When should a hack determine the fair trading price of points and miles?

Readers and fellow bloggers: please weigh in with your thoughts.

Yesterday, I proposed a method to determine “Fair Trading Prices for Points and Miles“. If you didn’t get a chance to read this post, please do so! If you only have time to read one post this month, this should be it! OK, just kidding about that, but seriously, take a look. In that post I proposed a way to use point earning credit cards as benchmarks for determining “fair trading prices” for points and miles. The idea is to develop and maintain a lookup sheet that people can use to help decide whether a bonus offer, hack, or deal is really worth doing. To-date, the sources of data for the chart are the prices charged directly by hotels and airlines for their points and miles, and the prices we pay indirectly to earn points and miles from credit card use. The question today is this: what if a readily available travel hack provides an easy and repeatable way to buy points at a lower cost? Should that hack, then, determine the fair trading price for those points? Let’s look at a few example hacks and discuss:

Priority Club

There is a well documented trick that allows you to buy Priority Club points for .6 cents each. See, for example, Million Mile Secrets post: Use The Priority Club “Points & Cash” Trick To Save 76% Off On Hotels. When putting together the fair trading prices table, I agonized over whether this trick should define the fair trading price for Priority Club points. Or, should we look at the best usual means for buying Priority Club points and see that this hack is a great deal because it beats that price? Do you see the dilemma? Ultimately, I went with the latter argument, but now I’m not so sure. Since this hack is easy and repeatable, I’m leaning towards resetting the fair trading price to .6 cents. My thinking is: if Priority Club ran a promotion where they offered to sell Priority Club points for .7 cents each, would I do it? The answer is very clear: No. I wouldn’t do it because I know that I can buy points for even less. So, for me, the fair trading price is .6 cents. Agreed?


Twice this year now, Delta has run a promotion that has made it possible to buy Delta SkyMiles for 1.1 cents each. Like with Priority Club, I struggled to decide whether 1.1 cents should be the fair trading price for Delta miles. Unlike the Priority Club hack, this trick is only available when Delta runs this promotion, so it doesn’t seem right to suggest that this be the benchmark. On the other hand, Delta has now run the promotion twice in a fairly short amount of time and so it seems likely that they’ll keep doing this whenever they see a need to raise revenue. My inclination right now is to wait and see. If Delta runs the promotion again early next year, then I’m inclined to make 1.1 cents the benchmark to go by. Until then, I’ll keep it as is. What do you think?

American Express Gift Cards

A common hack is to go through the Big Crumbs shopping portal to buy American Express gift cards. By going through the portal, you get 1.6% cash back for the purchase of those cards (and if you use my sign-up link I’ll get a very small % referral fee). With this trick, it is possible to reduce the credit card cost of points and miles by buying gift cards with your point-earning credit card and then use the Amex gift cards for the things you would have bought anyway. Should we reduce all of the fair trading prices because this trick is readily available? To me, the answer to this question is easy: No. You could also use this trick to reduce the cost of buying a pack of gum, but would you then think that the fair trading price for gum ought to come down 1.6%? Of course not. Since this trick applies broadly to everything, I don’t see it as a useful tool for setting fair trading prices. However, it is a fantastic tool to use to help ensure that you save money on whatever deal, trick, or hack you invest in.

For completeness, I’ll point out that people can do similar tricks using credit cards that give big category bonuses for grocery store spend (or drug store, or office supply store, etc.). People have been known to go to their local grocery store and use these credit cards to buy $500 visa, mc, or amex gift cards. In these cases, the credit card bonus can far exceed the service charge for buying those cards.

Another detail to point out: this trick could also be used with 2% cash back cards in order to effectively increase the standard return to 3.6%. Therefore, the cost of credit card points when using this trick should be benchmarked against 3.6 cents per dollar instead of the 2 cents per dollar that I’ve used so far. This, to me, is yet another reason not to muddy the waters by introducing a trick like this into the calculations.


