Is it now irrational to hold Ultimate Rewards points? (on Nick’s mind)


On our most recent Frequent Miler on the Air, I made some points about the new ability to cash out Chase points at a value of 1.5c each via the current promotion. When we initially reported this (perhaps limited-time?) option to use points toward groceries and other things, some readers were quick to dismiss it. More than one or two readers indicated that this was something they’d only do if they were “cash strapped” since they can otherwise redeem Ultimate Rewards points for much more value. While I also feel like I have redeemed Ultimate Rewards points for greater value, I can’t shake the way it’s making me re-think redemptions and the cost of holding my points. While loyalty programs often make us act in irrational ways, this 1.5c redemption rate really has me thinking about just how irrational it is for me to want to keep these points given such a valuable cash out option.

I love redeeming points for outsized value. I still remember feeling like a total impostor the first time I flew in a premium cabin. After having traveled for years on the most economical of economy class fares I could find, I skipped right from the cheap seats to first class on Etihad from Cairo to Abu Dhabi to Tokyo (for 45K American Airlines miles at the time, though the rate for Middle East to Asia 1 has since increased to 50K miles one-way in first class).

It wasn’t the apartments, but it may as well have been to us.

I had an absolute blast spending 8 nights in Bora Bora last year, something I never ever would have even imagined were possible no less actually done without miles and points.

And I want to keep doing those things. With trips obviously on hold given the COVID-19 pandemic, of course I miss traveling to exotic locales in comfort. Like many readers, I’ve been somewhat spoiled by the premium cabin experience: while I traveled to Europe, India, and Far East Asia a couple of times in economy class before discovering frequent flyer miles, these days I find myself more turned off by the thought of 8 or 10 or 14 hours in economy class simply because I know how to get there more comfortably by leveraging credit card welcome bonuses, category bonuses, manufactured spending, and the other tools we use to play the game.

However, while there is no doubt that I enjoy the premium travel I’ve done and value the ability to do so to some extent, the recent Sapphire Reserve cash out ability has me re-thinking the cost of doing so.

The first example to hit me after we spoke during Frequent Miler on the Air was a redemption that became significantly more attractive last week: Emirates has seemingly dropped its surcharges by ~90%, making award tickets via Emirates (and its partners) much more attractive. Stephen covered how one could fly round trip in first class (pending availability) from Newark to Athens for 135,000 miles. I’ve been fortunate to have flown the Emirates A380 in first class a handful of times and while it’s over the top in terms of bling, it’s a lot of fun.

Enjoying the Emirates experience

At about the same price that most programs would charge for a round trip business class ticket, I’d be happy to get to Europe round trip like this. Furthermore, I love Greece and would be happy to plan a 2021 trip there in hopes of travel being safe and advisable at that point.

Since Emirates is one of the five most promiscuous airline programs, making it easy to put together the miles for a redemption, I gave it a search or twenty to find availability. And in fact I did find at least a couple of dates with three seats in first class on the way to Athens. Unfortunately, it was on the 777, which features the same seat as above but is missing the shower and bar of the A380 (that sound you’re now hearing is the world’s smallest violin, playing just for me). I temporarily gave up my search planning to hold off a bit and look for slightly later 2021 travel.

And then this new Chase redemption came around at 1.5c per point toward groceries, home improvement stores, and dining.

When the Emirates redemption came back into my mind, I had to consider the opportunity cost of redeeming miles this way: 135K Chase points could buy me $2,025 at those stores over the next four months. Obviously, the first class Emirates flight would cost much more if I were to purchase it. But would I purchase the round trip first class fare to Athens for $2,025 if it were on sale for that price? Would I do that for three passengers (my wife, son, and I) at a total cost of $6,075? Actually, add in the surcharges that still exist (over $100 per person round trip) and we’re at more than $6,400 in cost for those three seats. And that’s to say nothing of the cost of acquiring the points: some of my points came with MS costs attached. Those costs exist whether I cash out points for a statement credit or use them for travel, but the points themselves weren’t “free”.

Truthfully, I wouldn’t spend six grand on flying to Athens. I’ve flown there in economy class before and I could do it again. Flying out of New York airports, I know I could pretty easily get to Athens in economy class for about $450 per person all-in by hunting for a fare sale (likely less time consuming than hunting for first class availability). Spending six thousand plus dollars to fly my family rather than $1350 is more of a splurge than I could justify in dollars and cents. In fact, if you were handing me a bag of your cash as a gift and you told me that I could either spend it on first class or buy the economy class tickets and pocket the rest of it to do what I want, I don’t even think I would hesitate: I’d book the economy tickets and take the money and run. That extra $5,000 in my pocket would not only cover my hotel and meals in Greece, it would probably cover another future vacation, too. While I know that many Frequent Miler readers love their premium cabin travel using miles, I can’t imagine I’m the only one among us who would take the cash in that scenario.

