While it is tempting to transfer points to different programs without too much thought, do your research first. It’s almost always best to use points within their original rewards program – with a few exceptions.
Dear Cashing In,
I just got an email offer to convert some of the Hyatt points I earned off of my World of Hyatt Credit Card to American Airlines AAdvantage miles. They said it is at a special rate of 2 Hyatt points per American mile instead of the usual 2.5-to-1 rate. Is that worth it? – Rick
From time to time, you will receive offers like this – usually special, limited-time opportunities to move points to miles at a favorable rate.
One of the frustrations many people with rewards credit cards have is that the points are not in some universal currency that allows them to be transferred easily among different programs.
In response, card companies and rewards programs have sought to give customers as much flexibility as possible in redeeming the rewards they have accrued.
See related: Does it make sense to transfer rewards points twice?
Stick with the program
Nowadays, it’s common for rewards programs to advertise that their points or miles can be used for a wide variety of rewards – such as gift cards, car rentals and even cash.
However, the trouble is that while you might have the ability to redeem points or miles for various perks, you often don’t receive the best value for your points.
For instance, if you want to redeem your rewards for cash, you’re much better off using a cash back credit card – rather than a travel rewards card and choosing the cash back option. The rate of return would be much higher.
Usually, to receive the best value for your points and miles, you should use them with the company that is offering the card.
For example, if you have a credit card offered by a hotel chain, the best value is most likely going to be to redeem points for stays at said hotel chain. And if you have an airline card, your best bet is almost always going to be to use frequent flyer miles with that airline.
See related: Best travel credit cards
How your points translate
In this instance – an offer to convert Hyatt points to American Airlines miles –you’ll get a better value using those points for hotel stays, rather than flights. It requires a little bit of research and math, but taking a closer look can ensure you get the most out of the rewards you earn.
So, say you had 50,000 Hyatt points. If you were to use them for a hotel stay, you could stay for three nights at a category 4 Hyatt hotel (15,000 points per night). That’s a hotel like the Andaz San Diego, in the city’s Gaslamp Quarter, that has a rooftop pool and bar. Its rates start at $169 a night. So, those 50,000 points are worth about $500.
If you convert those points to miles, those 50,000 Hyatt points would translate to 25,000 American miles. That would be enough for a free, round-trip domestic coach ticket at the lowest redemption level.
Could you find an award ticket at the 25,000-mile level that’s worth $500? Maybe. But usually when tickets are expensive, they command many more miles. In this case, you would more than likely get a better value from using the points for Hyatt instead of American.
When converting points makes sense
When it comes to converting points, it makes the most sense to do so with bank-sponsored rewards programs. These programs – such as Chase Ultimate Rewards, American Express Membership Rewards and Citi ThankYou rewards – provide flexibility and the points in those programs are designed to be transferred at a favorable rate.
Otherwise, use extreme caution when transferring among programs. If you have a bunch of points and miles you wouldn’t otherwise use, then go for it. But be aware that the greater value of those points probably lies with using them in their original rewards program.