A (0:00)

Every time you hear about another airline award chart disappearing or hotel program devaluation, you might wonder, is the points game even worth it anymore? So today I'm going to break down exactly why I still believe we are living in the golden age of credit card points and miles. I'm going to walk through the different types of points and how to calculate what they're really worth, including the biggest mistakes that most people make when doing that math. We'll look at where the value is, what to avoid, and whether you'd actually be better off earning cash back. And. And for some of you, I think you might be. Whether you're just getting started or deep in this game, this is everything you need to know to fine tune how you're playing the points game and whether it's actually going to be worth it for you. I'm Chris Hutchins, and if you enjoy this episode and want to keep upgrading your life, money and travel, click follow or subscribe. So whenever I talk about points, I hear some people ask, is it even worth playing this game given all the times we keep hearing about devaluations? And they're not wrong, right? I feel like most of the news we hear is, oh, this hotel chain moved their categories up. This airline devalued their points. It's not always the case. Sometimes you see JetBlue just recently added Condor as a way to redeem your points. And they recently added Japan Airlines. So JetBlue points might be more valuable. And Mesa, which is a new homeowner's card, added some transfer partners like sas, which is a airline that we couldn't transfer to from any other currency. So things do sometimes sound like they're getting better, but most of the news is that points are getting devalued. However, I want to go back in time to explain why I still think that we're in the golden age of points and miles. And I look back at this card that used to be kind of one of the greatest cards, the Starwood amex card. It was the favorite of most management consultants and people who traveled, and it was an amazing card at the time and it earned one Starwood point. I believe it had a 25 or 30,000 point welcome bonus when it happened. And the really cool thing about this card was you could earn Starwood points, but Starwood points could transfer to airline miles and you could transfer 20,000 points to 25,000 airline miles because they added a bonus every 20,000 points you transferred. So if you did it at those intervals, it was effectively a 1.25x on everything card. It was amazing. Now we have 2x on everything cards, so you can earn points way faster. Now. I looked back at the original Chase Sapphire Preferred launch. It didn't even have two x categories other than booking in the Chase Travel portal. A couple Years later in 2011, they added 2x on travel, and then the next year they added 2x on dining. It was revolutionary. Oh my gosh. You could earn 2x on travel and dining. It was amazing. Now we have cards that earn 5x on flights, 4x on hotels, 4x on dining. Things have just gotten so much better in the last 15 to 20 years when it comes to how much you can earn. But also, if you want to look back at what signup bonuses were, I looked back and in the early 2000s, people wrote articles about 10, 20, 30, 40,000 point welcome bonuses. That was news. I've had multiple 200,000 point signup bonuses and some even greater than that. It's not even crazy to pass up a hundred thousand point signup bonus right now because they seem to happen so frequently when 10, 15 years ago, they were unheard of. So are miles and points worth less now than they were 10 years ago? They absolutely are. But can you earn them at a way faster rate also? Yes. In fact, I would wager to say that the average dollar value of a welcome bonus, the effective value and the effective return on your spend in terms of what are you getting in terms of points back relative to their value? I think both of those have gone up in the past 20 years. And, and it's why I still think that this is the golden age of credit card points and miles and what you can earn. And so I am really excited to be diving into the actual value of those points because I think that there's a lot of value to be had here. But it's important to know that not all points are the same. So as I run through this episode, I'm going to highlight the four different types of points so we know what we're talking about. The first two are probably the ones almost everyone's familiar with, airline and hotel points. Now, one thing to keep in mind, airline and hotel points usually aren't very portable. Hotel points you can usually transfer to other people. But airline points, I don't think you can in any program. Some of them do have points pooling, so you can kind of book together with a friend and combine those points. But most of them do let you book flights for other people. So yes, you might not be able to Transfer your United or Delta points to your family members or friends, but you could book travel for them. So keep that in mind. They're not as portable. Now, the third type of point is transferable points. And these are my favorite. These are the points you get from Citi, Capital One, Amex, Chase, Bilt, Wells Fargo, Mesa, Brax, US bank, supposedly later this year, tbd how valuable that will be. And the reason I love them is because you just get so many options. You can transfer those points to airlines and hotel groups. You can use them in their travel portal, effectively, more like cash back. Some of those programs let you just take it as a statement credit. And so there's just so much more flexibility with transferable points that I value them much higher than airline and hotel points. It's a little bit strange because at the end of the day, I usually use them to transfer to airline and hotel groups. So you would argue, why would they be worth more? If I valued a hyatt point at 1.7 cents and I use my Chase points for Hyatt points by transferring, how could my Chase points be worth more? But you could also ask me, would I pay more for a point that could be an airline point at 10 different airlines or five different hotel groups than I would for an individual airline or hotel group? And the answer is yes, because you don't know where that availability is going to be. The trip you want to take to Europe or the trip you want to take to Asia might be on one carrier that if you only accumulated Delta miles, you might never be able to book. So having transferable points, I think is way more valuable. But also they have transfer bonuses. So I went back and I looked historically, on average, AMEX Wins here with 17 transfer bonuses a year, on average. And I'm looking at kind of year to date, 2025 and 2024. And what that means is 17 different times throughout the year, Amex would give you anywhere from probably 10 to 30% more points when you move them to another airline or hotel group. Sometimes for hotel groups, actually, that amount was as much as 3, 50% or even 100% transfer bonuses. But for the most part, with the airline groups, that bonus is right around 24 to 27%. I actually ran all the numbers for all of them historically. So on airlines, 21 to 27%, on hotels, 29 to 65%, with one exception, and that's BILT. Now, BILT has had less transfer bonuses over the last few years, in total, since the beginning of 2024. It's been 14. But if you have built status, those transfer bonuses, which always occur on the first of the month, end up being as high as 100 or I think in some cases 175%. On hotels, that means that if you transfer a hundred thousand points to Air Canada aeroplan, there have been days where if you had the highest build status, you would have 200,000 Aeroplan points. So one of the reasons I think built points are worth more than all other points is that they've had these really lucrative transfer bonuses. And even if you had the lowest tier of status within Bilt, it might only be 125% bonus or a 25% bonus where you'd get 125% of the points. But that's still a meaningfully great bonus. Obviously, if you can spend your way to platinum status and you get 100% transfer bonus, that's even better. So those transfer bonuses also give a little bit of a boost to the value of those transferable points. So I love transferable points. They're my favorite. They're the things I'll talk about the most. And then the last type of points is what I'll call fake points. And they're with programs that might call what you earn points. So in the case of bank of America, you earn points, but you can't really use those points for anything other than either booking travel or cashing out as a statement credit or just depositing into a bank account. So if you can't transfer those points to airlines, and if you can't use those points in an airline or hotel program, I'm going to call them fake points. I'm not even going to talk about them today. I want to be clear that some programs call what you earn points, even though you can't really do anything with them other than what you could do if they were also earned as cash back. So that's the different types of points. Why is it important to know what they're worth? Why are we doing this episode today? And I think there's really two reasons. One is so you can compare points amongst themselves that might help you decide which card to open. You might see 100,000 point signup bonus for one card and a 200,000 point signup bonus for another card. But in the case of hotel points, if those were Hilton Choice or IHG points, you might not want 200,000 of them if you could otherwise have a hundred thousand transferable points. And so it's helpful to compare the value of points to know which cards