And so I now look at Chase Ultimate Rewards redemptions much differently than I did a week ago. Truthfully, it even makes me question Chase redemptions outside of this limited-time deal. While it was easy to ignore the fact that Ultimate Rewards have long been worth $0.01 each for a statement credit since that seemed like such poor value, I could make the same argument above for redeeming points even apart from this 1.5c deal: would I pay $1,350 per passenger for Emirates first class to Europe? If I were single and without a family, maybe I would splurge like that once every few years as that’s obviously not unreasonable for what you get. But would I do it times three for me, my wife, and my son? Again, it isn’t the no-brainer it once was even if it is a good price per passenger (in my case since economy class flights from New York can often be quite cheap).

Hotel redemptions are at least as painful in my mind. I’m a bit of a cheapskate value shopper when it comes to hotels. You wouldn’t know that about me given some of the hotels I stayed at last year with points, but when it comes to paying cash I really don’t like to spend all that much on a hotel. I’ve used points to stay at many 5-star hotels over the years, but I can count on two hands the number of times I’ve paid much north of $150 per night on a cash rate.

While I have stayed at some hotels in recent years that really are the destination in themselves, I’ve taken many more trips where it didn’t matter where I’d sleep.

I was totally happy to spend a few nights in national park rest camps in Kruger National Park to see stuff like this. I also spent a few nights at a Marriott property, but neither the rest camp nor hotel were about luxury accommodation, they were about being close to the stuff I wanted to see.

Traveling with kids may be different for a while – I value having the space of a nice suite right now — but eventually I expect that I will again be fine with a clean hotel that has the basic amenities I need. And indeed now this grocery/home improvement redemption certainly has me thinking about that more closely.

There are some awesome Hyatt properties around the world at the Category 5-6 range (20K or 25K points per night). I’ve stayed at quite a few of them and been thrilled to walk out with a bill that said $0 after several nights of comfort and free breakfast or lounge access (or even an all-inclusive where all my food and drink were covered). But would I spend $300 or $375 per night for those hotels? Maybe there are situations where I’d consider it as a once-every-several-years splurge that would make for a really memorable trip. But truthfully, I wouldn’t often choose to spend that much cash.

And it’s not because I’m cash-strapped. I’m really fortunate to have been in a position to save well for a long time and to work for a blog with a great following and for a generous boss. It’s not that I can’t pay for a comfortable vacation once a year but rather that the value hunter in me — the same part of me that discovered miles and points in first place — knows I could be perfectly comfortable spending less and I could keep more for a rainy day.

Greg made the point on the show that points that are already tied to a program (i.e. points that are already in my Hyatt account or already in my Marriott account) seem like fair game since using them for hotels is clearly the best use of those points. But with Chase points, it is suddenly less clear that transferring them is the best option when I think of the cash cost in terms of money going out of my pocket (since every point transferred really is cash evaporating from my pocket). If I keep 20K points this month, that means I’m paying paying $300 in groceries to keep them. If I could be happy in a hotel that cost $150, I could redeem my points for groceries today and get two nights down the road for the same net cost.

And so now I look at my pile of Ultimate Rewards points and it almost makes me feel guilty about not redeeming them. I know that I’ll spend at least $500 per month on groceries for the next four months — I could easily redeem that 135K points that I was tempted to redeem for Emirates first class instead for free food, keeping that cash in my pocket for the proverbial rainy day (or perhaps investing it or using it to trigger bank account bonuses to make more money and leverage that for a future trip). I could further redeem more points than that for gift card purchases — goodness knows that between grocery stores and home improvement stores, I could find gift cards to cover most of my worldly expenses and/or effectively “cash out”. Should I?

The truth is that I don’t want to redeem my points this way. I feel like I put in the effort to earn these points with the aim of traveling in comfort and style beyond what I’d mean to pay in cold hard cash. But even though those Ultimate Rewards have long represented a sum of actual cash given the ability to redeem them at $0.01 each, never have they felt more like a pile of cash that represents a large cost. This new 1.5c option suddenly makes the weight of each redemption more perceptible.

Granted, my points also represent the ability to save real cash. I know that here are times when I would otherwise spend $150 on a hotel room that I could snag with 5,000 or 7,500 points and times when the cash cost of a last-minute flight would make it impossible for me to “be there” (wherever there is) without a stash of points. I know that my points do represent an ability to save money on future trips and to stay in more luxurious hotels for a  very small premium over what I’d pay elsewhere. But Chase has added more pressure today to redeem those points for much better than 1.5c in real world value — otherwise, why am I waiting to redeem them?

