Using points vs. Booking package

Discussion in 'Newbies' started by Dangjr213, Mar 12, 2012.  |  Print Topic

  1. Dangjr213

    Dangjr213 Gold Member

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    Sorry I posted this on the other forum as well, but have noticed that the other gets more traffic, but the people here are nicer, so I'm hoping to get answers on both...

    My wife and I are going to Vegas for a few days in June for a conference. We've known about it for quite some time so we've already put a fully refundable deposit at the Signature at MGM Grand 9 months ago. (total for 6 nights including resort fee $1050) As soon as southwest made thier flights available, we booked flights using 45k points ($750) because i was told if we cancel we would get our points refunded. The total value of the trip is $1800, but only a cash outlay of $1050. I've been watching the prices for hotel/flight pacakges and they are now at the point where the package price is less than the value. I can book a package on southwest for $1600 plus a resort fee of $150, so the total comes out to $1750.

    Now to my question...

    At one point is it worth booking a package vs using points? Right now it would only save me $50 so i plan to wait to see if the package price goes down even further. I don't even know where to begin with the value of holding on to my points. Any thoughts?
     
  2. Toula
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    Toula Gold Member

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    For me, it would come down to (1) how flush with cash you feel, (2) are you trying to meet any spend goals to trigger bonuses on your credit cards (3) if you don't use the points for this purpose what will you use them for?

    I always feel given situations such as you find yourself in, there is never a right or wrong answer. It comes down to what works for you. I choose not to get too hung up on the value of points or redeeming for a certain amount per point. You obviously saved them to spend them, but just remember the person who dies with the biggest point balance likely does not win a prize.
     
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  3. Dangjr213

    Dangjr213 Gold Member

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    That's a very good point, thanks. But to answer your questions

    (1) - cash flow not an issue, money was already set aside months ago for this trip
    (2) - no spending goals at this time
    (3) - my main form of vacation is cruising. I have three cruises booked in 2013 (2 in MIA), so if I don't use the points now they might go towards flights to FLL. I say might because then I'd have to transfer from FLL to MIA since southwest doesn't fly to MIA.
     
  4. MDDCFlyer

    MDDCFlyer Silver Member

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    It is actually an easy answer in your case - only because your miles have only value on one airline. If the cost of the trip paying cash is less than paying by miles - pay cash.

    The answer is much more complicated if the miles could be used otherwise (for example, I will never even dream on utilizing UA miles for domestic flight as their value for trans-pac or trans-atl in business class is much higher [the marginal value is greater - the differential in mile cost is much lower than the differential in cash cost], only when the cost of the domestic flight will be highly prohibitive [think $1000+] I would consider it).
     
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  5. MSPeconomist
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    MSPeconomist Gold Member

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    Would thhe OP pay change fees on the Southwest tickets in this case? Also, does the package offer the same rooom type with the same privileges at the same hotel?
     
  6. desamo

    desamo Gold Member

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    Assuming you're not using points for something you otherwise couldn't afford (as that changes the equation), the way I'd look at it is:

    If you divide the cost ($1750) by how many points it cost (45k), does the redemption value per point a good value for you? Or is there another trip where you could get a higher value per point that you'd rather save them for?

    I'm of the "any redemption is a good redemption if it meets your travel goals" sentiment, though.
     
  7. Dangjr213

    Dangjr213 Gold Member

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    I called in before I booked the tickets with points and was told there wouldn't be any fees to cancel and book the vacation package. I told them I felt that the package price would go down making it a better choice. So I hope the don't slap me with a change fee should the package price go down more.
     
  8. Dangjr213

    Dangjr213 Gold Member

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    Since its rapid rewards points the value is $.0167 no matter how I use them to fly, correct? I will pay for the hotel in cash (well charge) and only use points for the flight.
     
  9. desamo

    desamo Gold Member

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    I am technically a Rapid Rewards member, but that's more for booking purposes (for the occasional Southwest flight) than for redemption. Long way of saying: I don't know -- other programs are different.

    I was more speaking to the general principle of whether or not a redemption was a good idea.

    If it is constant, though, then it seems a no-brainer if that's the booking you really want. I managed .06 on a recent set of redemptions on BA/UA combination round-the-world. That may change if first class opens up, though.
     
  10. desamo

    desamo Gold Member

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    On the package question: sometimes you do get a better deal on the package, but it's always worth checking independent prices to make sure.

    I am generally one of those people who wants to pay when I get there. I do this even though I used to work for a wholesaler where everything was prepaid.

    Why do I prefer that? Because I had a horrific pre-paid stay at the Hotel Pennsylvania in NYC once (not a hotel my former employer would sell, fwiw), and I want to reserve the ability to walk without paying if things go south. I'm going to write up that stay (along with a couple of others I've had) soon, but let's just say it's the reason I pack a doorstop in my go bag.
     
  11. Mikus33

    Mikus33 Silver Member

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    The SW redemption is $.0167 as long as you book Wanna Get Away Fares. If you book Anytime fares using points the redemption is roughly* $.01/point, and if you book using Business Select your redemption rate is roughly* $.009/point. So, always save your points for Wanna Get Away redemptions.

    *I say roughly because now that the airlines must include fees when advertising prices, the fees screw up those rates slightly and I didn't take the time to figure out the exact rates.

    Also, you will not get a change fee with SW. I've heard you can even book the flight, not show up, not bother to cancel and still get your points/credit back. I haven't tried that one though. I've always called to cancel ahead of time, and it's been no problem. That flexibility is a major perk of SW. If you booked with points those will go back into your account, and if you booked with cash that will come back to you as SW credit to use on a later flight (which used to expire after a year from the date you booked the original flight).

    I think that credit now has to be used on the same person who the flight was originally booked for. That didn't used to be a requirement, and I was able to buy cheap SW credit on Craigslist from people who had cancelled trips, but weren't going to use their credit. It was a smart loophole for SW to fix.

    I'd see if you can book the package using your points as they now allow a points and cash option on flights, so it might be the same way with packages. I'd call in and see what they can do for you. SW is extremely helpful on the phone, and they typically don't have much of a wait time.
     

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