Points redemption 101


You accumulate travel reward points for months - possibly years - to go on a trip of a lifetime. But collecting enough points is only the first hurdle in your journey. Now, you have to figure out how to redeem them. 

Avery Campbell, president of Awarding Canada, says restrictions and rules make reward programs complicated and confusing to use. 

"There's a lot of really complicated routing rules when you redeem miles on any program," he says. "It's unfair for the consumer to be expected to know all those rules when they go to redeem their miles."

There are also taxes and carrier surcharges, also known as fuel surcharges with some frequent flyer programs. 

"Those can go up to over $1,000+ on your ‘free' trip," says Campbell.

Technical issues can also complicate booking. For instance, Campbell points to an ongoing booking issue on many Star Alliance carriers, such as Air China and Copa, with Aeroplan miles. 

Calling customer service may not help. "Unless you have sort of elite [Diamond with Aeroplan] status, you can easily be waiting an hour or two on the phone to speak with an agent," says Campbell.

And even then, the agent you reach may not be able to help you - not all agents are equally knowledgable. 

"You would be amazed by how frequently I am speaking to frequent flyer program agents where an agent will tell me something is impossible, where I very well know it isn't," Campbell says. He suggests hanging up and trying again, "But if you have to wait an hour each time you do, it's a huge waste of your time."

So how can you make it easier to redeem your points? Try these tips to avoid wasting your time - or your points. 

1. Choose your card wisely.
Keep in mind that there are a lot credit cards with travel rewards programs. 

"Consumers have so many different needs and desires when it comes to loyalty programs and how they spend their time and money," says Wendy Paradis, president of Association of Canadian Travel Agencies.  "So it's not surprising that there is such a variety of loyalty programs out there."

Although there are some similarities between programs, she says, they're all different in order to better meet the needs of a specific consumer group. 

Paradis recommends researching your travel rewards program in the same way that you would choose the right insurance so that you find one that meets your needs.

"They're not all created equal," she says. "What would be a great loyalty program for me might not be suitable to you. We have different goals and aspirations."

If the travel rewards card you have doesn't fit your needs and goals, you may want to switch. 

2. Hire a professional.
"Most loyalty programs have a travel agency associated with them," says Paradis. "Our recommendation is to use a professional travel agent so that you actually get the best value, the best price and the best expertise for the trip." 

She says a professional can help you cut through all the options and information.

Jason Binstock, co-founder of Canadian Points University, agrees. 

"There's a certain threshold of information that people are willing to absorb," he says. Then it becomes too much.

He suggests using an award booking service such as Awarding Canada. 

"That's where you can take that collective knowledge of someone who is very deeply entrenched in this community and leverage it without having to invest the time," he says.

There is a cost involved but, Campbell says, "We typically get you a lot more value than the fee we charge for the differential of what you can do yourself and what we can get you." 

3. Educate yourself.
"If you're more of a do-it-yourself type of person, just read," says Campbell. "Go on the Internet. As awful as it sounds, read Aeroplan's terms and conditions. It does supply guidance in how to build awards."

Get connected to a frequent flyer community, either online or in person. 

"There's a big FlyerTalk community," says Boris Remes, co-founder of Canadian Point University. "There's a very big Boarding Area blogging community with big followings where people can educate themselves. But there is a steep learning curve, and it's a dynamic industry."

"Having an informed or regularly consistent sharing of information goes a long way," says Binstock. "There's a lot of information to sift through, and there are people that do expedite the information for you."

These communities can also help you find some interesting tricks and deals, says Campbell. You might find an incredible flight redemption deal or a points conversion bonus that helps you maximize your rewards. 

4. Understand the value of your points.
All points are not created equal. Binstock recommends developing a basic understanding of how to value your points.

"Each points program has different varying values associated with it," he says. "There's also a moving target based on the changes in those programs, where the valuation of that particular program might change over time."

The online community can help you learn points valuations as well.

"Once you understand how to value the points, how many points a particular trip will cost you, you can then compare it against what it would cost you in cash to see if you're actually making a good financially savvy decision," says Binstock. "Is it a good use of your points?"

He suggests using an online aggregator such as Milez.biz. 

"You can put in your origin and destination, and it runs through a plethora of different miles programs to show you how many miles it takes in that program to go on a trip," he says. "You can get a good feel of where you could maximize and have the lowest redemption cost."

5. Fly first class.
When it comes to reward miles, first class or business class is often a better value than economy.

"On a point-to-value perspective, you're doing a lot better redeeming for a premium cabin than you are redeeming for an economy cabin," says Campbell.

He gives an Aeroplan example. A round-trip ticket to Europe in economy class is 60,000 miles, and 110,000 in business. But economy tickets cost only about $800. Business-class tickets are often $4,000 to $6,000.

Remes points out that flying business class, especially on a long-distance flight, also makes the experience more memorable, entertaining and comfortable.

"Many loyalty programs also sell their points at a discount," he says. This way you can top up your balance if you need a few extra points to fly business class.

6. Get creative.
When Binstock first started redeeming frequent flyer rewards, he thought about his trip as round trips. He says that isn't always the best way to go.

"In terms of maximizing your rewards, be open to non-traditional itineraries," he says. For example, you might fly to one destination using points from one rewards program, take a train to visit another city, and then return home with points from a different program.

"Being OK with being unconventional or doing something that doesn't make tradition sense," he says.

The important thing is to use your points.

"The mentality in the hobby or the industry of travel hacking is ‘earn and burn,'" says Campbell. "They're not currency. They never gain value; they only lose value. You shouldn't be holding onto miles."

See related: How to become a points chaser, 4 non-travel rewards for your travel rewards card, Air Canada, Aeroplan split: What does this mean for you?
Published June 28, 2017

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