Points and miles are a currency like any other: Their worth can shift depending on their use. Unlike dollars, however, it is not the financial market that determines that value. Rather, it is their owners (both the airline and the consumer) that figure out how to maximize the value of award points. Also, points and miles don’t usually accrue interest like money in your bank account (with some newer exceptions). Letting them ferment in your accounts does not improve them – much the opposite – it often devalues them.

What are some of the benefits of using points and miles for a plane ticket?

1. Normally, you have more flexibility in cancellation and changes. Airlines are continuously reducing cash fares by removing amenities like free checked bags, free seating choices, ability to refund, etc. Most U.S.-based carriers offer all this for free when you book with your miles. Using miles not only saves you the ancillary costs like seating choice and checked bags but also allows you to reduce how many miles you end up spending. If you book a flight for 60k United miles and find out two weeks later the same flight is only 25k, just call to re-book and you’ll get refunded 35k miles. Foreign carriers usually offer the same flexibility but have change or cancellation fees that are around $100 or less per person. Using your miles means you keep more options available for your travel.
2. Points can be worth more if you use them the right way. For most cash back redemptions (or redeeming for products on shopping portals), miles and points are worth between 0.5 and 1 cent each. While it can feel good to get that $600 cash rebate for 60,000 points, what if I told you those miles could be worth over $5,000 when used the right way? When you can find the saver level award tickets, flying between the U.S. and Europe could mean that business class flight on SwissAir becomes almost free (save some taxes and fees) – only 60,000 Air Canada miles can get you from New York City to Zurich in business class, a ticket that currently costs $4,983 for July flights. Save your points to use for long-haul business class, and you’ll get way more value out of them.
3. Using points allows you to purchase plane tickets on partner airlines, too! Just because you have miles on American Airlines does not mean you have to fly on their planes. As a member of the OneWord alliance, those miles can be used to book British Airways, Qatar Airways, Japan Airlines, and more. If you know how to leverage these alliances your points can go quite far. Recent deals that I’ve seen involve 70,000 Air Canada miles to buy Lufthansa business class, 55,000 Alaska miles to buy American business class, and even 45,000 Virgin Atlantic miles to buy ANA business class. Keep tabs on what partnerships exist and your points and miles will go far.

I would be remiss if I did not also mention the ways that cash tickets can benefit you, however.

1. You only earn miles when using cash to pay for plane tickets. Airlines view award tickets as free redemptions so they do not offer you the chance to gain miles for the cost of the ticket, even if there is a tax copay with the miles you spend.
2. Sometimes there are incredibly cheap deals in cash that rival points. Every once in a while there are plane tickets that are offered on deep discount or as a mistake fare that can get you where you want to go for almost nothing. A few years ago there was a $200 ticket to/from New Zealand – even in economy, that was way better than anyone could do with points or miles. Sometimes there are just no points-based tickets. The saying goes, “cash is king.” Airlines restrict how many seats they offer up using miles but cash allows you more flexibility on which plane ticket you want to buy. If you are expecting to use miles and just can’t – be prepared to pay up to get where you are going.

What about you? Do you have tips for using points or cash for your flights across the Atlantic and beyond?