Will I cash out all of my Ultimate Rewards points these next four months for groceries and gift cards? I doubt it. I don’t know for sure that I’ll redeem any of them that way because the truth is that I have come to irrationally value those nice flights and hotels that I know they can buy. But I can say for sure that not redeeming my points at grocery and home improvement stores at 1.5c each will carry weight on my mind and on my future redemptions when I consider the actual cash cost of those redemptions through this lens. I’ll still feel pretty good about transferring 34K points to Iberia for an off-peak business class award to Madrid and I’ll be pretty happy when I find the random gem like the Park Hyatt Mendoza (sad I missed the chance to stay there when it was 8K points per night). But would I transfer Chase points to Marriott to spend nights at the St. Regis Bora Bora? It’s beautiful and all, but even with a 5th night free it’s over $1,000 per night if my next best option is redeeming at grocery stores (admittedly, the better play if I wanted to stay here would be cashing out via VGCs at grocery stores and perhaps using them to buy Marriott points on sale under 0.8c each to reduce cost considerably).

I long for this view again…but transferring Chase points to get it seems crazy to me right now.

Right now, with much of our regular activity on pause, Chase’s introduction of a valuable cash out option has certainly given me pause. Splurges have become a bit less reasonable and make me think more carefully about how irrational it is to keep a make-believe currency with the hopes of redeeming it at a cost (in terms of the cash I’ll spend today to keep those points) that is in many cases higher than I’d otherwise be willing to spend if there were a sack of cash on the table that I could alternatively take. I feel like there is a psychological study to be done on this one given that Chase has literally put that sack of cash out there for us: will you take Chase up on the money and run, or will you clutch your points tightly? How many of us will resist it and which of us will give in?

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[…] Rewards points to Hyatt to book a 30-night stay at a Category 1 hotel. Despite the fact that I have argued that we should all be redeeming Ultimate Rewards points at the grocery store right now, I hadn’t personally done so specifically because I value the ability to get far outsized […]

[…] points for a statement credit for 1c each and then buying the Marriott points (or better yet, cashing out at grocery stores for 1.5c and then using the cash saved to buy points). If you’re considering either of those […]


I had a mess of URs redeposited from multiple Covid trip cancels (originally made on the Chase travel portal). I had already pd 90 days of (mostly) dining/take out/delivery purchases, so cashing in some of those recently redeposited points for a sizable checking acct credit was painless, mindless, & absolutely the right move for my family for right now.

I think if this decision becomes an all-or-none points proposition it might sting more or could be met with remorse when traveling is either back in full swing or, on the flip, remains stymied. People don’t generally regret not making the decision that would be a huge win as much as the one that would genuinely hurt them. Maybe the best solution is to split the difference between cash & points for a win either way the travel winds end up blowing in the foreseeable future.

[…] Is it now irrational to hold Ultimate Rewards points? (on Nick’s mind) […]


First I want to say great, well thought out post and a lot of great viewpoints in these comments. Everyone should consider these redemptions.

Now may take:

Economics: I value my points at little if no more than what I would actually pay out of pocket. Regardless of how “luxurious”, “nice”, “exotic”, or expensive it may be. For me that means I’d be willing to pay a 50% premium for business or first over and above what I’d be willing to pay in economy class. I’d never pay (round trip) $5,000 for business nor $15,000 for first. Now would I pay $750 if the economy fare is $500. Yep! I’m cheap so I’d consider discounted economy tickets my baseline here.

Personal hotel caveat: I don’t care about hotels. I go to places to see them. Not to spend my time in a room. I just need a clean room, shower, and safety. I rarely redeem for hotels except for cheap categories and free night certs.

Opportunity cost: you can earn 2% cash everywhere with no annual fees. That’s the baseline.

Taxes: points and cash back on are tax free. If you’re in a higher tax bracket this can be significant! Redeeming for cash as a non-taxable event is a consideration. You generally buy grocery, dining, and home improvement with after tax dollars. This also should be considered for the 2% cashback mentioned above as well.

Emergency travel: I personally keep a stash of the most useful points to me for last minute potential needs. It’s like an emergency fund for travel for medical or funeral needs, as an example. This includes flights and a night or two at a hotel. In this instance real cash can be saved.

Post COVID world: it will be some time before a vaccine. Airlines will be eager to fill seats and I expect cheap fares. While those would also be 1.5 cents there are 2 other things to consider: chase portal doesn’t always show the lowest price and cash today can be used today. In this scenario take the 1.5 cents now.

Devaluations: airlines are barely hanging on now. Hotels too. Some may go bankrupt. Others will wreck award charts that are already in decline. The thought of XX miles will get me to where I want to go may vanish or steeply increase. Don’t wish you got 1.5 cents and have to take 1 cent later.

I’ll conclude with this: do what works for you best and in the end makes you happy. Just know the financial side of it I’ve shown above. There is no wrong answer. Consider the risk/reward of your options. And keep in mind you can earn more points later via spend, sign up bonus, and other methods. Earn and burn. Enjoy. Live life!


