Introducing, Forward of the Wing’s brand-new Redemption Value Calculator.
Use this calculator to calculate the redemption value of your Airline Miles, Credit Card Reward Points and Hotel Loyalty Points.
But what is Redemption Value? And why is it important? Below, I will cover all you need to know.
What is Airline Mile and Loyalty Point Redemption Value?
Redemption Value is the value of the Airline Miles, Credit Card Reward Points or Hotel Loyalty Points you wish to redeem for a specific redemption opportunity. It is the value of the non-cash paid value of your points, in relation to that specific redemption.
The higher the value per mile or per point, the more valuable that redemption is, and the more value you get from your hard-earned points or miles. Different loyalty programs have different redemption value rate ranges, depending on a multitude of factors.
Airline Miles
For airline loyalty programs, this can include origin and destination, flight distance, cabin, travel dates (peak and off-peak) as well as which airline. All of these factors will adjust the redemption value, unless your airline loyalty program works on a fixed rate redemption basis (Air New Zealand for example).
Hotel Loyalty Points
For hotel loyalty programs, cities and country, specific hotel, hotel brand or hotel chain, travel dates and room type can all affect the redemption value.
Capital cities tend to be more expensive than other cities in most countries, and so hotel rates (both cash and points redemptions) tend to be higher. However, that doesn’t mean large cities can’t represent great redemption value opportunities for Hotel Loyalty Points. Several big hotel chains give you a “Free 5th night” for points redemptions (including Hilton and Marriott Bonvoy), which automatically increases the redemption value by 25% versus paying for all 5 nights. Additionally, some hotels will run sales for hotel loyalty point redemptions (such as Marriott Bonvoy Pointsavers), where you can also get some great deals on amazing hotels. I recently stayed at the W Bangkok using Pointsavers, which represented excellent redemption value versus cash.
Credit Card Rewards Points
For credit card rewards points, redemption value varies wildly between direct redemptions and indirect redemptions. Rewards points also vary massively between different credit cards with different banks. Direct redemptions are those points redemptions directly through your banks’ membership program. Examples include point redemptions to reduce your credit card bill, travel booked directly through your credit card rewards program, or shopping rewards. Indirect redemptions include transferring your credit card rewards points to other loyalty programs including airline loyalty programs and hotel loyalty programs. Often, you can get better value for indirect redemptions than direct redemptions. For example, business class or first class flight redemptions booked through airline loyalty programs (in conjunction with reward point earning bonuses on your credit card) can yield really great value.
The Beauty of Airline Miles and Loyalty Points
The beauty of airline miles and loyalty points lies in how you can get to experience the best luxury travel experiences including business class and first class travel, and hotel stays in some of the most luxurious hotels, all over the world, for cheap or for free. There are millions of ways to earn these miles and points, and Forward of the Wing only scratches the surface on some of the best ways. Redemption Value is the key to making the most of these miles and points, and compare different redemption options against another. Flying in business class or first class (often for less than the cash price of economy), or having an extra special hotel stay for a special occasion, such as your honeymoon, a big birthday or wedding anniversary, makes memories that you will always remember.
How to Calculate Redemption Value
Check out Forward of the Wing’s brand-new Redemption Value calculator, to make it easy and quick to calculate Redemption Value across all airline loyalty programs, hotel loyalty programs and credit card rewards points.
You can find Forward of the Wing’s Redemption Value Calculator here:
You will need the following inputs:
- Cash Price of Flight/Hotel Redemption ($/£)
- Number of Reward Points/Airline Miles Required for Redemption
- Any Cash Co-payment ($/£)
Cash Price of Flight/Hotel Redemption ($/£)
This is the price you would pay if you decided to buy the redemption opportunity you are looking at, outright with cash. It’s important to look at this before you decide to book, as sometimes its just not worth booking a flight or hotel with points. This is because the cost (and Redemption Value) is low for that particular redemption. Especially for economy flights or some hotel redemptions, this can happen. Some luxury hotels have a much lower redemption value than mid-tier or lower-tier hotels. Redemption flights and hotel stays for most programs do not earn airline miles or loyalty points, or tier points or status credits, so bear this in mind. One loyalty program that does is Marriott Bonvoy – you earn elite night credits on redemption stays but not Bonvoy points.
Consider multiple redemption alternatives for your trip. And compare the Redemption Value of those alternatives, to find the best value redemption.
Number of Reward Points/Airline Miles Required for Redemption
This is the number of Airline Miles, Hotel Loyalty Points or Credit Card Reward Points require for the specific redemption you are looking at. Some loyalty programs will offer co-payment options where you can use less points or miles, and a higher co-payment if you are just short of the required number. Use our Redemption Value Calculator for both options to compare Redemption Value, as often they will differ.
