December 21, 2025 • 28 mins
The 2026 travel landscape reveals that transferable credit card currencies currently provide the highest utility and protection against frequent loyalty program devaluations. While major airlines and hotel chains have shifted toward dynamic pricing models that often lower the baseline value of their specific rewards, flexible points from providers like Chase and American Express consistently maintain a higher valuation of approximately two cents per point. Experts suggest that travelers can combat rising travel costs by focusing on "sweet spots," such as luxury hotel stays or international premium cabin flights, which yield significantly better returns than basic domestic redemptions. To safeguard against the erosion of purchasing power caused by inflation, the guide recommends an "earn and burn" strategy rather than long-term hoarding. Ultimately, the most successful strategy in the current market involves prioritizing versatile rewards programs that offer the freedom to move assets between various travel partners as needed.
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Episode Transcript
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Speaker 1 (00:00):
Welcome back to the deep dive. If you're with us,
you're here because you know that information is power, especially
when it comes to your hard earned travel Ruwars. I mean,
if you've ever sat down to book that amazing trip
with Miles only to see the points requirement like triple
right before your eyes, you know what we're talking about.
Speaker 2 (00:20):
So absolutely, it feels less like a currency and more
like a riddle that keeps changing. The answer it does,
and the sources you've provided for twenty twenty six they
really confirm it. The whole landscape isn't just shifting a little.
It's undergoing this huge foundational chain.
Speaker 1 (00:36):
A structural transformation exactly.
Speaker 2 (00:38):
It's all being driven by these massive devaluations, dynamic pricing
becoming the norm, and just general economic volatility. The old
rules of hord and weight they're actually working against you now, Okay.
Speaker 1 (00:50):
So let's unpack this. Our mission for this deep dive
is to give you a clear playbook. I need to
pull out the most critical valuations, the surprising data, and
the real strategies from this material. We need to figure
out what value even means in twenty twenty six, and
that all important sense per point number and lay out
the non negotiable ways to still get that affordable luxury
(01:12):
trip even with all.
Speaker 2 (01:13):
These headwinds, and in the context is just it's everything.
Twenty twenty six is defined by these huge program changes
and the fact that dynamic pricing is everywhere.
Speaker 1 (01:23):
So the award cost just follows the cash price up.
Speaker 2 (01:25):
Precisely, and then you throw inflation on top of that,
and it just fundamentally messes with the value of every
single point you have.
Speaker 1 (01:32):
So before we get into nitty gritty, the main takeaway
right up front has to be this, points in miles
are still incredibly powerful. Well for sure, they're still the
best way to get into that business class seat or
that five star hotel, but you have to be smart
strategic earning timely redemptions. They're not optional anymore. They're prerecord bits.
Speaker 2 (01:51):
That's the core thesis, and it can be a painful
adjustment for a lot of us who've been in this
game for a while. The era of just passively stacking
points and hoping for the best, it's over.
Speaker 1 (02:01):
So we're moving from hoarding to strategic deployment.
Speaker 2 (02:04):
Exactly, always always prioritizing the assets that give you the
most options.
Speaker 1 (02:10):
All right, So let's start with the basic math of
the game. When we talk about maximizing value, we are
always coming back to one number, sense per point or CPP.
For anyone listening you's trying to get their head around this,
let's define it perfectly. Okay.
Speaker 2 (02:24):
So sense per point is basically the cash value you
get back for every point you use. It's the report
card that tells you how well you did.
Speaker 1 (02:32):
And the calculation is simple, right in theory.
Speaker 2 (02:34):
Yes, you take the cash price of the flight or hotel,
you subtract any fees you still have to pay, and
then you divide that number by how many points it costs.
The result is your CPP.
Speaker 1 (02:45):
So if a flight is say one thousand dollars cash,
but I can use one hundred thousand points to book it,
my valuation is exactly one cent per.
Speaker 2 (02:53):
Point, exactly. But the sources note that this metric often
reflects the value when points are redeemed optimally, and that
word opt is doing a lot of heavy lifting.
Speaker 1 (03:02):
Mare, I was going to say that sounds like a
big if.
Speaker 2 (03:03):
It really is. And this is where the expert insight
from the material is so vital. All redemptions are not
created equal, not even close.
Speaker 1 (03:12):
So you have your average redemptions, and then you have
your your home runs.
Speaker 2 (03:15):
Right, the average value for say, hotel points can be
pretty low, maybe half a cent per point, because people
use them for a quick night at an airport hotel
or for gift cards.
Speaker 1 (03:24):
Which is a terrible redemption by the way.
Speaker 2 (03:26):
Almost always. But then you have the targeted redemptions, the
home runs. Yeah, that's where you find the real leverage.
The sources highlight that premium cabin flights we're talking international
business or first class or luxury resort stays can push
your value to five cents per point or even higher
five cents.
Speaker 1 (03:44):
Yes, that's a five fold increase over just taking a
standard one cent cash back redemption.
Speaker 2 (03:49):
A tenfold increase over the average hotel point redemption. It's massive.
And on the flip side, using your points for statement
credits or merchandise almost always gets you less than one cent.
That's literally throwing away value.
Speaker 1 (04:02):
So the goal is clear, we need to earn points
that give us a high floor, maybe one point seven cents,
but let us hit that three to five plus cent ceiling.
Speaker 2 (04:11):
That's the game.
Speaker 1 (04:12):
Okay, Now let's talk about the headwinds, the forces. In
twenty twenty six that are actively trying to push that
value down.
Speaker 2 (04:18):
The first, and it's the biggest one, is this double
whammy of devaluations and dynamic pricing. For years, the whole
system was built on fixed award charts. You knew New
York to Tokyo and business class costs seventy thousand miles period.
Speaker 1 (04:33):
It was predictable, you can say, for a goal exactly.
Speaker 2 (04:35):
But now major programs Delta, United, Hilton, Marriott, they've pretty
much thrown those charts out the window.
Speaker 1 (04:41):
And with dynamic pricing, the award cost is just tied
directly to the cash.
Speaker 2 (04:45):
Price, right, So when the cash price for a flight
shoots up for the holidays, the points price shoots up
right along with it. It basically eliminates the main benefit
of points, which was to protect you from that peak pricing.
It just introduces massive uncertainty.
Speaker 1 (04:58):
No wonder people are frustrated. The promise was always collect
x miles, get why trip. Now it's collect x miles
and maybe you'll get a trip if the algorithm is
in a good mood that day.
Speaker 2 (05:09):
And that's compounded by the second headwind, which is inflation.
This one's a little more subtle, but it's just as powerful.
Speaker 1 (05:15):
Okay, so this is the indirect evaluation. Let's use a
concrete example to really break this down.
Speaker 2 (05:19):
Let's take that seventy thousand mile business class flight in
twenty twenty four. Maybe the cash price was fifteen hundred dollars,
so your redemption value was about two point one cents
per mile, a very good redemption.
Speaker 1 (05:31):
Okay, makes sense.
Speaker 2 (05:32):
Now fast forward to twenty twenty six. Because of inflation,
the cash price for that exact same flight on that
exact same plane is now eighteen hundred dollars.
Speaker 1 (05:42):
But if the ward chard is still fixed, it still
costs seventy thousand miles correct.
Speaker 2 (05:47):
So on paper, your sense per point value just went
up to almost two point six cents.
Speaker 1 (05:51):
It looks great, it does, but I feel like there's
a catch.
Speaker 2 (05:54):
The catch is that the traveler feels poor. Your points
are buying the same physical seat, but that seat is
now a smaller percentage of the overall rising cost of travel.
Your points purchasing power has been indirectly eroded.
Speaker 1 (06:07):
That's a great way to put it. So you have
direct devaluation the airline literally charging more miles, and indirect
devaluation where inflation just makes your points feel less powerful.
Speaker 2 (06:18):
And this is clearly why public perception has soured so much.
