When to spend or save your loyalty miles and points

As with most financial decisions, choosing to spend or save your loyalty miles or points has to be a strategic one, writes travel expert Johnny Jet.

Do you have a points or miles-earning credit card to reward you for all that travel? If so, you may be wondering when’s the right time to spend your loyalty miles or points? Is there ever any good time to hoard them away for a rainy day? 

As with most financial decisions, choosing to spend or save your loyalty miles or points has to be a strategic one. You want to get the most value out of all your hard-earned points. After all, they are a type of currency and each mile or point has a dollar value.

Using them for less than what they’re worth isn’t just wasteful, it’s missing out on potentially amazing experiences that you could’ve redeemed with those points or miles. Similarly, hoarding up your miles or points can mean they go to waste. 

Compare redemption and cash prices

One of the first things you can do when choosing when to spend or save your loyalty miles/points is to compare the cash cost of a flight, hotel stay, or other redemption options with the amount of miles/points you would need to redeem the same item or experience.

Once you know both totals, figure out how much value you’ll get out of your points or miles if you redeem them for a purchase of that cash amount.

For example, divide the cash needed for a purchase by the number of miles or points needed for the same purchase. This will help you see how many cents a single mile or point would be worth in this scenario. 

You want to get the highest amount of value possible when using one of the best international credit card options. If you’re booking a trip and want to use miles or points, play around with travel options to see what travel days, travel providers, and other factors will result in you getting the most value.

Don’t see any option that gives you the value you think you deserve? Or maybe there’s no value that makes sense for the amount of money you have to spend on a credit card in order to earn that point or mile? Then it might be time to pass on spending your loyalty miles or points and just pay cash for your travel. 

Take your needs into consideration

Of course, points or miles value alone isn’t always going to determine whether or not you spend or save your loyalty rewards. Sometimes you have to look at your actual needs.

In some instances, you might be a little low on cash but you have to get somewhere for an event. Spending those miles on a quick and comfortable flight may be well worth it.

In other instances, you might really want to take your partner on a dream vacation and you happen to have some hotel points sitting in your account that might lessen the budgetary blow. While you might not get the best value for points or miles when spending them in these situations, it might just be worth it for you according to the situation at hand. 

Look at expiration dates

It’s becoming less and less common for points and miles to expire within the terms and conditions of loyalty programs, but that doesn’t mean that it doesn’t still happen. This can be especially true if you have an account with a loyalty program and you haven’t used that program’s credit card in a while or traveled with that program.

Keep a close eye on all your programs’ expiration dates. If your points or miles are close to expiring, definitely spend them versus letting them just go to waste. Alternatively, in some cases, you can transfer your points or miles from the close-to-expiring account to another that you use more frequently. 

Don’t wait too long

While you don’t want to redeem miles or points just for the sake of redeeming them, you also don’t want to wait too long to do so. Waiting more than a year can mean that your points or miles are devalued.

Generally, letting your points or miles balance keep growing and growing, without ever spending those points or miles, leads to points or miles devaluation.

If you have some miles you’ve been sitting on for a while, consider where you might be able to use them. 

Take a look at the deals and offers

Lastly, take a look at the various deals and offers available to you through your loyalty program. Many provide seasonal promotions that allow you to get way more value out of your points and miles if you’re just willing to wait for one of those promotions to roll around.

Keep an eye on miles and points-spending blogs and the miles and points-earning community in general. This way you’ll have early notice that these deals and offers are coming up. You’ll also know whether or not they’re actually a good deal.