If you are sitting on a boat load of points then there is value in cashing those out and rolling into a better investment. I do have a significant amount of points, but would rather sit on them and use them at Hyatt and business class flights. I am a retiree and do not have the avenues I had when I was a working guy travelling and putting alot on the CSR, ‘

Very tempting to cash out.


Typically I would probably be in the “hold on to them in case good opportunities arise in the future” camp but today not so much. Not necessarily because of an acute cash shortage but because I am drowning in airline credits from cancelled trips and also find myself with several companion vouchers. And so having cash to partner with those is more valuable than having points since you typically can’t use points to book a companion fare and a little extra cash will provide more flexibility in using those airline credits to go where I want to go. So might be time to upgrade back to the CSR!


Interesting how coming from different life experiences makes a difference in how you think about all of this. When I started we had 3 kids at home going to junior high and high school and one income earner. I got excited about all of the points opportunities, but every time I looked it just didn’t make sense to transfer for points when I did the math. That came to a lot of points for 5 people to Europe and it’s not always easy to get the seats.

Hotel points have been better, but I still have had problems with finding availability, not using a ton of points unless the hotel is far from a tourist site or they just don’t have hotels like Marrriot, IHG etc. What I usually end up doing is spending the hotel points for nights in a place where we are repositioning or for the hotel right by the airport on our way home.

Now we only have 1 child at home and I started getting excited about points again, but you know what? I find using points for airlines a huge pain! Maybe it’s the Phoenix market and the dates and times we are available to go? (I do know that is a big part of it). Maybe I just don’t know enough? Probably, but the more I learn I’m just not finding using points for cashing out, in travel portals etc is better.

All I know is that cashing out my points sounds like it might be a good option for us. And no, it’s not going to go “towards” groceries. In my budget software, it will go towards “vacation”.


You give me 1.5 cents for almost any points I have in exchange for something I want, I wouldn’t hesitate to spend them. I probably have 600K on various airlines and another 500K (mostly with Chase) with CCs. I’d easily would take 1.5 cents for stuff like Apple products (computers) or even cash directly.

I don’t see myself doing international travel much in the next 3 years (be lucky to do 1 trip) so the points are only going to devalue. Some of the changes Chase & Co. have made will cause me to keep the cards for a bit longer but when AFs roll around later this year and next, more will be on the chopping block.

[…] Nick covered in detail why this cash-out option is so compelling, so I won’t repeat the argument here.  Instead, please see his post: Is it now irrational to hold Ultimate Rewards points? (on Nick’s mind). […]


What great thoughts in your article and in the comments. Everyone has provided such detailed insight from different perspectives. This made me sit and think AGAIN about what to do. In the end, I’m with Ricardo and the dances.


Your post makes perfect sense and I agree with you, but I will play devil’s advocate here: you are trying to rationalize the very nature of this hobby which I’ll try to translate from my native Spanish (Venezuelan): “A mi nadie me quita lo bailao” which translates to something like: no one will ever take from me all the dances I have had. It is a metaphor for the ultimate price of this hobby: the memories you’ll make, the stories you will tell, etc. Your are trying to put a price on the adrenaline you get when you see that office max has Visa cards on sale, on the high you get when you find 4 seats on Qatar Q suites, or when you get a week on a suite at the Paris Vendome because of your Globalist status. I understand the purpose: those things make no sense in times of rampant unemployment when cash is king . I not only respect your post but there is no refutal that you are right. But I prefer to use my points to keep dreaming and to plan new dances. This is a hobby that never made to much monetary sense anyways for me. I play the game for the dream, to keep me looking forward to the next adventure or memory and I don’t want to exchange that for a pound of cheese or a gift card. I ll pay the price…


Just when I thought I had made my mind up to cash out … this post really hit home. It may be the best economical decision to cash out, but I still may not do it. Ricardo, thanks for posting this!


Counterpoint I now have $4,200 (MR/UR) worth of points that I transferred to FF programs for a month long trip which I booked last November for us this Sept-Oct – Shanghai, Fiji, NZ and AU.

Granted COVID19 threw a monkey wrench in the works. DW PTO normally has too be scheduled at least 6- 9 months out for anything longer than a block of 7-10 days.

Complicating the PTO matter – Is DWs co-worker who had covered her PTO during extended trips – took a new job the week that Oregon passed shelter in place – and now there is a hiring freeze in place.

So the trip to FiJI/NZ/AU will be back-burnered possibly till 2022-23 or beyond ( we already have an Asia trip with extended family members penciled in for December 2021).

Would I have paid $4,200 for me and DW to fly J around the ring of fire this Fall – yes for that trip I would have.