The sources point to these surveys showing that thirty four
percent of travelers that's more than one in three, feel
their points are less valuable than they were just two
years ago.
Speaker 1 (06:31):
That's huge number.
Speaker 2 (06:31):
It is they're seeing the dynamic prices, they're feeling the inflation,
and they're concluding that the game is just getting.
Speaker 1 (06:38):
Harder to win. So, okay, this sounds pretty bleak. Rising costs, volatility,
a third of travelers feeling like they're losing. But this
is where the source material introduces this really powerful idea
of the buffer solution.
Speaker 2 (06:50):
And this is where it gets really interesting. This is
the pivot from frustration to actual strategy. The buffer solution
is all about using transferable currencies points.
Speaker 1 (07:00):
From the major credit card issuers, Chase, American Express, Capital,
Ones City, and the new one built exactly.
Speaker 2 (07:07):
These currencies are the crucial buffer against every single trend
we just talked about.
Speaker 1 (07:11):
But why are they a buffer if Delta devalues its miles,
aren't the bank points also at risk?
Speaker 2 (07:17):
They are, but the risk is diversified. That's the key.
If Delta devalue Sky miles tomorrow. Your Chase Ultimate rewards
points are totally fine because they're still sitting with Chase.
Speaker 1 (07:27):
They're not committed yet.
Speaker 2 (07:28):
Right, you can still transfer them to a dozen other
partners who haven't devalued, like World of Higatt or Air Canada.
They give you options, They let you sidestep the worst evaluations,
and that optionality is why they are, without a doubt,
the highest value assets in the entire game.
Speaker 1 (07:44):
So the strategy for twenty twenty six isn't loyalty to
a specific airline, but loyalty to a flexible credit card program.
Speaker 2 (07:50):
That's it. You're banking with the stable central reserve, not
the volatile local currency, and the valuation data for these
top assets. It just confirms what's this dominance.
Speaker 1 (08:01):
We've established that flexibility is king in twenty twenty six.
The shift away from fixed charts means your best defense
is having points. They can be deployed at a moment's notice.
Let's talk about the idea of arbitrage here.
Speaker 2 (08:13):
Arbitrage is the absolute key to understanding high value redemptions
in our world. It's the ability to find and exploit
a temporary pricing mistake or a misalignment.
Speaker 1 (08:23):
Meaning the bank gives me a point, they value it ascent,
but I can redeem it through a partner for travel
that costs five cents.
Speaker 2 (08:30):
Precisely, that four cent difference is your profit, your arbitrage.
Transferable points let you hold your assets until you find
that window. If your points are already with an airline,
that airline can just close the window overnight and you're stuck.
Speaker 1 (08:43):
But if they're sitting with Chase or Amex, you could
just move them to whoever's offering the best deal at
that exact moment.
Speaker 2 (08:48):
And that's why all the top transferable currencies have valuations
so much higher than any single airline or hotel program.
The twenty twenty six data really proves it.
Speaker 1 (08:57):
Okay, let's get into those numbers. Starting with the highest perform.
Speaker 2 (09:00):
Leading the pack, really setting the gold standard for twenty
twenty six is Chase Ultimate Rewards. It comes in at
a stellar two point eight or five cents per point.
Speaker 1 (09:09):
That's the highest median valuation out there. But why Chase?
I mean Amex has way more international airline partners. What
gives Chase that slight edge.
Speaker 2 (09:17):
That little five hundreds of a cent difference really comes
down disability, and that Stability has a name, World of Hyatt.
The sources are clear on this. Hyatt is the highest
value hotel program, mainly because it's resisted the crazy dynamic
pricing shifts we've seen at Marriott and Hilton.
Speaker 1 (09:34):
So the reliability of their best hotel partner anchors the
whole system. Can we put a number on that? Yeah?
Speaker 2 (09:39):
Absolutely? Think about it this way. A top tier luxury hyat,
maybe a park Hyat that costs one thousand dollars a
night in cash, often only requires thirty thousand points.
Speaker 1 (09:48):
Wow, that's over three point three cents per.
Speaker 2 (09:50):
Point, far above their average, and because redemptions like that
are so consistent and predictable, it pulls the entire Chase
valuation up to that two point zero five cent figure.
So the listener it's often cited as the safest, most
consistently high value place to put your rewards.
Speaker 1 (10:04):
Makes perfect sense. Stability wins, okay. Right behind Chase is
American Express Membership rewards, valued very strongly at two point
zero cents per.
Speaker 2 (10:14):
Point right and MX is the powerhouse for international flights.
If Chase dominates on the ground, with Hyatt, AMX absolutely
dominates in the air.
Speaker 1 (10:22):
They have that unmatched roster of airline partners.
Speaker 2 (10:25):
They do, and they offer these incredible transfer bonuses, sometimes
giving you twenty thirty, even forty percent extra points when
you move them to an airline. So while the median
is two cents, an experienced user can easily push that
value to four five cents using those bonuses. The ceiling
is arguably higher than any other program.
Speaker 1 (10:43):
So Chase is reliable luxury and AMX is more high risk,
high reward arbitrage.
Speaker 2 (10:48):
That's a really good way to put it. Now, moving
on to the rising stars, Capital one miles are valued
between one point eighty five and two point zero cents.
They have just shot up the rankings recently.
Speaker 1 (10:58):
They used to lag behind, but they made a huge push.
What are the key partnerships that are supporting that high valuation.
Speaker 2 (11:04):
Capital one has been super aggressive in building out its
partner network. The source material specifically calls out their partnership
with Air Canada's Araplan.
Speaker 1 (11:13):
Program, which is a huge deal.
Speaker 2 (11:15):
It's crucial because Araplan gives you excellent, often fixed rate
access to the entire Star Alliance network. That partnership alone
is a major pillar supporting their high valuation. For a
lot of people. Capital one is now a must have
alternative to the old Chase and Amex duopoly.
Speaker 1 (11:32):
Okay, next up is City Thank You Points, valued slightly
lower at one point eight to one point nine cents,
not leading the pack, but the material says they are
essential for accessing specific sweet spots.
Speaker 2 (11:44):
Yeah. Sweet spots are those amazing deals that have somehow
survived on fixed award charts, and City has the keys
to a few of them. The source specifically mentions Virgin Atlantic.
Speaker 1 (11:54):
Yeah, what's the play there.
Speaker 2 (11:55):
Well, you can use Virgin Atlantic points to book Delta
one business class flights to Europe for way way fewer
points than if you booked directly with Delta's own sky
miles one of those weird loopholes.
Speaker 1 (12:06):
So City's value is for the savvy traveler who knows
exactly where to.
Speaker 2 (12:09):
Look for those deals exactly. It's an excellent compliment to
a Chase or Amex strategy.
Speaker 1 (12:15):
And finally, the newcomer making huge waves Built rewards value
between one point seven and two point zero cents. This
is a genuinely revolutionary product.
Speaker 2 (12:26):
It's a total game changer because of how you earn
the points. Built lets you earn points on rent payments
without paying a fee that's a massive monthly expense that
was basically off limits for rewards before.
Speaker 1 (12:37):
And they didn't just create a new way to earn
they connected it to the best partners.
Speaker 2 (12:40):
Precisely built points transferred to many of the same high
value partners as Chase and Amex, including Hyatt. By turning
Rent into a rewards engine that feeds into the best
redemption networks, Built instantly became an elite currency. They solved
a huge problem for a huge number of people.
Speaker 1 (12:58):
So across the board, the lost of these is one
points seven cents, the highest is two point zero five.
It just confirms that these flexible currencies are the only
place to be. They're the future proofing the ategy.
Speaker 2 (13:07):
It's the essential insurance policy. But now we need to
see what happens when those high value points actually get
transferred into the airline and hotel programs, because the story
changes pretty dramatically once they're locked in.
