Over time, rewards programs have evolved and become more intricate and complicated. By the same token, rewards programs have also become significantly more flexible, and with that flexibility, even more rewarding!
Unfortunately for many, thoughts and actions regarding points and miles have not evolved at the same pace as these rewards programs, and many individuals are stuck in a rut – redeem X points through X program for X value, without giving much thought to the MANY other possibilities!
Forget all that “back in my day” talk and hop on board to a better way of thinking…
The way that I think about points, miles and travel rewards reflects this evolution and I think yours should too!
Let’s call it the New School Way of Thinking – Maximize your points and miles travel potential – through earning and redeeming for top value!
I seek to accumulate specific point & mile currencies that are both flexible and rewarding, in order to ultimately redeem them for specific travel goals that I determine as far in advance as possible (truly in line with the Starter Guide here)!
The earn ‘em and burn ’em strategy!
While I believe this to be a sound strategy (if I do say so myself), many people don’t share this strategy and are stuck in a way of thinking that is dated (and less rewarding)…
Let’s call it the Old School Way of Thinking – Blindly accumulate points and redeem them as needed.
These are the people who accumulate points in a single program with no specific travel redemptions in mind, and prefer the simplicity of a single type of redemption (i.e. booking redemptions through the American Express Travel Portal).
For example – You own your own company. While you do not have a defined point earning strategy, you do hold the American Express Business Gold Rewards card and are sure to put every possible business expense on the card in order to earn valuable Membership Rewards points. Month after month your spending on the Business Gold is accumulating quite a stash of points – you have no specified redemption in mind, but you know that earning credit card points was better than earning nothing!
When you want to travel, you remember the stash of American Express Membership Rewards, call American Express, and book travel with your Membership Rewards points.
No cash out of pocket, so a free trip using points right?
While there was no large out of pocket cost, the Old School Way of Thinking may have led to a redemption that cost more in American Express Membership Rewards points than it should have…
Let’s take a specific redemption and compare highlight a quick example:
Thanksgiving Trip: Google Flights – Tampa (TPA) – New York (EWR) – flying United
You could of course pay cash for the flights… or put your Amex Membership Rewards to use!
Old School – Travel with Points – Redeem Amex Membership Rewards points through American Express Travel Portal:
Step 1: Log onto Amex Travel Portal
Step 2: Search Desired Flights
Step 3: Book Using Membership Rewards Points, Cash, or a combination of the two
Total Cost – 32,719 American Express Membership Rewards
New School – Transfer Partners – Transfer Amex Membership Rewards points 1:1 to travel partner Singapore Airlines, then redeem Singapore Krisflyer Miles for travel on Star Alliance Partner United
Step 1: Create a Singapore Airlines Krisflyer Account – its free & note the award chart for redeeming Krisflyer miles on Star Alliance Partners:
Step 2: Search United.com for Award Availability of Star Alliance:
Step 3: Call Singapore Airlines at 312-843-5333 to ensure the flights are available. Follow the prompts to book an award flight on a Star Alliance Partner Airline (United Airlines). Once you have the agent on the phone, tell him/her you would like to confirm the award availability.
Step 4: If seats are available from Step 3, call or request online for Amex to transfer 25,000 American Express Membership Rewards Points to Singapore Airlines (will have to provide your Singapore Airlines FF# created in Step 1).
Note: It normally takes about 24-48 hours for these points to transfer (despite the fact that Amex says it can take up to 7 days)
Step 5: When the points post to your Singapore Airlines Krisflyer account (after 24-48 hours), repeat Step 3 and this time tell the agent that you would like to book the award.
The award will cost you 25k Krisflyer miles (according to the chart above) and additionally you will incur a nominal amount of taxes and fees.
Total Cost – 25,000 American Express Membership Rewards points transferred to Singapore Airlines
In this case, it pays to think the New School Way– to the tune of 7,719 American Express Membership Rewards points, which I would value at a minimum of $80!
$80 in savings for the SAME EXACT flight, just different redemption booking process!
A few more steps, but MORE REWARDING!
Are there more valuable Membership Rewards redemptions? Yes, of course there are…
Will this Amex to Singapore Airlines transfer option always provide better value? No, not always, and it may be the case that this redemption is not even available for your desired flights, or that redemption through the portal or paying cash for the flight works better for your situation…
The New School Way of Thinking that I am highlighting is not just about this one specific transfer –
Redeem X points through X program for X value…
But, rather is more about ALWAYS combining the earning of valuable flexible currencies with the broader scale of redemption options –
Redeem X points through transfer to Y program, for travel on Z airline for Q value!
Don’t settle for unrewarding redemptions – change your way of thinking and learn how your points can be earned and redeemed for maximum value!
Be sure to send me an email at firstname.lastname@example.org if you have any question on Membership Rewards redemptions or transferring to travel partners!
Happy [New School] Travel!
3 thoughts on “Is Your Old School Points Strategy Costing You Money?”
Great stuff. Thanks..Dr Tim
This is a very nice recap with examples. Congrats, one of my fave blog posts of the week.
Thanks Randy! I really appreciate the feedback here and will make sure write similar style posts in the future!