That is the risk of this game, along with routes being cancelled, frequency, in addition to now working with COVID – making multi-country trips harder. Part of the challenge of the game is that you do have to book so far in the future to snagged lay flat awards seats for non-solo travel to some destinations.

We still have a ton miles/points (branded) we are sitting on from SUB’s and across several airlines and now even more from CC transfers for the trip not taken.

I cashed out about $5K of MR/UR the past 30 days – no regrets – Tastyworks and CS brokerage bonus should net an extra $500-600 from that money. – Cashing out 125K UR – was a little premature in that I could have banked – a bit more with Grocery and VGC and the 5X – with some extra work. We will still have about $3,250 of MR that we can cash out before the next AF in 11 months.

Would – I PC back to CSR right now – If I still had the 125K MR possibly.

I think we have a few years much like after the great recession – before the the airlines start pushing deals again – either cash or awards.

I also think that flying will be more of a hassle for the next 12-18 months post COVID or post COVID fears subside.

That said I’m extremely thankful for the experiences and the travel this game has afforded our family. Additionally that those memories did not come with a revolving credit card balance to paid for those experiences. That is what is priceless. To steal a CC advertising tagline.


My CSR 90 day history shows restaurant and, since 5/1, grocery purchases, so point values of 3X and 5X respectively. Redeeming at 1.5 cents per point thus gives me a return of 4.5% and 7.5%. However, if Chase ends the CSR 5X grocery bonus on 6/30, I’ll be getting 1X on grocery purchases, so only 1.5% return on grocery purchases until 9/30 (and, for that matter, on home improvement stores now). That’s less than I can get on a Citi Double Cash Card. Something to consider.


I used my CFU for groceries and I just looked, they are eligible for credit statement for 1.5cpp, and all the way back 90days worth. I suppose it doesn’t matter if the charge is on CFU or CSR. I am still thinking if I should cash my 240K since I won’t be going anywhere for 12 months from now. However I live with parents so I don’t pay my bills with card so that cut down my ability to earn what I redeem. It is such a hard decision.


You are an absolute piece of garbage for bringing a baby to Bora Bora. Thank God you were not there the same time I was.


I hope none of us ever run into you when we travel. You seem like you would be quite unpleasant.


Sounds like there was a pretty big baby in Bora Bora when you were there. Exactly when you were there, in fact.


Did you use Nick’s tips for booking the Bora trip? Or are you the baby Nick brought to Bora?


It depends on your UR balance as well. If you have a million UR, then each incremental UR earned is unlikely to be redeemed for travel anytime in the next two years. So the value of each incremental UR has to be discounted by the time value of money (since points aren’t earning interest), and discounted further due to the risk of holding points that can be devalued or confiscated. So if you have a million UR, or more than a year’s worth at your own burn rate, then yeah, 1.5cpp is a good option. However, if you collect points for the specific purpose of traveling well, and you aren’t a UR millionaire, then 1.5cpp doesn’t change anything. I already made my own valuation for points based on what I’d be willing to pay out of pocket for the J/F flights or nicer hotels vs. using points. My valuation for UR is over 1.5cpp, and I have less than 100k now, so I’ll pass on the grocery cashout.


It was an easy decision to cash out UR for me.

I was in New Zealand in March. I had to cut the trip a few days short but awesome overall. I also have business class to Santiago and Rapa Nui booked in November (fingers crossed).

And I still have plenty of MR and TYP for travel redemption’s.

I’ll be cashing out all my UR over the next few months.

Tej in Vancouver

Do you think there is a possibility Amex/Schwab increase the cashout from 1.25 to 1.5 to kinda of match the CSR (now that it’s easier to cash out UR)?


This is exactly how I’ve been feeling, I don’t WANT to use my points for groceries but it’s hard to justify not doing it. I’ve already been leaning this direction with the increase in points prices for premium cabins over the years. Sure they’re a better ‘value’ compared to cash, but how much do I value the experience? Now with easy 1.5 cent redemption it makes it all the harder to justify. Is 6.5 hrs in business class to Europe with my wife really worth $900 more than economy? $1800 RT?? Kinda takes the fun out of it…

Joe Scmho

Great post, Nick!

As for me, assuming that one maintains a healthy balance of points with Amex and Hyatt points (which I do), I think it makes sense to cash out nearly all UR pts. That’s what I’m leaning towards doing.


This is a really great post. When I saw the title, my gut reaction was of course not, they’re worth so much more. But after following your line of thinking, I agree that I too would not spend $6,000 + to fly a family of three first class to Europe. I’m now reconsidering whether I’d spend the equivalent of even $2,000 + to do it on my own. Food for thought, thanks for a great read.


What do people think about Chase sensitivity to people buying VGCs to cash out points at 1.5? I was thinking of cashing out 500k points but worried if that’s going to trigger closer account monitoring.


