Finding Value in Points

In Credit Card Currencies, I highlighted why credit card points provide more accrual potential through category bonuses and more flexibility because of the multiple transfer partners with each currency.  I also wrote briefly on how Singapore Airlines’s frequent flyer program, KrisFlyer, is a transfer partner with all four credit card currencies and also offers some very valuable redemptions.

But the Singapore Airlines KrisFlyer program is just one example.  There are a ton of transfer partners and redemption options, so I wanted to highlight a few other tips that may help fellow infrequent flyers.

I find the most value in Chase Ultimate Rewards points.

I love Chase Ultimate Rewards points because they are the only 1:1 transfer partner with United Airlines, which is what I often earn through my personal and work travel.  Being in Washington, DC, the major international airport is Washington-Dulles (IAD).  Dulles is a hub for United Airlines, and many of United’s Star Alliance partners also fly into Dulles airport.  So I am naturally biased towards redemptions on the Star Alliance partners, such as United Airlines, Lufthansa Airlines, Austrian Airlines, ANA, etc.

But I also see value in Chase’s other transfer partners as well.  Chase is transfer partners with British Airways, which has an awards chart based strictly on the distance between the departure and destination airports.  This differs from most airline award charts, which charge the same amount for flights within or between geographic regions, such as within the continental United States or between the United States and Europe.

So what?  That means that transferring Chase Ultimate Rewards points into the British Airways frequent flyer program can provide for some great redemption values.  For example, using British Airways frequent flyer miles (called “Avios”), Taryn and I were able to fly roundtrip in economy class with Aer Lingus (an Irish partner airline with British Airways) from Washington-Dulles to Dublin, Ireland, for 26,000 points each.  That’s roughly the same amount for a roundtrip domestic award ticket with American Airlines, Delta Airlines, or United Airlines.

Korean Air is another transfer partner with Chase Ultimate Rewards.  They are a member of the SkyTeam airline alliance and you can redeem their miles on other SkyTeam partner airlines, such as Delta, KLM, Air France, or China Eastern Airlines.  Korean Air also releases much of its award space only to members of its frequent flyer program, which can be very advantageous.

In addition to having valuable transfer partners, credit card currencies periodically provide transfer bonuses to frequent flyer programs.

The main example is with SPG Starpoints.  When you transfer 20,000 Starpoints into one of the program’s airline partners, SPG will provide a 5,000 point bonus, meaning your frequent flyer program will receive a total of 25,000 miles.  This also means that when you transfer 40,000 Starpoints, SPG will give 10,000 additional miles as a bonus.  The best part is that it works with any of their transfer partners, and you can earn the bonus anytime you transfer points.  Taryn and I milked this bonus when transferring Starpoints into our Alaska Airlines frequent flyer account, even though we had never flown Alaska Airlines.  Why?  Because Alaska Airlines is an airline partner with Emirates Airlines, and we redeemed 82,500 Alaska Airlines miles each to fly in Emirates Airlines business class to the Maldives (check out our full story here).

SPG isn’t the only credit card currency that has transfer bonuses.  Periodically, both American Express and Citi offer up to 30% bonuses for transfers into various frequent flyer programs, including Virgin Atlantic, Cathay Pacific, JetBlue, and Air Canada.  Unfortunately, these bonuses are often for a limited time only, and the public doesn’t know whether or not they’ll be available again.  So while a 30% bonus is fantastic if it means you would have enough points to book a trip that you were hoping to take, it’s not always wise to speculatively transfer points to a frequent flyer program, which brings me to another tip.

Frequent flyer programs devalue their award charts every so often, while credit card currencies change much less often.

For example, Singapore Airlines released an update to their award chart in late 2017.

Old Singapore Airlines Chart
Old Singapore Airlines KrisFlyer Award Chart.
New Singapore Airlines Chart
New Singapore Airlines Award Chart effective December 2017

Yes, it’s a bit of an eye chart.  Luckily, many of the award costs remain the same, including economy and business award travel between North American and Europe (on potential Star Alliance partners United, Lufthansa, Austrian, Swiss, Scandinavian Airlines, etc.).  Award flights between North America and South America (on Star Alliance partners such as United, Copa Airlines, or Avianca Airlines) also remain unchanged.  That’s a plus.

However,  I’ll flag a few key changes in the North American redemptions to Asia and Africa.  The prices for one-way economy redemptions increased between 3,000-9,000 miles, with the biggest price hike to North Asia 2 (China, Japan, and Korea).  Not too bad. However, the real killer is with business and first class award tickets.  One-way prices between North American and North Asia increased by 17,500 miles in business class, and then 25,000 miles in first class.  For a pair of roundtrip business class tickets, that’s an extra 70,000 miles you’ll need to come up with.  Yikes.

Every airline will eventually devalue its award chart, which is why its a better idea to keep your points in credit card currencies rather than transferring them prematurely into a frequent flyer program.  You could save up United Airlines or American Airlines miles for years, only to have the goal posts move on you just before you’re able to redeem.  That sounds miserable; please don’t do that.

Credit card points allow you to book multiple one-way awards on a variety of airlines rather than being beholden to the rules and prices of a single airline’s frequent flyer program.

I don’t even want to think about how many United MileagePlus miles it would have cost to book our around-the-world adventure in business class.  Easily hundreds of thousands of miles each.  Even if I had a nice stockpile of points, it would have taken us YEARS to earn enough points to book everything with United miles.  Plus, that also means we would have only be able to redeem flights with Star Alliance airlines or other United partners.  As I’ve mentioned, I love the Star Alliance… but certain areas and destinations in the world aren’t as easily accessed by Star Alliance airlines.

Which is why having a diverse portfolio of points and miles can provide the most flexibility when going to book an award trip.  Maybe you have 60,000 American Airlines miles.  That’s enough miles for a roundtrip economy ticket to Europe and back.  However, 60,000 miles is also good for a one-way business class ticket to Europe.  With one credit card signup and a little more spending, you could easily earn 60,000 points in one of the other credit card currencies, which could then be transferred to an airline for your return business class airfare from Europe.  And since you would have the 60,000 points in a credit card currency, you could transfer them to the airline with award availability for the particular dates you have in mind.  So rather than searching for award space on two dates with one airline (roundtrip economy class ticket on AA), you 1) have much more flexibility when redeeming and 2) are traveling in business class.  That’s a win-win in my book!


You should be able to see how much more beneficial credit card points are then frequent flyer miles.  Next, I’ll explain a few strategies to use when searching for award space.

1) Ground Rules

2) But My Credit Score…

3) Credit Card Currencies

4) Finding Value in Points

5) Award Availability

 

 

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