One of the big debates within the frequent flyer community is whether it makes sense to rack up miles, perhaps in hopes of one day redeeming for an expensive first-class international adventure for the whole family, or redeeming miles and points quickly in an effort to overcome an inevitable devaluation. Like everything related to award travel, it is entirely up to the traveler and collector, but there are some pros and cons of each to consider. Let’s explore each option to see what makes the most sense for you.
Build a balance
The best reason to accumulate more and more miles without making a single redemption is if you are saving for an “aspirational award.” In general, these are intercontinental flights in a premium cabin, either Business or First Class, for more than one passenger. In general, it will take months or years to save for this type of award, so there really is no other way to do it if you plan to book each ticket using your own mileage balance.
One way to avoid a lengthy delay between when you start building a balance and when you have enough for a great redemption is to divide the responsibility of winning with friends or family who plan to join you on your aspiration journey. Credit card sign-up bonuses can go a long way in increasing your balance, and if everyone in your party joins in, you can book your adventure much more quickly. This strategy is most useful after an airline announces a devaluation, so you can increase your balance and reserve an award before fares go up significantly.
However, if a great trip is not in your future, there is no point in accumulating hundreds of thousands of miles before booking an award. Some frequent fliers accumulate miles simply for the purpose of accumulating, and they often miss out on great redemption opportunities. Instead, you should use your miles periodically for last-minute trips to visit family or for a spontaneous vacation that would otherwise be out of reach.
“Win and burn”
In general, it is recommended that you use your miles as you earn them. You still need to add to your balance if you are planning a specific redemption, but do not buy miles or go out of your way to acquire miles you don’t need by other means. Once you have a reasonable number of miles on your account, it’s time to start planning your next getaway. Take a long weekend to discover a new domestic destination or fly to the Caribbean to unwind and relax for a few days. What you should not do is use your miles and points for merchandise, unless you do not anticipate accumulating a large enough balance for a flight or hotel room with a particular airline or hotel program.
Fixed value points
While ideally you should use your frequent flyer miles and hotel points as long as you have enough to redeem, fixed value points, such as those you earn with Barclaycard, Chase, or American Express, retain their value as long as you plan to use for redemption cash equivalent, and are only devalued at the standard inflation rate. In other words, 10,000 points worth $ 100 today will carry the same cash value per year, but due to moderate inflation, your purchasing power may decrease slightly over time.
However, you should have fixed value points just as you would cash, and use your frequent flyer miles and hotel points first as long as the redemption rates seem reasonable. However, if you are working towards a specific elite level, it may make more sense to use fixed value points on airline miles, so that you can earn elite qualified credit with the airline.