Nick, I’m a little surprised that you are just now realizing that your UR points can be redeemed to save 1.5 cents cash? I know you’ve said that you don’t often pay cash for airfare, but most people do and they have always had to the option to use UR points through the travel portal at that rate. Personally, I even spend more on airfare than on groceries in normal times, though obviously grocery spend is easier to “juice” with gift cards.

So is your advice for everyone now that before booking airfare with cash, they should always check the Chase portal and redeem miles for it at 1.5 cents if the prices match?


Thanks for the reply, but I guess I’m confused why you view grocery spend as “more concrete” than flight spend? In your example of the $450 airfare to Athens, you are essentially saying that you would redeem 30,000 points to reimburse $450 of groceries and then use that extra $450 to buy the flight to Athens…..but…..that’s the same thing as just redeeming 30,000 points on the portal to buy the flight to Athens. And that’s something that you could have done last year, so I don’t think that this new ability to cash out should change your view of the value of UR points.

(Admittedly, if you buy the flight in cash you would earn points on that purchase as opposed to using points in the portal, so there is a small margin of difference.)

All this change really seems to have done in my eyes is made it so that people with balances greater greater than their “target” balance have an easier way to work down their large balances.


There are indeed a lot of variables, but let me add one more. In all my flights (and I personally favor the Chase eco-system more than AMEX or Citi or even Cap One, even though others may strongly disagree and I play in all programs), I have only used the Chase portal once, when the cash price using the portal was literally half of the points needed to transfer to an airline. Although I don’t earn points when using points, what I get instead is something I greatly value–the peace of mind knowing I have the ability to make the whole trip “go away” for the two of us for just the redeposit fee. United charged me nothing to get my points back plus all cash payments (including a change fee) on a trip to Asia (Asiana, Thai and EVA–all in J) due to Covid-19. Although I would love to make the trip, at most I will pay AA $175 to make my trip to the Seychelles in Etihad J go away due to Covid-19. My trip to Aruba in Delta F will still hopefully happen, but if it doesn’t, I can make that go away for a few hundred dollars and get my points back. This is far more inclusive than travel insurance–it is really a cancel for any reason for minimal cost. In a world of craziness–parents, kids, and who knows what else, to me, this is a true benefit of transferring those UR points to an airline or to Hyatt instead of booking through Chase or just paying cash for a ticket. Great article–I’ve been thinking about it all day.


My problem with the portal is that it isn’t nearly as flexible as actual cash.
I frequently fly ULCC (Frontier/Spirit) and can’t use Discount Den or the trick to buy the ticket in person to save on BS fees.

And, especially with the recent COVID issues I trust getting refunds/waivers/changes much more when purchasing directly from the airline.

Joseph Giorgianni

I was just playing around with it. I have CSP. I selected maximum value on all of the transactions. $827.88 for 66,225 points. Tempting. However, the Confirm & Submit button is greyed out.


This was something I had to think about with Amex points. I was booking 2 RT business to Europe using ANA points (88 * 2 = 176). I believe with the Schwab card you can cash out your Amex points for 1.25 cents. I realized that I could turn those points into $2,200. I asked myself if it made sense to forgo that money just for business classes tickets to Europe. I could take that cash and get cheap economy tickets and still have cash left over. Like you points have enabled me to do some amazing things. Without points I don’t think I would have ever gone some of the places I’ve gone or done some of the things I’ve done. There is a ton of value in that.


Personally I would rather earn 5x with the sapphire reserve…..and max out other once in a lifetime ( maybe ) grocery bonuses


Great thoughts here, Nick. I just realized last night the Ford Transit I scheduled for later this month could be paid for with just 44K points instead of over $650 cash, so I switched it and gave up the Rakuten portal points that would’ve earned me. Kind of hit myself upside the head for not considering it to begin with.

We focus on upgraded seats for flying because as we get older the economy seats are not working for our backs or hips. So that’s a priority for us, but there’s time right now to keep building, so great redemptions at 1.5x certainly makes sense while I learn to increase my points earning abilities.


I have lots of thoughts about this. I have now come around to the idea that points and miles can only be valued at what you would pay for them at the time the redemption is being considered. I am not a buyer at 1.5 cents or at least it is very close. I am certainly not a buyer right now at 1.7 cents.

It used to be that points and miles represented opportunities for over the top travel experiences that none of us could come close to replicating for cash. Getting driven from the Lufthansa first class terminal in a Porsche. And while it was a mistake to use the $15,000 value of the ticket as the yard stick for measuring the value of the points, it still was the case that these experiences were only possible to have for most of us with points.

