Once you’ve figured out what you want and you’ve learned how important is to take advantage of limited time offers, it’s time to strategize about your points. There are many different options on where to keep your points, depending on what your goals are.
In many cases, the easiest and best place to start are with non-loyalty Amex or Chase credit cards (i.e. not a Hilton Amex card or a United Chase card, but rather a Amex Gold or Chase Sapphire Preferred). The reason for this is because you will have more flexibility with these points than if all your points went to just one hotel or one airline.
For example, American Express has an extensive transfer partner network (Chase has good partners as well). This is the reason Amex points are so valuable – you can use them for airfare or hotels with many different partners. Does Hilton have a property in the perfect location for your next trip? You can transfer your points there. Maybe there’s an InterContinental that better suits your needs…so transfer your points to Priority Club instead. Or maybe the hotels are so cheap you don’t want to waste your points on them – cool, transfer your points to one of the many airline partners to get a free ticket instead.
Flexibility is the name of the game with Amex and Chase.
In some cases it’s easier or better to transfer points from one of these banks than the other. For example, if you’re planning on flying to Korea, Chase may be your better option. Chase is partners with Korean Airlines, which can obviously get you there, but they are also partners with United Airlines. Since United is part of the Star Alliance, you can use their points to book on almost every carrier in the Star Alliance (and the list of airlines is extensive), including Asiana and several other airlines that fly to Korea.
It’s important to note that Amex has three Star Alliance transfer partners, but for various reasons it can benefit you to book via Chase and United to save on fees (this is a detailed topic for another time, so just trust me here for now).
But (you knew one was coming), there are several important airlines that you cannot transfer to via Amex and Chase. Most notably, American Airlines and US Airways, two of the major airlines in the US. So how do you know whether to sign up for credit cards of these airlines versus bank ones, or from what airline to book your trip?
Instead of me answering this question, I can direct you to an article that’s already answered this exact question better than I probably ever could. TravelByPoints did a guest post at UsingMiles in which he summarized the cheapest way to get to wherever you want to go if you’re using miles from an American carrier (American Air, Delta, United, US Air). I use this chart for reference all the time, and it should be useful to everyone out there that doesn’t have these award charts memorized.
Hotel points can be a little simpler. If you know where you’re going, you can easily find out what hotels are there. Determine the best way to get points to the account of whatever hotel you choose, and you’re pretty much done. But there are some tricks!
The most notable of these tricks is for Hilton Points. You’d be hard pressed to find a Hilton credit card that gives you more than, say, 50K HHonors points. BUT you’ll find 50K+ Amex point offers around all the time. The transfer ratio from Amex to Hilton is 1:1. So what’s the point of getting the Amex? The trick: Transfer those 50K Amex points to Virgin Atlantic at a 1:1 ratio. Then, transfer those 50K Virgin Atlantic points to Hilton at a 1:2 ratio. Those 50K Amex points just became 100K Hilton points. So in almost all cases, if you want to accrue Hilton points, get Amex/Virgin Atlantic points!
It’s very hard to get Starwood points, which are extremely valuable, at a good transfer rate. In fact you can’t even transfer from Chase. Amex’s transfer rate is pretty bad, and even the transfer bonuses are not worth it on the rare occasion they have them. Instead, I suggest signing up for the Amex SPG card. It’s a great card for everyday spend, and SPG has an amazing benefit where you can transfer your SPG points to a huge list of airlines at a 1:1 ratio. Even better, for every 20K SPG points you transfer to an airline, they’ll throw in another 5K! So say you needed 100K points for an airfare redemption on Japan Airlines. Transfer 80K SPG points and you’re there!
One thing Amex is known for is having transfer bonuses. That means that for a limited amount of time they give a better transfer ratio to a particular transfer partner. For example, there’s currently a 40% transfer bonus to British Airways Avios (the British Airways points program). So, say you needed 75K BA Avios for your award trip. Instead of transferring 75K Chase points, you can transfer just 54K Amex points using the transfer bonus and get 75.5K Avios. Good deal!
Thus far, there have been no transfer bonuses from Chase. If they ever do start doing it they would in my opinion become a stronger point program than Amex.
If you want American Airlines flights or miles, you have two options. One is to sign up for American Airlines branded credit cards and accrue points from sign-up bonuses. If, however, your goal is to fly on American Airlines (or even a partner), you can do this using British Airways Avios. These two airlines are part of the OneWorld Alliance, which has several notable airline members. The Points Guy did a wonderful series on the best uses for Avios, and it’s worth checking out.
Earning US Airways miles is a little more difficult. Signing up for their credit card, as I did in my recent churn, is a quick way to earn some points. There is a more complicated way that will get the job done, but you’ll lose a few points along the way. You can transfer your Amex points to Air Canada Aeroplan (Air Canada’s point program), and then from there to US Airways at a 1: .85 ratio. You’ll lose some points, but if you’re in desperate need for some US Airways points, it can be done!
You can also buy US Airways miles during certain times of the year when they offer a 100% bonus on purchased miles. This can be beneficial if you use it for certain award redemptions as explained by The Points Guy, but in general is not a great deal.
The reason the title ends with “…usually” is because this all depends on your travel pattern. If all you care about doing is going from Los Angeles to San Francisco and back for as cheap as possible in economy, then by all means hoard Amex points and transfer to BA Avios to get in on those 4,500 point one way short-haul redemptions on American Airlines. During a transfer bonus of 40%-50%, you can do this round trip for just 6-7K miles!
Or if all you care about is flying to Korea, maybe Chase/United points are what you want.
But in general, it’s good to diversify…usually.
Next up in the Beginner’s Guide series will be Part 4: Know Your Spending Habits Really Well. Look for this post in the coming days!
Beginner’s Guide to Points – A 5-Part Series