How should I be calculating how much my points are worth and how much to pay for them?

Hi there,

Trying to understand point worth and calculations.

Every \$1 spend gets 2.25 points.

According to this:

Point value for Singaporean Airlines is 1.8 (is this correct in my case?)
Point value for AMX MR is 1.2 (is this correct in my case?)

Trying to calculate whether it’s worth paying cc surcharge based on article -

‘if your card earns you 1 point for every dollar spend and you are asked to pay a fee of 1.5% (i.e. 1.5 cents for every dollar) and you value a point in that program at 1.8 cents, then you’re acquiring the point at a rate (1.5 cents) less than our valuation (1.8 cents) which should be good value

My card earns me 2.25 for every point. Let’s say surcharge is 3%. (is this 3 cents for every dollar?) and my value point in which program? Should I be looking at 1.8 Airline point? If so, what does AMX Point value mean to me?

Little confused. Please point me in the right direction, thanks!

This is a little complex. I’ll try to communicate as clearly as I can but please get back to us if I’m not making myself as clear as I should be:

You don’t explicitly say this, but my guess is that you have an American Express Platinum charge card? That card earns 2.25 AmEx Ascent Premium Membership Rewards points per \$ spent, and the Point Hacks article you link to values those points at 1.2 cents each.

AmEx Ascent Premium points convert to Singapore Airlines KrisFlyer “miles” (ie. points) at a 2:1 conversion ratio. So for every dollar spent you get 1.125 KrisFlyer points.

If my assumption that you have an AmEx Platinum card is correct, read on…

In the example you give, you’re being charged a 3% surcharge to use your AmEx. Yes, that means that for every dollar you spend, the seller is adding 3 cents. Let’s do a hypothetical calculation:

A product costs \$100. To pay by AmEx, you’ll be charged an extra 3%. Total charge: \$103. That \$103 will earn you 232 AmEx Membership Rewards points, which you may choose to convert to 116 KrisFlyer miles.

In effect, you’re being charged \$3 for the privilege of earning points on your purchase. So your 232 AmEx points are costing you \$3, which works out at 1.29 cents per point.

If you were after KrisFlyer miles, your \$3 would earn you 116 KrisFlyer miles at a cost of 2.58 cents per point.

So… is the \$3 worth it? It depends on your circumstances.

If you want the points simply for the sake of having the points, the answer is no, it’s not worth it. The points cost too much (ie. they cost more than what they’re worth).

If, however, you have a specific redemption in mind (say, a business-class flight on Singapore Airlines on a particular date and there’s availability on that date) and you need lots of points quickly so you can grab the flight you want, my “take” is that because these points cost only slightly more than they’re worth, it might be worth paying the 3% surcharge.

I hope that helps, but please let us know if I’m not making myself clear or I haven’t understood your question.

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Thanks for the breakdown.

So just to clarify, I can go up to 2% for it to be worth it (if I convert to KF). My calc is 1.74c/point. It is below 1.8 according to article value. Please confirm.

My goal is to rack up points through business spend to use for personal travel if possible. Should I be accumulating points another way?

If you are being charged a 2% surcharge rather than a 3% surcharge, then 2% is beginning to be in the ballpark if you’re talking about an AmEx Platinum card. Personally my cutoff is a 1.5% surcharge unless I’m in the hunt for quick points. But if you’re comfortable with 2%, then go for it.

Should you be accumulating points another way? There are lots of ways to accumulate points: personal spending, business spending, card sign-up bonuses, Flybuys or Everyday Rewards, shopping, insurance, paying for flights (or getting your business to pay for them), etc etc. Not all of them will work for you, but some will. The more ways you accumulate points, the faster you’ll get them! I would definitely advise that you look into more than one way to accumulate points.

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Yes, I have an AmEx Platinum card. So I just need to make sure my point value calc is below 1.8 cents? Please confirm 1.8 cents is the number I need to work with for KR miles and I don’t need to worry about 1.2 cents figure.

Thanks for the extensive list. I am definitely using the AmEx anywhere that accepts it Can Everday Rewards be converted to KR miles? I thought it was only for Qantas!

Hi again,

I wouldn’t take that 1.8 cents figure as gospel truth. The article you refer to itself says that calculating the value of points “is not an exact science” and that the valuation is based on the writers’ “opinions”. Use the article as a springboard for you to do your own research and come to your own conclusions about how much it’s sensible for you to pay, given what you want to use the points for.

As a very general rule: if you’re intending to use the KF miles to redeem Economy class or Premium Economy seats, I’d look to be paying considerably less than 1.8 cents per point. If you’re intending to use them for Business and/or First class seats, then you can possibly go up to 2.5 cents or so, or even a little higher depending on where you want to fly.

No, Everyday Rewards can only be converted to Qantas points. The best KrisFlyer earning cards I know of are the AmEx Platinum and (for places that don’t take AmEx) one of the Amplify cards from St George, Bank of Melbourne or BankSA. I have an AmEx Platinum and a Bank of Melbourne Amplify Signature Visa.

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