These opportunities are mostly gone. Emirates first class with Alaska or 60,000 point Singapore suites are non-existent or rare these days. Crazy value using SPG Moments have dried up or people have caught on now. The days of getting a suite and eating with Bayern Munich players on their private jet for 20,000 SPG points are long gone. Even when you find the nuggets you have to position or use even more miles to take a non-preferable return or combine it with a mileage run to Colombo that costs you cash, or whatever. Sure, they are still there at the margins. Maybe you wrangled globalist status and you want room service breakfast at the Vendome or you go to Necker island. But in the main, this is not how most of us use the bulk of our points any longer. But we still cling to valuing them like we do. Yeah, maybe ANA using VS lasts for another year or two and maybe some day I really will make that trip to the Park Hyatt Sydney. But is that really enough of a promise for me to pretend I am really getting three cents per point for all my other points consistently?

The truth is that it is now much more straightforward. $2,400 business class to Europe is now the new normal. Yes, in theory I can do it for 68,000 points but there are so many buts. I have to position to Chicago because domestic connecting space has all but disappeared and maybe to avoid misconnect risk and through check problems on split tickets I need to go the night before and get a hotel. And maybe off peak is not ideal and connecting out of Madrid causes me problems and again I am on split tickets because Iberia charges by segment and Vueling only has one flight a day and RyanAir goes from the other terminal at the massive Barajas so six hours of my vacation is taken up with split ticket buffer zone. Etc. Etc. Etc.

1.5 cents is putting these issues in sharper focus. If you would not pay $1,500 RIGHT NOW …. TODAY for 100,000 chase points but you have $1,500 in eligible charges on your statement from the last 90 days, you need to take a hard look in the mirror and ask whether fantasies about using your points that are four years backdated are causing you to act irrationally.


Great post Larry. I would bring up last minute domestic flights as a rebuttal though. I may not do as well on a cents/point basis as ANA first class, but I have reliably secured 2-5 cents/point.


Also some programs still charge relatively low redeposit fees — Virgin, Air France, etc. BA for low tax awards and even AA is moving away from redeposit fees if you cancel far enough out (though it’s more punitive closer in). So using miles can be more flexible than cash. I will always want to have good balances of points for many of these reasons. But saving up for 700,000 thinking I’m going to get my family to Sydney from my home town on First Class over Christmas, or whatever, gets harder to justify when there are easy redemption options for good as cash. (Or, what Nick said!)


BA was one of the ones I’ve used extensively


It’s great. I keep waiting for it to stop. It has gotten harder to use in that sometimes BA seems not to see the space and AA’s move to dynamic pricing is screwing with partner availability. And the 4500 mile band is long gone, but it’s still a great thing.


Thanks for writing this well thought out post. I have always thought the emphasis on flying FOTP was silly. I am in a financial position where I live well, and flying upfront is meaningless to me for at most 13 hrs, so I travel economy. However, beautiful hotels are another story since I feel like they are part of the experience, especially at Resorts. For non-resort hotels, I downgrade to a four-star property.

I am not in a financial crisis position, but I am rethinking if I cash out for the reasons you outline. My usual trigger point for using points is 1.5-2 pp. While the value Chase is offering is on the low end, I am still receiving points for the purchase and interest on the money that remains in the bank. Plus, with dynamic pricing for United, I am going only to transfer points to Hyatt. The question is, can I do better with hotels than say a Hyatt Sydney by stacking deals with that provide more value?

Thanks for adding more food for thought…


Another big factor is Chase nerfing the CSR’s value prop, combined with United and Hyatt devaluations. I’m looking to exit at $200 net AF (DoorDash credit worth $50 if you pickup). This is the perfect avenue to do so. I might come back if I can get a CIP, but BofA is much better cash back for regular spend, and Amex is better earn for transferable points in bonus categories per annual fee.


I love the BoA setup now and agree you can do better with it. However, BoA doesn’t have a great option for groceries.


I currently do BCP for groceries and CSR for travel and restaurants ($245 Net AF-> $295 next year). If I switch both to Amex Gold, I’ll come out ahead even if I don’t get much value from flight fee and bs dining credits, as long as Amex transfer partners are not worse than UR. OTOH, have to get decent cpp for MR to justify not doing BofA cash back alone…


I think BofA strat is best for families but I need to spoil gf until at least the honeymoon


Currently though Chase SR and Freedom are 5x though.


Cash is the ultimate flexibility. While I never cashed out before the pandemic, I am redeeming the Chase points while available at 1.5 cents. Otherwise, I am relying on my two credit cards with 2.5 cents and 2.0 cents per dollar. Stay well, live well, and blessing to you and your family.


Cash is so easy to book flights with, even premium cabins. Availability is fantastic and you even earn points on the spend and miles on the ticket 🙂

I cashed out all my UR points and enjoyed two months of no credit card bill. My last flight was a covid evac and paying full F was worth it, no question, and no way I could’ve gotten a ticket with points before the border closed. Cash is easy.


Do you have to pay taxes if you cash out?


