Credit Cards

How Much Are Credit Card Points Worth

By David Krug David Krug is the CEO & President of Bankovia. He's a lifelong expat who has lived in the Philippines, Mexico, Thailand, and Colombia. When he's not reading about cryptocurrencies, he's researching the latest personal finance software. 5 minute read

Points and miles earned at a faster pace don’t matter nearly as much as the value of each one. A fresh travel credit card application might feel like comparing apples to oranges. Just because one card has a better sign-up bonus and rewards rates doesn’t guarantee you’ll gain more value from using it.

So, what’s the monetary value of credit card points? It is determined by the card’s rewards program. This is what you need to know about various incentive systems and how much you can expect to gain out of each point or mile you earn.

What’s the difference between miles and points?

If you use a credit card to earn points or miles, these are just other terminology for the incentives you might get. JetBlue Airways and Southwest Airlines are two examples of airlines that don’t utilize miles but instead use points. Currency miles are a term used by several general travel credit cards, including the Capital One Venture Rewards Credit Card.

You may earn points for your hotel loyalty program by using a credit card, on the other hand.
It is easy to tell how much credit card points are worth depending on the sort of rewards program your card has because the two phrases are more about terminology. Here, we’ll focus on the many types of travel credit cards available, including those issued by major airlines and hotels.

Travel cards of all kinds

As a rule, general travel credit cards don’t provide dynamic value scales, but rather static ones. The value you get when redeeming points or miles for travel vs cashback is the same regardless of how you redeem them. There are a variety of general travel reward programs offered by major credit card companies. Since you’re not bound to a certain airline or hotel chain, you may use your points to book flights, hotel stays, or car rentals through the credit card company or one of its travel partners.

How to get the most out of your rewards

Redeeming for travel is the greatest method to get the most out of your travel credit card points. The Chase Sapphire Preferred card’s 60,000 points are worth $600 in cashback or $750 when used to book travel through the Chase Travel Booking Center. It’s not always the ideal strategy to redeem your points for travel through a general rewards program, though. It is possible to get more value out of your points and miles by transferring them to travel partners, such as airlines, hotels, or both.

Ineligible for awards in this manner

Redeeming points or miles for cash or gift cards is almost never a smart option because general travel credit cards give the best value for travel-related redemptions (if you can help it). If you’re looking for more freedom in redeeming your points, you may be better off with a cash-back credit card than a card that offers points. Check out our guide to the top cashback credit cards for more information.

Airline credit cards

Loyalty programs for airlines, as opposed to other forms of travel incentives, offer points or miles with fluctuating values. To put it another way: Depending on how you redeem your points for flights, the monetary value of your rewards might vary. Additionally, when airlines make adjustments to their incentive schemes, the value of airline points and miles might diminish over time. It’s recommended not to hoard airline rewards, but rather to earn and use them as needed.

Here’s an average of what you may anticipate getting from your airline rewards based on your booking method.

Best way to redeem airline miles

There’s no one-size-fits-all strategy for getting the most out of your airline reward points. However, if you have a certain location in mind, try to be flexible with your flight dates to see if you can get a higher redemption value.

On international flights, first-class tickets tend to be more valuable per point or mile. You may redeem your airline points for the luxurious experience, but only if you’ve got a lot of points to spare. Use your arithmetic skills to figure out how much money you’re saving by booking your ticket with miles.

Consider the various bonuses that your airline credit card may provide, as well. Some credit cards give gratis checked bags for you and up to eight other passengers, while others offer complimentary tickets to the airline’s lounge, as well as a variety of additional benefits.

Worst way to redeem airline miles

Consider paying cash or switching airlines if you’ve already varied your points and find a redemption rate that delivers a lower value than the average. Also, if you’re seeking to get the most out of your airline miles, don’t redeem them for anything other than free trips.

Hotel credit cards

Credit cards for hotels, like those for airlines, provide you access to flexible rewards programs with points that fluctuate depending on how you book your free hotel stays. When with frequent flyer programs, hotel points can lose value over time as hotel chains change.
On the other hand, below are the average rewards you can anticipate receiving from some of the most popular hotel companies.

Redeeming hotel points in this manner is the best option.

Make the most of your hotel points by scouting out a variety of options and being flexible with your travel plans. With a large brand, you may be able to choose from a variety of assets, allowing you to optimize the worth of your points. Additionally, the value of points varies depending on when you book, much like nightly prices.

Always double-check your bookings to ensure that you’re receiving a better deal than the average. A free anniversary night with no spending limits, like the IHG Rewards Club Premier Card, is another option to explore.

It is the worst way to redeem hotel points.

There may be better redemption options available if the value you receive from redemption is below average. It’s true that you may spend your points for other items through hotel rewards programs as well, but you’ll get the most value by using them to receive a free stay.

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