Is there a rule we can develop to determine when a hack can be used to set the fair trading price of points? Do you agree with my tentative decisions shown above? Are there other hacks you would like me to consider? Please comment below! Once I’ve received enough feedback I’ll update the fair trading prices table and I’ll publish it as a fixed page on this site. Also, I will continue to update the table over time as new credit cards, offers, and hacks lead to changes in fair trading prices.

About Greg The Frequent Miler

Greg is the owner, founder, and primary author of the Frequent Miler. He earns millions of points and miles each year, mostly without flying, and dedicates this blog to teaching others how to do the same.

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15 Comments on "When should a hack determine the fair trading price of points and miles?"

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Great post. Thanks. You lost me, however, on how to use a card with 2% cash back (Capital One) in order to effectively increase the standard return to 3.6%.


Dont forget that, when using Big Crumbs, you can refer your spouse, so you both can make a little money. Sorry, FM, for letting that cat out of the bag.


Your analysis of point value ignores two factors that I personally consider: (1) what is the value of each point when spending, and (2) how many do I think I “need”? #1 has been analyzed to death by many people, but each person must personally do this for themselves. (e.g., Delta is probably worth more to you if you live in ATL than it is is you live in SEA). #2 means the points are worth more to me if I need to reach a particular award amount. (e.g., it’s good to have 200K for each airline on hand)


I have yet to read an effective way to drain the last few bucks out of these gift cards. Your method?


I’ve really enjoyed reading your posts and I love your analysis. But I have to disagree that the fair trading price of Priority Club points is 0.6 cents. While this hack has been around for a while, there have been noted instances where accounts have been suspended/closed due to abuse of this hack. So since the price of 0.6 cents can effectively go away with abuse of this practice, I don’t think 0.6 cents is the fair trading price. To me it seems to be closer to the Delta promotions since you can only purchase the points/miles so often at that price.


Great post. First off, let me start off by saying to please don’t change your writing style and to continue putting emphasis on the best travel hacks and PPMs. Posts like this provide for a refreshing read in the CC churn/trip report heavy blog world. Also as a fellow math junkie, it is a joy to read posts like this.

I agree with your post except on the Delta piece. Even with the 100% promotion running about 2-3 times a year, I still think we shouldn’t use the 1.1 CPM as the benchmark for acquiring miles. I think a pretty good rule going forward would be for the opportunity to buy/get the miles for a specific program at ALL times and not just during limited time promotions like this.

Again, keep up to good work!


@Mike Are you talking about how do you spend the last 4.27 on the card kind of thing?

If so, you just say to the cashier, “Can I put on this card?” right before you swipe it.

It gets fun with a stack of single-digit dollared GCs… 😉


Unless you earn and burn Delta pts right away, it is reckless to bank them. Delta has showed a willingness to devalue the points without notice. Delta points and by implication AMEX MR are really not worth much at all unless you have an urgent use for them.


They are worth no where near 1.1 cents, it more like investing in Greek euros, zimbabwean dollars or worst…because at least there are others who will redeem them with Delta Skymiles you are completely reliant upon one buyer.


[…] Originally Posted by Napolehon I think Frequent Flyer did a good job with the point valuation, but one thing that adds or reduces value of the points is also how easy/hard it is to get the points. For Ex: My trading value for Delta is 1.1 cents just because it was very easy to transfer to friends and family for 1.1 cents all last year. Most on FT will also agree that they dont transfer MR straight to Delta unless there is a 40%~66% bonus promo which happened often last year as well. Maybe I should add another column to the table for this sort of thing (Delta 1.1 cents, Priority Club .6 cents, etc.). You can see a debate about this here: http://boardingarea.com/freque…nts-and-miles/ […]


Most seem to agree Delta miles are not what they were in the past for sure.
I haven’t seen any posts about using them for hotel stays. It’s buried in the shop now section of their new user un friendly web site.
Looks like a 1.5 cents per exchange. Not good but better than being robbed by their overpriced mileage charges for flights.