For Airline or Hotel Loyalty Programs with flexible cash co-payments (such as the British Airways Executive Club), simply add in the number of airline miles or rewards points required for your specific redemption. Make sure to test out different points and co-payment options, as they will often have vastly different Redemption Values.
I recently booked a hotel redemption for a Marriott Property, the W Bangkok, where the co-payment option had a significantly lower Redemption Value than using just points for the entire stay. I was just short, and there was a sale on buying points, which meant I ended up getting a much higher Redemption Value for the Points I did use, when I bought the points I needed separately.
Any Cash Co-payment ($/£)
Cash co-payments are any additional airport fees and/or airport taxes, or the cash cost of topping up hotel loyalty points or airline miles in order to have the required amount of miles or points for your redemption. If you are using all points with no cash co-payment (often the case with Hotel Redemptions), leave this field blank or 0.
In the Marriott example above, I would input the cost of the Marriott Bonvoy points I bought, which would calculate the Redemption Value of the Marriott Bonvoy Points I used for the specific hotel redemption.
With just these three components, Forward of the Wing calculates the Redemption Value on your airline miles and points. Helping you to maximize Redemption Value across all your Airline and Hotel Loyalty Programs.
Unleashing the Potential: How to Maximize Redemption Value
The biggest secret is: Be Flexible. Flexibility with dates, times, destinations, cabins, cities, and hotel locations will yield vastly different Redemption Values.
Luxury hotels, some of the costly in the cities you are visiting, may not offer the highest Redemption Value opportunities. Low-tier or mid-tier hotels may have much better options. Cash cost is not always an indication of Redemption Value.
Airline Miles
For airlines, consider other airlines within your airline alliance of your airline loyalty program. You can often book flights with them on points, often with different Redemption Value sweet spot flight routes to your native airline. Distance-based airline redemptions are a great sweet spot for expensive flights with airline alliance partners, if there is award flight availability.
For example, within the oneworld airline alliance, British Airways Executive Club is a distance-based airline loyalty program. Even if you don’t hold British Airways Avios, you can transfer Credit Card Rewards Points from most banks to British Airways for flight redemptions. Short-haul, monopolistic regional routes or routes with little competition, on oneworld carriers represent great redemption value usually, as the cash price tends to be high. Within the US, regional flights with American Airlines or Alaska Airlines can represent great value. Other options include domestic Regional Australia flights with Qantas. These are obviously subject to award availability with oneworld partners (including British Airways), but it is possible.
Hotel Loyalty Points
For Hotel stays, look at different hotels within the same city you intend to travel to. If you have Hotel Loyalty Points with a particular Hotel Chain (such as Marriott Bonvoy) you can look at different hotels within their portfolio.
City Stays
For city stays, look up neighbourhoods within your intended destination and shortlist your hotels based on proximity to transportation, proximity to activities, and, to the best of your knowledge, neighbourhood safety. Sometimes mid-tier hotels can also have higher redemption values than luxury hotel brands, so it’s worth considering. Being flexible on hotels could save you thousands of Hotel Loyalty Points, and you will still end up with a fantastic trip.
Destination/Resort Stays
For destination trips, it will require a bit more research, but it’s still very doable. In the case, the hotel is usually the destination, not the city or surrounding activities, and so it’s important to consider your hotel or resort as the destination. There are a few great hotel chain resorts located around the world to uncover, but usually the lesser popular destinations are best (and quieter). The “Stay 5 nights pay 4 nights” rule is great to take advantage of here, so you and your loved ones can properly relax. Afternoon pool swims. Cocktails. Lazy breakfasts. Everything you need and want on holiday.
Generally, the resorts in Asia and South East Asia can tend to represent better value Hotel Loyalty Point redemptions than those in the Caribbean or Indian Ocean, but there are many variables that can impact this. Hotel redemptions during peak times including school holidays and peak holiday periods can make for great redemption value options, where there is availability. Consider different options within your Hotel Loyalty Point budget, the cost of transport to the resort or hotel, available dates and activities, to find suitable options that work for you.
Credit Card Reward Points
Sometimes Airline and Hotel Loyalty Programs have lucrative transfer bonuses for credit card reward program members. If you have a specific redemption opportunity in mind and are a member of one of these credit card reward programs, often with many transfer partners, it is worth considering these special time-limited offers. Not all Airline and Hotel Loyalty Programs are created equal, and so there may be some transfer partners that don’t represent good value. Examine your options and be open minded. As most flight and hotel redemptions do not earn airline miles or hotel loyalty points or tier points or status credits, if you have points or miles to use up, consider various alternatives of both direct and indirect redemption opportunities (with airline or hotel transfer partners).