to open or which cards to use. Right. Some cards, especially hotel cards, might look like they earn a ton. Oh, I can get 3x on everything with a Hilton card, but if those Hilton points are only worth half a cent, I'd much rather be earning 2x capital 1 points with a venture card, because I think that's a better earning rate. So that's something to keep in mind. And then also I think the most important thing is to decide if this whole game makes sense. If we compare earning points to earning cash back. And by the way, when I say points, some programs call them miles. We're going to bucket all of those in the same bucket. If you compare them to earning cash back, you can know if you're actually getting the value. So if your points are worth 2 cents and you have a card that earns 2x points on everything, then you're effectively earning 4%. So if your best cashback alternative is a 2% card or even a 3% card, you'd be way better off with points. But if you go through the exercise we'll go through today and you decide that your points are really only worth $0.01 and you have a 3% cash back card, well, that 2x card is effectively earning you 2%, and a 3% cashback card is earning you 3%, you would be way better off earning cash back and paying to book all of your travel. That said, if you're comparing your points to your cash back and it's to tie or it's even close, I'd always give the edge to cash back because you're not locked into anything. Right. If you earn points and you decide later. I'm not sure I do value them as much as I thought. Well, you have them. They're pretty hard to convert to cash in any way. That's at least legal or by the terms and conditions of most of the programs. But with cash back, it's cash. You can invest it, you can earn a return on it. You could do all kinds of things. So if it's tie, if it's close, I would always err on the side of cash back. This episode is brought to you by Gelt. But it's not just this episode, because I am also hosting a live event on September 18 about the top tax moves that business owners need to know, especially in light of the new tax legislation that's reshaping everything from business deductions and tax brackets to estate exemptions and energy credits. So in this online event I'm hosting, which is totally free, I'LL be joined by CPAs and tax pros from GHELT to unpack everything you need to know for your business. Whether you're running a company with dozens of employees, you're freelancing on the side, or you're just getting your startup off the ground, the event is online. It's on Thursday, September 18th. You can register for free at allthehacks.com tax event and even if you can't make it, definitely register because we'll be sharing a recording with everyone who signs up. And if you're not familiar with ghelt, they're the tax team I use and trust to handle everything for my personal and business taxes. I like to think of them as the ultimate modern CPA because they pair a team of in House expert CPAs with an amazing tech platform. So if you want a more premium proactive tax Strategy, check out Gilt@AllTheHacks.com G E L T or join our free online event at AllTheHacks.com Tax Event. This episode is brought to you by Fabric by Gerber Life. I get it. You probably don't love talking about life insurance. It's not fun, it's uncomfortable. But here's the question. If something happened to you tomorrow, would your family be financially okay? If you can't answer a resounding yes, you probably should take a look at life insurance and probably just ignore all the crazy policies out there and focus on term life. I personally think it is the best kind. It's simple, affordable and does exactly what you need. And fabric makes it incredibly easy. Fabric by Gerber Life is term life insurance you can get done today made for busy parents like you all online on your schedule right from your couch. You could be covered in under 10 minutes with no health exam required. Fabric has flexible policies to fit your family and your budget, like a million dollars in coverage for less than a dollar a day. And if you're young and healthy, the time to lock in low rates is now. And best of all, with a 30 day money back guarantee, there's no risk and you can cancel at any time. Join the thousands of parents who trust fabric to help protect their family. Apply today in just minutes@meetfabric.com AllTheHacks that's MeatFabric.com AllTheHacks M E-E-T fabric.com AllTheHacks Policies issued by Western Southern Life Assurance Company not available in certain states. Prices subject to underwriting and health questions okay, so what are these points worth? I'm going to throw a lot at you in this episode. And I'm going to do my best to recap and summarize things as we go and end with really strong takeaways so that everything makes sense. And so here's how we're going to walk through this episode. I'll start with some reasonable floor value for points so you understand kind of what's the base? Then we'll look at what most of the experts in this field say, how do they value points? But then we're actually going to dig into the data itself to see how that might change things. And it's actually really interesting. Now I think we have access to data that can give us a better understanding of the value of points and who might get more or less value than other people. Then I'm going to talk about how you kind of need to personalize all of this to your particular situation. I'll talk about how to do that and what kinds of things might change those values. And then we'll look at why there might need to be a ceiling or a cap on the value we give points because you can buy these points. And so if the alternative of accumulating them is accumulating cash back and then buying them, really, we could set a ceiling on their value as to what we could buy them for. I'll share where I net out on points and what I think the values are. And finally, I'm going to walk through all of my learnings, looking at the best cashback cards and the best points cards to see if there's actually an easier way to approach this question with. And I think there might be. So, like I said, we'll start with what are the floor value of these points if they're transferable points? One of the great reasons that I love transferable points, especially for people who are new to this, is that you can often use transferable points in the travel portal of the program. So if you log into Amex, you can go book flights or hotels. With Amex Travel now, you might only get $0.01 per point, and you might, by the end of this episode, think that's not a lot. But when you compare cash back cards to points cards, if you guarantee yourself at least getting one cent on the points card, it's an amazing hedge for not being able to get all the value you think booking flights and booking travel. Some of these programs even let you take statement credits. So if you're able to take a statement credit for $0.01, then the floor value of points really should be somewhere around $0.01. Because if you could book flights, any flight you want in the portal or hotels, or you can take a statement credit, that $0.01 value is kind of the floor. Now, if you have airline and hotel points, you usually don't have as many options of how you cash them out. However, most airlines and hotels have two tiers of pricing. They have their what I'll call saver pricing or standard award pricing, which is where you really get outsized value. But a lot of programs now have moved to this dynamic version of pricing where take United, American, Alaska, Delta, Southwest. There is some value where you can book any flight and that value tends to be around at least $0.01. So if you just need to book a flight on United and there's no saver availability, there's no special deals, you can still book that flight with your United miles and you'll usually get at least a cent of value. So for me, I think the floor value for transferable points for airline miles is usually around $0.01. For hotels, it's a little tricky, but for reasons I'll explain. But their values kind of widely change depending on the program, and some of them don't have the ability to use them as easily if there aren't those standard awards. I've often looked at the Hilton calendar and seen, oh, this night it's 120,000 points, and this next night it's 975,000 points. So it can be a little crazy looking at that. So I don't have a perfect floor for hotel points, but I'm not sure we need one. I just thought that was a good place to start. Now, the easiest place to say how much are my points worth is to just look at what most of the experts are saying and you can decide whether you want to trust their valuations. So I'm pulling up this article from the points guy. Every month they update it. We're looking at their August 2025 valuations and they say, hey, what are credit card points and miles worth? AMEX Membership Rewards $0.02, Capital One, 1.85 cents. Then they go down and say, what are airline points and miles worth? And they go through every airline and they give a value like Delta sky miles 1.2 cents. They actually clarify that they recently increased this. You go down in JetBlue 1.45 cents and you can go down and see what they value. These points are. There are a few different people that do it. A blog I really like, One Mile at a Time does it as well. I think they're a little bit more conservative with their point values. And so here I'm seeing all the transferable points from them are 1.7 cents. Most of the airlines, they value at 1.1 to, it looks like about 1.5 cents. And then on the hotels, it's kind of across the board, mostly because