Calculate the cents-per-point value of a rewards redemption and decide whether to redeem points or pay cash.
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Redemption Value Formula
CPP = (P - F) / N * 100
Where:
CPP is the redemption value of each point, measured in cents per point.
P is the cash price you would otherwise pay for the same booking, in dollars.
F is the taxes and fees you must still pay in cash when you book with points, in dollars.
N is the number of points the award costs.
Subtracting the cash fees from the cash price gives the real dollar value your points buy you. Dividing that by the number of points and multiplying by 100 converts the result to cents per point, so you can compare any redemption on the same scale. If you only want the plain cash value of a points balance, multiply the points by your value per point and divide by 100:
V = Q * R / 100
Where V is the cash value in dollars, Q is the number of points you hold, and R is the value of each point in cents.
Typical Point Values and Rating Scale
The values below are common reference points for comparison. Your own redemption can be worth more or less depending on how you book.
| Program or redemption | Typical value (cents per point) |
|---|---|
| Chase Ultimate Rewards (transfer) | 2.0 |
| Amex Membership Rewards (transfer) | 2.0 |
| Hotel points (mid-tier) | 1.5 to 1.8 |
| Travel portal redemption | 1.0 to 1.5 |
| Cash back or statement credit | 1.0 |
| Gift cards or merchandise | 0.5 to 0.8 |
Use this scale to judge any result the calculator gives you:
| Cents per point | Rating |
|---|---|
| Under 1.0 | Poor, pay cash |
| 1.0 to 1.5 | Average |
| 1.5 to 2.0 | Good |
| 2.0 and above | Excellent |
Example Problems
Example 1. A flight costs $400 in cash, or 25,000 points plus $11.20 in taxes and fees. Subtract the fees from the cash price to get $388.80 of value. Divide by 25,000 points and multiply by 100, which gives 1.56 cents per point. That is above a 1.5 cent baseline, so redeeming the points is a good deal.
Example 2. You hold 60,000 points and value each one at 1.5 cents. Multiply 60,000 by 1.5 and divide by 100 to get a cash value of $900.
FAQ
What is a good cents per point value? A redemption of 1.0 to 1.5 cents per point is average, 1.5 to 2.0 cents is good, and anything above 2.0 cents is excellent. Below 1.0 cent you are usually better off paying cash and keeping your points.
Should I redeem points or pay cash? Compare the cents per point you get to the baseline value you set. If the redemption meets or beats your baseline, use the points. If it falls short, pay cash and save the points for a higher value booking later.
Where do I find the cash price and points required? Look up the same flight, hotel night, or item two ways: the normal cash price, and the points price shown in your rewards account. Enter both, plus any cash taxes or fees the award still charges, to see what your points are really worth.