Traveling on Points and Cash: PNW Edition

[canyonwalker]

Pacific Northwest August Travelog #6
Retrospective

When we travel "Planes, Trains, and Automobiles" we usually pay for some of the trip with points and some with cash. The three-day trip we took to Washington last week was a bit different from most in that we paid for most of it with points. The flights were all on points, the 3 hotel nights were all on points (and a free-night certificate). The only cash cost was the rental car. Here are Five Things about paying for the trip:

1. Hotels were expensive. Even with staying in small towns and far flung suburbs we were facing prices of $250-300/night. Blame inflation, blame Covid revenge travel (which is part of what's driving inflation), blame having to make last minute plans. It's hard to swallow these prices as I know that 5 years ago I'd have looked to pay half as much.


2. Points are not free. It's a mistake many travelers new to rewards programs make to think that using points = "Free Trip!" Points have value. At a minimum it costs something to earn them. When I write about earning points with credit cards I always note the opportunity cost of using that card. See, for example, my analysis of the Hilton Aspire American Express two months ago.


3. It's helpful instead of thinking about points as freebies to think about them as an alternate currency. I could pay for a hotel room with $270 in cash or with, say, 30,000 points. Using points doesn't mean I get $270 for free; it means I made some of my points worth 0.9 cents each. Is $0.009 a good exchange rate? For Marriott points, sure. That's why I used them. Ditto the free night cert I used at a Holiday Inn Express. I look to make those certs worth $150. Using a cert for a room night that otherwise would cost $300 is a great redemption value.


4. The rental car was expensive, too. That's no surprise as rental prices have been crazy for at least a year now. It's a combination of travel bouncing back (not just "revenge" travel) after car rental agencies had gutted their fleets during Covid. We paid $400 for 3 days. And even that was with a corporate discount rate.


5. Years ago I stopped pursuing rewards with rental car agencies. I felt it took too long to earn a free day and was too hard to redeem relative to the value. Instead I let them credit me several hundred frequent flyer miles in my choice of airline program each time I rent. Now that cars are way more expensive to rent than several years ago I will reevaluate whether it makes sense to accumulate rental points.

Comments

[ckd]

Apparently Hertz just went through a major points devaluation, so...probably still not worthwhile. (I had all my Hertz points go poof because I haven't rented a car from them since early 2020 for some reason, so it doesn't really affect me anyway...but I didn't have that many and my early 2020 rental was using points because I was trying to earn & burn.)

[canyonwalker]

All points programs go through periodic devaluation cycles. Since I started collecting points in the mid 00s all the programs that are still around today have gone through at least 2-3 major devaluations, each. That's why savvy travelers advise to "earn and burn" points on the regular rather than save them up like a retirement account. Points only ever lose value.

Points expiry is another risk in playing the points and miles game. I wrote about an "Oh, shit!" moment a few weeks ago when I thought I might be about to lose 750,000 AA miles. I wasn't; I still had 11 months to go. I had no plans to fly AA within that timeframe, though, so I sought a different way to earn points and renew my entire balance.

[canyonwalker]

Also, to be clear, it was one of those devaluation rounds among the car rental majors several years ago that made me say, "This just isn't worth it anymore." But now, given how car rental costs are 3x what they were a few years ago, I'll take a fresh look at it.