Speaker 1 (13:17):
Okay, so we're moving from the high value, liquid world
of credit cards to the specific locked in programs where
volatility is the name of the game. Let's start with airlines, right,
The domestic US carriers show a pretty discouraging range with
values hovering around one point two to one point four
cents per mile. That is a huge drop from the
(13:40):
two cent average. We were just talking about that gap.
Speaker 2 (13:42):
That point six sense. That is the price of dynamic pricing.
We can call it the volatility tax. Once you lock
your points in with one airline, you lose all your leverage.
Speaker 1 (13:51):
And they know it, and the sources say international partners
are generally the way to go.
Speaker 2 (13:55):
They are because those partner rewards often still follow fixed
or at least semi fi fixed charts that are set
by the global Alliance, not by the whim of the
domestic airlines algorithm.
Speaker 1 (14:05):
But there is one clear exception here in the US,
a leader that's bucking the trend. Alaska Airlines mileage plan
stands out with the highest valuation, hitting one point eight
to two point zero cents per mile. That puts them
on par with the credit cards themselves. How are they
doing that?
Speaker 2 (14:19):
Alaska is just a fascinating case study. Their high valuation
comes from their incredible partner network and their commitment to favorable,
often fixed, award pricing with those partners. For years, they've
been famous for redemptions on carriers like japan Airlines Cathay
Pacific QUANTUS.
Speaker 1 (14:38):
So, can we give a tangible example of one of
those Alaska sweet spots?
Speaker 2 (14:41):
Oh, definitely. The classic one is using Alaska miles to
book Cathay Pacific first Class. A cash ticket could easily
be fifteen thousand dollars. Alaska has historically priced that award
at a fixed rate around seventy thousand miles.
Speaker 1 (14:55):
Seventy thousand that's that's over twenty cents per mile.
Speaker 2 (14:58):
It's an astronomical value. And while not every redemption is
going to hit that, just the existence of these consistently
amazing partner awards pulls their entire media and valuation way
way up. It makes them one of the very few
domestic programs worth transferring your flexible points into.
Speaker 1 (15:13):
Wow. Okay, so Alaska is the one to watch. Now,
let's look at the carriers who are really feeling the
impact of dynamic pricing, the ones responsible for that one
point two to one point four cent.
Speaker 2 (15:22):
Average, right, And when we look at the major US carriers,
you can see that trend. So clearly, American advantage comes
in a little higher at one point four to one
point six cents.
Speaker 1 (15:32):
Why do they get a slight edge over United in Delta.
Speaker 2 (15:35):
It's the same reason as Alaska, just on a smaller scale.
Their strength is in their partner awards through the One
World Alliance. So while a domestic American flight can be
dynamically priced into oblivion, using your advantage miles on Qatar
Airways or jal often gets you that higher, more predictable value.
Speaker 1 (15:53):
Okay, And then we have the dynamic pricing heavyweights, United
Mileage Plus and Delta sky Miles, both right in that
one point two to one point four cent range. This
is where it feels like the goalposts are just constantly moving.
Speaker 2 (16:05):
And the sources are really explicit. Here dynamic pricing is
the single biggest factor hammering the value of both programs.
A business class ticket that was one hundred and fifty
thousand miles last year can suddenly be four hundred thousand
miles during a peak period. It makes it almost impossible
for the average person to save up for those aspirational trips.
Speaker 1 (16:23):
That one point two to one point four cent range is.
I mean, it's better than nothing, but the promise of
affordable luxury just feels out of reach.
Speaker 2 (16:30):
It often is. And then finally you have Southwest Rapid
Rewards valued very consistently at one point three cents per point.
Speaker 1 (16:38):
But Southwest is a totally different model, right. Their points
are basically just cash back tied to the flight cost.
Speaker 2 (16:44):
That's the key. The sources note they had a devaluation
in twenty twenty five, which for them just means they
increase the number of points needed per dollar of airfare,
So that one point three cent value is rigid. It's predictable, sure,
but it's kept. You'll never get those massive ten cent
per point home runs.
Speaker 1 (17:00):
Okay, So the airline strategy is clear, focus on flexible
points than target fixed chart partners like Alaska. Now let's
move to the ground game hotel points. The data shows
hotel programs have lower average values but can have these
huge peaks. Why is the average so low Two main reasons.
Speaker 2 (17:19):
First, hotel points are generally much easier to earn in
huge quantities, especially with big credit card sign up bonuses.
And second, people use them for lower value redemptions like
a single night in a mid range airport hotel, which
drags the average down.
Speaker 1 (17:31):
But the luxury redemptions can still be amazing.
Speaker 2 (17:34):
Exactly, the peaks are really high, and there is one
standout performer, the undisputed king of hotel points world of Hyatt.
It's the only one that competes with the transferable currencies
valued between one point five and two point us.
Speaker 1 (17:48):
Since and it's all about that award chart.
Speaker 2 (17:50):
It's all about the award chart. They've stuck with a
fixed category chart, and that's what protects the value. Booking
a top tier park Hyatt that costs one thousand dollars
a night for just thirty thousand points, you consistently hit
that two cent plus valuation. That predictability is worth its
weight in gold.
Speaker 1 (18:08):
Hyatt is the poster child for resisting the race to
the bottom. Okay, now let's talk about the big players
who are struggling. Marriott Bonvoy is at point seven to
point eight cents. That is a shockingly low number for
the biggest hotel chain in the world.
Speaker 2 (18:21):
And it's a direct result of them getting rid of
their award charts and embracing dynamic pricing. The sources say
they have faced huge criticism for the insane point costs
that some of their top properties. That point seven cent
value just reflects how hard it is to find that
value arbitrage anymore.
Speaker 1 (18:36):
So, if the value is that low, why are people
still collecting bonvoid points? Why are they still so popular?
Speaker 2 (18:41):
That's a great question and the answer is twofold ubiquity
and sign up bonuses. Marriott is everywhere. Sometimes you just
need a hotel where Hyatt doesn't have one. And second,
their credit card bonuses are often huge, dumping one hundred
and fifty thousand points into your account at once. So
people make up for the low value with sheer quantity.
Speaker 1 (19:00):
Quantity and necessity over quality. Got it Now? At the
very bottom of the heap, we have Hilton Honors and
IHG one Rewards, both at a pretty discouraging point five
too point six cents.
Speaker 2 (19:12):
Yeah, and this is a critical data point. A point
worth half a cent means you need two hundred thousand
points to cover a one thousand dollars hotel bill. That's
just one night at a lot of high end places.
Both programs had big devaluations in twenty twenty five that
really drove their value down.
Speaker 1 (19:27):
Does Hilton have anything going forward at that valuation?
Speaker 2 (19:29):
They do, It's mostly their promotions and status benefits. Colton
is pretty aggressive with promos and it's easy to get status.
It gives you the fifth night free on award stays.
That's a built in twenty percent discount which helps HG,
though is often the lowest of them all. It's probably
the hardest program to get real luxury value from.
Speaker 1 (19:46):
So the lesson is hammered home. If you want to
maximize sense per point, you have to prioritize earning flexible
points and then target the stable ecosystems like Hyatt in Alaska.
Speaker 2 (19:56):
That's the perfect summary of the data, but knowing the
ver is only half of it. Now we need the playbook.
How do we actually change your behavior in twenty twenty
six to hit those high values and protect ourselves from
the next devaluation.
Speaker 1 (20:10):
The volatility of this twenty twenty six market it it
demands a really strategic and adaptive approach. It's not enough
to just have a good credit card anymore. You have
to change how you earn and when you redeem.
Speaker 2 (20:21):
Right and strategy number one is the absolute foundation for survival.
Focus on transferable points. We've talked enough about Chase MX
capital one city and built. They are your safest, highest
potential investments.
Speaker 1 (20:34):
If you're starting from scratch, this is where you put
your spending.
