Using cent per point value is the standard to calculate our award redemptions. But using cent per point can be misleading and manipulated. So what if there was a different way to calculate value when we redeem our credit card rewards points?
00:00 – start
00:33 – Goal of Award Redemptions
00:52 – Manipulating Value
1:24 – Example
3:12 – Issue with CPP Value
3:26 – Different Value calculation
5:07 – Post bonus spending
6:28 – Rate of Redemption Return
7:46 – More Accurate Picture?
8:38 – Thoughts
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25 comments
Comparison is the thief of joy! If you feel good about a redemption then go with that feeling. The moment you start breaking t down into terms that you can compare with others, the quicker you’ll start to lose that feeling.
I appreciate you always keeping it real! 💯
Just get the fanciest metal card you can lay your hands on, and smack that baby down at the bar. Hold ALL the points into retirement, and tell the ladies at the senior center, "I've got the suite, if you cover food and gas."
My boy’s wicked smart. Appreciate the perspective and originality of the content, always well done!
Interesting idea but in practice, points from sign up bonuses and spend get all mixed up so it’s going to be difficult for me to do your proposed calculations.
Next video: "Flexing by clanging your metal card on the table does NOT impress nor does it compensate for your small peens."
(You can show us what sounds metal cards make when the waiter/waitress dunks a pretentious person's metal card in the toilet.)
Definitely not as cut and dry as some people like to brag about. Nice video. Personally, I redeem at decent value but put more worth on booking a whole experience together. Timing a hotel stay and great airfare with the days of the year that work for me (sometimes chaining events together) is more valuable than a single part of that equation being a big CPP win.
1000% solid. This is the reality of the credit card game after year 1. It’s not talked about enough. Your setup is key after year 1 unless you have ridiculous spend no matter what.
Not gonna lie but it was hard for me to keep up with this video 😩
That said… I think people should stop focusing on trying to squeeze every penny of value out of their rewards and just book what’s most convenient for them. Not everyone is a points nerd like us, I have friends who have anxiety while booking points travel because they want to make sure they’re doing the right thing. My advice is to just research transfer partners and book whats convenient for them. Not every redemption will be a 20 cent per point redemption.
Just know what your base value is… AMEX 1 cent, Chase 1.25 cents…. And try to beat that.
Great points Dustin! CPP can be something that people focus on too much. Those examples were helpful to explain why its so important to look at your rate of return on spending too! Loved this take on redemptions
Get it right!!
Your name is not, Dustin. Your name is, Waller’s Wallet. Please proceed. Lol!
I’ve thought of this too, and have been racking my brain for formula for rate of return. I wish someone could come up with a good spreadsheet.
Here's a thought this reminded me of: Most "Average Joes" aren't going to get very far relying on category spending to earn points. Even if you're getting 3x back on many small purchases, it is finite – and not that much.
I can see this logic also showing why cash back could be better than earning airline miles. With cashback, you can book whatever flight is the best value, and then just use the cash to pay for it. With points your more limited, and while you may get a higher cpp for the redemption, that might be because the cash value of the flight was inflated.
If I understand this right, I personally don't agree with it. For example, I do ~10 personal-expense trips on Delta per year. If I see a flight that I'm only getting $0.011/point, I'll pay cash because I know that I can regularly get $0.013/point. Yes, I maximize my purchases to always get the highest earning rate, but I never consider that when booking since it'll be the same, relatively, whether I book at the higher or lower cpp.
I think your point makes a lot of sense for people who are signing up for cards with the intended goal of using those points for a specific trip.
Great way to think of value for your redemption. I like it and really the memories and quality time can also be included with the value of the redemption. Keep up the great work man…take care and keep moving forward!
You are a genius 🤓
Súper. Taré.
Despite small channel, one of the bestest Youtuber 🙂
Whenever I hear Dustin, my mind just calm down and become more organized
Another great quality that you have Dustin is you are efficient with words, not a second of delay or unnecessary sentences.
Hello, can you do a video on the chase/Aircanada news just broke yesterday; now we can transfer points to aircanada. It looks pretty good, but better than united? domestic flights seems much cheaper.
Dustin, agree that point redemptions are more nuanced than what can be captured in a CPP evaluation. Case in point, my family and I had an unexpected cancellation on our outbound flight (thank you SouthWest) and they could not get us to our vacation destination for a few days. I turned around and nuked 50k United points for a one way flight so that our vacation would stay intact.
The problem with such a nuanced look is that it requires more data points and context and makes a simple comparison between cards more complex, perhaps too complex for the casual applicant. While CPP is flawed, it does provide a flawed yet simplified standardization amongst credit cards and their associated point systems.
Appreciate the context as always and congratulations on 500 videos. Your success is well deserved.