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Cards and Points point valuations

You might be wondering what your miles and points are worth. At Cards and Points, we publish point valuations of major points currencies to help you make better decisions about how to earn and use your miles and points. On this site, we publish two different valuations:

  • Redemption value – This number is based on the cash price of the median redemption. Use this number to gauge whether your point redemption is better than average.
  • Valuation – This is the number we use to compare credit cards and rewards points against cash back. Use this number if you’re weighing credit card welcome offers or earning points.

We use these point valuations across our site when talking about the value you can get from your credit cards. And we update these numbers continuously.

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About out point valuation methodology

We believe that simpler is better and the valuation methodology on this site reflects that. Here’s how it works:

It all starts with redemption value

All of our point valuations are based on the value you can get for your points when you redeem them. When you can redeem points for cash or cash-like awards (such as a statement credit to offset a travel purchase) we use that number for redemption value. If you can redeem 10,000 points for a $100 cash award, the redemption value is 1 cent per point.

Sometimes, you can’t get cash from your points directly. In these cases, we will try to find the most cash-like point redemption option that is a good option for most people and publish a redemption value based on that. For example, sometimes you can redeem points through a portal for hotel and airline bookings at a certain amount of cents per point. If you can redeem 10,000 points for a $125 travel booking, the redemption value is 1.25 cents per point.

If you can’t get cash out of your points, we will compare the cash prices against the cost of the most common award redemptions in points to figure a redemption value. For airline programs, we’ll look for the median value of coach redemptions within the United States, since that represents most of the airfares that our readers book. For hotels, we’re going to compare nights at vacation and large city destinations within the United States.

That’s pretty much it.

We apply a discount factor to find the valuation

Not all rewards currencies can be redeemed for cash. To account for this, we apply a discount factor to all rewards currencies that can’t be redeemed for cash. This discount adjusts for the fact that restrictive credits are worth less than cash. After all, would you rather have $100 cash or a $100 airline gift card? The discount also adjusts for the fact that often points are redeemed somewhat inefficiently. If you have Marriott points to spend, but the Hilton across the street is offering cheaper cash prices, you’re giving up some value by using your points.

This discount factor is usually based on the secondary market for selling gift cards. You wouldn’t trade $500 in cash for a $500 airline gift card that you had no immediate plan to use. But you might buy it speculatively if you are offered a generous discount. Frequent flyer miles and hotel points typically can’t be traded or sold. But prevailing rates in the gift card market give a good approximation of the difference between face value and the cash value of points.

Card synergies and transferable points

Chase Freedom Flex credit card
If you hold a Chase Freedom credit card, you can get additional value from your points if you also hold the Sapphire or Sapphire Reserve cards.

Some credit cards synergize with others, allowing you to get increased value if you hold multiple cards. Transferable point programs like Chase Ultimate Rewards, Citi ThankYou Points and Amex Membership Rewards allow you to increase the value of your points through point transfers to travel partners. How are these cases handled?

With Chase Ultimate Rewards, you can always get one cent of cash back out of each point. But if you hold the Chase Sapphire Preferred, you can redeem points for 25% more value for travel. And if you hold the Chase Sapphire Reserve, that increases to 50% more. This is why we publish multiple valuation variants. When talking about the Chase Freedom cards, we use the Base Value tier of the Chase Ultimate Rewards.

With respect to transferable points, we don’t make assumptions about your travel patterns in my valuations. The vast majority of people simply won’t spend hours searching through award travel availability in international airline loyalty programs to discover that rare international first class redemption opportunity. Most people also won’t be able to rearrange their schedules to travel opportunistically to Bali because a cheap ticket is available two weeks from now. Further how much any given person would actually pay in cash for that ticket is highly variable. There is too much variability here to create a valuation that has any use to a large swatch of my readers. Instead, we talk about transfers to partners as opportunities to get more value from your points.

Opportunity cost of travel redemptions

Yes, there is some opportunity cost of redeeming rewards for travel through a travel portal. If you redeem Chase Ultimate Rewards for travel through the portal, you’ll lose some value. You won’t earn Ultimate Rewards points on those travel purchases. We’ve made the deliberate decision to leave this out of my valuations. We don’t believe the additional precision is worth the complexity.

Beware false precision

Speaking of prevision… we publish our numbers to two decimal places reluctantly. And the reason is Chase Ultimate Rewards. Chase markets its Sapphire Preferred card is offering “25% more value” when you redeem for travel through its portal. If our valuation of Chase Ultimate Rewards for mid-tier premium cards displayed as “1.3” we would be overwhelmed by feedback point out that our valuation is incorrect. Just don’t read too much into that second decimal place. Take that last decimal place with a grain of salt.

Bottom line

Cards and Points valuations show you both how much and what the points are “worth” when comparing them to cash back rewards. It’s a tool that you can use when making your own value calculations about credit cards.

About the author

  • Aaron Hurd

    Aaron Hurd is a credit card, travel rewards, and loyalty program expert. Over the past 15 years, he has authored over a thousand expert contributions published by leading outlets including WSJ, TIME, Newsweek, Forbes, NerdWallet, The Points Guy, Bankrate, CNET, and many others. He has also served in consulting roles for many of these same outlets, designing content strategy, hiring teams of teams of editors and contributors, developing thought-leadership pieces, and ghost-editing for senior editors. Aaron is well-known in the miles and points community and regularly presents about travel rewards at conferences like the Chicago Seminars and Minnebar. Aaron has enjoyed the game of optimizing credit card rewards since getting his first credit card shortly after he turned 18. He started learning about credit cards and travel rewards from the (now defunct) FatWallet Finance forums and FlyerTalk. He holds more than 40 open credit cards and has first-hand experience with almost every major credit card product.

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