hyperbling

i've racked up over 100k UR points on my CSP and i've been trying to book a flight to europe. i'm super new to all this miles earning/spending so naively i thought i could easily redeem at 4 cents per point because i read it in a blog somewhere. as most of you already know, award redemptions are hit and miss.

long story short, my points are worth 1.4cpp for the time frame i'm looking to use them in...

but that's only if i book through united, and other airlines have cheaper options.

i also found out that in one of the popular travel sites if you book flight+hotel they give you insane discounts, such that the total cost is LESS than booking the flight alone.

all of this makes me doubt whether UR points really are worth that much....because to maximize their value you have to a) wait until united/ba/korean is cheaper than competitors, b) super saver award availability, and c) not have discount packages offered.

do the stars ever align like that? what's the cpp should i settle for as "good enough"? thanks.

redtop43

I'm not sure I would look at it as "cpp value" per se. That would imply that if you get an overseas biz class ticket for 100K points that would cost $3000 it's not as good a redemption as if the same ticket cost $8000.

Many people feel that the best use of rewards points are for international premium cabin tickets, but yes, you have to find "saver" level availability. United's search engine is pretty good, but especially if you are traveling in the high season, you might have to either book way in advance or at the last minute. I did find a first-class ticket for low miles for my wife's annual trip to Europe in August, but I booked it last October. I'm not familiar with KE's search options. BA has very high surcharges on some routes through LHR, but if you use your BA avios to fly on AA you will avoid these.

Getting the miles/points is just half the game, using them is the other half. There are award booking services that for $100 a ticket (more for some, less for others) will find you availability if it's to be had.

Packages do present a savings, but usually only as great a savings as you're saying if the paid tickets on that particular itinerary happen to be unusually high.

If you don't feel you can get a good redemption value for your 100K points now, save them for another time. If you've been saving them for this particular time and failed to plan far enough ahead, unfortunately it's just a lesson not learned soon enough, but maybe you need to engage one of the booking services.

One final thought, the best search on each alliance is not necessarily the most obvious. I'm not sure, but I think that ANA (*A), Quantas (OW) and Air France/KLM (ST) are the best, and you might want to open accounts with them so that you can use their search engines. In other words, if you want flights on KE, you're better off searching for them on AF/KLM (Flying Blue) than on KE itself.

welookgood.com

I have the options to cash out 100k Chase UR pts for 1.33 Cents a Pt. Will use the $1330 toward my mortgage as prepayment (not that I need to, but figure why not). My annual fee is soon due, so keeping the pts as is, lose me the annual fee.

I know you can transfer to United /Hyatt (but have lots of miles on both of them) so wanted to get others opinions on if I'm doing that am I losing a lot of value? In the past, I have used it for Amtrak awards as well (helped save me a bunch of money) but have been traveling much less recently and figure I can just get Amtrak card in future.

TOMFORD

I wouldn't. Unless you really need the money.

I value UA miles at >2 cents each. ~2 domestic flights, which I rarely redeem. And 3-4 for US-China in BizFirst.

JWEMTX

Ultimately, you have to decide what you value the most. It seems you already mentioned that you don't really need to put the money towards the mortgage, I'm just curious why you don't want to travel? Maybe you can transfer the points for a vacation as birthday/anniversary/whatever occasion present to yourself or your friends/family.

I've thought about paying more each month towards my mortgage so I can pay off the house sooner... but then I realize I'll lose out on the tax deductions sooner, too. So I'm happy to have a mortgage.

terpfan101

Ugh...as a CPA this reasoning for not paying off a mortgage sooner is maddening! I'm not faulting you because it's something I've heard countless times. Here's an example:

Let's say you have a mortgage with an average principal balance over the course of one year that is $200,000. Your interest rate after refinancing is 3.5%. Over the course of the year your interest cost is $7,000 ($200K x 3.5%). Assuming you're in the 35% tax bracket and in a state where the tax rate is 7% (I'm ignoring the impact of the deduction for state taxes on your federal return), the tax savings would be a combined 42% which is equal to $2,940. Thus the after-tax cost of borrowing is $4,060.

However let's assume that you could pay off an additional $20,000 during the year resulting in an average balance of $180,000. Your interest paid would be $6,300. Right there that is $700 less paid in interest. On the $6,300 using the same tax rates, your tax savings would be $2,646 for an after-tax cost of $3,654.

So while you're tax savings goes down by $294 (and thus you owe $294 more in tax), your after-tax savings is $406 ($700 less $294). Thus as far as overall savings with regard to taxes you're almost always better off paying down the mortgage faster!

The better question to ask is could you be better off putting that money elsewhere and with a fixed rate of 3.5% my guess is more likely than not you could, however with this comes risk, ie. you could invest it in the stock market and earn 25% or you could lose 25%.

KennyBSAT

Unfortunately not. AA flights to Europe have the same surcharges as BA when booked with BA Avios.

eltex

So you started by bashing his idea on not paying off the mortgage, and then you say yourself it is probably not a good idea anyway. I am a big fan of mortgages, as it gives you additional leverage for other things in your financial life. Putting up $300K and paying cash for a house can break you short-term, and keep you down with limited flexibility in the long-term. I say borrow for everything, use bluebird to pay your mortgage, and maximize your points every month. If you need additional ways to earn points, you can pay my mortgage too.

augustus21

The surcharges on AA to Europe are not as high as BA, but still insane just for the "luxury" of connecting through LHR. I'll stick with UR transfers to UA.

highops

Long Answer: Well, the floor on value is clearly 1 cent since you can cash them out. If you fly much at all the real floor is 1.6 cents or so since you can get that much for them on Southwest Airlines.

For an upper bound you can get 6+ cents per point if you transfer to UA for a pricey flight and were going to pay cash for that flight and class anyway.

I have used them for 1.25 cents to buy travel, but don't do that anymore. Since I'm not flying to Europe in the next couple years I try to get around 2 cents a point on Hyatt or United redemptions. I try to be careful about Hyatt since I might be able to find a less expensive hotel. Is it worth 15,000 points to avoid a $300 charge when the hotel next door is charging $150?

Short answer: I try to get 1.6 cents each or more for them.

PainCorp

Yeah, the charges are not YQ, but rather LHR charges.

Kat007

I personally get the best value when redeeming on premium cabin on international flights, it is about 5.8-13c/point. Also, I find it quite reasonable to redeem on Hyatt with an average value of 3c/point.

Do you get more out of UR?

redtop43

A lot of people will express the same sentiment I'm about to - it's not the posted price, it's the value to you.

For example, if you can get a $700 Hyatt room for 22K points (quite possible) that's a notional value of 3.2 cpp. But suppose you can get a room on Priceline for $150 that you personally value as only $70 less valuable than the Hyatt room. That makes the true value 1cpp.

Same for premium cabin travel. If the airline says it's worth $12,000, but you would only pay $3000 for it, it's worth $3000.

That said, yes, most people would agree that premium cabin international travel at saver level is one of the most efficient uses of award points, and Hyatt tends to be a good value depending on the location, but often for their most prime locations it's very good.

jmw

Inflated, ridiculous, and absurd valuations for premium international flights. You would never part with that much cash for a premium cabin. Would you pay a lowly $2000 for a RT flight to Europe in C? Honestly, I would not unless I was on pain meds every few hours.

I also believe the hotel valuation is probably inflated as well since it is likely you can find a cheap Priceline deal at an acceptable 3 or 4 star quality level. If you choose 5 star, pick a cash amount you would be willing to pay.

Kat007

I don`t find it absurd when getting RT to Europe on LH for $5.9K cash for 100K points in Business or $13K and sometimes up in First for 135K.
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