Playbook14 min readAugust 8, 2026
Points or Cash? The One Calculation That Decides It
One division problem settles most of this question. The rest is knowing your baseline, the fees that survive an award booking, and the three cases where the math is deliberately wrong.
What is in this guide
- The calculation, in one line
- Your baseline: what points are actually worth
- The two costs almost everyone leaves out
- When points win
- When cash wins
- Transfer partners versus the portal
- Why the sweet spots keep disappearing
- Three worked examples
- The rules that survive every program change
- Frequently asked questions
The short answer
To decide between points and cash, subtract the taxes and fees payable on the award ticket from the cash price, divide by the number of points required, and multiply by 100. That is your cents per point. Compare it to your program’s baseline value — around 2 cents for transferable credit card points, and 1.2 to 1.4 cents for most U.S. airline miles. Beat the baseline and use points; miss it and pay cash.
2.2¢
Bilt points, the strongest transferable currency (TPG, Aug 2026)
2.05¢
Chase Ultimate Rewards; Amex Membership Rewards at 2.0¢
1.2–1.4¢
Typical value of major U.S. airline miles
1.55¢
Alaska Atmos Rewards, the strongest airline currency
Most advice about points is really advice about which card to open. This is not that. This is the arithmetic that tells you, standing at a booking screen with a cash price and a mileage price side by side, which button to press.
It is one division problem. Everything else on this page is about the numbers you feed into it.
The calculation, in one line
Cents per point (CPP)
The value you extract from a redemption, calculated as the cash price minus the taxes and fees due on the award ticket, divided by the points required, multiplied by 100. A $480 ticket costing 30,000 points plus $12 in taxes returns (480 − 12) ÷ 30,000 × 100 = 1.56 cents per point.
The two mistakes people make with this formula are both subtractions they skip. The first is the award ticket’s own taxes and surcharges, which can run into hundreds of dollars on some transatlantic routes. The second is the value of what a cash ticket would have earned, which is covered below.
Compare like with like
Price the same flight, on the same date, in the same cabin, with the same bag allowance. An award seat on a red-eye with two connections is not the same product as the nonstop you were pricing in cash, and quietly comparing the two is how people talk themselves into bad redemptions.
Your baseline: what points are actually worth
The number you compare against is the opportunity cost of your points: what they would be worth on an average good redemption elsewhere. Published valuations are estimates rather than exchange rates, and they are the best available anchor.
| Currency | Valuation | What that implies |
|---|---|---|
| Bilt Rewards | 2.2¢ | The strongest transferable currency in the valuations |
| Chase Ultimate Rewards | 2.05¢ | Beat this or keep the points |
| Amex Membership Rewards | 2.0¢ | A 1.5¢ portal booking is well below baseline |
| Citi ThankYou | 1.9¢ | |
| Capital One miles | 1.85¢ | |
| Alaska Atmos Rewards | 1.55¢ | The strongest airline currency |
| Major U.S. airline miles | ~1.2–1.4¢ | Delta SkyMiles toward the lower end, United MileagePlus higher |
| World of Hyatt | 1.6¢ | Included because it is where transfers often beat flights |
Two implications worth stating plainly. Transferable points are worth materially more than airline miles, so transferring early “to be safe” destroys value. And a portal redemption at a fixed 1.25 or 1.5 cents is below baseline for every transferable currency in that table — convenient, and a discount you are paying for.
Which card’s points reach which airline, and when a transfer bonus changes the answer, is what our card-to-airline points tool is for.
The two costs almost everyone leaves out
1. The award ticket’s own taxes and surcharges
A domestic U.S. award is usually a few dollars in federal segment fees. A transatlantic award through certain carriers can carry several hundred dollars in carrier-imposed surcharges — not taxes at all, but sitting in the same line on the screen. That amount comes off the cash price before you divide, and it is frequently the difference between a redemption at 4 cents and one at 2.
2. The earning you give up
Award tickets on U.S. programs generally earn no redeemable miles and no elite qualifying credit. On a $600 paid fare you would typically have earned something in the region of 3,000 to 6,000 miles plus progress toward status. Book the award instead and that is forgone.
It is a small number next to the fare, and it is consistent in direction: it always pushes marginal redemptions toward paying cash. If the calculation is close, the earning breaks the tie.
