I’ve been on YouTube for a bit today, and I keep seeing posts where people mentioned that they’ve saved a lot on certain flights, by using miles and points instead of cash to pay for the ticket. They’ll mention that they used 7,000 points and a very small taxes and fees surcharge, as opposed to paying £328 for a one-way ticket. That’s a great deal (for anyone wondering, this specific video was by MilesAhead on YouTube, and the flight in question was a Korean Air economy flight).
Okay, but where do I get these 7,000 points? Many of us might take for granted that we’re in the miles and points “ecosystem”, though getting started can actually be quite tricky. I remember seeing good value miles and points deals a few years ago on frequent flyer programmes such as Virgin Atlantic, before realising I didn’t actually have those 29,000 miles to spend for the flight in question.
The aim of this post is to give some ideas for points newbies to get started within the industry. This is meant to be location-independent, though you’ll have to research opportunities that are specific to your country (e.g. if you live in an EU country, you’ll have to check which credit cards are available to you personally). By all means skip this post if you’re familiar to miles and points, but here are a few ideas I had on getting started with booking. For full disclosure, I’m working on helping people set up bespoke miles and points strategies with Alvia, so do check out my professional services if you’d like to get a bit of extra capacity and help on this.
Why do credit card companies give out “free” miles?
Simple answer – credit card companies reward miles to customers to incentivise their spending.
Miles don’t cost anything more to the consumer. The merchant is the one who pays a small dividend of your payment to the miles and points company. The thought is that the customer has been incentivised by the miles rewards to spend more, so it’s a win-win situation for everybody:
- The consumer earns miles as a “reward” for their spending, which they can use on future travel
- The merchant gets extra business from the consumer’s spending
- Miles and points companies get a dividend of the merchant’s revenue
This is also why sign-up bonuses are so lucrative once you hit a target spend – you as a consumer might’ve spent more than you otherwise would’ve during that time, which is good for both merchant businesses as well as the miles and points companies that get a revenue share.
The principle is that you should try and earn miles on spending that you would have done anyway, without majorly pushing any auxiliary spending just to hit miles and points goals. Of course there might be exceptions (e.g. you might dine out a few more times to earn miles from eating at certain dining outlets), though miles and points collection shouldn’t be an expensive hobby to the average consumer.
Miles and points collection should not be expensive for the average consumer
Understand the goal posts – how many miles are you trying to earn?
Much like when you start any new endeavour, the first step is to have a goal for the miles that you are earning. If you just decide to earn and spend miles blindly without knowing what you can do with your miles, that’s not quite the best strategy to use them.
The point of miles for most people is that it helps bring first and business class travel down from 10x the price to 2-3x the number of miles. Therefore, generally, I’d recommend setting your first goalpost to be a first or business class longhaul flight. In most countries, will be in the ballpark of 60,000-70,000 miles one-way. The goalpost itself can differ massively from airline to airline – London to New York can be as low as 29,000 miles one-way on Virgin Atlantic Upper Class (plus some hefty taxes and fees, which are unique to UK airlines). I’d say that one of the most important things to stay in the miles and points game is to to have the discipline not to book a flight with miles until you reach this goalpost, unless the number of miles spent won’t rock your balance at all.
Have a goalpost for how many miles you want to spend (e.g. 75,000 AAdvantage points for a one-way Qatar Airways business class itinerary)
When would I make an exception? If you need to go somewhere for personal travel, and can redeem a ticket during a surge pricing season, I might use points even if I haven’t hit my goalpost yet. For example, Cathay Pacific award space to Hong Kong is wide open over the Christmas period, though cash fares are easily upwards of £1,500. I’d be happy spending 27,000 miles for Cathay Pacific economy just to avoid paying this surge price.
However, the general principle is to be in for the longhaul when earning points – get into the habits where you earn miles towards the products you want to fly, and don’t collect miles aimlessly.
Take every opportunity to earn miles – a mile is a mile
If you had the opportunity to get cashback on your spending, you wouldn’t waste a penny. Treat miles as money – don’t waste opportunities to earn miles.
This includes if you’re flying – make sure you put a frequent flyer company on your booking if you paid cash for your ticket, and check to see which frequent flyer programme will be strategically the best for you to earn miles that help you reach your spending goals. Make sure you have at least one frequent flyer programme going for every major alliance, and if you’re flying a non-alliance airline that doesn’t partner with any of the miles and points currencies that you already have, sign up to their rewards scheme too. There’s no reason not to spend an extra few minutes ensuring that you can earn these miles, especially given that frequent flyer programmes tend to be free.