Discovering Hidden Gems: Lesser-Known Redemption Opportunities
As I mentioned above, be flexible. Get off-the-beaten-track.
When it comes to redeeming your hard-earned airline miles and loyalty points, the world is your oyster. Beyond the popular options (most popular cities, hotels, resorts, destinations) that most travelers are familiar with, a universe of lesser-known redemption opportunities awaits, brimming with extraordinary experiences and unexpected delights.
Inspiration
For some off-the-beaten track inspiration, I have another article on all the different destinations within each distance band for British Airways Avios redemptions. There are so many destinations there I had no idea they flew to. These off-the-beaten-track holiday destinations generally have more redemption available as they’re less popular. This means more dates, flight times and more chance of premium cabin availability, if you are looking to experience flying in premium economy or business class. On your next trip to Europe, why not consider Ljubljana, Bari, Sardinia, Reykjavik or Minorca? All great holiday destinations, with something unique to offer besides the classic European holiday cities such as Paris, London or Rome.
City Break or Resort Stay?
The same is the case with hotel stay points redemptions. Marriott has some fantastic hotels in destinations outside (and sometimes inside) major cities and tourist destinations, where you can find cheap hotels, or great value redemption opportunities. Sheraton Lombok is one of those resorts out of the way, however there are also a few great redemption value Marriott brand options in Bangkok and Kuala Lumpur. I will be covering some great redemption value opportunities using Marriott Bonvoy Points over the coming months in different regions around the world, so keep an eye out for that.
In all, keeping an open mind with dates, holiday destinations and routes for your airline miles and points redemptions allows you to get off-the-beaten-track. You can have new and unique experiences, often with less tourists, so you can enjoy your holiday with your loved ones more.
Credit Card Rewards Points: Transfer Partnerships
Credit Card Rewards Points are rewards points earned through your credit card that are part of the bank’s own reward scheme (such as American Express Membership Rewards Points). These can be used for direct redemptions (such as reducing your credit card bill or travel). However, you often get greater redemption value from indirect rewards, which is when you transfer these Credit Card Rewards Points to Airline Miles or Hotel Loyalty Points schemes.
To compare redemption value for different redemption options, from Credit Card Rewards Points you can use our Redemption Value Calculator. Check the transfer point rate from your bank’s reward scheme website.
To use Forward of the Wing’s Redemption Calculator with Credit Card Points:
Cash Price of Flight/Hotel Redemption ($/£)
Cash Price of the Flight or Hotel you wish to book. This should be from the direct Airline or Hotel Chain (such as Marriott) website.
Number of Reward Points/Airline Miles Required for Redemption
This is the number of Credit Card Rewards Points you need to redeem to have enough Airline Miles or Hotel Loyalty Points to make your redemption. To calculate this:
Number of Airline Miles or Hotel Loyalty Points divided by Rewards Point Transfer Rate
For example, for a US American Express Membership Rewards to Delta flight redemption, the transfer rate is: 1,000:1,000. This means you will receive 1,000 Delta SkyMiles for every 1,000 American Express Membership Rewards Points. In this example, it’s easy.
Any Cash Co-payment ($/£)
Add in any cash co-payment for airport taxes and surcharges for flight redemptions, or any co-payment for hotel stays. For fully-points hotel stay redemptions, this field might be zero.
Using these inputs for our Redemption Value Calculator will give you the redemption value for your Credit Card Rewards Points. This is super helpful for comparing whether you should use your points for flights (across different airline loyalty program transfer partners and/or flight routes) or hotel stays (across different hotels, destinations and hotel chain options).
Conclusion
When it comes to airline miles and loyalty point redemptions, the possibilities are truly endless. Redemption Value is about maximizing the value you get from your airline miles and loyalty points, for redemptions that work for you and your schedule.
With limited redemption availability, heading to off-the-beaten-track destinations often can give you more flight and hotel redemption availability. Sometimes these flight routes can be more expensive on a cash basis, and so for distance-based loyalty programs, when there is availability, these “regional” routes can have a high redemption value. High redemption value hotel stays in off-the-beaten-track destinations can mean cheaper holidays, often with less tourists, without compromising quality, or enjoyment.
Be sure to use the Forward of the Wing Redemption Value Calculator to check out and compare the redemption value of your next redemption opportunities. Our calculator works for Airline Miles Flight Redemptions, Hotel Loyalty Point Hotel Stay Redemptions and Travel booked with Credit Card Rewards Points.