Hyatt points and Accor points are more valuable than all the others. So if you look at all hotel points, excluding those, it's almost always in the 0.3 to 0.7 cents. But Hyatt points here are 1 1/2 cents, and Accor points are actually at 2 cents. But the devaluation of the US dollar has actually made them a little more valuable because Accor points are fixed at €2 cents, which is now worth about, I think, think about 2.3 cents. So you could look at the experts and just say, what do they think? Now, one of the things that's tricky about doing this is that most of these experts are basing it on the type of value that they think their readers and they themselves can get. So if I look at the points Guy valuation, they're putting built points at 2.2 cents. That is true if you take advantage of these transfer bonuses and you know what you're doing and you book flights in the way that a lot of these readers and a lot of the people writing these posts do, frequent Miler, which is another blog that I love, has a different approach. They do what's called reasonable redemption values, and they say they're looking at midpoint values that they think are reasonably easy to achieve. So this is another approach. And if you're not an expert in the industry and you don't know what you're doing yet, this might be a better place to start. They're going to value most transferable points at 1.3 to 1.55 cents lower than the other two by a pretty big margin. But because they're saying this is what it's going to be worth if we make it easy, if you want to get advanced, obviously those can go up. And so their reasonable redemption values, I think, are lower than the value I might get from points, they bring an approach that I think is super helpful, especially for people early in this. But at the end of the day, I prefer looking at the data. And we have a few excellent sources for this. So on the flight side, there is a tool called Points Path, and I don't have the data pulled up, but just so people who aren't familiar, if you're watching on video, which by the way I think this episode and the previous episode will now be on video, not just on YouTube but on Spotify. I'm looking at Google flights and what Points Path does when you search for Google flights is they just go out and look at the points needed from that program and compare it. So I'm looking here and it says, oh, from San Francisco to JFK there's a JetBlue flight, it's 31,400 points plus 11 or $462. Now every time they do that math they save that data point and they have tons and tons of data. Now you can't access the data directly on your own, but if you do go to the Frequent Miler website, they've started using that data and they've reported on it and they've shared a bunch of it back. So as an example, if we look at some of this points path data, I'm looking here for Air Canada, they report a average value and a median value. And so they're actually quite different. And that's because a lot of the flights on the high end skew this data. Sometimes you'll find a last minute flight that might be $1,000 and it's a great deal with points, but that doesn't mean that's the value you should expect. And so there's medium values, average values. But the interesting thing is that they break out economy versus business and then they also break out domestic versus international. Now another source for this data which does a similar breakout is Award Wallet. And Award Wallet is a tool that you can link a lot of your airline, hotel and bank programs to. They track the balances of all those programs. I will say it's not quite as simple as it sounds. The refreshing often needs you to have a browser extension installed or sync your email. But for every one of their members that books a flight, they see that in their email. They go into a search using I think Skyscanner and Kiwi to find the cheapest tickets that meet a criteria that they've set, which is same class of service, same calendar day and no more than 20% longer in terms of travel time. So they're going to go price these itineraries and then compare them to the number of points that the individual Award Wallet member used. So if you look at the Points Path data, it's based on all the flights out there, whether someone actually ever booked it or not. So it includes really bad redemptions that people might never do. If you look at the Award Wallet data, it's only the redemptions that people do. And so you'll see that their average values are a lot higher. So, for example, Air Canada aeroplan points, the average value someone has gotten from award wallet is 1.85 cents, whereas the medium combined value of Aeroplan points from PointsPath is 1.18 cents. So that's a pretty wide difference. But I think where it gets more interesting is if you start to look at the value for domestic versus international economy versus business class. So if I look at this for Air Canada for a domestic US flight, and keep in mind for people thinking, well, Air Canada is not in the US this is people using the Air Canada program to book domestic US flights, most likely those flights are on United. So the median value for an economy domestic ticket is 1.2 cents, whereas the median value for a domestic business ticket is 2.1 cents. Similarly, on international, the median value for an economy ticket is 1.08 cents and the median value for business is 1.53 cents. And the median value for first class is 2.26 cents. Those averages are even higher. So the average value of an international first class ticket is 3.67 cents. Now, this is the points path data. This is just all the flights that are seen. If you actually look at what people are booking, at least people who use award wallet. I'll take Air Canada again, but then I'll talk a little bit about Alaska because it's just clear to see why Alaska points are so valuable. The average point value for a regional economy flight is 1.21 cents. And then for a regional first class, it goes up to 2.56 cents. And then if you look at long haul, business or first class, 2.63 cents. So the big takeaway here is that if you're using your miles for short domestic economy flights, you're going to get less value for per mile than you are using your miles for long haul, first or business class tickets. Now, if you're doing international or you're doing business class domestic, those are still more elevated values than domestic economy. But the biggest bang for your buck is on long haul business. This is probably not a surprise to most people listening. If you scroll through all of the award wallet long haul business class valuations for different programs, it's like 4.17 cents, 2.39 cents, 3.19 cents, 3.92, 3.28. Almost all of them are one and a half to as high as 5.86 cents. That's really high. I'm not suggesting that Everyone should value their points at 3 to 5 cents. I'm just saying, if you're using your points for international business Class, that's effectively what that value has been shown to be. So if I'm looking at United, I'm seeing United's Points Path data says that the median value of economy is 1.09 cents, but the median value of business class is 1.46 cents. And these are tons of data points. The total number of data points for United that this data is based off is 4.8 million flights. So there's a lot of stuff going on here. But there are two big takeaways for me. So one is that huge difference you get between domestic and international economy versus business. The other big takeaway is that some programs have a really wide band of potential point values and others don't at all. And that's really notable when you're comparing the Award Wallet values to the Points Path values. If you figure Points Path is everything, Award Wallet is what the experts get. And you compare those two. You look at something like Alaska where the Experts are getting 2.12 cents and the kind of general data is getting 1.46 cents. Now, these are just averages. This is not looking at business or economy. I took the average numbers, but then you go down and you look at JetBlue and you say, wow, all JetBlue flights, the average value is 1.21 cents. The experts, the people using Award Wallet, the people like me, the average value they're getting from JetBlue is 1.24 cents. And that's because there are a handful of airlines, Delta, Southwest, JetBlue, where it's just really hard to get outsized value. Now, in the case of JetBlue and Southwest, they're mostly a fixed value point. It does change dynamically a little bit. But I haven't heard of a lot of situations where someone booking a flight on JetBlue or on Southwest or usually on Delta, has gotten 2, 3, 4, 5 cents. With JetBlue adding a few transfer partners internationally, maybe that's possible every now and then you might be wildly lucky and get an international partner booking from Delta in business class that's greater than that. But looking at Delta here, the average value that a Word Wallet user is getting is 1.34 cents. So, yes, that's more than the 1.14 cents that most people are getting on Points Path, which is just all the flights. But honestly, that value might come from the fact that I would guess most Award Wallet members have a Delta American Express card, which gets you a 15% discount on your Delta bookings and that might make up for that Delta. So when you look at the flight data, the big takeaway is business class and international flights are going to get you more value and certain programs like Delta, JetBlue, Southwest or are going to get you less value or at least less upside in value. They might get you more consistent value, but on the upside it's not going to be there. And honestly, if