Even when you’re making a purchase (particularly if it’s online, or particularly if it’s a larger amount), make sure that you check shopping e-portals to see how you can maximise your miles earnings. This applies to habitual small purchases – for example, if you’re in the UK, get a Tesco or Nectar card, where you can earn Virgin points or Avios (respectively) on your supermarket spending. If you have a rewards credit card, see whether your company would be happy with you footing corporate event bills or travel expenses, and paying you back. If you’re in the U.S., see whether you’re eligible for a credit card that lets you earn points on rent (such as Bilt).
Obviously it’s not worth making every life decision in order to earn miles. For example, I know people who exclusively dine out at dining outlets that partner with Avios, and I personally wouldn’t do that (especially when we’re only talking tens of miles). However, generally if you’re going to be making a larger or habitual purchase, make sure you’re maximising your opportunities.
Convert Nectar points (from supermarket spending) to Avios in the UK
As the saying goes, “a watched kettle never boils”. It can be a little discouraging to see a very small points balance when you’re first starting off with miles. Trust the process – you will rack up miles, especially if you do any flying, and you’ll be able to reach your points goals sooner than you realise.
Sign up for a rewards credit card and treat it like a debit card
If you’re currently waged (even on freelance), you’ll probably be eligible for a credit card in your country. Many people unfamiliar with miles and points tend to believe that credit cards are only for those that need the actual credit. I’d say treat it like a debit card, and use the credit card for the sole reason that you’ll earn points on your spending.
Rewards credit cards are the first port of call for most people that want to seriously attain miles and points goals, as they’re seriously lucrative. For example, in the UK, you’ll get a 30,000 point head start if you use the AmEx Gold card upon spending £3,000 on your card, and it’s even free for the first year (given London prices, most people will be able to hit this with little effort). Avoid points schemes where the miles expire, and make sure you make every effort to keep the miles that you earn – for example, if you were to cancel the AmEx Gold card after the free first year ends, make sure you roll off to a free AmEx card, so you keep the Membership Rewards points you’d earned.
Rewards cards also give you extra points on spending on airfare. For example, in the UK, the Gold Card gives you double points if you spend on any airfare, including if you’re flying on Ryanair/easyJet (where you otherwise wouldn’t earn points).
A credit card gives you points when you spend on it – not just when you miss a payment. In order to build your credit score and not pay any fines, you shouldn’t ever miss a payment anyway. As a consumer you don’t have to pay any auxiliary fees when spending on a credit card, as long as it’s in the currency the card was registered in.
While the cards that will give you the highest volume of points are usually affiliated with a single airline, I’d recommend starting off with a card that will let you earn transferrable points (to multiple different airlines), such as the AmEx Gold or Platinum cards. Why? That’s because although you aren’t earning the maximum number of miles available, you’re opening yourself up to the most options to redeem points at good value (e.g. you could take advantage of points fare sales for KrisFlyer, Virgin, and Avios, as opposed to only being committed to one of them). It’ll also give you more options for points redemptions if you’re flying between cities outside of your home country.
I flew Singapore Airlines’ 737 MAX business class with my Membership Rewards points, which I wouldn’t have been able to do if I only earned Avios
If you’re a student or unwaged, perhaps have a look at debit cards with rewards schemes, even if these don’t tend to be as lucrative.
Use airline e-shopping portals (especially for train and hotel bookings)
Perhaps you aren’t eligible for a credit card yet, if you’re unwaged or a student. Airline e-shopping portals will still give you very lucrative deals, sometimes giving you up to 10-30 points per pound or dollar spent (or whatever the equivalent is in your currency). Even if you already have a credit card, you should still check out airline e-shopping portals, as you can double dip on rewards.
For example, here in the UK, both British Airways and Virgin Atlantic have shopping portals that let you earn points when you spend with certain merchants. At British Airways, you can get 30 Avios per pound spent when you book a hostel on Hostelworld, as long as you pay during the session (you can even pay for a refundable rate). They also have their own hotel portal, where you can get 10 Avios per pound spent (though check how many Avios per point Booking.com and Hotels.com is offering as well, where you’ll be able to double dip if you earn points with them).
Check airline e-shopping portals for earning opportunities, particularly when booking trains or hotels
This can be a great opportunity to earn points when you’re spending on travel as well.