Speaker 2 (20:36):
One hundred percent. This is where your highest floor of
value is around one point seven cents and where your
highest potential ceiling is at five cents or more.
Speaker 1 (20:43):
And the most important behavioral shift, the one that reverses
decades of advice, is the next point transfer only when necessary.
Speaker 2 (20:51):
This is the strategic antidote to devaluation. You have to
be surgical. Only move your points from Chase or AMEX
after you've found the award space, confirmed it's available and
you're ready to book it.
Speaker 1 (21:01):
That second you're minimizing your risk exposure.
Speaker 2 (21:04):
Exactly the second those points become Delta sky miles, they're
vulnerable to Delta's next surprise devaluation.
Speaker 1 (21:11):
Okay, but let's talk about the risk there. Finding the
award space is the hard part. Then you transfer, But
what if the transfer is an instant and the seat disappears.
Speaker 2 (21:19):
That is a calculated risk, You're right, But the risk
of a program wide devaluation is so much greater. And
for many of the most valuable redemptions, the transfers are
instant or near instant, like AMEX to Delta or Chase
to HYAT and United. You just have to know which
ones are quick and have a backup plan. But the
key is holding flexible points prevents a catastrophic.
Speaker 1 (21:40):
Loss confirmation first transfer. Second, that's the mantra. Okay, now
let's talk about the techniques to make sure those transfers
lead to high yield redemptions.
Speaker 2 (21:49):
The first technique is really about continuous learning, targeting sweet spots.
You're hunting for those islands of stability in the dynamic storm.
We've said their names before, World of Hyatt and Alaska Airlines,
those are your primary targets.
Speaker 1 (22:02):
Walk us through a classic airline sweepspot again, just so
the listener understands the kind of arbitrage they should be
looking for.
Speaker 2 (22:09):
Let's go back to that Alaska and Cafe Pacific first
class example. The cash ticket is maybe fifteen thousand dollars.
Alaska requires a fixed rate, say seventy thousand miles. A
similar dynamically priced ticket on another airline could easily cost
two hundred and fifty thousand miles. That seventy thousand mile
fixed rate is a massive predictable sweet spot. You have
(22:30):
to know where these fixed charts still exist.
Speaker 1 (22:32):
And the second technique, this is the most aspirational one,
is booking premium redemptions.
Speaker 2 (22:38):
This is the ultimate leverage for your points business or
first class flights are the single best way to get
those three to ten cent point valuations, Ayasa, because the
cash price jump from economy It's business is huge, but
the points jump is often much smaller. The difference might
be five thousand dollars in cash but only fifty thousand points.
That's ten cents per point on the upgrade alone. You're
(23:00):
using your points to buy scarcity and luxury, not just
a seat on a plane.
Speaker 1 (23:05):
And the third technique is about timing leverage, bonuses and promotions.
Speaker 2 (23:09):
This is a powerful immediate value booster. You should always
be watching for transfer bonuses from the credit card programs
when they offer you twenty or thirty or forty percent
extra points to a specific airline.
Speaker 1 (23:20):
So your one hundred thousand points suddenly become one hundred
and thirty thousand points with the click.
Speaker 2 (23:24):
Of a button exactly, and that thirty percent bonus instantly
inflates your effective value. Planning your transfers around these bonus
windows can be the difference between affording a trip and not.
Speaker 1 (23:35):
Okay, we have the earning and redemption strategies, let's talk
about the tools. Finding these sweet spots can feel like
looking for a needle in a Haystack.
Speaker 2 (23:42):
It can, which is why manual searching is basically obsolete now.
Technology is your best friend. You have to be using
specialized search tools. Platforms like Awardfares or Rome are essential.
They search across dozens of airline programs at once to
find that one elusive partner award seat for you.
Speaker 1 (24:00):
It saves you hours of.
Speaker 2 (24:01):
Work days sometimes, and.
Speaker 1 (24:03):
This brings up an advanced idea knowing when a hybrid
redemption is the best play.
Speaker 2 (24:08):
This is about optimizing the entire trip costs, not just
one transaction. If you find a super cheap cash flight deal,
pay the cash, save your points for the hotel. If
the hotel prices are outrageous, you use your points on
the most expensive part of the trip where they'll provide
the highest return.
Speaker 1 (24:24):
Right, don't waste fifty thousand points on a five hundred
dollars rental car when you could save them for a
three thousand dollars flight.
Speaker 2 (24:29):
Never and that leads to maybe the most important mindset
shift for twenty twenty six, the urn and burn mentality.
Speaker 1 (24:36):
It sounds a little reckless, but why is this so
critical now?
Speaker 2 (24:39):
Because of the relentless pressure of devaluation, the source material
is explicit redeem sooner, not later. The points you are
in today are almost certainly the most valuable they will
ever be. Hoaring points for a trip five years from
now is just asking for them to be devalued.
Speaker 1 (24:54):
So points should be treated like a depreciating asset, not
a savings account.
Speaker 2 (25:00):
That is the perfect way to phrase it. It's a
fundamental reversal of how we used to think.
Speaker 1 (25:04):
And finally, we have to remember the cards themselves provide
value beyond just the points, right.
Speaker 2 (25:10):
We have to factor in the credit card perks as
value boosters. We're talking about the premium cards, the ones
with the high annual.
Speaker 1 (25:16):
Fees, the Chase Sapphire Reserve, the Amex Platinum h.
Speaker 2 (25:20):
The sources note that they offer travel credits, lounge access,
elite status, all things that boost the overall value. If
you have a card with a five hundred and fifty
dollars fee, but you get three hundred dollars in travel
credits back, the net cost of holding that card is
much lower, which makes the points you earn even more valuable.
Speaker 1 (25:37):
So the entire section really reinforces the core message you
have to be flexible, where you earn, targeted, how you
redeem and fast. When you execute, you just can't be
passive anymore.
Speaker 2 (25:47):
That is the complete twenty twenty six playbook.
Speaker 1 (25:50):
So what does this all mean for you the traveler?
If we step back and look at the whole picture,
what are this say? Three big takeaways from this deep
dive into the two twenty twenty six points in miles world.
Speaker 2 (26:02):
First, transferable currencies are supreme despite inflation, despite dynamic pricing.
They are high valuations. You know, two point zero five
cents per chase two point zero for AMEX. Prove that
flexibility is your best defense. Your loyalty has to be
to the banks, not the airlines.
Speaker 1 (26:16):
Second takeaway, exceptional value requires a surgical strategy. You could
still get that two cents plus value, but you have
to be targeting the sweet spots like Hyatt and Alaska,
and you have to prioritize those premium redemptions where the
arbitrage is highest.
Speaker 2 (26:29):
Right, the days of just accidentally stumbling into a great
deal are pretty much gone, and third speed is value.
You have to adopt that urn and burn mindset and
only make timely strategic transfers redeemed sooner rather than later
to outrun the next evaluation.
Speaker 1 (26:43):
It really feels like the travel rewards game has I
don't know matured. The barriers to entry for maximizing value
are just higher now. It takes knowledge and diligence.
Speaker 2 (26:53):
It does, and the sources emphasize that transferable points mitigate devaluations,
which is true for now. But this raises a really
important final question for you to think about as you
plan your next trip. Okay, given this relentless trend toward
dynamic pricing everywhere, Marriott, Hilton, United, Delta are all going
that way? What if the next evolution is the slow
(27:15):
erosion of the best transfer partner sweet spots.
Speaker 1 (27:19):
You mean, what if even Hyatt and Alaska eventually give
in and go fully dynamic. What if that fifteen thousand
dollars first class ticket suddenly costs five hundred thousand miles
instead of seventy thousand.
Speaker 2 (27:29):
Precisely, if the highest ceiling redemptions get erased and only
the mid tier ones are left, then even the flexible
credit card programs will be forced to settle for lower
median values. In the long run, we could be heading
for a future where one point five cents is the
new gold standard. Wow, that's the big unknown and It's
something to watch very carefully as you use this twenty
twenty six playbook.