my choice was only earning points in those programs or cash back, I'd probably go for cash back. The reason I like points is because of the outsized value I can get from all those other programs. On the hotel side, a Word Wallet does actually do the same thing for hotels. So we can get the data that they show for hotels. There isn't the same breakout of what do you get from international versus Domestic, sweets versus not. So they just have their average value this episode is brought to you by Masterclass. If I'm trying to rewrite something or do some research, AI tools have been great. But when I'm really trying to learn something meaningful in business or life and really build some mastery, I love to turn to an expert or mentor. And one of the first places I look is Masterclass. Masterclass is the only streaming platform where you can get unlimited access to over 200 classes taught by the world's best business leaders, writers, chefs and more. And if you're short on time, you can get thousands of bite sized lessons across 13 categories that can fit into even the busiest of schedules. You can learn to win negotiations with FBI hostage negotiator Chris Voss. Unlock investing fundamentals from Wall Street Pros Master leadership with top CEOs like Bob Iger and Howard Schultz. But it's not just business topics. I'm loving their new Science of Parenting series right now and learning so much about being a dad to our two girls with masterclass. Plans start at just $10 a month billed annually and come with a 30 day money back guarantee. And right now our listeners get an additional 15% off any annual membership at AllTheHacks.com Masterclass that's 15% off at AllTheHacks.com masterclass AllTheHacks.com MasterClass this episode is brought to you by Bilt. Nobody wants to pay rent, but if you have to, why not get rewarded for it? And Bilt does exactly that. They have totally changed the game by rewarding their members with valuable points and exclusive benefits around their neighborhood every single month by paying rent through BILT you can earn flexible points that can be redeemed towards hundreds of hotels and airlines, a future rent payment, your next Lyft ride, and more. But it doesn't stop there. BILT is about making your entire neighborhood more rewarding. You can dine out at your favorite local restaurants and earn additional points, get VIP treatments at certain fitness studios, and enjoy exclusive experiences just for Bilt members. Every month, Bilt is turning a monthly expense into an opportunity to earn rewards and discover the best that your neighborhood has to offer. Your rent is finally working for you. Earn points on rent and around your neighborhood, wherever you call home, by going to allthehacks.com BILT that's allthehacks.com bilt B I L T Make sure to use our URL so they know we sent you. The next tool I want to introduce is called Gondola and they have amazing data for hotels. And they do that because they have this website that allows you to search and compare cash and points booking rates for hotels. The site's totally free to use. They even track your points on hotel side, but they also let you complete the points bookings on their site, which is really cool. So instead of using an award search tool, finding a hotel booking and then going to the hotel website to book it, you could do it all on their site. So definitely check that out. There is a referral link. If you use someone's referral, you get a free $50 after your first booking. Mine is at allthehacks.com gondola so if you're going to sign up, definitely use someone's referral code. And every time they see a hotel, they cache all of the data and they store it and then they let people like me analyze that data and share it with you guys. And if I have one qualm with the site, it's that sometimes on the search results page they will show cached data and then when you actually click into the hotel they live, refresh it and that points booking might not still be available or the rate might have changed. Doesn't happen all the time, but I understand why they do it because it's just too many things to refresh at once. So it's a quicker site than some other ones because it's getting you all that data right out front. But you need to click into the individual hotel to refresh the data to make sure that rates there. But when it comes to looking at the redemption values, they have a tool that they've given me to look at so I can see what is the distribution of redemption values for Hyatt? And so here I'm seeing on Hyatt, 730,000 different options across 1700 properties, 23 brands. And they show you the distribution, the percentile distribution, and they say median value of Hyatt points is 1.65 cents per point. Now, this is why I love Hyatt points. They're so much more valuable than all other hotel points and they transfer one to one from Chase. It's awesome. They also say at the 75th percentile you get 2.15 cents per point, and at the 90th percentile it's 2.81 cents per point. They let you go further and say, hey, because most points bookings are refundable, what if we only compare to refundable rates? And then because one of The Hyatt chains, Mr. And Mrs. Smith, is just a fixed rate redemption, there's not a lot of outsized value. You can say, hey, show me only Hyatt, excluding Mr. And Mrs. Smith. Now, the median value goes up to 1.89 cents per point. When you're looking at refundable bookings that aren't Mr. And Mrs. Smith, the 75th percentile goes up to 2.46 cents per point, and the 90th percentile goes up to 3.25 cents per point. TLDR Hyatt points are worth a lot relative to airline points. They're kind of comparable or even better. The tricky thing with hotels is that hotel points are across the board. If I look quickly at Award Wallet and the value that most of their members have gotten, choice points, Hilton points at about 0.6 cents, IHG 0.68, Marriott 0.93. So they're kind of around all across the board. If I look at the data from Gondola, I think the interesting thing is you can see a couple takeaways. One, if I look at Hilton, the median value is 0.39 cents. However, the 75th percentile goes up to 0.46 and the 90th percentile goes up to 0.57. So if you cherry pick the best redemptions, you can get more value. I think we all know that if you compare it to refundable rates, the values go up a little bit. But, you know, maybe 10% ish. But if you look at particular properties and chains, you see more value. So with Hilton at the 75th percentile, so points are worth 0,46 cents. But if you look at the Conrad, it's 0,56 cents. If you look at LXR, it's 0.88 cents. And if you look at the Waldorf, it's 0.65 cents. So you don't need to remember all these numbers. So I'm sorry for throwing them all at you, but the takeaway is at certain chains within the hotel groups, you can get more value. This is similar to the airline example of getting more value from business class. If you're booking luxury chains like Conrad, Waldorf, Park, Hyatt, St. Regis, Ritz Carlton, Kimpton Six Senses in those respective chains, you find that the value of those points are worth more. So I think the big two takeaways here, from looking at the data they apply to hotels and airlines, the more premium booking you're doing, whether it's premium properties, premium cabins, you get more value. And if you compare what the experts are getting from their points to what the data shows the average price per point is, it's just significantly higher. I'll use Hilton as a great example. The median value for all bookings from the gondola data is 0.39 cents. But if you look at what Award Wallet users are getting at Hilton, it's 0.59cents. Now, those point values may seem smaller, but keep in mind that earning 0.59cents instead of 0.39cents is 50% more value. So again, the more you understand how to do this, the more you're picking the best redemptions and not picking the worst ones, the more value you're going to get. Now, if you hear me talking about hotel points and you think, wow, if they're worth so much less than airline points or transferable points, why would I want them? Keep in mind two things. One, oftentimes when you're using a credit card or staying at a hotel, you're just earning way more points. With top tier status at Hilton and the top tier credit card, I think you're earning 34 Hilton points per dollar. Also keep in mind that if you're transferring those points from bank programs, the transfer ratios are often not just one to one. So if you go from Amex to Hilton, you're going one Amex point to two Hilton points. If you're going from city to Choice Privileges, you're going one to two. And so it's not always just a straight one to one transfer. That said, sometimes it is. And that's why I never use those points as transfer partners from those programs. So if you're transferring from Chase to Marriott, you're getting one to one. And those merit points are worth a lot less than airline points, which is why I'm never doing those transfers. So keep that in mind. So now that we've looked at what experts say, we've looked at what the data says, I'm just going to do a quick kind of min max on the values here. If I look at airlines and I look at the points path data, I look at all the experts. The minimum value that anyone assigns to airline points is 1.1 cents, and the maximum is 1.55 cents. Now, award wallet members might be earning a lot more than that, but valuation wise, that's kind of the range. 