Treat miles like currency and don’t use them “for free”
I believe there’s one thing that ruins the way that the miles and points industry comes across to the general public, and that can be summarised in one word – “free”. It grates me when someone posts a video that said “my £10,000 flight cost £17.50”, without talking about the miles that they spent on the flight.
Miles should be treated like cashback – not a complimentary add-on. When you book a 18,000 mile roundtrip economy flight shorthaul in Europe that would’ve otherwise cost £60, you shouldn’t consider the flight as “free”, even though you didn’t spend any money on it. I admit that sometimes this blog won’t display it in the best way possible – e.g. I redeem regularly for intra-European business class so I can review lounges for my readership, though I wouldn’t necessarily incentivise you to do the same.
This means that you should be calculating the number of cash per mile that you save whenever you’re making a redemption. I’d say that universally, the value of the average mile hovers at around 1-1.5p (GBP), though you should be getting outsized value when you’re making a redemption, particularly for first and business class. Save your miles so that you’re spending 75,000 miles on a flight that otherwise would’ve cost £3,000 (making each mile worth 4p), rather than spending 9,000 miles on a one-way flight within Europe when a Ryanair alternative would’ve cost £45 with a bag (0.5p per mile).
Sometimes there’s merit to using miles when booking shorthaul economy flights (especially when pricing surges), though I would rarely ever use miles to book anything outside of air travel, unless I was using a programme where my miles were expiring. For example, UK AmEx lets you pay for any transaction with points at 0.45p per point – this is a horrible use of miles in most cases, and I would discourage you from doing so whenever possible.
Generally, I’d favour a <£100 cash price over using miles to redeem for economy travel
Similarly, when deciding which airline you’d like to redeem your points with, don’t just choose the one with the lowest tax surcharge – figure out how many miles you’ll be using, and calculate value from there. Lastly, you might also want to figure out how many miles you earn when you’re crediting miles to an airline from a flight, though generally you wouldn’t want to deviate too much from your “main” account with the alliance.
Use transferrable points schemes that help you earn miles
If you’re in certain geographies, you might have access to points schemes that will increase the number of points that you can earn from spending with certain merchants. For example, in Singapore and Hong Kong, we partner with HeyMax, where you get to double dip on rewards when spending with certain merchants, as long as your card is linked to the HeyMax portal. There’s Cosmo Points if you’re in the Middle East, HKTVMall if you’re in Hong Kong, Rove miles in the U.S., and you might be able to find transferrable points schemes that work for your specific location.
We partner with HeyMax, where you can earn points with certain merchants in Hong Kong/Singapore and convert Max Miles to e.g. Qatar Airways Avios
Don’t go ham with the rewards schemes available – try perhaps 1-2 per alliance
I would suggest not over-diversifying the miles that you’re collecting. There are three major airline alliances out there, and I’d recommend sticking to 1-2 miles and points schemes per major airline alliance. I would recommend collecting points in the geography that you’re based in, as well as one other major loyalty programme for the alliance that has some strong partners.
This is highly subjective, but generally the best value Oneworld rewards schemes tend to be the following:
- Alaska Airlines Atmos Rewards
- American AAdvantage
- British Airways, Qatar Airways, or Finnair Avios (they all transfer between one another)
- Cathay Pacific’s Asia Miles
The best value Star Alliance rewards schemes tend to be known as the following:
- Aegean Miles+Bonus
- Avianca LifeMiles
- Air Canada Aeroplan
- Singapore Airlines KrisFlyer
The best value SkyTeam rewards schemes tend to be known as the following:
- Air France/KLM Flying Blue miles
- Virgin Atlantic points
- Korean Air SKYPASS miles
The following rewards schemes are also known for being quite lucrative:
- Emirates Skywards miles (generally for Emirates travel)
- JetBlue TrueBlue points
I wouldn’t recommend holding Emirates miles unless you fly Emirates often, though if you do, they’re good
Ultimately you should decide whether a frequent flyer programme works for you, though the above are some suggestions. As a general point, though, don’t hold a small number of miles in a large number of programmes – stick to those that offer the most valuable redemption opportunities, and earn miles with them.
Conclusion
If you’re new to miles and points, it can be a daunting prospect to set up your miles earnings. Generally, don’t waste any opportunities to earn miles, and treat miles as currency – don’t spend recklessly on “free” flights, but save up for aspirational travel opportunities in premium cabins.
Do you have any tips for someone just starting out their miles and points journey?