When points win
- Long-haul premium cabins. A $6,000 business class fare against 90,000 miles and $150 in taxes is about 6.5 cents per point — several times any baseline. This is where points do the work nothing else can, because most people will not pay $6,000 in cash. The other six ways into that cabin are worth knowing before you spend the miles.
- Close-in bookings. Cash fares rise steeply inside two weeks because seats are deliberately protected for late buyers, while award pricing does not always climb in step. A redemption worth 1.1 cents three months out can be worth four times that inside a week.
- Peak dates where cash spikes. Holiday periods move cash fares more than they move some award charts.
- Routes with one carrier and no competition. The fare reflects the absence of pressure; the award price often does not.
- When the alternative is not travelling. A redemption at 1.1 cents that gets you to a funeral is a good redemption, and no spreadsheet says otherwise.
When cash wins
- Cheap domestic flights. A $118 round trip against 12,000 miles is under one cent per mile. You are selling a scarce currency below its own baseline to save an amount you would not notice.
- When the fare is already unusual. Points cannot improve a good fare. If a route has fallen 40% below its normal price, pay cash and keep the miles for a fare that has not.
- When you need the elite credit. Anyone chasing status in a given year should be paying cash for the qualifying trips and redeeming on the ones that do not count.
- When surcharges eat the redemption. A transatlantic award with $400 of carrier-imposed fees is a cash ticket wearing a costume.
- When the award seat is a worse trip. Two connections and a 5:40am departure to save $260 is a decision about your weekend, not about points.
Transfer partners versus the portal
Transferable points have two exits, and they are not close in value.
| Issuer travel portal | Transfer to an airline partner | |
|---|---|---|
| Rate | Fixed, commonly around 1–1.5¢ per point | Variable — poor to several times baseline |
| Availability | Anything bookable for cash | Only where award space exists |
| Reversible? | Yes, points stay with the issuer until you book | No — transfers are one-way and final |
| Earns miles and status? | Usually yes, it is a paid ticket | No |
| Best for | Cheap economy, when convenience matters more | Premium cabins and constrained dates |
Never transfer speculatively
Confirm the award seat is bookable before moving a single point. Transfers are irreversible, transfer times range from instant to several days, and award space can vanish while a transfer is pending. The correct order is: find the seat, hold it if the program allows, then transfer.
Why the sweet spots keep disappearing
The reason points advice from five years ago no longer works is structural, not incidental.
Programs have moved from fixed award charts — where a region cost a set number of miles regardless of the cash fare — to dynamic pricing tied to that cash fare. That change does two things at once. It removes the sweet spots that made outsized redemptions possible, and it couples the price of a redemption to the thing miles were supposed to hedge against. When cash fares rise, the mileage price now rises too.
The practical conclusion is unglamorous: a mileage balance is a depreciating asset that pays no interest and can be devalued without notice. Earn what you will use, spend it deliberately, and do not stockpile for a redemption you have not priced.
Three worked examples
Example 1: the domestic trip
Cash $178 round trip. Award 21,000 miles plus $11.20. That is (178 − 11.20) ÷ 21,000 × 100 = 0.79 cents per mile, well under every baseline, and the cash ticket also earns miles and elite credit. Pay cash.
Example 2: the transatlantic business class seat
Cash $5,800. Award 88,000 miles plus $180 in taxes and surcharges. That is (5,800 − 180) ÷ 88,000 × 100 = 6.39 cents per mile. Four times a typical airline baseline, and it buys a cabin most people would never buy in cash. Use points.
Example 3: the awkward one
Cash $640 for a nonstop next Tuesday. Award 40,000 miles plus $22, but the award routing has one connection and lands three hours later. Pure arithmetic says (640 − 22) ÷ 40,000 × 100 = 1.55 cents per mile, above baseline. Then subtract the earning you lose and price the extra three hours. This is a genuine toss-up, which means it does not matter much — take whichever you would not regret.
The rules that survive every program change
Programs change constantly. These do not.
- Always compute cents per point before booking. It takes fifteen seconds and it is the whole decision.
- Subtract the award’s taxes and fees first. Every time, including on domestic awards where the number is small.
- Keep points transferable for as long as possible. Flexibility is most of their value, and transferring destroys it.
- Spend miles on cabins you would not buy. That is the arbitrage the currency exists for.
- Pay cash for cheap fares. Especially fares already well below the route’s normal price — those are the ones worth catching in cash.
- Do not hoard. The balance loses value every year that a program repriced awards, and most of them did.