1.1 to 1.55 cents. If you're using premium cabins. If you're doing what Award Wallet users say, then I think it's a little bit different. Award Wallet, the minimum is 1.24 and the maximum is 3.65 cents. So that's something to keep in mind as well. On the hotel side, generally, all of those hotel points, except for Hyatt, are in the.05 to 0.75 range. And then Hyatt is in the 1.5 to 1.7 range. There are other hotel chains preferred leading hotels in the world. Accor Wyndham, I did not include those in this analysis. Most of them are a bit more fixed rate values, so it's not as interesting to think about their value. And they have a limited number of places you can transfer to. But just having valuations from data or experts is not really enough, because if you're not staying in those luxury hotels or flying premium cabins, then the values you get might be totally different. So the real best answer here is to look at your own personal value. And I want to walk through how to calculate that. Unfortunately, you probably don't have a history of every redemption you've done and what the going rates were at the time in the past. So it's a little bit hard to go back in time. But the next time you're planning a trip, I'd encourage you to go through this process so you can get a sense. And if you want, right now, you can even go and plan a hypothetical trip just to see what kind of values you're getting. But as I did this, I realized there's some things that I think most people out there are missing. So let's start with just a simple example. There's $150 flight. It costs 10,000 points. And you might say, great, if I were to book that, I would get 1.5 cents per point. So my point should be worth 1.5 cents, right? It's not that easy. So first off, there are taxes and fees. Domestically, those taxes and fees are usually $5.60, so it's a little bit negligible. So in that previous example, I would just subtract 560 from the cost of the flight, which would make the cents per point 1.44 cents per point. However, internationally, especially on premium cabins, those taxes and fees could be $50 and they could be $1,000. So I think of this just like an equation. You've got. The price of the flight equals the number of points plus the taxes and fees. Subtract the taxes and fees from both, divide and you get the answer to what is the cents per point? However, you can't always compare the exact flight you're taking for a few reasons. Let's say you're flying from LA to New York and the cheapest points ticket is on Delta. But when you look at the cash prices, United's flight is half the price. If you were booking with dollars, you weren't going to book that Delta flight for 2x the price. So I think you need to use a reasonable alternative as to whatever you would book with cash. And then maybe you need to adjust it for some premium cabin. For example, we might book a flight to Europe using 50,000 Air France points that otherwise was $3,000 in business class. But would we really pay $3,000 to fly in business class? If you wouldn't, then I'm not sure that cent per point value makes sense because if you are using it to compare to earning cash back, it'll put the favor in the points every time. But if you wouldn't actually pay for that flight, then it's not necessarily a fair comparison. But also, don't just use the economy flight prices because you're getting a way better experience. So I'd say look at the price of flights and come up with a what is the amount of money I would have spent on this trip? And compare the number of miles to that. And if you are doing this looking at one way flights, keep in mind that in some geographies, one way flights are wildly inflated in price if you're booking them with cash. So I've often looked to Europe and found that a $3,000 round trip flight to Europe might be $2,300 each way, but only 3,000 booked as a round trip. So when I'm really trying to be honest with myself and say what are my points worth on this trip? I'll look at the round trip flight compared to the round trip points. And I'll look at it on flights that I would have reasonably taken, not just the flights that I booked with points. Often you can get really expensive flights with your points, but there's another flight that wasn't as expensive that you would have been totally happy taking if you were paying for it yourself. A couple other things to keep in mind if you need to buy positioning flights. Let's say you found a great award, but it's from LA to Paris and you live in San Francisco. We need to factor in the fact that you might have to buy that other flight to get down to la. But the biggest thing that I see no one doing on the Internet when they compare what is the cents per point I'm getting on my trips is when you book a paid flight. And this includes flights, if you book them in a travel portal, you earn points on those flights. Now, depending on what status you have or what program it's in, the number of points varies. But for most of the US domestic airlines, it's anywhere from 5 to 11 points per dollar. And you earn credit card points when you book a cash booking, whereas on an award booking, you're only earning credit card points on those taxes and fees. So if you stack those two things up, that could be somewhere between 5 to 15%. You also don't always earn the elite qualifying points that you need on an airline to get status on your award flights. And so that has to have some value too. I went through the math. I think that value is roughly around 5% if you really care about status on that airline. If the only flight you're taking is Delta and you never fly Delta, the fact that you're going to earn a marginal amount of elite qualifying miles or medallion qualifying dollars in Delta's case is negligible. So you shouldn't include it. So depending on whether you care about earning status on the airline, I think that the value of all of the points and status you're going to earn, including your credit card on a paid flight, is between 10 and 20%, which is a meaningful change. It definitely does make the math hard. And so my quick rule of thumb is when I'm looking at a flight I'm booking with points, I compare it to the most reasonable alternative that I would have booked as part of a round trip. And I subtract the taxes and fees or any positioning flight, and if I don't have status on that airline or care about status on that airline, I knock off 10% and if I really value the status and I have a high level of status with that airline, depending on that status level, I'll knock off 15 to 20%. So that means that $150 flight that was 10,000 miles could actually end up being closer to 1.2 cents per point instead of 1.5 cents per point. Most of the time that bloggers share their cents per point, including me, I am guilty of this. They don't factor in all this data. And so I think the points path data above the valuation from experts above, it's probably not using this data either. So you could probably make a case that point values across the board are inflated by 10 to 20%. That said, there is one bonus for points bookings, and that is they are often way more flexible. Back when we were looking at hotels, when you found that you compared it to refundable rates, you found that the hotel value per point went up. Well, that's because most points bookings on the hotel side and on the flight side can be canceled for a full refund. Now, that's not true across the board. So definitely I'll link to an article in the show Notes from Frequent Miler that is all about the award cancellation policies per airline because they're not all free. But for American, Delta, Alaska and United in Alaska, by the way, partner bookings do have a fee, but that gets waived with their new Summit card. Those cancellations are free, and so there's some value there. Now, if it's an airline, you fly a ton and you cancel their flight, you will get a credit on that airline. And if you. And if you fly them a ton, that might be really easy to use. But if you're booking a flight to Europe, which we've done a few times, and you have to cancel it, and you had done that as a paid booking on, let's call it Lufthansa, well, now you might be stuck with thousands of dollars in Lufthansa credit that I can guarantee you will be way, way harder to use than if you just got your miles refunded. So it's up to you to decide what value that refundability has. In my mind, anytime I was making a cash booking, if they were to offer me a 10% premium to make that fare refundable, I'd probably always take it. So, yes, you could argue points prices are all maybe inflated 10 to 20%. If you value flexibility, maybe they're all deflated 10%. So maybe it all breaks even. There's a lot of ways to look at this. If you just want to do it on easy mode, I would say the easiest thing to do is subtract the taxes and fees of a comparable flight and discount 10%. And know that going forward, when I talk about cents per point on future trips, I'm going to try to do a better job of calculating this. That's a little bit more of a fair comparison so that it gives you a better idea of what points are actually worth. But two big caveats here. 1. Just because you got a good redemption once doesn't mean you're going to get it every time. Just because you see a blogger promote hey, this time I got 10 cents per point. Well, that's because it's a great article title. That's because people get excited to read it. Sometimes I use my Delta miles and I might only get 1.3 cents per point. That's not a fun thing to talk about. So it might not make headlines, but it is true. So over time, I think as you use your points and your miles and you start to look at the value you're getting, you'll have a better barometer for what what your value is. If you don't have that data yet, maybe starting with something like