Speaker 1 (27:48):
Food for thought indeed, and a pretty urgent called action
to use these sweet spots while they still exist. Thank
you for guiding us through this. It's an incredibly complex landscape,
my pleasure, and thank you for joining us for the
deep dive. Whelp. This is giving you the clarity and
the strategy you need to maximize your value in this
dynamic market. Happy travels,
Welcome back to the deep dive. If you're with us,
you're here because you know that information is power, especially
when it comes to your hard earned travel Ruwars. I mean,
if you've ever sat down to book that amazing trip
with Miles only to see the points requirement like triple
right before your eyes, you know what we're talking about.
Speaker 2 (00:20):
So absolutely, it feels less like a currency and more
like a riddle that keeps changing. The answer it does,
and the sources you've provided for twenty twenty six they
really confirm it. The whole landscape isn't just shifting a little.
It's undergoing this huge foundational chain.
Speaker 1 (00:36):
A structural transformation exactly.
Speaker 2 (00:38):
It's all being driven by these massive devaluations, dynamic pricing
becoming the norm, and just general economic volatility. The old
rules of hord and weight they're actually working against you now, Okay.
Speaker 1 (00:50):
So let's unpack this. Our mission for this deep dive
is to give you a clear playbook. I need to
pull out the most critical valuations, the surprising data, and
the real strategies from this material. We need to figure
out what value even means in twenty twenty six, and
that all important sense per point number and lay out
the non negotiable ways to still get that affordable luxury
(01:12):
trip even with all.
Speaker 2 (01:13):
These headwinds, and in the context is just it's everything.
Twenty twenty six is defined by these huge program changes
and the fact that dynamic pricing is everywhere.
Speaker 1 (01:23):
So the award cost just follows the cash price up.
Speaker 2 (01:25):
Precisely, and then you throw inflation on top of that,
and it just fundamentally messes with the value of every
single point you have.
Speaker 1 (01:32):
So before we get into nitty gritty, the main takeaway
right up front has to be this, points in miles
are still incredibly powerful. Well for sure, they're still the
best way to get into that business class seat or
that five star hotel, but you have to be smart
strategic earning timely redemptions. They're not optional anymore. They're prerecord bits.
Speaker 2 (01:51):
That's the core thesis, and it can be a painful
adjustment for a lot of us who've been in this
game for a while. The era of just passively stacking
points and hoping for the best, it's over.
Speaker 1 (02:01):
So we're moving from hoarding to strategic deployment.
Speaker 2 (02:04):
Exactly, always always prioritizing the assets that give you the
most options.
Speaker 1 (02:10):
All right, So let's start with the basic math of
the game. When we talk about maximizing value, we are
always coming back to one number, sense per point or CPP.
For anyone listening you's trying to get their head around this,
let's define it perfectly. Okay.
Speaker 2 (02:24):
So sense per point is basically the cash value you
get back for every point you use. It's the report
card that tells you how well you did.
Speaker 1 (02:32):
And the calculation is simple, right in theory.
Speaker 2 (02:34):
Yes, you take the cash price of the flight or hotel,
you subtract any fees you still have to pay, and
then you divide that number by how many points it costs.
The result is your CPP.
Speaker 1 (02:45):
So if a flight is say one thousand dollars cash,
but I can use one hundred thousand points to book it,
my valuation is exactly one cent per.
Speaker 2 (02:53):
Point, exactly. But the sources note that this metric often
reflects the value when points are redeemed optimally, and that
word opt is doing a lot of heavy lifting.
Speaker 1 (03:02):
Mare, I was going to say that sounds like a
big if.
Speaker 2 (03:03):
It really is. And this is where the expert insight
from the material is so vital. All redemptions are not
created equal, not even close.
Speaker 1 (03:12):
So you have your average redemptions, and then you have
your your home runs.
Speaker 2 (03:15):
Right, the average value for say, hotel points can be
pretty low, maybe half a cent per point, because people
use them for a quick night at an airport hotel
or for gift cards.
Speaker 1 (03:24):
Which is a terrible redemption by the way.
Speaker 2 (03:26):
Almost always. But then you have the targeted redemptions, the
home runs. Yeah, that's where you find the real leverage.
The sources highlight that premium cabin flights we're talking international
business or first class or luxury resort stays can push
your value to five cents per point or even higher
five cents.
Speaker 1 (03:44):
Yes, that's a five fold increase over just taking a
standard one cent cash back redemption.
Speaker 2 (03:49):
A tenfold increase over the average hotel point redemption. It's massive.
And on the flip side, using your points for statement
credits or merchandise almost always gets you less than one cent.
That's literally throwing away value.
Speaker 1 (04:02):
So the goal is clear, we need to earn points
that give us a high floor, maybe one point seven cents,
but let us hit that three to five plus cent ceiling.
Speaker 2 (04:11):
That's the game.
Speaker 1 (04:12):
Okay, Now let's talk about the headwinds, the forces. In
twenty twenty six that are actively trying to push that
value down.
Speaker 2 (04:18):
The first, and it's the biggest one, is this double
whammy of devaluations and dynamic pricing. For years, the whole
system was built on fixed award charts. You knew New
York to Tokyo and business class costs seventy thousand miles period.
Speaker 1 (04:33):
It was predictable, you can say, for a goal exactly.
Speaker 2 (04:35):
But now major programs Delta, United, Hilton, Marriott, they've pretty
much thrown those charts out the window.
Speaker 1 (04:41):
And with dynamic pricing, the award cost is just tied
directly to the cash.
Speaker 2 (04:45):
Price, right, So when the cash price for a flight
shoots up for the holidays, the points price shoots up
right along with it. It basically eliminates the main benefit
of points, which was to protect you from that peak pricing.
It just introduces massive uncertainty.
Speaker 1 (04:58):
No wonder people are frustrated. The promise was always collect
x miles, get why trip. Now it's collect x miles
and maybe you'll get a trip if the algorithm is
in a good mood that day.
Speaker 2 (05:09):
And that's compounded by the second headwind, which is inflation.
This one's a little more subtle, but it's just as powerful.
Speaker 1 (05:15):
Okay, so this is the indirect evaluation. Let's use a
concrete example to really break this down.
Speaker 2 (05:19):
Let's take that seventy thousand mile business class flight in
twenty twenty four. Maybe the cash price was fifteen hundred dollars,
so your redemption value was about two point one cents
per mile, a very good redemption.
Speaker 1 (05:31):
Okay, makes sense.
Speaker 2 (05:32):
Now fast forward to twenty twenty six. Because of inflation,
the cash price for that exact same flight on that
exact same plane is now eighteen hundred dollars.
Speaker 1 (05:42):
But if the ward chard is still fixed, it still
costs seventy thousand miles correct.
Speaker 2 (05:47):
So on paper, your sense per point value just went
up to almost two point six cents.
Speaker 1 (05:51):
It looks great, it does, but I feel like there's
a catch.
Speaker 2 (05:54):
The catch is that the traveler feels poor. Your points
are buying the same physical seat, but that seat is
now a smaller percentage of the overall rising cost of travel.
Your points purchasing power has been indirectly eroded.
Speaker 1 (06:07):
That's a great way to put it. So you have
direct devaluation the airline literally charging more miles, and indirect
devaluation where inflation just makes your points feel less powerful.
Speaker 2 (06:18):
And this is clearly why public perception has soured so much.
The sources point to these surveys showing that thirty four
percent of travelers that's more than one in three, feel
their points are less valuable than they were just two
years ago.
Speaker 1 (06:31):
That's huge number.
Speaker 2 (06:31):
It is they're seeing the dynamic prices, they're feeling the inflation,
and they're concluding that the game is just getting.
