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Just trying to work out if I understand the how to work out the value of Avios, sorry I struggle with numbers quite a bit so this might seem a basic question.
The flights I would like to book are currently not in a sale and for 2 adults, 1 teen and a child £2550. Using Avios with the least amount of cash is 180000 Avios and £400 in cash, 141000 Avios and £1000 in cash, 120000 and £1840 and so on.
Currently I have 85000 Avios of which I have collected through spending on credit cards and I spent £445 to boost x3 recently adding 48500 Avios, also I have the option to spend £225 to add 24500 Avios which would take me to 109500. Using the new Finnair offer to add the remaining 75000 Avios to hit the 180000 would cost me roughly £690 at todays exchange rate.
So i would have spent £1360 to get the Avios and another £400 surcharges so the flights would cost me £1760 instead of £2550 currently, although sometimes in the sales they come down to roughly £2150.
To me this seems like a good deal, I’ve seen it said that people value Avios at about 1p for Avios so this would mean the Avios would be worth around £1800 and the surcharges at £400 meaning the value would be £2200. So getting the flights for £1760 seems like a good deal to me, I’m not sure if I’m missing something or there is a better using the miles?
You should probably also factor in avios you would get from the cash flights, plus avios/other loyalty points you’d get via the payment method. So, for example, buying avios with the BAPP Amex gets you 1.5 avios per £1 of spend, but paying cash for the flights gets you 3 avios per £1.
You might also get a better deal (and bonus avios) by booking a BA Holiday instead of just flights.
Incidentally, which route/cabin is this? Are you paying for 3 people or 4 (how old is the child)? Companion or upgrade voucher involved?
If you know how much your avios cost you don’t need to use a 1p valuation.
It sounds like you want to:
– pay £445 for 48500 avios
– pay £225 for 24500 avios
– pay £690 for 75000 avios
= total £1360 for 148000 aviosSo you haven’t included the cost of 180k-148k = 32k avios.
For simplicity let’s say that you spent £21333 on a credit card to earn the 32k avios, and if the avios card did not exist, you would have used a card that gives 1% cash back = £213.
So your flights priced at 180k avios + £400 would cost you £1973 in total. This is less than the flights are currently being offered for sale in cash. Obviously if they were on sale for £1800 and you are willing to pay £1800, you should do that.
Are you willing to pay £1973 for those flights? If yes, sounds like you have a deal.
If avios did not exist, would you be willing to pay £2550? If no, that figure doesn’t matter as you wouldn’t pay it. If yes, you’ve saved £2550-£1973 = £577. To put it another way, you bought the avios for £1573 (0.874p per avios) and sold the avios for £2150 (1.19p per avios).
If you wouldn’t pay the cash price of £2550 but you would pay a cash price of £2150, you’ve saved £173. Or you bought the avios for £1573 and sold them for something that you value at £1750 (0.972p per avios).
Generally people want to buy avios for less than 1p, and sell them for more than 1p. Based on cash fares for premium class flights, it is frequently achievable to sell your avios for 1.5p to 2p or even higher, but that assumes you would have paid what the airlines are asking for.
You should work it out according to how much the flight is worth to you. As long as you sell your avios for more than you bought them for, you’ve still saved money.
Regarding “is there a better use of avios”, in your case you would be buying the bulk of your avios that you require, so it doesn’t really apply. There is no point buying the avios if you don’t want to use them, unless you have a clear plan for when to use them in the future, and you could easily replenish the avios after using them.
Don’t forget one thing: if you book using avios, the tickets are flexible and can be changed or cancelled with £35 pp. Cash tickets depending the fare classes. So if the avios and cash prices are similar, I’d go to avios tickets.
Don’t forget one thing: if you book using avios, the tickets are flexible and can be changed or cancelled with £35 pp. Cash tickets depending the fare classes. So if the avios and cash prices are similar, I’d go to avios tickets.
I view it as Avios bookings can be cancelled for a low fee, but I don’t regard them as easily changeable simply because to do so requires redemption availability which is often not there, or at least cannot be relied upon to be there. Of course it does heavily depend on the route, class and dates of travel and, for CW, whether or not you are using a BAPP companion voucher.
Thank you for all the very helpful replies.
