How to use the cents per point calculator
- Enter the cash price of the same flight, room or item that you could pay for with money.
- Enter the points needed and any cash you still pay with points, such as taxes and fees.
- Enter the value per point that you would accept as a good redemption. It is your own bar.
- Read the value of each point in cents, the cash you save and the cash price at which points break even with your bar.
Formula
Cash saved = cash price - cash you still pay with points
Cents per point = cash saved / points x 100
Break-even cash price = points x your cents per point / 100 + cash you still pay
A higher number means each point bought more. It is only meaningful if you would have bought the trip with cash anyway.
A flight for 28,000 points
A flight costs $420 in cash, or 28,000 points plus $11.20 in fees. The cash saved is $420.00 - $11.20 = $408.80. Divided by 28,000 points that is 1.46 cents per point.
At a bar of 1 cent per point, 28,000 points are worth $280.00, so this redemption is above your bar. The cash price would need to be $291.20 for points to be worth exactly 1 cent each. If the booking took 60,000 points instead, each point would be worth less than 1 cent.
How to compare redemptions
Points have no fixed price, so the value comes from what you buy with them. Work out the cents per point for each option you are considering and pick the highest one that you actually want. A high cents per point on a trip you would not take is not a good deal.
Compare cash prices on the same dates and same service, and use the price you would really pay in cash, not a list price that no one pays. Taxes and fees paid on an award booking belong in the cash you still pay.
Setting your own bar
Your bar is the value below which you would rather keep the points or pay cash. If you can turn points into a cash credit at 1 cent each, that is a simple floor. Some people set a higher bar for travel because it takes more effort to use.
The value you find can feed the credit card rewards calculator, which weighs a card's points against its fee. For trip planning, see the trip budget planner, and to compare prices after discounts the discount calculator.
Assumptions and limits
- The value is for one booking and uses the cash price you enter.
- The cost of earning the points, transfer ratios and the value of flexibility are not modeled.
- The bar you enter is your own number, and the example of 1 cent is only a default.
- Cash still paid cannot be more than the cash price.
Frequently asked questions
How do I calculate cents per point?
Subtract the cash you still pay from the cash price, divide by the points needed and multiply by 100. For $408.80 saved and 28,000 points that is 1.46 cents.
What is a good cents per point value?
There is no single answer. It depends on what you would do with the points otherwise and on your own bar, which you can enter in the tool. A redemption above your bar is a better deal for you.
Should taxes and fees count?
Yes. Cash you still pay on a points booking reduces the savings, so subtract it from the cash price before dividing.
Does the cost of earning points matter?
It can, but it is not in this tool. If you gave up cash back to earn the points, count that separately when you judge a redemption.