Speaker 1 (06:38):
Harder to win. So, okay, this sounds pretty bleak. Rising costs, volatility,
a third of travelers feeling like they're losing. But this
is where the source material introduces this really powerful idea
of the buffer solution.
Speaker 2 (06:50):
And this is where it gets really interesting. This is
the pivot from frustration to actual strategy. The buffer solution
is all about using transferable currencies points.
Speaker 1 (07:00):
From the major credit card issuers, Chase, American Express, Capital,
Ones City, and the new one built exactly.
Speaker 2 (07:07):
These currencies are the crucial buffer against every single trend
we just talked about.
Speaker 1 (07:11):
But why are they a buffer if Delta devalues its miles,
aren't the bank points also at risk?
Speaker 2 (07:17):
They are, but the risk is diversified. That's the key.
If Delta devalue Sky miles tomorrow. Your Chase Ultimate rewards
points are totally fine because they're still sitting with Chase.
Speaker 1 (07:27):
They're not committed yet.
Speaker 2 (07:28):
Right, you can still transfer them to a dozen other
partners who haven't devalued, like World of Higatt or Air Canada.
They give you options, They let you sidestep the worst evaluations,
and that optionality is why they are, without a doubt,
the highest value assets in the entire game.
Speaker 1 (07:44):
So the strategy for twenty twenty six isn't loyalty to
a specific airline, but loyalty to a flexible credit card program.
Speaker 2 (07:50):
That's it. You're banking with the stable central reserve, not
the volatile local currency, and the valuation data for these
top assets. It just confirms what's this dominance.
Speaker 1 (08:01):
We've established that flexibility is king in twenty twenty six.
The shift away from fixed charts means your best defense
is having points. They can be deployed at a moment's notice.
Let's talk about the idea of arbitrage here.
Speaker 2 (08:13):
Arbitrage is the absolute key to understanding high value redemptions
in our world. It's the ability to find and exploit
a temporary pricing mistake or a misalignment.
Speaker 1 (08:23):
Meaning the bank gives me a point, they value it ascent,
but I can redeem it through a partner for travel
that costs five cents.
Speaker 2 (08:30):
Precisely, that four cent difference is your profit, your arbitrage.
Transferable points let you hold your assets until you find
that window. If your points are already with an airline,
that airline can just close the window overnight and you're stuck.
Speaker 1 (08:43):
But if they're sitting with Chase or Amex, you could
just move them to whoever's offering the best deal at
that exact moment.
Speaker 2 (08:48):
And that's why all the top transferable currencies have valuations
so much higher than any single airline or hotel program.
The twenty twenty six data really proves it.
Speaker 1 (08:57):
Okay, let's get into those numbers. Starting with the highest perform.
Speaker 2 (09:00):
Leading the pack, really setting the gold standard for twenty
twenty six is Chase Ultimate Rewards. It comes in at
a stellar two point eight or five cents per point.
Speaker 1 (09:09):
That's the highest median valuation out there. But why Chase?
I mean Amex has way more international airline partners. What
gives Chase that slight edge.
Speaker 2 (09:17):
That little five hundreds of a cent difference really comes
down disability, and that Stability has a name, World of Hyatt.
The sources are clear on this. Hyatt is the highest
value hotel program, mainly because it's resisted the crazy dynamic
pricing shifts we've seen at Marriott and Hilton.
Speaker 1 (09:34):
So the reliability of their best hotel partner anchors the
whole system. Can we put a number on that? Yeah?
Speaker 2 (09:39):
Absolutely? Think about it this way. A top tier luxury hyat,
maybe a park Hyat that costs one thousand dollars a
night in cash, often only requires thirty thousand points.
Speaker 1 (09:48):
Wow, that's over three point three cents per.
Speaker 2 (09:50):
Point, far above their average, and because redemptions like that
are so consistent and predictable, it pulls the entire Chase
valuation up to that two point zero five cent figure.
So the listener it's often cited as the safest, most
consistently high value place to put your rewards.
Speaker 1 (10:04):
Makes perfect sense. Stability wins, okay. Right behind Chase is
American Express Membership rewards, valued very strongly at two point
zero cents per.
Speaker 2 (10:14):
Point right and MX is the powerhouse for international flights.
If Chase dominates on the ground, with Hyatt, AMX absolutely
dominates in the air.
Speaker 1 (10:22):
They have that unmatched roster of airline partners.
Speaker 2 (10:25):
They do, and they offer these incredible transfer bonuses, sometimes
giving you twenty thirty, even forty percent extra points when
you move them to an airline. So while the median
is two cents, an experienced user can easily push that
value to four five cents using those bonuses. The ceiling
is arguably higher than any other program.
Speaker 1 (10:43):
So Chase is reliable luxury and AMX is more high risk,
high reward arbitrage.
Speaker 2 (10:48):
That's a really good way to put it. Now, moving
on to the rising stars, Capital one miles are valued
between one point eighty five and two point zero cents.
They have just shot up the rankings recently.
Speaker 1 (10:58):
They used to lag behind, but they made a huge push.
What are the key partnerships that are supporting that high valuation.
Speaker 2 (11:04):
Capital one has been super aggressive in building out its
partner network. The source material specifically calls out their partnership
with Air Canada's Araplan.
Speaker 1 (11:13):
Program, which is a huge deal.
Speaker 2 (11:15):
It's crucial because Araplan gives you excellent, often fixed rate
access to the entire Star Alliance network. That partnership alone
is a major pillar supporting their high valuation. For a
lot of people. Capital one is now a must have
alternative to the old Chase and Amex duopoly.
Speaker 1 (11:32):
Okay, next up is City Thank You Points, valued slightly
lower at one point eight to one point nine cents,
not leading the pack, but the material says they are
essential for accessing specific sweet spots.
Speaker 2 (11:44):
Yeah. Sweet spots are those amazing deals that have somehow
survived on fixed award charts, and City has the keys
to a few of them. The source specifically mentions Virgin Atlantic.
Speaker 1 (11:54):
Yeah, what's the play there.
Speaker 2 (11:55):
Well, you can use Virgin Atlantic points to book Delta
one business class flights to Europe for way way fewer
points than if you booked directly with Delta's own sky
miles one of those weird loopholes.
Speaker 1 (12:06):
So City's value is for the savvy traveler who knows
exactly where to.
Speaker 2 (12:09):
Look for those deals exactly. It's an excellent compliment to
a Chase or Amex strategy.
Speaker 1 (12:15):
And finally, the newcomer making huge waves Built rewards value
between one point seven and two point zero cents. This
is a genuinely revolutionary product.
Speaker 2 (12:26):
It's a total game changer because of how you earn
the points. Built lets you earn points on rent payments
without paying a fee that's a massive monthly expense that
was basically off limits for rewards before.
Speaker 1 (12:37):
And they didn't just create a new way to earn
they connected it to the best partners.
Speaker 2 (12:40):
Precisely built points transferred to many of the same high
value partners as Chase and Amex, including Hyatt. By turning
Rent into a rewards engine that feeds into the best
redemption networks, Built instantly became an elite currency. They solved
a huge problem for a huge number of people.
Speaker 1 (12:58):
So across the board, the lost of these is one
points seven cents, the highest is two point zero five.
It just confirms that these flexible currencies are the only
place to be. They're the future proofing the ategy.
Speaker 2 (13:07):
It's the essential insurance policy. But now we need to
see what happens when those high value points actually get
transferred into the airline and hotel programs, because the story
changes pretty dramatically once they're locked in.
Speaker 1 (13:17):
Okay, so we're moving from the high value, liquid world
of credit cards to the specific locked in programs where
volatility is the name of the game. Let's start with airlines, right,
The domestic US carriers show a pretty discouraging range with
values hovering around one point two to one point four
cents per mile. That is a huge drop from the
(13:40):
two cent average. We were just talking about that gap.
Speaker 2 (13:42):
That point six sense. That is the price of dynamic pricing.