No, it’s considered a rebate


I’ve been travelling in premium cabins with a family of 3 also now for about 5 years. Here are 2 takeaways from my experience that may make you lean toward cashing out.
1) Those great redemptions that get you much more than 1.5 cents per point are often not an option for us. Travelling with our daughter when she was 6 through 11 yrs old, we found ourselves not wanting indirect flights nor inconvenient flight times. But it is hard to snag 3 premium cabin seats on points that are direct, convenient and during school vacations or other high demand times we would want to take family vacations.
2) Most redemptions we ended up using points as cash to be able to take the flight we wanted. As a result, we ended up using points as cash many times with the Amex Biz Platinum 2 cents per point initially, then the 35% point rebate which is like getting 1.55 cents per point. Our typical formula is that we wait for a fare sale, where cash prices are around $1,500 and use in the neighborhood of 100k points per ticket for 3 tickets.

We did once get like 19 cents per mile on a first class ANA from the US to Tokyo that we were lucky enough to find 3 seats there and back. But that was a rare occurrence. Overall, I am tempted to cash out at 1.5 cents as you are.


Great point Rob- I will give an example that matches- last year my family of 4 were flying back to the US from Paris. Most of my miles were with AA at that time, but there was no AA non-stop service to our city. Air France did have a perfectly timed non-stop, and was on the A380, with no business availability but good economy availability. The surcharge was about $50/person higher than on AA, and we flew in economy, but our trip time was 4 hours shorter, and we got in an Uber as soon as we cleared customs and went straight home. It was a daytime flight and we had a middle section of 4 seats to ourselves on the upper deck of the A380. So it was perfectly comfortable and we just read/watched movies for the flight. Much better way to go than flying in business class, but adding a connection and 3-4 more hours of traveling.


Thanks DCJoe. Yeah, that is a perfect example and a situation we often find ourselves in as well. And like you did, we would also choose to do the shorter direct economy flight. I get what Nick is saying in the article totally. My brain knows I should probably just cash out at 1.5 cents since that is the value I mostly get from them anyway, but there is also this pull in the other direction that I can’t explain. Something comforting about having a padded balance of points.


This may go against a lot of people’s better judgement here. But being single and have 2 commas worth of Chase UR points with no intentions of traveling within 6 to 8 months, I cashed out 500k and invested in to S&P a few months ago. Cash is king, it can be invested or you buy tangible goods with it.

Background, I’m employed full-time. A few years ago, I a full-time job and traveled the world for a year plus and redeem a but load of points and experienced all the flying products and visited more countries where visiting a UNESCO world heritage sites have become experience fatigue.

This is a well thought out post.


When factoring in “cashing out” on groceries you should also factor in the opportunity cost to earn points on that spend. Many cards have boosted earn on grocery store spend in particular.


Since to cash out the grocery spend must be made with the CSR or CSP at 1X (except for the bonus rate on $1,500 for May and June), the opportunity cost is the difference between 1.5% at 1X and what you could have gotten for that grocery spend elsewhere. If the alternative for grocery spend is 12X Hilton, worth say 5.5%, you are giving up 4%. That makes the 1.5 cpp cash out actually 1.44 cpp. Still good, and maybe not a large enough drop to change the minds of most who decide to cash out, but something to be aware of.


But you get the points for the spend and then you erase it with the new feature. So, you get the points for the spend and you get to redeem the points.


Sure you get 1 point per dollar on either CSR/CSP (except for the bonus rate on $1,500 for May & June). The issue is that 1X on grocery spend stinks, especially at the moment when there are so many better offers available. Thus you are giving up a better return you could have earned on the grocery spend using a different card. In my example, you are losing 4% by using CSR/CSP versus using the Surpass at 12X HH points. Deducting that 4% lost return against the 1.5 cpp on the redemption means you are really only netting 1.44 cpp on the redemption.

Captain Greg

I’ve basically decided to take the cash while this is available. I don’t have any immediate plans for my U.R. points, and my short term plan is for P2 to pick up a bunch more points through SUBs in the near future (assuming chase starts approving cards again). As you say, we are irrational about wanting to hold onto our points, but cashing out really seems like the right decision (especially with my hope of re-supplying in the near future). The bigger question will be if I continue cashing out if chase extends the program. We’d essentially be getting $1200 for each CIP signup. Rationally, it’s hard to not take that cash…

I Can See For Miles

This is a thoughtful post, Nick, that correctly challenges our preconceived notions of how those of us who play this Game value our points, miles, money, flights and accommodations. With the stockpile in various travel loyalty programs I have, I’m on Team Cash Out — even at the 1.25 cpp I’m receiving on our Sapphires because we can’t upgrade to the CSR yet. But it’s an excellent thought-exercise, and you can make a compelling argument either way, depending on individual circumstances. Excellent work.

Joseph Giorgianni

Great user name! I’ve been a big fan of The Who since 1967.