What is a points devaluation?

In some of my posts, I’ve talked about making sure your points don’t expire worthlessly or get devalued. But what is a points devaluation?

In one of my earliest posts, I wrote about how points actually operate as a virtual currency. So the first step to understanding a devaluation is first acknowledging that your points balance is actually worth something, to begin with. What it’s worth is somewhat variable. The value you get when you spend the points is really what defines how valuable they are. Get a great deal, then you got more value than someone who got a less good deal, for example.

A good rule of thumb for value per point is about 1.2 pence or above. I.e. if you’re getting less value than that when you spend them, it’s probably not a good deal.

Devaluation is when the airline, or owner of the points programme, changes the rules so you get less value. An example of this is increasing the points required for a reward flight or an upgrade. If the reward flight now costs 20,000 points more than it did a week ago, you’re spending more points to get something of the same perceived value.

More often than not, these devaluations are fairly hard to avoid. You pretty much have to take it on the chin. That’s one of the reasons that holding a balance of points that’s very large is a bad idea. One day they may be worth less than they are worth today.

Want to make sure you avoid devaluation? Talk to us about your next trip.