We can call it the volatility tax. Once you lock
your points in with one airline, you lose all your leverage.
Speaker 1 (13:51):
And they know it, and the sources say international partners
are generally the way to go.
Speaker 2 (13:55):
They are because those partner rewards often still follow fixed
or at least semi fi fixed charts that are set
by the global Alliance, not by the whim of the
domestic airlines algorithm.
Speaker 1 (14:05):
But there is one clear exception here in the US,
a leader that's bucking the trend. Alaska Airlines mileage plan
stands out with the highest valuation, hitting one point eight
to two point zero cents per mile. That puts them
on par with the credit cards themselves. How are they
doing that?
Speaker 2 (14:19):
Alaska is just a fascinating case study. Their high valuation
comes from their incredible partner network and their commitment to favorable,
often fixed, award pricing with those partners. For years, they've
been famous for redemptions on carriers like japan Airlines Cathay
Pacific QUANTUS.
Speaker 1 (14:38):
So, can we give a tangible example of one of
those Alaska sweet spots?
Speaker 2 (14:41):
Oh, definitely. The classic one is using Alaska miles to
book Cathay Pacific first Class. A cash ticket could easily
be fifteen thousand dollars. Alaska has historically priced that award
at a fixed rate around seventy thousand miles.
Speaker 1 (14:55):
Seventy thousand that's that's over twenty cents per mile.
Speaker 2 (14:58):
It's an astronomical value. And while not every redemption is
going to hit that, just the existence of these consistently
amazing partner awards pulls their entire media and valuation way
way up. It makes them one of the very few
domestic programs worth transferring your flexible points into.
Speaker 1 (15:13):
Wow. Okay, so Alaska is the one to watch. Now,
let's look at the carriers who are really feeling the
impact of dynamic pricing, the ones responsible for that one
point two to one point four cent.
Speaker 2 (15:22):
Average, right, And when we look at the major US carriers,
you can see that trend. So clearly, American advantage comes
in a little higher at one point four to one
point six cents.
Speaker 1 (15:32):
Why do they get a slight edge over United in Delta.
Speaker 2 (15:35):
It's the same reason as Alaska, just on a smaller scale.
Their strength is in their partner awards through the One
World Alliance. So while a domestic American flight can be
dynamically priced into oblivion, using your advantage miles on Qatar
Airways or jal often gets you that higher, more predictable value.
Speaker 1 (15:53):
Okay, And then we have the dynamic pricing heavyweights, United
Mileage Plus and Delta sky Miles, both right in that
one point two to one point four cent range. This
is where it feels like the goalposts are just constantly moving.
Speaker 2 (16:05):
And the sources are really explicit. Here dynamic pricing is
the single biggest factor hammering the value of both programs.
A business class ticket that was one hundred and fifty
thousand miles last year can suddenly be four hundred thousand
miles during a peak period. It makes it almost impossible
for the average person to save up for those aspirational trips.
Speaker 1 (16:23):
That one point two to one point four cent range is.
I mean, it's better than nothing, but the promise of
affordable luxury just feels out of reach.
Speaker 2 (16:30):
It often is. And then finally you have Southwest Rapid
Rewards valued very consistently at one point three cents per point.
Speaker 1 (16:38):
But Southwest is a totally different model, right. Their points
are basically just cash back tied to the flight cost.
Speaker 2 (16:44):
That's the key. The sources note they had a devaluation
in twenty twenty five, which for them just means they
increase the number of points needed per dollar of airfare,
So that one point three cent value is rigid. It's predictable, sure,
but it's kept. You'll never get those massive ten cent
per point home runs.
Speaker 1 (17:00):
Okay, So the airline strategy is clear, focus on flexible
points than target fixed chart partners like Alaska. Now let's
move to the ground game hotel points. The data shows
hotel programs have lower average values but can have these
huge peaks. Why is the average so low Two main reasons.
Speaker 2 (17:19):
First, hotel points are generally much easier to earn in
huge quantities, especially with big credit card sign up bonuses.
And second, people use them for lower value redemptions like
a single night in a mid range airport hotel, which
drags the average down.
Speaker 1 (17:31):
But the luxury redemptions can still be amazing.
Speaker 2 (17:34):
Exactly, the peaks are really high, and there is one
standout performer, the undisputed king of hotel points world of Hyatt.
It's the only one that competes with the transferable currencies
valued between one point five and two point us.
Speaker 1 (17:48):
Since and it's all about that award chart.
Speaker 2 (17:50):
It's all about the award chart. They've stuck with a
fixed category chart, and that's what protects the value. Booking
a top tier park Hyatt that costs one thousand dollars
a night for just thirty thousand points, you consistently hit
that two cent plus valuation. That predictability is worth its
weight in gold.
Speaker 1 (18:08):
Hyatt is the poster child for resisting the race to
the bottom. Okay, now let's talk about the big players
who are struggling. Marriott Bonvoy is at point seven to
point eight cents. That is a shockingly low number for
the biggest hotel chain in the world.
Speaker 2 (18:21):
And it's a direct result of them getting rid of
their award charts and embracing dynamic pricing. The sources say
they have faced huge criticism for the insane point costs
that some of their top properties. That point seven cent
value just reflects how hard it is to find that
value arbitrage anymore.
Speaker 1 (18:36):
So, if the value is that low, why are people
still collecting bonvoid points? Why are they still so popular?
Speaker 2 (18:41):
That's a great question and the answer is twofold ubiquity
and sign up bonuses. Marriott is everywhere. Sometimes you just
need a hotel where Hyatt doesn't have one. And second,
their credit card bonuses are often huge, dumping one hundred
and fifty thousand points into your account at once. So
people make up for the low value with sheer quantity.
Speaker 1 (19:00):
Quantity and necessity over quality. Got it Now? At the
very bottom of the heap, we have Hilton Honors and
IHG one Rewards, both at a pretty discouraging point five
too point six cents.
Speaker 2 (19:12):
Yeah, and this is a critical data point. A point
worth half a cent means you need two hundred thousand
points to cover a one thousand dollars hotel bill. That's
just one night at a lot of high end places.
Both programs had big devaluations in twenty twenty five that
really drove their value down.
Speaker 1 (19:27):
Does Hilton have anything going forward at that valuation?
Speaker 2 (19:29):
They do, It's mostly their promotions and status benefits. Colton
is pretty aggressive with promos and it's easy to get status.
It gives you the fifth night free on award stays.
That's a built in twenty percent discount which helps HG,
though is often the lowest of them all. It's probably
the hardest program to get real luxury value from.
Speaker 1 (19:46):
So the lesson is hammered home. If you want to
maximize sense per point, you have to prioritize earning flexible
points and then target the stable ecosystems like Hyatt in Alaska.
Speaker 2 (19:56):
That's the perfect summary of the data, but knowing the
ver is only half of it. Now we need the playbook.
How do we actually change your behavior in twenty twenty
six to hit those high values and protect ourselves from
the next devaluation.
Speaker 1 (20:10):
The volatility of this twenty twenty six market it it
demands a really strategic and adaptive approach. It's not enough
to just have a good credit card anymore. You have
to change how you earn and when you redeem.
Speaker 2 (20:21):
Right and strategy number one is the absolute foundation for survival.
Focus on transferable points. We've talked enough about Chase MX
capital one city and built. They are your safest, highest
potential investments.
Speaker 1 (20:34):
If you're starting from scratch, this is where you put
your spending.
Speaker 2 (20:36):
One hundred percent. This is where your highest floor of
value is around one point seven cents and where your
highest potential ceiling is at five cents or more.
Speaker 1 (20:43):
And the most important behavioral shift, the one that reverses
decades of advice, is the next point transfer only when necessary.
Speaker 2 (20:51):
This is the strategic antidote to devaluation. You have to
be surgical. Only move your points from Chase or AMEX
after you've found the award space, confirmed it's available and
you're ready to book it.
