The best time to use your points and airline miles

Frances Meredith of Raleigh, North Carolina, has used an American Airlines-branded credit card for everything from groceries to medical ...


Frances Meredith of Raleigh, North Carolina, has used an American Airlines-branded credit card for everything from groceries to medical expenses during the pandemic, racking up points with nowhere to spend them. It meant she had a lot to redeem when her family of four decided it was time for a winter getaway in Miami. Although the seats cost 50,000 points each, internist Dr. Meredith was happy to save money by using her rewards balance. “It was easy. There were plenty of spaces,” she said.

As travelers return to the skies, many, like Dr Meredith, have amassed larger-than-usual totals in airline and credit card rewards programs. And they start spending them. United Airlines’ Mileage Plus program has had several record-breaking days in recent weeks as customers flocked to redeem miles, said Michael Covey, general manager of the United program. “Demand is hitting the books in a way we’ve never seen before,” he said.

Several factors now make time to cash in points.

Flights booked with points on major US carriers are fully refundable. This means that if you have to cancel the trip, all your points and any associated fees will be returned to you without any penalty. Tickets purchased with cash, on the other hand, generally offer a credit towards a future flight rather than a refund and may charge a fee, so your money is tied to the airline. Refundable tickets can be purchased, but are more expensive.

This difference, between ending up with a credit or a refund, can be significant for expensive trips like family vacations abroad. Some travelers are ‘still uncomfortable with international travel’ as conditions remain shifting due to the pandemic, so using points to book a flight to a foreign country can provide more peace of mind, a said Jamie Larounis, who writes about loyalty programs on his travel site, the forward cabin. He now also sees concerns about flights near Eastern Europe due to the Russian invasion of Ukraine.

Many travelers are sitting on bigger points balances than ever before, both because they haven’t redeemed their points and because they’ve added to the pile over the past two years with card purchases. credit associated with airline loyalty accounts. According to a study by ValuePenguin and OnPoint Loyaltythe five largest airline loyalty programs – SkyMiles from Delta Air Lines, AAdvantage from American Airlines, MileagePlus from United Airlines, Rapid Rewards from Southwest Airlines and TrueBlue from JetBlue – ended 2020 with liabilities of $27.5 billion. dollars, up $2.9 billion from 2019. Customers earned about half as many points in 2020 as the previous year, and only redeemed 10% of their available points compared to 30% the last year.

The most important reason to use points now is that they might have less purchasing power over the next few years, Larounis said. Airline and hotel points are like currencies held by businesses, and those businesses can value their currencies any way they want by changing the redemption cost. Helane Becker, airline analyst at investment bank Cowen, said airlines had devalued points several times over the past few years and she expects the practice to continue.

This is already evident in the airline and hotel sectors. Alaska Airlines recently increased the cost of booking some of its first class tickets. Hyatt Hotels recently increased the points needed for certain hotel stays when it introduced a new peak-off-peak pricing program.

Companies know that “people are sitting on big piles of miles and have a lot of pent-up demand for travel,” said Mr. Larounis of the Forward Cabin website. “There’s no downside to them increasing the cost of reward travel.” This is especially true for airplane seats in the first cabin, he said. Some leisure travelers, who may have been content with economy class seats, are now buying seats at the front of the plane where passengers are a little more spread out. “They see it as safer as far as Covid is concerned,” Mr Larounis said.

Yet airlines are aware of which ones have fewer miles. “We have more seats available for under 10,000 miles than ever before,” United’s Mr Covey said.

Airlines encourage customers to use their points. Award tickets booked on Delta airlines through the end of this year will count towards elevating the customer’s loyalty program status. Previously, only cash-paid flights counted toward program status. United Airlines recently joined a list of airlines that allow customers to combine “cash and miles” to purchase tickets, so “members can redeem miles sooner and not wait until they have a big total,” it said. said Mr. Covey. United also held flash sales in February for tickets to London and Australia purchased with points, and is now allowing members to use points to purchase food and drink on flights.

Travel itself is now less daunting, with more countries eliminating Covid testing for vaccinated passengers. London, one of the most popular destinations for American travelers, dropped its test requirement February 11. Thailand, Vietnam, Australia and other countries are open to tourists.

Alison Carpentier, Director of Customer Loyalty at Alaska Airlines, which is part of the Oneworld Alliance from 14 global airlines, including Cathay Pacific and Qantas, said the availability of tickets purchased with points “has been good as international travel begins to reopen”.

Airlines want to fill as many seats as possible, which is why many now offer almost all of their seats for purchase with points, instead of just a subset. The prices set by most airlines fluctuate, so it pays to check periodically before the flight to see if the number of points needed has dropped.

Business class seats on international routes are more plentiful than usual now as demand has been low during the pandemic. Business travel is still down and companies that allow employees traveling abroad to purchase business class seats so they can arrive (a little) refreshed for their meetings do not buy as many tickets.

Redeeming points to capture the most value can take some research. For example, at the time of this writing, a business class flight on Delta from New York to Paris costs 320,000 SkyMiles points on a randomly selected day in March, but a similar flight on Air France only costs 75,000 miles more. $213 with Air France’s Flying Blue Loyalty Program. American Express, Citi, Chase and Capital One have partnerships with Air France, so their customers with loyalty points could transfer them to Air France, which costs only a fraction of the Delta ticket.

A new website Indicate. Me, which debuted in February, aims to help travelers see all of their exchange choices, according to company founder Adam Morvitz. Travelers can enter the dates and cities of their potential trip and the site will compare the number of points they need from various airline and credit card programs, taking into account partnerships that allow points to be transferred from one program to another, like New York to Paris. scenario above. The site also offers a concierge service for those who need help through the dot maze.

Airlines keep adding routes and flights, so it might not be easy to find exactly what you want, said Tiffany Layne, travel consultant and owner of LaVon Travel and Lifestyle in New York, but she said booking as early as possible will give you the most choice.

Mr Larounis agreed: “There is rarely a downside to booking with points, even very far away. If your plans change, you have full control.

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