And keep the sizes in proportion. Optimizing a redemption from 1.4 to 1.8 cents on a 40,000-mile award is worth about $160. Buying the underlying trip inside the right booking window is routinely worth more than that, on every ticket, whether or not a single point is involved.
Frequently asked questions
Short, direct answers to the questions people actually type. If yours is not here, the guides linked below probably cover it.
Should I use points or cash for flights?
Calculate the redemption's value and compare it to your program's baseline. Subtract the taxes and fees due on the award from the cash price, divide by the points required, and multiply by 100 to get cents per point. If the result comfortably beats your baseline — commonly around 2 cents for transferable points and 1.2 to 1.4 for airline miles — use points. If it does not, pay cash and keep the points.
How do you calculate cents per point?
Cents per point equals the cash price minus the award's taxes and fees, divided by the number of points required, multiplied by 100. A $480 ticket that costs 30,000 points plus $12 in taxes works out at (480 − 12) ÷ 30,000 × 100, or 1.56 cents per point. Always subtract the award's own fees, because ignoring them overstates the value of every redemption.
How much are airline miles worth in 2026?
Most major U.S. airline programs value out between about 1.2 and 1.4 cents per mile, with Delta SkyMiles toward the lower end and United MileagePlus toward the upper end in The Points Guy's mid-2026 valuations. Alaska's Atmos Rewards is the strongest airline currency at roughly 1.55 cents. Transferable credit card points are worth more: around 1.85 to 2.2 cents depending on the issuer.
What is a good cents-per-point redemption?
For transferable credit card points, 2 cents or better is a good redemption and anything under about 1.5 cents is usually a poor one. For airline miles, 1.5 cents is strong and 1 cent is weak. The number to beat is your own program's baseline value, because that is the opportunity cost — spending points below baseline is selling a currency at a discount.
Is it better to transfer points to an airline or book through the portal?
Transferring usually wins when it wins big. Portal redemptions are fixed at a rate set by the issuer, commonly around 1 to 1.5 cents per point, while a transfer to the right partner for a premium cabin can return several times that. The trade-off is that transfers are irreversible and award space must exist first, so confirm availability before you move any points.
When should you pay cash instead of using miles?
On cheap domestic tickets, where the redemption rate falls below your baseline; when the cash fare is low enough that you would rather keep the points for a premium redemption; and when you need the miles and elite credit that a paid ticket earns and an award does not. Cash is also right when a fare is already unusually low, because points cannot make a good fare better.
Do you earn miles when you book with points?
Generally no. Award tickets on U.S. programs earn no redeemable miles and no elite qualifying credit, so a redemption costs the earning as well as the points. On a $600 fare that is roughly 3,000 to 6,000 miles plus elite credit forgone. It is a small number next to the fare, and it belongs in the comparison because it consistently pushes marginal redemptions the wrong way.
Are airline miles losing value?
Structurally, yes. Programs have moved from fixed award charts to dynamic pricing tied to the cash fare, which removes the sweet spots that made outsized redemptions possible and links mileage prices to the thing miles were supposed to hedge against. Devaluations are typically announced with little notice or none. Treat a mileage balance as a depreciating asset with no interest, and spend it deliberately.
Do you have to pay taxes on an award flight?
Yes, and the amount varies enormously by route and carrier. A domestic U.S. award is often a few dollars in federal segment fees. A transatlantic award through certain carriers can carry several hundred dollars in carrier-imposed surcharges, which are not taxes at all but appear alongside them. Always subtract these before calculating cents per point — they are what turn an apparently excellent redemption into an ordinary one.
Is it worth using points for economy flights?
Sometimes, and it is usually the least exciting redemption available. Economy awards on domestic routes typically return around one cent per mile, which is at or below most baselines. The exceptions worth taking are close-in bookings where the cash fare has tripled, peak dates where cash prices spike but award pricing lags, and the last seats on a route you have to fly.
Sources
Every figure on this page traces to one of these. Airfare data moves, so each source is dated by its publisher — check the original before quoting a number a year from now.
- What are points and miles worth? Monthly valuations — The Points Guy
- When to use miles vs. cash for flights — Chase
- When to use miles vs. pay cash for flights: how to do the math — One Mile at a Time
- How much are travel points and miles worth? — NerdWallet
- First Quarter 2026 Average Air Fare — U.S. Bureau of Transportation Statistics