True Value Of Points
If you didn’t know already. I’m a huge fan of collecting miles & points and this post will convince you too.
Let’s take a look at two middle class travelers, one is your average traveler and the other is a travel hacker. Both of these individuals live in the Silicon Valley and are planning a trip to Japan. They want to travel during April to watch the Cherry Blossoms. Both of them have saved up a budget of $3,000 for their one week-long vacation. This month is a peak month so both hotels and flights will be more expensive than usual.
The average traveler is your typical consumer. He researches all online travel agencies like Kayak, Expedia, Priceline, etc for the cheapest round trip flight to Japan. Upon searching, to keep his costs as low as possible, the average traveler decided for a round-trip flight between San Francisco and Haneda for ~$1,060 (rounded to the nearest 10). This flight had a layover both ways for at least 12 hours and the total time traveling one way was at least 25 hours.
For lodging, the average traveler decided to rent out an entire apartment close to Shinjuku Gyoen Park on Airbnb website (a smart cheap choice). The total cost of apartment was $780.
The grand total of the average traveler’s cost was $1,840 (61% of budget spent). This left the average traveler with $1,160 spending money for food and activities. Nonetheless, the average traveler managed to get a good deal for his vacation and stayed within budget.
Now the travel hacker has collected enough points to get an award trip to Japan. She shopped around multiple airlines for the best use of her points. She decided the best award flight was redeeming them at United Airlines. The flight route was identical to the average traveler by going San Francisco to Haneda. However, the main difference here was that this flight was a nonstop flight with absolutely no layovers and an out-of-pocket cost of ~$45!
Now for lodging, the travel hacker decided to put her points to use at Park Hyatt Tokyo, a category 7 hotel and a luxurious 5 star hotel. Which is also close to the Shinjuku Gyoen Park. By booking solely on points she didn’t have to pay any out-of-pocket cost for her 7 night stay at the hotel. Which would have been a retail value of ~$4,720 but instead she just had to redeem 210,000 Hyatt points for this stay.
Now the travel hacker’s grand total cost was still $45 (1.5% of budget spent). Essentially, leaving her with a hefty spending limit of $2,955 for food and activities. Same vacation and same budget, but different results.
I don’t know about you but I’d rather spend $45 than $$1,840 for a flight and lodging to Japan any day. This is just an example of how points can truly reward you with value. I’ve been lucky to take advantage of some memorable trips and even booked future travels on points. Not only does points allow you to travel cheap, it opens up those dream destinations that you always dreamed about but never would have gone due to the cost. It may sound simple but don’t underestimate the timing and planning you’ll need to put in travel hacking.
Too Long Didn’t Read (TLDR)
A travel hacker is able to have the same vacation as an average traveler but at a cheaper cost. For their flights and lodging, a travel hacker only spent 1.5% of her $3,000 budget vs an average traveler that spent 61% of the same budget.