the Frequent Miler, reasonable redemption values is better because it's a little easier guide. If you're a pro, you probably already have a good sense of what the value is. This episode is brought to you by Bilt. Nobody wants to pay rent, but if you have to, why not get rewarded for it? And BILT does exactly that. They have totally changed the game by rewarding their members with valuable points and exclusive benefits around their neighborhood every single month. By paying rent through bilt, you can earn flexible points that can be redeemed towards hundreds of hotels and airlines, a future rent payment, your next Lyft ride, and more. But it doesn't stop there. BILT is about making your entire neighborhood more rewarding. You can dine out at your favorite local restaurants and earn additional points, get VIP treatments at certain fitness studios, and enjoy exclusive experiences just for BILT members every month. BILT is turning a monthly expense into an opportunity to earn rewards and discover the best that your neighborhood has to offer. Your rent is finally working for you. Earn points on rent and around your neighborhood, wherever you call home, by going to allthehacks.comBilt that's allthehacks.comBILT B I L T make sure to use our URL so they know we sent you. Thank you so much for being here Today, you can find all the links, promo codes and discounts from our partners@AllTheHacks.com deals. These are brands I love and use, so please consider supporting those who support us. Number two, while it's super helpful to know how much value you get from your points, if you're using that value to compare whether points are better than cash back, it's really important to recognize that sometimes you can buy those points with cash back you've earned. So I want to walk through that and why that might put a ceiling on the value of points you have. So first, I'm going to use an example. And in my last episode I talked about getting a $1,500 room at the Waldorf Astoria in Costa Rica for 120,000 Hilton points. So if we take $115,000 divided by 120,000, we get 1.25 cents per point. Now, let's be aggressive with our cashback strategy. Let's say I have the Robinhood gold card earning 3% back. Now, to get enough cash back to pay for that fifteen hundred dollar room, I need to spend fifty thousand dollars on that card. Now, most Hilton cards out there earn at least 3x on all your spend. So if that $50,000 weren't in any category bonus, I would earn 150,000 Hilton points. So that means that I'd have 30,000 Hilton points left. So clearly the Hilton card would be a better deal, right? Well, maybe not. First, as I just talked about earlier, that $1,500 stay is likely to earn a lot of Hilton points, even with the Basic card. Between that card and silver status, you're actually going to earn 19 points per dollar. So on that stay, you would earn 28,500 points. Even more if you had diamond status. So now it's almost break even, right? Put $50,000 on a Hilton card, get 150,000 Hilton points, spend 120,000 on the room, have 30,000 Hilton points left, or put $50,000 on a Robinhood card, get 3% back, which is $1500. Spend that $1500 on the room, but also get 28,500 Hilton points. So we're within 1500 Hilton points of these being almost identical. But neither of those are the best case scenario because you could actually use that Robinhood card, earn your fifteen hundred dollars of cash back, but then just buy those Hilton points, and Hilton points go on sale all the time for as low as half a cent. So let's say you took that $1500, you spent $600 to buy the points you need, you would have $900 left. So comparing those three outcomes, that's a way better outcome. But if you want to do it apples to apples, because it's hard to compare having Cash Back left over when the other two scenarios didn't have cash, let's say you just spend the whole $1500 on Hilton points. You'd end up with 300,000 Hilton points. You'd book your 120,000 point room, and instead of having 30 or 28,000 Hilton points in the other scenarios, you'd now have 180,000 points left over. So in that comparison, you would have been much, much better off with a cash back card using Hilton points that you bought to book the room. So the price at which you buy those Hilton points for kind of creates an effective ceiling. So as much as you could say that because you got a $1,500 room for $120,000, you effectively made your Hilton points worth 1.25 cents. That is true. You did get a ton of value from Hilton points. But if you're comparing that 1.25 cents to what you would earn on a cash back card, I don't think it's a fair comparison because you could have bought those Hilton points for half a cent. So we need to look at the data on what buying points is worth to set a ceiling on what our points are worth. And by the way, in that previous example, that doesn't mean I'm moving to Team Cash Back. It just means that if your only two options are the Robinhood card and the Hilton card, you might not want to use the Hilton card for your everyday spending. So let's quickly run through what the data says about buying points so we can figure out what to do with that data. So, on the hotel side, when hotel points are not on sale, excluding Hyatt, they typically cost 1 to 1.25 cents, which is about 1 1/2 to 2x the valuation that most people give them. It's pretty awful. I would not buy hotel points if they're not on sale. That said, Hilton, IHG and Choice points are always on sale, so you're okay. They go on sale seven to ten times a year. So I think it's easy to put a ceiling on Hilton and IHG points at a half a cent and on Choice at about 0.62 cents. Marriott and Hyatt are on sale a little bit less, but when they do go on sale, their sales last as long as two months. But Their sales prices aren't quite as close to the value most people get them for. So if you're going to use them, Marriott points are often on sale for 0.89 cents and Hyatt points are often on sale for 2.8 cents. So you could use those ceilings if you want. I don't think it'll be that valuable, but I feel like it's important to talk about Airline point values are a little bit easier because they're all a little bit more clumped together. To recap on the public valuation side, they range from 1.1 to 1.55 cents, but the amount to buy them is all over the board when they're not on sale. The cheapest airline point you can buy is at 2.3 cents, all the way up to 3.8 cents. Again, like hotels, if points aren't on sale, don't buy them. When they are on sale, they're anywhere from 1.25 to 1.88 cents. Except Delta, which looks like never go on sale. So I'm never buying points, whether it's airline or hotel points, if I don't have a redemption in mind and I know how I'm going to use them. But the challenge here, and why I don't know if it's fair to use the exact sale prices as ceilings for airline miles is that they're not on sale nearly as often as hotel points. The only exception here is Avianca Life miles. They went on sale 17 times last year. I thought about throwing the dates into ChatGPT, and if I did, I probably would have gotten an answer that they were on sale like 340 of 365 days. So I would put a ceiling on Avianca points at 1.3 cents because they're almost always on sale. But their program has a lot of quirks and I don't think it's a program that someone new to this game should be using. And honestly, I still have a bunch of points there that I haven't used because of all the nuances of the program. That said, on any given day, at least five or six airlines probably have their points on sale somewhere in that 1.2 to 1.88 cents value that I mentioned. So I think it would probably be fair to put a cap on the value you give your points and miles at 2 cents per point. So I guess the takeaway here is that if you're looking at your data and you're ending up with point values that are higher than some of these sale values, then I would encourage you to bring that number down because it's not necessarily a fair comparison. It's absolutely fair to say you got that much value from those points. But if you're trying to compare whether you should be earning cash back or not, I would cap your airline points at $0.02 and I would cap your hotel points at 0.5 2.62 for most programs, 0.9 ish for Marriott and probably around 2.08 for Hyatt. So my summary is that I'm not buying points unless I need them, and I know the program really well and I know how I'm going to use them. But I would apply these caps if I'm doing any calculations as it applies to comparing airline and hotel credit cards to cash back cards. Right? Obviously it's totally true that you could get 2 cents of value from your Hilton points, but if you want to compare your Hilton card to an equivalent cash back card, I would cap the value of those Hilton points at half a cent. Same for IHG Choice again, 0.62, Marriott 0.89, Hyatt 2.08. On the airline side, if it's Avianca, cap it at 1.3 cents. For all other airlines, I would probably cap it at 2 cents just because there are a lot of options, but they're not consistent. So you probably couldn't come down much lower than that. Now you'll notice all those values we talked about were for airline and hotel programs. Yet I'm constantly talking about how much I love earning transferable points, and most of the cards I'm spending most of my dollars on are for transferable points because you don't need to commit to one program. So like I said before, if you find a flight on Lufthansa, you could just transfer points to a Star alliance airline and assuming that availability is there, you could book it. Whereas if you're accruing Delta or American