While points and miles can pave the way to traveling for “free,” most travel rewards enthusiasts use their rewards to supplement their travel budget. For instance, it’s not uncommon for families to book airfare with points or miles but pay cash for their hotel, or vice versa. There are also scenarios where it can make sense to reserve your points and miles and pay cash for travel instead. If you find an incredible cash fare for a flight you want to book, for example, you would likely want to take advantage and save your rewards for another trip.

That said, there are several scenarios where you’ll definitely want to use points and miles to book travel instead of paying with cash.

1. You’re getting a good value for each point you redeem

Generally speaking, you’ll want to redeem points or miles any time you can get the average redemption value or better. You’ll have to do some basic math to know if you’re getting a good deal, but our recent valuations of airline and hotel loyalty programs can do the heavy lifting for you.

For example, let’s say you want to book a flight with American Airlines. The flight you’re interested in has a cash price of $400, and that same flight would set you back 35,000 American AAdvantage miles plus $6 in airline taxes and fees. To do the math here, you would subtract the airline taxes from the cash price to get a cost of $394 and divide that figure by the number of miles you would need for a redemption ($394 / 35,000 miles = 1.12 cents per mile).

Our valuations show that American AAdvantage miles are worth 1 cent each on average. That 1.12 cents per mile is better than the average value for American miles, so you can book this award without any regrets.

That said, the math looks totally different if the flight price drops to $300 but still costs 35,000 miles plus $6 in taxes ($294 / 35,000 miles = 0.84 cents per mile). In this scenario, you’d be getting less than the average value and should probably pay cash for the flight and save your miles for another day.

2. You want to book airfare in a premium cabin

While booking economy airfare with miles can help you get a good redemption value, you have the potential to get outsized value for your rewards if you’re booking airfare in a premium cabin. This is especially true if you’re flexible with your travel dates, willing to consider multiple programs and planning an international trip.

Take this example below, which is from the Air France / Flying Blue program. As you can see, it’s possible to book a business-class flight from Chicago to Paris on an Air France Boeing 787-9 for 70,000 Flying Blue miles plus $206.50 in taxes and fees.

screenshot of booking direct flight chicago to paris

That’s an incredible deal since you would get to travel in a pod-style, lie-flat business-class seat with premium dining, and since the cash fare for this one-way itinerary works out to $2,882.

screenshot of booking direct flight chicago to paris using u.s. dollars

If you subtract the $206.50 in airline taxes and fees from the cash price, you’ll get $2,675.50. This means that, ultimately, you could redeem 70,000 miles for approximately 3.8 cents each — much more than our average value of Air France / Flying Blue miles of 1.3 cents each.

Plus, since the Air France / Flying Blue program is partnered with American Express Membership Rewards, Chase Ultimate Rewards and Capital One miles, Air France / Flying Blue miles are some of the easiest to accrue.

3. Cheap awards are available

While you can always do the math to see if an award lets you get the average value or better for your points and miles, some frequent flyer programs offer award “sales” that make it easier to achieve stellar value. For example, Delta Air Lines has SkyMiles Deals and the Air France / Flying Blue program has its Promo rewards.

As an example, we found an Air France / Flying Blue Promo rewards deal for a one-way economy flight from Atlanta to Paris in August 2023 for just 10,500 miles plus $64.60 in airline taxes and fees.

screenshot of booking direct flight atlanta to paris

In the meantime, the cash price for this one-way economy flight works out to $1,120. When you subtract the $64.60 in airline taxes and fees from the cash price, you’ll get $1,055.40. Divide that by 10,500 miles and you’ll get about 10 cents per mile in value.

screenshot of booking direct flight atlanta to paris with promo fare

4. Your rewards are about to expire

While some airline rewards never expire, the majority of programs will let your rewards lapse completely if you don’t “earn or burn” some of your rewards every 12 to 24 months (on average).

While you can always “restart the clock” with your rewards haul by making an eligible rewards portal purchase, redeeming points/miles for a seat upgrade or using an eligible credit card to earn rewards on regular spending, making a redemption can also extend the life of your rewards. Even if the award you’re booking is subpar, redeeming some of your points or miles is much better than watching them disappear.

5. Earning status isn’t a big priority

Finally, remember that redeeming points or miles for a flight or hotel stay typically will not get you any closer to earning elite status. So, while you’ll get to enjoy any elite status benefits you already have when you use an award, you won’t be spending any money that will help you earn qualification miles or hotel loyalty points for the next year’s status qualification requirements.

Ultimately, this is just another reason it can make sense to pay cash for some travel and save your rewards for the rest. The benefits of elite status are worth pursuing since you can enjoy perks like free checked bags and priority check-in with airlines, along with room upgrades and free breakfast with hotel loyalty programs. However, you’ll have to spend money with your favorite programs to retain status for the long haul.

The bottom line

While you have the right to redeem your rewards for whatever you want, you can stretch your points and miles further if you take a judicious approach when trying to decide whether to pay with cash or use your points or miles. Credit card rewards can make travel more affordable, comfortable and convenient, but being thoughtful about how you redeem your rewards can help you get optimal value.