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I could almost leave this article with just the title, it’s sound advice, but I guess it’s polite to go into a bit of detail rather than just issue a dictate! When you log into your American Express online account, you’ll see that underneath your rewards points balance, a new link has recently appeared entitled “use points towards purchases”.
Amex Gold or Platinum card holders will know that their membership reward points can of course be transferred into a range of airline or hotel loyalty programmes. However, given that each of those programmes has it’s own redemption formulas and sweet-spots, it can be difficult to categorically put a value on a membership reward point.
This new redemption option gives you another way of using your reward points. It effectively allows you to get statement credit, using points. Clicking through the link gives you a list of all your recent transactions, allowing you to pay some or all of each transaction using your reward points.
What value is Amex putting on each point ?
The key question is what value is Amex putting on each point? The picture above shows an extract from my “use points towards purchases” screen. Each transaction starts with zero points used and therefore £0.00 credit amount. Clicking on the “redeem points” button gives you a sliding bar, allowing you to allocate as few or as many points as you like to a transaction (minimum is 200 points). As you can see, I’ve done that on the first transaction, which requires 17,100 points to credit the £76.95 transaction in full. A quick dab on the calculator will tell you that works out at 0.45p per point. Having trialled various statement lines, I can tell you that 0.45p is what it always works out at.
How does that compare with other redemption options ?
Simply put, pretty awful. For example if you transfer Amex reward points to Avios, you’ll get 1 Avios per Reward point. It is not at all difficult to get 1p+ value per avios point, especially on reward flight saver flights.
The above LHR-DUB flight costs £76 in economy. A reward seat is also available on this flight, which will cost 4000 avios plus £17.50. That gives a value of 1.46p per avios / per Amex membership reward point.
As another example, each reward point can be transferred into 2 Hilton points. You can get great value for Hilton points at lower end properties. The picture below shows that for a night in the (rather wonderful) Hampton by Hilton Liverpool Airport, I can either pay £89, 10,000 points or £23 + 4000 points. The last one gives a Hilton point value of 1.65p. Remembering that you get 2 Hilton points per American Express reward point, giving a value of 3.3p per Amex point.
I can’t see any scenario that makes sense to use points to pay off your statement. Even if you don’t have any immediately plans for travel, you can send the points to Avios, they don’t expire for 3 years, and even then it’s easy enough to keep them alive.