Its for 2 adults, a 13 years old and a 10 year old using a companion voucher flying in economy to Cincinnati. The remaining Avios were earnt with 1500 Avios a month from the Barclays wealth bank account and 2 premium BA Amex cards.
I fully realise using companion vouchers is pretty worthless in long hall economy, almost painfully bad but as flying in the upper classes isn’t affordable with two children it’s just the way it is unfortunately. Unless of course someone can make me aware of something I don’t know.
All your above advise it very helpful, I’m not sure whether the above changes anything?
Thanks again.
From what you’ve said, with some management of your collecting strategy I’m sure you could get enough avios to redeem in PE or CW. There’s loads of information on this site about maximising earning opportunities. Plenty of people here (myself included) wouldn’t qualify for Barclays Premier Banking without resuming full-time work (no thanks!) but manage to collect enough avios for 2/3 CW and F trips per year.
I’m not an expert but I suspect you’re looking at the “wrong” way to spend Avios. If you’re looking for the best value you don’t want to use them to reduce a cash ticket. You want to use them to book an Avios ticket.
For Avios ticketsyou won’t get quite as many options of how many points to use — you either cash for taxes and “fees” or you can use Avios to reduce the taxes and “fees” (but this is generally poor value too).
Thanks for your replies but I just don’t get it unless there is another way to book flights or some untapped way to earn extra Avios that I don’t know about
If I wanted to book the same flights in PE I would need 360000 Avios and £1220, 276000 Avios and £1780 and so on, as you can see using half the amount of Avios (180000) and £400 is much more attractive to me for the sacrifice of sitting in a smaller seat and then I can have double the amount of holidays a year for the 4 of us a year. Sometimes there seems to be better value in the long haul/economy companion voucher thing, like the year before last year using two companion vouchers and 220000 avios I reduced the cost of 4 flights to Sydney from £6000 to £2200 and 220000 avios which seemed great but companion vouchers don’t seem to hold much value for travelling to the US in economy.
I see posts about people having half a million avios in their account and I just don’t understand how they would get them apart from setting up a subscription although it seems the boost avios is better as long as you have enough to boost. I already earn the two companion vouchers a year so hit the threshold on the premium Amex cards and I quite often get the 7000 bonus avios from the Premium Barclaycard card a year and I buy the correct things through the BA shopping portal. Apart from boosting the Avios or setting up a sub I just don’t see what else I can do.
I see the credit card sign up offers for example the Platinum Amex card that would give me the 80000 Avios, but it would cost me £650 to get those Avios as it would take me about 6 months to spend the money so I couldn’t cancel it early and I wouldn’t get a companion voucher. So surely buying the Avios with a 50% discount so getting 75000 Avios for £690 and still keeping my old Premium BA AmEx card and earning a companion voucher is better value?
As always any help or advice is appreciated.
People are doing it though, you just need a medium to long-term strategy. Have a look at this and similar articles on here:
https://www.headforpoints.com/2023/01/03/maximise-american-express-signup-bonuses/
You need to get into the mindset of earning points on all your spending, think council tax, car insurance, big household purchases (even cars) etc. The things most people pay by direct debit, but don’t generate any rewards. There are also threads on this forum with plenty more ideas.
I’m not an expert but I suspect you’re looking at the “wrong” way to spend Avios. If you’re looking for the best value you don’t want to use them to reduce a cash ticket. You want to use them to book an Avios ticket.
For Avios ticketsyou won’t get quite as many options of how many points to use — you either cash for taxes and “fees” or you can use Avios to reduce the taxes and “fees” (but this is generally poor value too).
I don’t understand how you’ve interpreted the OP in this way.
Thank you for all the very helpful replies.
Its for 2 adults, a 13 years old and a 10 year old using a companion voucher flying in economy to Cincinnati. The remaining Avios were earnt with 1500 Avios a month from the Barclays wealth bank account and 2 premium BA Amex cards.
I fully realise using companion vouchers is pretty worthless in long hall economy, almost painfully bad but as flying in the upper classes isn’t affordable with two children it’s just the way it is unfortunately. Unless of course someone can make me aware of something I don’t know.
All your above advise it very helpful, I’m not sure whether the above changes anything?
