The majority of people will find their Avios points have a value of 0.5p - 1.7p per Avios.
The value of your Avios points varies drastically depending on how you redeem them. For long-haul premium cabin redemptions, it is possible to achieve a value of 1.7p per Avios.
Use of a companion ticket (obtained through the British Airways American Express Credit Cards - here) can increase the value of premium long-haul redemptions, further still to around 1.9p per Avios - However, most people will find they are not receiving this value in their redemptions, especially when redeeming for short-haul flights!
Using the "part pay with Avios" option provides a value of 0.5p - 0.8p per Avios, when redeeming towards a British Airways cash ticket.
As non-flight redemptions typically offer a value of around 0.5p per Avios, I would avoid any flight redemptions below this value.
Why do you need to consider the value of your Avios redemptions?
Whilst some readers will obtain all of their Avios points by flying, most will collect points in various other ways such as: credit card spending, Tesco Clubcard transfers or even purchasing additional points. If you collect points in any of these ways, it is important to understand the value of your redemptions so you can make an informed choice about how is best for you to earn your Avios points.
For instance, if you collect points through credit card spending, redemptions equating to below 1p per Avios would represent poor value, as a 1% cashback card would provide a better reward.
Having an idea of how much your redemptions are worth, allows you to determine whether purchasing additional Avios points represent value for money.
More infomation about the multitude of ways to collect Avios points, can be found here.
Other considerations when redeeming points.
Whilst long-haul premium class tickets often offer the highest value for your points (due to the high cash price of these tickets), the taxes and other fees can still cost more than the cheapest economy ticket. If you don't mind which class or airline you fly, you should factor this in when planning your redemptions. As these fees and taxes are still applicable for long-haul economy redemptions, these almost always represent extremely bad value for money.
Even if you would not be prepared to pay the full cash price for a first class ticket, the intrinsic satisfaction and perceived value from a first class redemption does translate to a cash saving. The Avios points are lowering the cost of this product to the taxes and fees price - the product is still worth the full cash price.
For short-haul European flights there are other considerations to be taken into account. These flights replace the taxes, fees and carrier chargers with a flat fee known as a Reward Flight Saver fee, to pay in addition to your Avios points.
The current Reward Flight Saver Fees are as follows:
- British Airways flights in Europe - £35 return in economy and £50 return in business.
- Comair flights in southern Africa - £56 in economy and £64 in business.
By offering this low cost flat fee for short-haul redemptions, Avios is the best air mile reward scheme for this type of flight - Taxes and fees with other carriers often cost more, than flying with an alternative airline, drastically devaluing the points in your redemption.
Whilst Rewards Saver Flights appear excellent value at first glance, if it is a short flight and you would normally consider using one of the budget airlines, a failure to account for the value of your points could lead to you effectively spending far more than the cash price of alternative flights available. If an economy reward flight costs 9,000 points + the £35 Reward Flight Saver fee, and the cash price fare with a different airline (that you would otherwise use) is only £50, then your 9,000 points would only have a value of £15 or 0.16p each. Whilst this is an extreme example, it is worth considering when planning your rewards.
Calculating the value of your redemption
To calculate the value of a redemption flight, first find the reward flight you wish to take using the Avios reward flight calculator (here). This will give the price in Avios and the cost of the taxes and additional fees.
It is then good practice to use a flight search engine (Momondo*, Skyscanner* or Google Flights) to find the best cash price for a similar flight you would be prepared to take. To get the monetary value (in £) for all the Avios points required simply:
|Cash price||-||Taxes and Fees||=||Value of Avios|
To get the cost per single Avios (in £), simply divide the monetary value of your Avios (above) by the number of Avios points required. If this value is less than £0.005 (0.5p) then I would reconsider this reward flight.
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