Cash, Miles, or Points: The Best Way to Pay for Your Flight

By Amy Farley
8/7/2012 12:59:59 PM

I'd like to fly round-trip from New York City to Martha's Vineyard. I can pay $300 for a ticket, dip in to my reserve of 50,000 Delta SkyMiles, or use Starwood points. What's the smartest move?
Question submitted by Mike Green, New York, N.Y.

Trip Doctor's Answer
Translating easily between cash, frequent-flier miles, and loyalty-program points would require something like the travel version of the Rosetta stone-and, unfortunately, we haven't found it just yet. But there are a few ways to judge whether you're getting a good deal.

Photo: Leif Parsons

First, let's tackle the question of how much your miles are really worth. Earning 50,000 miles would take more than 11 round-trip flights from Atlanta to Seattle. You can also buy 50,000 Delta SkyMiles for $1,750 (a rate of 3.5 cents apiece), but you're not likely to get a free ticket on a fare that high for fewer than 80,000 miles. The generally accepted street value per mile is more like 1.4 cents-that's based on the average domestic airfare ($361*) divided by 25,000 (the minimum number of miles required for a domestic ticket). By that standard, 50,000 points are worth $700, which indicates that paying cash for this ticket is the better option.

But calculating the dollar value of your miles is only one consideration. You also have to take into account how easy it is to actually use these 50,000 points. A recent survey by Idea Works Company, a Wisconsin-based transportation consultancy, tested the ease of redeeming miles for tickets on various carriers. The study found that 27 percent of Delta flights were available for reward bookings. So the "Use them when you can" argument definitely comes into play here. My advice? Save your miles for a more expensive fare-something in the $500 range, at least.

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Your other option is to turn to your Starwood Preferred Guest program for the miles, moving 40,000 Starpoints into your SkyMiles account (Starwood will give you a 10,000-mile bonus for transferring these points, getting you up to the 50,000-mile mark). But 40,000 Starpoints would also net you a full five nights in a Starwood Category 4 property-even at a low $150-a-night room rate, that's worth at least $750 in free accommodations.

The better choice: use Starwood's new SPG Flights online service, which allows loyalty-club members to book reward tickets directly with airlines. There's no need to transfer points (which can take up to eight weeks) and you won't encounter the same availability problems as you do when booking rewards seats through airlines. It would take only 25,000 Starpoints to nab this flight to the Vineyard. Again, you'll want to weigh whether you'd rather spend this amount on hotel stays: 25,000 Starpoints are worth roughly $400 in free room nights. (See "How to Maximize Your Loyalty Credits," at right, for more on the value of hotel-loyalty programs.) But if you have points to burn, you might want to cash them in anyway.

Assigning straight dollar values to any of these options can take you only so far. Ultimately, it comes down to the type of traveler you are and which account-bank, frequent-flier, loyalty-program-you feel most comfortable drawing on at any given moment. And if you still can't decide, you can always skip the flight and drive instead.

How to Maximize Your Loyalty Credits:

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