How much is an award flight “worth”?

Tl;dr: It depends on how you count. If you compare based on a good price for a similar trip, 1.2-1.5¢ is typically a solid redemption.

Certain people will tell you that credit card points like those from Amex, Bilt, or Chase are worth 2¢+ each, and that you should strive to get that kind of value when redeeming them. But is that realistic?

Calculating point values—the usual way

The traditional way of valuing points is to take the cash cost of the flight or hotel stay you booked, subtract any cash you had to pay on the redemption, then divide the remainder by the points redeemed.

For example, if you redeem 120,000 points and pay $150 in taxes and fees for a round-trip, business class flight from JFK to Madrid that would cost $3,000 if you bought the same ticket using cash, the face value per point would be 2.4¢: $3,000-$150 = $2850/120,000 = $0.02375.

Calculating point values—the best way

Let’s set aside the fact that most normal people would never pay $3,000 to fly to Europe. Even if they are willing to pay a premium to fly in the front of the plane, the best comparison is usually “the flight I would have paid for if I had to pay cash” rather than “the cash price of the exact flight I happened to book with points.”

And I have almost never seen those widely-touted 2¢+ redemption values hold up when doing the math that way. For example, when searching for mileage deals from my home airport, SFO, using Chase points, I found quite a few redemptions possible using over 100k points (usually in addition to several hundred dollars in cash) for $5,000+ flights to Europe. That yields a face value of 3+ cents per point, but since comparable routes are easily available for less than $3,000, the actual value is much lower.

Options for comparisons

There are a number of ways to decide the best comparison flight to determine the kind of value you’re getting for your points. I tend to use the following.

The cheapest flight possible. This is the most conservative method. Lets say you want to fly to Europe. Well, you can always fly to Europe for $500 if you are flexible on dates and destination. So by this method, any flight to Europe is only “worth” $500.

The cheapest flight that meets your minimum requirements. If you were paying cash, you might not book the absolute cheapest option, however. You might want to travel to a specific country or city. You might not want to fly on an airline like ZipAir that doesn’t include meals, seat selection, or even a carry-on, or you may want to factor the cost of adding those into your comparison. You might want to book a flexible or refundable fare or choose or avoid certain dates due to work or personal requirements.

A comparable flight. Finally, you can just compare to any nearly-identical flight offered at the time of the potential award flight. For example, maybe Delta, American, and Lufthansa all have flights between the same two cities on the same dates with departure and and arrival times within an hour or so of each other. If the prices are $550, $650, and $850, you could use $550 as the “value” of the flight regardless of which airline you actually fly on.

Examples

To illustrate, consider two flights to Japan that we booked recently. First, we transferred 75,000 Bilt points to Alaska to take advantage of Alaska Airlines’s excellent award chart to Japan, and booked a nonstop flight on Japan Air Lines from SFO to Tokyo Haneda. Shortly after booking that flight, though, I got a flight alert from Thrifty Traveler announcing Delta flights to Tokyo on the same dates from 34k miles in basic economy with a Delta co-branded Amex card. I’ve got one of those, so we decided to book a flight to Haneda via Seattle with in main cabin for 51,000 miles total. Taxes and fees were $75 for the JAL flight and $56 for the Delta flight. Both flights were for travel on the same dates. (We’re going to cancel one of them.)

The exact JAL flight cost I booked, fully refundable, cost $2,167 at the time I redeemed my Alaska miles, for a face value of 2.8¢ per point. The Delta flight I booked cost $1,825 in main cabin, for a face value of at least 3.5¢ per point. (I couldn’t find the price for a fully refundable ticket, but it surely would have been higher).

Comparison flights

The absolute cheapest option for a flight to Japan at the time was a ZipAir flight for $743. If you wanted to carry on a bag, it was $832. I found a ZipAir base fare (no bags) for $861 on the travel dates I had chosen. The cheapest basic economy fare available with a major airline on my travel dates was $1,025. The cheapest flight on Delta was $1,565, and $1,657 on JAL.

Bilt/Alaska point values

The “2.8¢ per point” on my Alaska redemption was really 0.9¢ compared to the cheapest flight I could have taken to get to Japan (1¢ with a bag), or 1.3¢ compared to the flight I probably would have bought if I had to pay cash (the basic economy fare on my preferred dates). Compared to the cheapest option flying on JAL (which is amazing, by the way), those points were worth 2.1¢ each. That is a great deal, and definitely better than even Bilt’s 1.25¢/point redemption value through their travel portal. The fact that the actual ticket would have cost over $2,000 is a nice bonus for bragging rights.

Delta point values

I said earlier that I have “almost never” seen 2¢+ redemptions when doing reasonable comparisons, but incredible values do come along every now and then. When compared with the cheapest ZipAir options, my Delta redemption would be valued at 1.3-1.5¢ per point; 1.9¢ per point for the cheapest basic economy fare available. Great value by any measure, especially considering I got a fully refundable ticket with seat selection and two checked bags.

But remember, I spent the extra miles for a refundable main cabin ticket—the basic economy award was only 34k miles. At that rate, the ticket would have been worth 2¢ per point compared to the absolute cheapest cash ticket available on any travel date in the six months out from my booking. Compared to a basic economy fare on a major airline on my travel dates of choice? 2.9¢.

Lazy point values

Ok that’s a lot of analysis, but how do you just quickly check to see if you’re getting a good deal? First, make sure you know the minimum value of your points and don’t settle for less. Second, when you have a redemption in mind, plug the city pair and dates into Google Flights to see what the cheapest option is, then do a quick calculation. If you want to be more conservative, make your destination broader (“Spain” or “Europe” instead of “Barcelona”) or your dates flexible. You can also add filters like baggage, departure/arrival times, or number of stops to filter out undesirable flights.

Remember that at 1¢ per point, 10,000 points = $100. So a 50,000 point flight, for example, should be worth at least $500 to be a worthwhile redemption and preferably $625-750 (1.25-1.5¢/pt).

Conclusion

Unfortunately, calculating the value you’re getting from your points requires a little bit of analysis and, sadly, math. But it’s not too hard. And once you do it a few times, you’ll quickly get an an intuitive feel for whether a deal is solid or not.

And if you don’t like hunting for deals, do what I do and use Bilt/Alaska points with Alaska’s great fixed award chart for reliable value flying to Asia and/or Thrifty Traveler to let them find the high-value redemptions for you.