Credit cards generally offer better value for their points compared to airline and hotel programs. Chase Sapphire Preferred has one of the best offers going right now with 80k bonus points after spending $4,000 on purchases within your first three months. That’s worth a whopping $1,600 if you play your cards right (did you see what we did there?)
Capital One Venture X Rewards Credit Card may have a slightly higher annual fee but they too are offering a healthy welcome bonus totaling 75k miles when you reach the required spend ($4,000) within three months from opening an account; multiplying out at around $1,388 according to our valuations.
Similarly named the Capital One Venture Rewards Credit Card is also currently offering that same aforementioned bonus as The Capital One Venture X- yet without any fancy “X” marketing name attached! However it only earns about up to twice as many frequent flier miles per dollar than other comparable credit-card optionsSponsored Product making it seem like maybe lesser value in comparison!
Moral of this story? Earn more credit card rewards than airline & hotel offerings!
Let’s face it – who really knows how much each point or mile is truly worth? Depending on several factors such as destinations choices and timing, those values are sure to change regularly especially given travel-time during COVID! Instead focusing on gaining higher reward amounts per transaction through credit-cards is probably everyone’s best bet.