miles, you'd be out of luck. So how do we think about valuing those transferable points? I think at a minimum they have to be worth the average of all the programs you can transfer them to. But I'm not transferring them to places with terrible value. So you could probably make the case that they should be valued at the maximum value of all the airlines and hotels you could transfer them to. That wouldn't necessarily account for the fact that there are transfer bonuses and you get value from flexibility. So this is a tough one. The points guy errs on the higher side, valuing Chase Amex, built at 2 cents per point or more, one mile at a time, just gives them all 1.7 cents per point. And frequent miler has them all around 1.5 cents per point. Keep in mind they're doing these reasonable redemption values, so they're not trying to target the max value you can get. For me, I'm almost always getting at least 1 1/2 cent per point. Often it's 2 cents per point or more. I recognize I could buy those points, so I can't go above that level. So I probably lean towards something around the one mile at a time perspective of saying I'm going to value all my transferable points at 1.7 cents per point. Now, again, if you're new to this game, if you're flying mostly economy, if you're flying mostly domestically, maybe you're not getting 1.7 cents per point and that's totally fine, right? The game is not to try to get the most value, because if you have to take trips you don't otherwise want to take to get the most value, that doesn't make sense. The point of all this is to make sure you're maximizing what you earn when you're spending money on a regular basis. But one other important consideration here is really about your own psychology. You might realize that points allow you to take a trip that you wouldn't have otherwise taken. In the same way that paying down the principal of your mortgage forces you to save, earning points instead of cash back might force you to travel. If you had that cash back, you might not have made the decision to spend your money on travel. But with points, you really have to travel to get your value out of them, which might be a good thing. On the flip side, the overhead of booking a trip with points can be a lot, especially if you're new to this. It might limit where you can go or the dates you travel. And the best deals might put you in a situation where they're driving the trip instead of where you want to go. Now, I think as you learn this game more you can get past that, but it's definitely a consideration. And I would bump up or down my point value depending on how strongly I felt about either of these. For me, I love the former. I love that it forces us to take trips. I do hate that the process is harder, right? If I were just sitting here with no points at all and we wanted to take a trip, I would just find the best deal, but I would probably game that out as well. Trying to figure out, well, what if I fly here and then change planes and go here or book two separate flights so that overhead would probably exist for my personality anywhere. But it's just something to consider and I think for a lot of people might give a slight edge to points. So with all that taken into account, I think the real benefit of having a good framework for valuing points is not just to know how much value we're getting, it's to give us a good comparison of whether earning points make sense over earning cash back. And fortunately, I will save you a lot of work here because I took a lot of time digging through my credit card optimizer tool, which I built to really help you compare what value you get and out of all of the different cards you could spend on. But one of the inputs for that tool is what is the value of your points. So hopefully this episode will help you drive that number. If you want to play with that tool, go to allthehacks.com card tool and you can buy it there. Or it's free for all the Hacks members, which you can learn more about at allthehacks.com join so my goal was actually to run through all the different spending categories and all the different credit cards out there to compare the best cashback rates, the best points earning rates. Because at the end of the day, if the place you spend the most money on gives you an option of a Forex points card or a 2% cashback card, well then as long as your points are worth half a cent or more, then it's a clear decision to go for points. And so for this episode, I ran through all the cards I had, but I did not include the earnings on cards where they were capped at less than $10,000 of spend a year. So there are lots of cards that might give you 5 or 6% on the first hundred or 500amonth or a quarter. I excluded all of those cards because I just don't think it's a fair comparison and it just makes the math really messy. So as I ran through this data, I looked at kind of two versions. One is assume you have all the best cards in all the categories. So on the cashback side, that means you have the Verizon card, the Gemini card, the Altitude Connect. On points, it means you have cards like the amex Business Gold card or the Chase Inc. Cash card. That's version one. Version two was I assumed you had a more limited set of cards and it might be one or two cashback cards for catchalls, it might Be on points common cards like Amex Gold, Chase Reserve City, Premier, Autograph Journey. And when I ran through it, the results were surprisingly the same for both of those sets. For many categories, gas, grocery, flights, hotels, dining, entertainment, the points card matched or beat the cashback rate, meaning that if you would get 3% cash back, you would also get 3 or more X points on those purchases. And so for most of these categories, it makes more sense to go for points if you want to get the maximum value. Now, obviously, if you're working on a welcome bonus, whether it's a cashback or point welcome bonus, then none of this matters because the earnings of most welcome bonuses, take for example, 100,000 points for $6,000 of spend, you're going to get a better return on that welcome bonus spending than you will with any cashback or any points card in almost any category. So if you're working on welcome bonuses, keep going. But let's ignore that for a moment and look at the four categories where things were a little interesting. So the first one is non flight and hotel travel. Now, the big change here is that the Chase Sapphire Reserve used to give 3x travel. Now it gives 4x on flights and hotels, but 1x on all other travel. There is actually no points card that earns more than 3x points on travel, but the Altitude Connect card from US bank actually does earn 4% on all travel. And if you have a Bank of America Premium Rewards or Premium Rewards Elite card and you have $100,000 in a bank of America or Merrill lynch account, you actually earn 3.5% on all travel as well. So if the best you can do on non hotel and flight travel is 3x points and the best you could do on cash back is 4%, then you really need those points to be worth more than about 1.33 cents for that trade off to make sense. And on that point side, to get that 3x points, the only cards still doing that are the autograph card from Wells Fargo and the Amex Green card, which I know are not the most popular cards. So I would say if you spend a lot of money on non flight, non hotel travel, it might be worth digging into this a little bit more and, and you might find that a cashback card like the Altitude Connect is the better card for you. Next category is Amazon. This one's really easy. There's nothing in the points world that I think comes close to earning 5% back on the Prime Visa. If you spend a lot on Amazon, you probably want that card. I do not earn points on Amazon purchases. Next category is a small one for I think most of us, which is streaming. But that Altitude Connect card I mentioned before, you get 4% back on streaming. The best points cards that I found earn 3x points. So I don't think most people are spending enough on streaming for this to matter. But if for some reason you're spending a ridiculous amount of money on streaming, you know, depending on how you value your points, it might not make sense to be earning points on streaming. But the big one here is the everything else category. It includes all the spending at places that you aren't getting, bonuses on dining, on gas, on groceries, on travel. And this one is really dependent on which cashback card you have. On the points side, there's a bunch of Options to get 2x points, Venture Venture X from Capital One. If you have the Citi Strata, Premier or Elite, you can get the Citi Double Cash. There are a bunch of options for getting 2x points on everything. And on the cashback side, there are a lot of options for getting 2% cash back. And if that's your only option on cash back, then again it's a relative do you value points more than one cent? If so, points wins. If not, then it doesn't make sense. However, there are cash back cards that earn more than 2% cash back. And that's where this gets interesting. So the first one, which was a lot more compelling earlier this year, was the US Bank Smartly card. Now if you have the US Bank Smartly card after it got nerfed this year, and you factor in all these new limits, what you need, the fact that in order to get beyond 2%, you have to hold cash in an account that earns almost nothing. I don't think you can make a strong case for this card being any more than a two and a half percent cash back card. And even that feels like a little bit of a stretch because you still have to keep $10,000 in an account earning