Dear Cashing In,
I plan on traveling to New Zealand next May to visit a friend. I currently have an AAdvantage card with 30,000 miles banked, as well as a Capital One Venture card with just 3,000 points. What would be the most effective way to use miles or points to help pay for the airfare? Plus, I would love to upgrade for the overseas flight, if possible. I'm not a rewards junkie or frequent world traveler, so any advice would be helpful. -- Julie
I love New Zealand -- lucky you. As I'm sure you know, you're not going to be able to score a flight to Auckland with the reward points and miles you currently have. Venture points trade at 1 cent each, which means your 3,000 points are worth $30 towards a flight. That's not going to going to get you to New Braunfels, Texas, let alone New Zealand.
There are productive ways to turn points into miles, by the way, but you don't have the right reward systems in place. Most lucrative is the 1:1 transfer rate Chase Ultimate Rewards offers for its partner airlines, which include United and Southwest (not American). For each point earned on Sapphire Preferred, Ink Bold or Ink Plus (which charge $95 annual fees) you can get one mile on those partner airlines.
Your 30,000 AAdvantage miles will buy you a domestic trip. Double them and you'll be in the market for an overseas trip. American Airlines is partners, via oneworld, with several airlines that fly to New Zealand, including Qantas and Cathay Pacific. As of July, you can actually redeem your AAdvantage miles on Qantas flights -- as well as Hawaiian, British Airways and Alaska airline fares -- through the American Airlines website using the MileSAAver Awards option. MileSAAver Awards require fewer points than AAnytime Awards, but usually have to be booked earlier.
However, unless you have some other big trip coming up soon, you won't be able to score a round-trip to New Zealand yet. With 30,000 AAdvantage miles in your account, you are edging closer to free one-way ticket abroad -- but that may not be the best use of your miles. A one-way economy fare between San Francisco and Auckland in May costs 37,500 miles, which means you're 7,500 miles short. Between now and Dec. 31, you can purchase 6,000 AAdvantage miles and get a 1,500-mile bonus for $165. That's enough to make up the difference you need for a one-way flight.
Here's the catch. Unless you love New Zealand so much that you decide to stay forever, you'll still have to pay for a flight back. Total cost for a round-trip between SFO and Auckland is 75,000 points. You could use your 30,000 miles, purchase 30,000 miles for $825, and get 15,000 bonus miles to bring you up to that level. Round-trip fares via American Airlines in May start at around $2,000, so using your 30,000 miles will save you $1,175. Charge it on your AAdvantage card, and you get another 1,650 miles (two miles for every dollar spent on American Airlines) and 3,000 more at the end of the year. (Your card offers a 10 percent rebate on redeemed miles.) That's 4,165 miles. If you were a rewards junkie, you might have added to that stash by adding a couple stops along the way, but you're not.
If you're just looking to save money, there are cheaper flights between San Francisco and New Zealand. Non-stop round-trip fares between SFO and Auckland in May on Air New Zealand start at $1,350 -- only $300 more than a one-way flight on American with stopover. Unfortunately, Air New Zealand is not a oneworld member, thus not among American's partner airlines. You can, however, score United miles on many Air New Zealand flights through the Star Alliance partnership.
If I were you, I'd spend $1,310 on Air New Zealandan round-trip. That's about $700 cheaper than the American-operated flight. You also save your 30,000 AAdvantage miles for another trip while earning Star Alliance miles. Use your Venture card for that purchase and you can double your points in that account as well.
If you can't score free travel this time around, you might as well maximize the free travel in your future.
See related: Buying airline miles usually doesn't pay, but might now , Buying airline miles: is it worth the cost? , Generic miles vs. airline-specific rewards