CREDIT CARD REWARDS: What Are Points & Miles Worth? (Credit Card Rewards Explained)

From hotel points, air miles, and bank points, it’s easy to get confused by it all. Learn how much your points are worth and if you got a good deal on your redemption so you can travel the world for FREE (or close to it)! Click “Show More” to see Ad Disclosure. 📲 MAXREWARDS - Manage credit cards & rewards! Get Gold level for free with PROMO CODE = markr http://markscreditcards.com/maxrewards 💳👉VIEW CREDIT CARD OFFERS! https://markscreditcards.com/offers 🛍 RAKUTEN - Earn Cash Back! http://markscreditcards.com/rakuten ‼️ GET FREE STOCKS FROM WEBULL when you open an account & deposit $100: http://markscreditcards.com/webull SETTING THE STAGE – PART 1 - All points are not equal. 1 Chase point ≠ 1 Amex point ≠ 1 Citi point 1 Marriott point ≠ 1 Hilton point ≠ 1 Hyatt point - All miles are not equal. 1 American mile ≠ 1 United mile ≠ 1 Delta mile SETTING THE STAGE – PART 2 BANK POINTS usually have FIXED VALUES for cash back + travel portal bookings. Examples include: - Chase Ultimate Rewards points - Amex Membership Rewards points - Citi ThankYou points - U.S. Bank Altitude points Examples of CASH BACK redemptions with bank points issued by 3 major banks: Amex Membership Rewards - 0.6¢ per point (All cards | Statement credit) Chase Ultimate Rewards - 1.0¢ per point (All cards | Statement credit or deposit to checking / savings account | Pay Yourself Back feature yields a greater value) Citi ThankYou points - 0.5¢ or 1.0¢ per point (Depends on the card you have | Statement credit) Examples of TRAVEL PORTAL redemptions with bank points issued by 3 major banks: Amex Membership Rewards - 0.7¢ per point (All cards | Hotels, car rentals, cruises, vacations) - 1.0¢ per point (All cards | Flights) Chase Ultimate Rewards - 1.0¢ per point (Chase Freedom Flex, Chase Freedom Unlimited) - 1.25¢ per point (Chase Sapphire Preferred card, Chase Ink Business Preferred card) - 1.50¢ per point (Chase Sapphire Reserve card) Citi ThankYou points - 1.0¢ per point (Citi ThankYou Preferred, Citi Rewards+, Citi Premier Card, Citi Prestige Card, Citi Custom Cash Card, Citi Double Cash Card) AIR MILES & HOTEL POINTS usually have VARIABLE VALUES at all times. Examples include: - American Airlines AAdvantage miles - Delta SkyMiles - Marriott Bonvoy points - World of Hyatt points WHY? 2 main reasons… - The number of miles or points required for a given redemption can change - The cash price covered by those points or miles can change HOW TO CALCULATE THE VALUE OF POINTS & MILES [(Cash Price) ÷ (Points or Miles Price)] x 100 = Value Per Point - Note 1: For Cash Price, include taxes + fees if the points or miles cover them, otherwise subtract them out. - Note 2: Value Per Points is expressed as ‘cents per point’ EXAMPLE 1: Hotel | IHG Points | Kimpton Seafire Resort + Spa - Cash Price = $1,597.89 - Points Price = 70,000 - Value = 2.3¢ per point - Rating = Good Redemption per TPG comparison (see below) EXAMPLE 2: Flight | Delta SkyMiles | JFK to FCO, Round Trip - Cash Price = ($3,812 - $70) = $3,742 - Miles Price = 435,000 - Value = 0.86¢ per mile - Rating = Bad Redemption per TPG comparison (see below) EXAMPLE 3: Gift Card | Amex Membership Rewards points | $50 Target gift card - Cash Price = $50 - Points Price = 7,143 - Value = 0.7¢ per point - Rating = Bad Redemption when compared to Travel, or Good Redemption when compared to Cash Back per TPG comparison (see below) WAS THE REDEMPTION A GOOD VALUE? - Compare YOUR VALUE vs. AVERAGE VALUE from The Points Guy (TPG) at thepointsguy.com - Direct Link: https://thepointsguy.com/guide/monthly-valuations - NOTE: TPG’s average values are best used for comparing air miles, hotel points, and bank points when redeemed via transfer partners. SUMMARY 1. Do a cent-per-point calculation 2. Compare the result to TPG’s average value 3. Determine if it’s a good, average, or bad redemption IF the redemption is average to good THEN consider doing it! IF the redemption is average to bad THEN consider paying cash to save your points / miles for a future redemption where you get greater value & save more money FINAL NOTE Even if it’s a “bad” redemption, it can still be worth doing, especially if you don’t want to spend cash or don’t have the cash available. This entire exercise is to help you understand the value of your points & miles and to make an informed decision as to whether you want to use them now vs. later. Disclosure: This site is part of an affiliate sales network and receives compensation for sending traffic to partner sites, such as CreditCards.com. This compensation may impact how and where links appear on this site. This site does not include all financial companies or all available financial offers. The content in this video is accurate as of the posting date. Some of the offers mentioned may no longer be available. Mark Reese is not a financial advisor. #creditcardrewardpoints #chaseultimaterewards #amexmembershiprewards