nothing. But let's say that's your primary checking account and you already leave that there, we'll call this a 2 1/2% cash back card. Well, to use a 2x points card like the Venture Venture X cards, over a two and a half percent cash back card, you really need to make sure your point value is above 1.25 cents. That's above the floor value. So that means you need to be comfortable transferring to airlines and hotel groups and booking flights. And so at that point, I could say it really depends on you but it's starting to make a case for cash back if you're not that experienced or you're not interested in some of the premium travel options that get higher value from your points. Next up is the bank of America set up where you can put $100,000 in bank of America or Merrill Lynch. And when you do it at Merrill lynch, it can be stocks. So it doesn't need to be something that's making you lose interest putting it in an account that earns nothing. With that card, you'd be getting 2.6 to 5% on everything you spend on. And so comparing that to a 2x points card means you need your points to be worth 1.33 cents or more. So as that number creeps up, you have to ask yourself, am I really getting enough value for my points to justify getting 2x points versus 2.6 to 5% cash back? If you're not in a situation that you could put $100,000 of cash or stocks at a Merrill or bank of America account, then it's not an option. Then finally, if you have the Robinhood card, you could be getting 3% cash back on everything. So in that case, you'd need your points to be worth more than one and a half cents. And I would argue that if you're not experienced in this game or using premium travel, now that you factor in some of the things I've realized like earning points on cash bookings, I think it's a hard case to make that you're going to consistently earn more than one and a half cents on your points. Obviously, if you're working on a welcome bonus, it's a no brainer to spend the money on a points card. But if you have no welcome bonus and you're debating between a 3% cashback card and a 2x points card, I don't know. It's a tricky comparison, especially factoring in that that cash back can go straight into a bank account, that you can hopefully earn 4% back right now in today's environment versus those points are going to sit maybe in a transferable points balance, but they're not growing over time. I thought long and hard about this one for myself because I actually think that I could make the case to switch to a card earning 3% cash back. However, the Robinhood card doesn't consider taxes or business type transactions eligible for cash back. And if you look at all the spending that we do that is not in all the categories that bonus like dining and groceries and travel and then you remove taxes and business transactions. There's not a lot left. So yes, I could open that card and I could be getting slightly more value for all those everything else purchases. However, we don't have a lot of purchases in that category. So if you're doing a ton of spend in the everything else category, maybe you're spending a lot on home renovations, buying furniture. In that case, I'd actually consider you to go look at the Mesa rewards card because that card gets 3x on home improvement stores and furniture and home decorations. So that one actually in that example I'm wrong. Go look@allthehacks.com Mesa in the other categories, I'm not sure what it might be. Maybe you're buying a lot of stationary, maybe you're spending a lot on ebay, just things that don't bonus that maybe aren't considered business type transactions. It might make sense to look at a cashback card if you value your points anywhere close to or below 1 1/2 cents a point. So to recap, for almost all purchases with most cards, if you value your points over $0.01 then cash back won't be worth it. However, if you spend a lot on Amazon, I'd get the Prime Visa. If you spend a lot on non flight hotel and travel or streaming and you value your points right around 1.2 1.3 cents, I would take a look at that Altitude Connect card. And then for all the other spending that's not bonused on any cards, it really comes down to which cash back card you have and whether you value your points at more than the cashback rate of that card divided by two. Since there are a lot of 2x points cards. So if it's 2.5% cash back, then you need to be valuing your points at more than 1.25 cents. Now for me, I said I value my points at 1.7 cents, at least the transferable ones. So the only place the math gets close is on that everything else category. And if there was a card that was an uncapped 3% on all my spending, I would consider switching my cash back to those purchases. If a card comes back that's 4% on everything with no caps and no restrictions, I would move all my everything else spending there. Unfortunately, almost all my everything else spending is in categories that that Robinhood card excludes. And there's not really another option that's uncapped right now, but I'll keep my eyes out. It feels unlikely anyone that does it ends up changing it. The coinbase card came out and it seemed like it was going to be uncapped 4%. Now it's capped. So I am pessimistic that one of these cards will come out, but if they do, I will gladly switch my everything spending to team cash back. And of course, if you're working on a welcome bonus, that's always going to be the better return on your spend. So to do the final recap, transferable points probably have a floor value that's at least $0.01 and airline points might be similar. Hotel points all have different values, but for the most part, excluding Hyatt, I'd say they at least have a floor of half a cent. When you look at the data, you'll see that if you're booking more premium flights or hotels, your points are going to have more value. But you need to adjust all that data for your own trips that you actually take to look at what kind of value you're able to get. And unfortunately there's no one right answer. It's all very personal, but you also need to factor in some of the things that I think this industry as a whole leaves out, which is that booking flights and hotels with cash often earns a lot more points and status and points on the credit card spend to book them than I think is getting factored in here at a range of about 10 to 20%. So make sure you include that if that's important to you. And if you value the fact that points force you to travel, give the value of your points a bump. If you value that points bookings are easily refundable, then give that value a bump. If you hate the overhead of booking travel with points and you are very unflexible and you just want to be able to book whatever flight you want, maybe bring the value of points down a bit, but not lower than that $0.01 value because you could still go book that flight in a travel portal on whatever flight you want with almost every transferable currency. After looking at all the cards you could likely use for spending, I think it's really easy to make a case for points for everything as long as you value your points at more than $0.01. And if you've made it this far, you probably do, with the exception of the categories I mentioned, which is Amazon non flight and hotel travel streaming and that everything else category which really just needs to be compared to whatever the best cashback card you have would be earning. Finally, I'm going to push you all to test your convictions in whatever value you think you've come to for your points using something I learned from Greg at the Frequent Miler. He encourages you to think about what you would really pay for these points. So if you came to the end of this episode and said I think my points are worth one and a half cents and someone actually offered to sell you points in whatever transferable currency or airline you want, would you really pay one and a half cents for them? Would you really buy another hundred thousand million Chase points Alaska points for one and a half cents if that's the value prescribed. And if not, if you really wouldn't buy them at that price, I'd encourage you to think about maybe lowering that valuation. Okay, I know we packed a lot into this episode, so if you have any thoughts, questions, reactions that came from it, please send them to podcast at all the hacks.com or go to allthehacks.com ama and submit them as a question I can tackle in an upcoming Ask me Anything episode. Thank you so much for listening. I will see you next week. If you're like me, you love learning practical tips and fascinating insights that can make you a little smarter every day. That's why I want to tell you about a podcast you should check out called Something you should Know with Mike Carruthers. Every episode delivers information you can actually use in your life, with topics ranging from human behavior to technology to everyday hacks. Some recent episodes covered things like how great innovators think, the psychology of lying, why you owe your life to bugs, which was so interesting. Or I was recently a guest talking about the history of credit card points and how rewards programs came to be, so I know you'll probably love that one. And what makes the show so great is that Mike is always asking the questions you're thinking about, the ones that really get to the heart of the topic. Something you should know is fun, it's entertaining, and it's one of those podcasts where you learn something new and useful in every episode. Just search for something you should know wherever you listen to podcasts and when you see the bright yellow light bulb, start listening.