- Airfare is 13% higher than it was a year ago.
- Many airlines have changed their travel reward models so that the redemption value of your points is based on the cost of a ticket, not on the distance of the trip.
- Points are likely to become less and less valuable as airfare continues rising.
The cost of a plane ticket increased more than 5% between January and February, according to the most recent consumer price index from the Bureau of Labor Statistics, and it's almost 13% higher than it was a year ago.
Airline tickets typically get more expensive toward the spring and summer as vacation demand goes up, but this year's seasonal increases are being compounded by the rise in oil prices since Russia invaded Ukraine.
For travelers hoping cash in reward points to pay for their vacations, those rising prices could be a big headache, says Nick Ewen, senior travel editor at The Points Guy. It used to be that your points correlated with the distance you were hoping to travel, but more and more airlines are moving away from that model, he notes.
Now, "the number of points or the number of miles that you need corresponds directly to be the price of the ticket itself," Ewen says, and, because prices are going up so quickly, "your points and your miles are never going to be more valuable than they are today."
His advice: Book your travel early and use your points ASAP.
Despite Covid's omicron wave and all the hiccups it created in January, the winter holiday season was pretty solid for U.S. airlines. The momentum has continued, and they've built capacity in their domestic schedules for spring and summer.
As of March, the four big U.S. carriers — American, Delta, Southwest, and United — are operating just 8% shy of what they were at the same time in 2019, according to data from Cirium, a company that tracks flight schedules.
By June, the big four will have narrowed the gap with their pre-pandemic performance to 3%.
The increased schedules are great for travelers who want more options and are excited fly again, but it's yet to be seen just how much increased fuel costs will dampen their return to the skies, Ewen says.
"It's a give and take," he says. "We have this huge demand to travel, but we have these new higher costs."
Using travel reward points sooner than later — "earning and burning," as Ewen puts it — is the common wisdom among savvy travelers, but it's even more important during times of high inflation, he says, because they stand a greater chance of losing their value.
"Points and miles are not good long-term investments," Ewen says. "You want to use them as soon as you can."
Video by Courtney Stith
That's been tough to do during the last two years as many people curtailed their travel during the pandemic. Meanwhile, they've continued using their credit cards and racking up points, and now, a lot of antsy travelers have accumulated a lot of points.
"They're sitting on huge pots of miles," Ewen says, and "so now is a great time to go ahead and put them to use."
If you're worried about getting the most dollar-for-dollar value from your points, you don't need to be, he says. Using points isn't the same as spending your own money, he says, and "at the end of the day, if you're keeping cash in your pockets, that's money that you can spend towards other aspects of your trip."
More from Grow:
- 'You can save thousands of dollars' on your honeymoon if you use credit card rewards wisely, says travel expert
- Planning a trip? Use points or miles to avoid having 'cash on the line,' travel editor says
- Delta named best airline for third year running — but as leisure travel rebounds, all the carriers are competing hard for your business