Lesson 1:
Maximize the value of your points
On the surface it may seem like every rewards program earns at the same rate of roughly 1 point per penny of spend, so that must mean that every point or mile is worth 1 cent, right? WRONG.
Points and miles vary in value
Major airlines miles hover around 1.2 cents per mile
Hotel groups are the most variable with most major chains coming in at a measly 0.5 cents per point, with the exception being Hyatt at 1.5 cents per point (3x better)
While the above may sound compelling, the best place to start is a credit card that has multiple rewards program “transfer partners”
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What’s a transfer partner and why is it better?
American Express, Capital One, Chase & Citi premium travel cards have multiple hotel and airline partners connected to their respective rewards programs (Membership Rewards, Rewards Miles, Ultimate Rewards & ThankYou Points).
Despite having different names, they’re all much closer in value to another than airlines or hotels will be. More importantly, they give you flexibility and options when booking rewards. Flexibility is useful when booking travel during peak times. Instead of committing to a single airline or hotel, you can choose a route or a room based on availability and current offers.
Let’s explore transfer partners
Below is a chart showcasing transfer partners across the top card brands. As you can see there are various ways to get to some partners while others are exclusive to a specific financial institution. Once you complete this course I’ll share a link to this sheet, which you’re welcome to make a copy of so you can highlight eligible partners based on your credit cards.
Flexibility is key here. For most of us, it’s better to have points that can go to various partners instead of being locked into one. That said, you should consider signing up for a specific partner card if you have a significant and consistent spend with that airline or hotel chain and you have no choice but to continue using that airline or hotel. Outside of that edge case, you should accrue generic points and transfer them if and only if you’re ready to redeem them.
🔑 To be crystal clear, desirable points will come from cards like the Amex Platinum or Gold, Capital One Venture cards, Chase Sapphire cards, or the Citi Premier card. Whereas co-branded cards from hotel chains or airlines will accrue specific points that aren’t as easily transferable, and thus not as valuable for someone who is getting started. Another note is that most retail co-branded cards are not worth it, since their intro bonus is just a coupon for your first purchase.
Kinkaku-ji Golden Pavillion, Kyoto, Japan
Making the most of your points Tomorrow we’ll talk through my strategy to optimize spend and accrue points quickly. Before we get there, let’s talk about maximizing the value of each point. There are three aspects to keep in mind.
Who accepts these points? If you really value a particular airline, hotel, or destination, you may have specific points that are more valuable to you than others. For instance, I’m becoming a bigger fan of Hyatt hotels meaning that my Chase rewards points (as per the chart above) are slightly more valuable to me.
Are there any transfer bonuses that I’m eligible for? Transfer partners occasionally run promotions encouraging you to proactively send points from your credit card to their specific program. I typically would advise against speculative transfers, but if it’s a program you’re consistently using then it may be worth it. Better yet, if you have flexibility in your booking, you may want to consider an alternate airline to take advantage of a transfer bonus. See AMEX transfer offers below:
Is a “sweet spot” available? This is where the magic happens. Inconsistent rewards charts across airline alliance partners lead to redemption arbitrage opportunities. We call these sweet spots, and they’re super easy to find with a quick Google search, but they’re not always easy to book. I’ll detail a favorite sweet spot each day, starting with Japan.
American Express Membership Rewards transfer partners
🍬 Sweet Spotlight: ANA First or Business Class (US → Japan)
Business and first class tickets are always exciting, but I find the Asian and Middle Eastern airlines truly excel in creating a world class flight experience. The most memorable flight I ever took was a first class route from Los Angeles to Tokyo on a flight where I happened to be the only passenger in the first class cabin. The cabin crew went above and beyond to make me feel special, especially after I shared with them that it was my first time riding in the front. While it will be difficult to recreate that, every moment was savored and despite having a lay flat seat, I couldn’t sleep a wink out of pure excitement.
The Deal
Through Virgin Atlantic, you can book an ANA First class flight for 110-120k points round trip or ANA Business class for 90-95k points. The first class flight from NYC retails for ~$25k, so this sweet spot yields an unfathomable $0.21 per point. Another joy of this deal is that it can now be booked as a one way, so you can be more flexible when searching for availability.
ANA First Class
But wait, there’s more
We got so excited about the sweet spot that we neglected to check if Virgin Atlantic has any transfer bonuses. A quick search shows that Amex is offering a 30% bonus, meaning every 1,000 points converts to 1,300 miles. Thus requiring only 93k points, bringing the value to $0.27 per point. Before you transfer your stash, note that the transfer bonus is only valid until 9/30/22 and finding ANA availability via Virgin for more than one person is VERY difficult, so couples and families beware. Solo travelers, click here to learn how to book this award.
If you’re set on going to Japan during a specific time frame, that deal isn’t for you. Instead I would simply transfer my miles to ANA directly and book Business Class through them. It’s not a $0.27 per point redemption on paper, but it’s still a world class experience that’s far more valuable than booking anything in your card’s travel portal or redeeming points for gift cards or cash back.
💳 Credit Card Review | Capital One Venture X®
At the end of each lesson I’ll review one of the marquee rewards cards. Let’s start with a newer entrant that won me over due to its simplicity and generosity when it comes to authorized users. Capital One’s Venture X card is as straightforward as a premium rewards card can be.
BENEFIT (my estimate value of the benefit) ( = requires enrollment)*
75k bonus points after spending $4k in the first 3 months ($750)
10k bonus points each anniversary ($100)
$300 annual travel credit ($300)
$100 every 4 years towards Global Entry ($25)*
Lounge access for you and guest + up to 4 authorized users ($50/card)*
I cannot overstate how valuable the lounge access has been for me, and how nice it is to issue a card to my mother as an authorized user so she can have access to the lounges without having to worry about paying the annual fee or taking advantage of other benefits.
🍵 Spill the Tea
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❤️ Love Notes
Great job – started from the top, now you’re here! A quick disclaimer, I’m not a financial advisor and this isn’t financial advice. This mini-course took hours to put together, special shout out to all who helped edit and those of you who choose to share it.
Editorial Disclosure
Opinions expressed here are the author's alone, not those of any bank, credit card issuer, hotel, airline, or other entity. This content has not been reviewed, approved or otherwise endorsed by any of the entities included within the post. The content on this page is accurate as of the posting date; however, some of our partner offers may have expired.
🐰 Continue Down the Rabbit Hole?
Lesson 1 is in the bag. How about you try Lesson 2 on for size? Continue here…
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