What’s Your Miles and Points Philosophy?

This post on the importance of having an airline miles and hotel points philosophy builds upon bikeguy’s talk (“bikeguy” is his FlyerTalk handle) at last year’s Chicago DO (The Chicago DO was a meeting for Frequent Flyers in Chicago) and on my learnings over the years.

Determine YOUR Mile and Point philosophy

Before starting to collect miles and points, you should know your mile and point philosophy, because knowing your point and mile philosophy will help you get the most value from your points and miles.  Without a Mile and Points philosophy it will be hard to have Big Travel with Small Money.

Where do you want to go with your miles and points?  Are you traveling alone  or do you have a family of 4 with you?

Would you rather sacrifice a day of vacation to try out the latest First Class seat?

Would you rather use your points to save paying cash for hotels under $150 in the US?  Or would you rather save your points for a $1000 hotel in Paris or Bora Bora?

The answers to these questions are important, because they require you to approach the mile and point collecting game differently.

Redeeming for air travel in the US:

For example, if you always redeem miles on air travel in the  US (about a 1 cent per mile value), you should make sure not to acquire miles above 1 cent per mile.  And since you can get 2% or higher cashback on some credit cards, you should not use a mile-earning credit card as your primary card for everyday shopping.

Instead, you should use airline mile and hotel point earning credit cards just for the sign-up bonus, and then switch back to a regular cash-back credit card.

Redeeming for luxurious International travel:

But if you want to have truly luxurious experiences, like a First Class suite in Jet Airways First Class (stay tuned for my trip report),  or staying in an over water bungalow in Bora Bora you would approach your mile and point strategy differently.  Not only would you want to get all the possible airline and hotel credit card bonuses, but you would ensure that you redeem miles for international First and Business class and, perhaps, pay cash for domestic US  air travel (unless they were really expensive last minute trips).  This strategy would let you save your miles and points for use where they can provide the most value to you.

And you would also use airline and hotel credit cards to earns miles and points as your primary credit card which you can later use to redeem for the decadent experiences which you otherwise wouldn’t have ponied-up the cash for.  For e.g,  spending $20,000 on the Chase Hyatt Card would give you 1 night at the Park Hyatt Vendome in Paris (a $1000 value) whereas a 2% cash-back card would give you only a $400 value).

More travel in Economy Class or Less travel in First or Business Class

Would you rather travel alone or with your spouse in First or Business class?  Or would you rather travel with your entire family of 4 in economy class?  Or do you want to gift air tickets to your parents to visit you?

More travel with your entire family might mean having to travel in economy class so that you have enough miles to redeem for the tickets.  Or you may have to travel in economy class so that you have enough miles to gift your parents tickets to visit you.

The mile and point game does, at times, require trade-offs.  But thinking through the trade-offs early will help you maximize the value of the points and miles which you earn and redeem.

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You may also want to check you my Miles and Point Philosophy.

What’s your mile philosophy?