The True Value of Your Points and Miles: It Really Is All About You

Some points and miles websites take a stab at estimating the value of the currencies of airline miles, hotel points, or flexible credit card points. For example, The Points Guy website puts out a monthly post with updated values for the miles and points of dozens of programs. Having paid careful attention to my own points and miles redemptions for almost a decade, I would describe these TPG valuations as very rough estimates. In my experience, American or United miles tend to get me a little more than Delta miles. Hyatt points tend to buy more than Hilton, Marriott, and IHG points. So, my personal rank ordering of those currency values matches those from that website even though the actual values I get in point and mile redemptions can vary a great deal.

Recently, The Points Guy announced a “data-driven valuation” based on a “proprietary formula.” The approach included an analysis of 23,000 data points, a weighting algorithm, and “extensive validation testing.” Apparently, the folks at The Points Guy believe there is a great deal of precision in this “updated methodology” as the new valuations are reported down to one-twentieth of a cent (or 0.0005 dollars).
 
Gary Leff of the View From the Wing website described these new valuations as “nonsense built on stilts.” He pointed out the difficulty of saying that points or miles are worth a certain amount of money when your use of miles or points is constrained, but money can be used for things other than travel. He is not saying that miles have no value, he just disagrees that you can simply use a straight division of miles into an airline ticket cost to determine a per mile value.
 
I have a different concern about the TPG methodology. My concern is that, despite the 23,000 data points and proprietary alchemy, they are providing no more than a one-size-fits-all average. We would never say all American men are five feet, nine inches tall. In fact, only a minority of American men are 5’9”; this figure is an average of men of varying height. Similarly, the average mile or point values provided by TPG might only apply to a minority of people playing the miles and points game. This is certainly a place where the expression “your mileage may vary (YMMV)” applies.
 
Numerous factors can influence variation in per point valuations. As an example, say there are two women who have identical profiles with respect to travel goals, credit cards held, spending patterns, etc. However, one lives in Charlotte, North Carolina (an American hub) and the other lives in Atlanta (a Delta hub). The relative value of American and Delta miles for each woman will probably be different. Now imagine both women live in the Atlanta area and both are loyal Delta flyers. However, one uses her Delta miles for domestic flights to visit her grandchildren during holidays and the other uses her miles to fly to Europe off season. Again, they are likely to see different values when they redeem their miles.

To bring this closer to home, when using Delta miles post-COVID, I have struggled to get the per mile value suggested by TPG and other websites. Perhaps, it is a function of where we fly with our Delta miles or how Delta structures award travel to and from our home airport. At the same time, Ms. Optimizer and I fare much better with our redemptions for travel to Europe and, happily, easily surpass the TPG valuations for using miles and flexible points for these flights.

The bottom line is that points and miles valuations can vary as much as individuals. Every client we encounter is unique, so each Travel Rewards Optimizer plan is completely custom. We do not provide “one size fits all” solutions because the value you will derive from your miles and points can be influenced by where you live, where you want to travel, when you want to travel, and a range of other factors which we take into consideration.
 
It really is all about you (and you are certainly not average).

We are ready to help you turn your routine credit card spending into the travel of your dreams.