Thanks again.
If using the Avios gets you and your family to a destination you want to go to then it’s a good redemption. People get far too hung up on maximising their perceived value.
That’s blown my mind, and I subscribe (pay) for Avios. We each have our own reasons/ways for saving and spending. However you “buy” Avios, you are paying for them – even if “free” you could probably have got some other benefit instead.
As long as you perceive you’ve got good value, enjoy! Personally, I usually only spend on long-haul in F/J with a 241 voucher. It doesn’t save me money, it costs me money! Because at cash prices I’d be unlikely to fly F/J. But I’m paying 3x economy for F/J rather than 6-8x – result!
As NL said the switch moment was when I was running everything through the card, direct debits, payments here, payments there. Its a mindset change. If you want to b something with cash, think! I will pay it with the Amex then pay it straight back when you leave the shop straight away. Controversially whilst the system is still in place, threaten to leave for a retention bonus. Another is LEGITIMATE f&f with paypal is great. The question youve asked has been asked a million times, go through forum and your Avios balance will increase without a doubt.
sorry to hijack the thread but just need some help with terminology
F/j?
PE?Also im in the same boat (ish)
Flights short haul to amsterdam costing £131 cash
Value they have said with Avios are:18000 avios – £1.00
17000 – £9.00
lowest is 5900 – £85.00F – First Class
J – Business Class
PE – Premium EconomyThe upper two are fare codes and the last is an abbreviation, clear as mud!
If you get your avios from flying which is paid by someone else (ie your employer) you’ve got then for free.
However, as others have said upthread, any other way has cost you; you’ve either paid a.bank account fee in return for Avios, boosted for a certain price, or opted to be rebated in avios instead of cashback.I still use the 1p rule, because most of mine are earned from Cc spend in lieu of cashback, so I’d like to achieve at least 1p back.
So, using that rule, I generally wouldn’t use avios for short haul economy when cash prices are lower than the avios cash equivalent, calculated at 1p. Some may also put slightly more for a cash booking, on the basis they will earn some Avios back AND more importantly Tier Points towards status.
I’m in a position where I don’t fly enough to earn a decent status, but have a cash booking in economy in term time (similar.pricee to yours above) and an avios booking for 6 of us in October half term where the Avios are easily achieving my 1p valuation. In fact, cash prices are on the border of “we wouldn’t do the holiday at that price” so working out my valuation needs to take into account what we WOULD pay. So, as from all the other comments above its not a simple equation.
Rob has written an article about how much avios COST, and plenty about how to value them.
You need to get into the mindset of earning points on all your spending, think council tax, car insurance, big household purchases (even cars) etc. The things most people pay by direct debit, but don’t generate any rewards. There are also threads on this forum with plenty more ideas.
And of course stacking bonuses where you can.
For example, my last £65 spend at Sainsbury’s netted:
* 730 Nectar points (triple points on £60 spend, “Count Up to Christmas” reward, “Shop for Points” reward, point bonuses on items)
* 110 Avios from the BA e-Store
* 56 Avios from the Ba e-Store 50% extra “Black Friday” promotion
* 97 Avios from paying for it on my BA credit cardConvert the Nectar to Avios and I’ve ended up with a total of 719 Avios for spending £65 on stuff I needed anyway.
Mind you, the glory days are long gone. Back in the day you would sign up to casinos with a cashback site, wager £20 on roulette, get £50 in cashback, convert it to Tesco points and then on to Avios when they had a 30% bonus. That mean you got 16,250 Avios for £20 (if you were unlucky), or were paid £20 *and* got 16,250 Avios (if you were lucky).
Then there was the time Tesco sold 3250 Avios for £5 (as in pre-order a game you didn’t want, pay the fiver, they gave you £10 cashback which you converted into Avios when a bonus was on). You could do that once for every game on every format, and some people did it far more than that!)
Others, more adventurous than me, made use of prepaid credit cards, or just filling shopping trollies with stuff which had bonus Clubcard points.
Sadly those days are long gone but there are still plenty of ways to get Avios. I find it fun, like a game – and points mean very nice prizes!
Thank you all very much for the suggestions.
If you’ve got 200k Avios you should look at 241 vouchers or BAPP upgrades.
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