Speaker 1 (21:01):
That second you're minimizing your risk exposure.
Speaker 2 (21:04):
Exactly the second those points become Delta sky miles, they're
vulnerable to Delta's next surprise devaluation.
Speaker 1 (21:11):
Okay, but let's talk about the risk there. Finding the
award space is the hard part. Then you transfer, But
what if the transfer is an instant and the seat disappears.
Speaker 2 (21:19):
That is a calculated risk, You're right, But the risk
of a program wide devaluation is so much greater. And
for many of the most valuable redemptions, the transfers are
instant or near instant, like AMEX to Delta or Chase
to HYAT and United. You just have to know which
ones are quick and have a backup plan. But the
key is holding flexible points prevents a catastrophic.
Speaker 1 (21:40):
Loss confirmation first transfer. Second, that's the mantra. Okay, now
let's talk about the techniques to make sure those transfers
lead to high yield redemptions.
Speaker 2 (21:49):
The first technique is really about continuous learning, targeting sweet spots.
You're hunting for those islands of stability in the dynamic storm.
We've said their names before, World of Hyatt and Alaska Airlines,
those are your primary targets.
Speaker 1 (22:02):
Walk us through a classic airline sweepspot again, just so
the listener understands the kind of arbitrage they should be
looking for.
Speaker 2 (22:09):
Let's go back to that Alaska and Cafe Pacific first
class example. The cash ticket is maybe fifteen thousand dollars.
Alaska requires a fixed rate, say seventy thousand miles. A
similar dynamically priced ticket on another airline could easily cost
two hundred and fifty thousand miles. That seventy thousand mile
fixed rate is a massive predictable sweet spot. You have
(22:30):
to know where these fixed charts still exist.
Speaker 1 (22:32):
And the second technique, this is the most aspirational one,
is booking premium redemptions.
Speaker 2 (22:38):
This is the ultimate leverage for your points business or
first class flights are the single best way to get
those three to ten cent point valuations, Ayasa, because the
cash price jump from economy It's business is huge, but
the points jump is often much smaller. The difference might
be five thousand dollars in cash but only fifty thousand points.
That's ten cents per point on the upgrade alone. You're
(23:00):
using your points to buy scarcity and luxury, not just
a seat on a plane.
Speaker 1 (23:05):
And the third technique is about timing leverage, bonuses and promotions.
Speaker 2 (23:09):
This is a powerful immediate value booster. You should always
be watching for transfer bonuses from the credit card programs
when they offer you twenty or thirty or forty percent
extra points to a specific airline.
Speaker 1 (23:20):
So your one hundred thousand points suddenly become one hundred
and thirty thousand points with the click.
Speaker 2 (23:24):
Of a button exactly, and that thirty percent bonus instantly
inflates your effective value. Planning your transfers around these bonus
windows can be the difference between affording a trip and not.
Speaker 1 (23:35):
Okay, we have the earning and redemption strategies, let's talk
about the tools. Finding these sweet spots can feel like
looking for a needle in a Haystack.
Speaker 2 (23:42):
It can, which is why manual searching is basically obsolete now.
Technology is your best friend. You have to be using
specialized search tools. Platforms like Awardfares or Rome are essential.
They search across dozens of airline programs at once to
find that one elusive partner award seat for you.
Speaker 1 (24:00):
It saves you hours of.
Speaker 2 (24:01):
Work days sometimes, and.
Speaker 1 (24:03):
This brings up an advanced idea knowing when a hybrid
redemption is the best play.
Speaker 2 (24:08):
This is about optimizing the entire trip costs, not just
one transaction. If you find a super cheap cash flight deal,
pay the cash, save your points for the hotel. If
the hotel prices are outrageous, you use your points on
the most expensive part of the trip where they'll provide
the highest return.
Speaker 1 (24:24):
Right, don't waste fifty thousand points on a five hundred
dollars rental car when you could save them for a
three thousand dollars flight.
Speaker 2 (24:29):
Never and that leads to maybe the most important mindset
shift for twenty twenty six, the urn and burn mentality.
Speaker 1 (24:36):
It sounds a little reckless, but why is this so
critical now?
Speaker 2 (24:39):
Because of the relentless pressure of devaluation, the source material
is explicit redeem sooner, not later. The points you are
in today are almost certainly the most valuable they will
ever be. Hoaring points for a trip five years from
now is just asking for them to be devalued.
Speaker 1 (24:54):
So points should be treated like a depreciating asset, not
a savings account.
Speaker 2 (25:00):
That is the perfect way to phrase it. It's a
fundamental reversal of how we used to think.
Speaker 1 (25:04):
And finally, we have to remember the cards themselves provide
value beyond just the points, right.
Speaker 2 (25:10):
We have to factor in the credit card perks as
value boosters. We're talking about the premium cards, the ones
with the high annual.
Speaker 1 (25:16):
Fees, the Chase Sapphire Reserve, the Amex Platinum h.
Speaker 2 (25:20):
The sources note that they offer travel credits, lounge access,
elite status, all things that boost the overall value. If
you have a card with a five hundred and fifty
dollars fee, but you get three hundred dollars in travel
credits back, the net cost of holding that card is
much lower, which makes the points you earn even more valuable.
Speaker 1 (25:37):
So the entire section really reinforces the core message you
have to be flexible, where you earn, targeted, how you
redeem and fast. When you execute, you just can't be
passive anymore.
Speaker 2 (25:47):
That is the complete twenty twenty six playbook.
Speaker 1 (25:50):
So what does this all mean for you the traveler?
If we step back and look at the whole picture,
what are this say? Three big takeaways from this deep
dive into the two twenty twenty six points in miles world.
Speaker 2 (26:02):
First, transferable currencies are supreme despite inflation, despite dynamic pricing.
They are high valuations. You know, two point zero five
cents per chase two point zero for AMEX. Prove that
flexibility is your best defense. Your loyalty has to be
to the banks, not the airlines.
Speaker 1 (26:16):
Second takeaway, exceptional value requires a surgical strategy. You could
still get that two cents plus value, but you have
to be targeting the sweet spots like Hyatt and Alaska,
and you have to prioritize those premium redemptions where the
arbitrage is highest.
Speaker 2 (26:29):
Right, the days of just accidentally stumbling into a great
deal are pretty much gone, and third speed is value.
You have to adopt that urn and burn mindset and
only make timely strategic transfers redeemed sooner rather than later
to outrun the next evaluation.
Speaker 1 (26:43):
It really feels like the travel rewards game has I
don't know matured. The barriers to entry for maximizing value
are just higher now. It takes knowledge and diligence.
Speaker 2 (26:53):
It does, and the sources emphasize that transferable points mitigate devaluations,
which is true for now. But this raises a really
important final question for you to think about as you
plan your next trip. Okay, given this relentless trend toward
dynamic pricing everywhere, Marriott, Hilton, United, Delta are all going
that way? What if the next evolution is the slow
(27:15):
erosion of the best transfer partner sweet spots.
Speaker 1 (27:19):
You mean, what if even Hyatt and Alaska eventually give
in and go fully dynamic. What if that fifteen thousand
dollars first class ticket suddenly costs five hundred thousand miles
instead of seventy thousand.
Speaker 2 (27:29):
Precisely, if the highest ceiling redemptions get erased and only
the mid tier ones are left, then even the flexible
credit card programs will be forced to settle for lower
median values. In the long run, we could be heading
for a future where one point five cents is the
new gold standard. Wow, that's the big unknown and It's
something to watch very carefully as you use this twenty
twenty six playbook.
Speaker 1 (27:48):
Food for thought indeed, and a pretty urgent called action
to use these sweet spots while they still exist. Thank
you for guiding us through this. It's an incredibly complex landscape,
my pleasure, and thank you for joining us for the
deep dive. Whelp. This is giving you the clarity and
the strategy you need to maximize your value in this
dynamic market. Happy travels,
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