Of all the mistakes that beginners to the points and miles space can make, saving up points and miles can perhaps be the toughest of them to avoid. I'm certainly guilty of prematurely spending my points on something with less value or utility than I could have.
The crux of this challenge is that when you see a big-ish number of points, it's inspiring! It's all about the art of the possible, and a lot is possible with 50,000 or 100,000 points. That could be enough for a round trip flight most places within the US, or even some international destinations. Or it could be as much as $1,000 in cash! That's very tempting, especially if you recently paid the annual fee on one of the premium cards like the American Express Platinum or Chase Sapphire Reserve. And it's not necessarily wrong, per se. Despite the title of the article, your points are yours to do with as you please! I just happen to be a big proponent of using points to unlock aspirational travel that would otherwise be impossible. This is the best "value" for points, depending on your definition of the term, and it's generally only possible once you have a sizeable balance.
What get's me excited about the world of points and rewards is doing things that I otherwise couldn't, and optimizing for maximal value from my points. I've learned that this means I should save my points. Let's go through a few examples.
I was recently reminded of this after a couple of work trips near one another ballooned my American Airlines miles to just over 70,000. The sudden influx of points made me curious what some good redemption options for them were. While poking around the AA site for different award bookings, I knew generally that partner awards were more valuable than American's own award pricing. Also knowing that British Airways (plus Aer Lingus and Iberia) and Qatar Airways are part of the Oneworld Alliance with American, I started looking for destinations in Europe.
British has lots of business class options to Europe at 57,500 miles each way, which is great! They even have direct flights to London from my home airport in Phoenix. Kristyn and I love London, and could always use another excuse to get there. Business class tickets across the Atlantic are regularly several thousand dollars, and I would generally say $2,000 is a fair market value for them without looking up the cash price of the exact itinerary. The only downside is that flights to and from London have very high taxes and fees, often over $500. This still makes the redemption worth something like 2.6 cents per points.
Then I checked some places I knew were served by Qatar, and to my absolute delight, American will package an itinerary all the way from Phoenix to my favorite place in the world, Male, Maldives, for 70,000 points. This is a ticket with a market value of more like $5,000! This exact itinerary through Houston and Doha was $5,800 when I searched it, and the award taxes and fees are much lower. That makes the value over 7 cents per point.
The lesson I took out of this little search experiment was that saving just 12,500 more points, or about 22% more, can be the difference between 2.6 and 7 cents per point. Put another way, it could be the difference between getting to London, a place I love, and getting to the Maldives, a place I'm obsessed with.
That's a single example with a single type of point, but the premise is also true for flexible points across a variety of possible trips. The more points you have saved up, the more trips are possible. It's an incredible feeling to plan a trip knowing you have the potential to do almost anything, and your limitations are only when you can find award availability and how much time you can spend travelling.
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