February 8, 2009
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Maxing out the value
As most of you know, I’m the type of person that either wants to get something as cheaply as possible, or to get something additional when I am spending money. Sometimes I get to do both.
When I got my credit card from my bank, I had the option of a cash back reward, or points. At the time, I went with points. I did a calculation of how much I would get back if I chose cash, and then the cost of a Best Buy gift certificate in points. The gift certificate came out ahead by a couple of tenth of a cent.
Now, I’m looking at the number of points that I have, and I can get a good amount of stuff for them. i have also found that I can get cash back. However, looking at the program, I decided that i would have to do a bit more math. The top three rewards that I felt were most useful to me would be the cash back, the gift certificates, or money off of a plane ticket. Here’s how it breaks down:
Cash back’s lowest redemption is $25 for 3000 points. That works out to 120 points per dollar. That the ratio I get until the $200 for 20,000 points. There, the point spread dips to 100 points per dollar. There is no change at the higher values, so if I chose this option, there would be no reason to redeem anything lower than the $200 option.
Next is the gift certificate option. Now, they have them for a bunch of stores, but there is no difference in the amounts for points depending on merchant, and amount of points required is directly related to the amount. Again, the spread is 3000 points for $25, and the $200 one would cost 24,000 points, so we have a constant of 120 points per dollar.
The last choice is the flight savings. Basically, if you buy a ticket through the link, it will use the points to deduct money off of the price. If there is a weird hanging amount (like $9), then you just pay that, but you can essentially work out an almost free ticket. The lowest one is $150 off for 15,000 points. Pretty straight forward at 100 points per dollar. At $225 off, it cost 20,000 points, bring us to 88.9 points per dollar. It’s at $300 off that we level off, at 25,000 points, meaning that it’s 83.3 points per dollar.
So, in the end, it would be in my best interest to fly somewhere, however, barring that, I should take the money and run.
Black6, out.
