This is the twelfth post in a monthlong series that started here. Each post will take about two minutes to read and may include an action item that takes the reader another two minutes to complete. I am writing this for an audience of people who know nothing about frequent flier miles, and my goal is that by the end, you know enough to fly for free anywhere you want to go. Previously The Six Types of Frequent Flyer Miles.

Transferable points programs are loyalty programs, usually run by banks, that allow a person to earn points that can be transferred to several different airline or hotel programs. The three most important programs are American Express Membership Rewards (MR), Chase Ultimate Rewards (UR), and Starwood Preferred Guest (SPG) Starpoints.

First I’ll describe the basics of those three programs, then I’ll talk about how to make the most of your transferable points.

American Express Membership Rewards

American Express Platinum, Gold, Green, Centurion, and Corporate cards earn Membership Rewards points.

Points are transferable to dozens of air and hotel loyalty programs including Delta (1 MR to 1 SkyMile), British Airways (1 MR to 1 Avios), Singapore Airlines (1 MR to 1 KrisFlyer miles), and SPG (3 MR to 1 Starpoint)

The airlines programs include at least one airlines from each of the three alliances and several airlines that are not part of alliances like Hawaiian.

There are near constant transfer bonuses, which temporarily improve the transfer ratios of certain programs.

Membership Rewards can be frustrating if you want premium international travel because Delta has the worst award space of major US carriers, and the other airline transfer programs charge huge surcharges on redemptions.

Your Membership Rewards can be transferred to anyone’s loyalty account. This is why when I sometimes do giveaways on Twitter, I give away Membership Rewards that I transfer to the program of choice of the winner.

Chase Ultimate Rewards

The Sapphire Preferred, Ink Bold, Freedom, and other Sapphires and Inks earn Ultimate Rewards.

Points earned on the Sapphire Preferred, Ink Bold, and Ink Plus are transferable to several air and hotel loyalty programs including United, Southwest, British Airways, and Hyatt–all at a 1:1 ratio.

Points earned on the Freedom and other Sapphires and Inks are not transferable to those loyalty programs, but they are transferable to your other Ultimate Rewards accounts. So you could transfer your Ultimate Rewards from your Freedom to your Sapphire Preferred, and then from there to United.

Chase has not gotten into the transfer bonus game yet.

Ultimate Rewards can be combined among your Chase accounts and your spouse’s. You can also send the points to your airline or hotel accounts or your spouse’s. But Chase prohibits sending points to anyone else and has shut down accounts for transfers that don’t comply with Chase’s rules.

SPG Starpoints

Starwood Hotels’ loyalty program is a much-loved transfer program. Many hotel loyalty programs let you transfer your points to airlines, like many airlines let you transfer your miles to hotels. However, it is almost always a bad deal. By contrast, SPG points transfer to airlines at an incredible rate.

A complete list of airline transfer partners is here. Notable 1:1 transfer partners include American, British, Delta, US Airways, Alaska, and Hawaiian.

And the reason everyone loves SPG points is that you can do better than 1:1 on airline transfers.

For every 20,000 Starpoints you transfer, you get a bonus 5,000 miles in the transfer partner’s miles. Example: If you transfer 20,000 Starpoints to American, you receive 25,000 AAdvantage miles. Thus if you transfer in exactly 20,000 Starpoint increments, all the 1:1 transfer partners are really 1:1.25 transfer partners!

Starpoints can usually only be transferred to your own airline accounts. You can transfer your Starpoints to another person’s Starwood account (and from there to that person’s airline accounts) if you and the receiver have had the same address on file for 30 days.

Now that you know about the big three, let’s talk about how to get maximum value from transferable points programs.

1. Keep you points in the transferable points program until you have an award in mind, then transfer. Holding on to your points in the transferable programs retains your option value: you can still transfer them to any of the partners. Once you transfer, that option value is destroyed, so don’t transfer until you have an award in mind. Membership Rewards and Ultimate Rewards make following this easy because points transfer instantly to most partners. Starpoints do not transfer instantly, so you have to transfer with some anticipation, but still you should hold those as Starpoints as long as you can before transferring.

The one exception to this hold-the-points approach is if you close your last Ultimate Rewards or Membership Rewards earning card. The points disappear in that case, so send them out first.

(This is not a worry with the SPG AMEX and Starpoints because those points are in your SPG hotel account. Nor is this a worry with airline cards like the Citi American Airlines MasterCard because your AA miles are in your AA account.)

2. Make sure the award you plan to book with your transferred points is worth more than your other transfer options. For instance, you can transfer UR points to United and Southwest. Checking the Mile Value Leaderboard, we see that a Southwest Rapid Rewards point is worth 1.69 cents. If you’re transferring to United for an award worth less than 1.69 cents per mile, and you should check that at the Mile Value Calculator, you’re probably making a mistake and could get more value from a transfer to Southwest.

3. Make sure the award you plan to book with your transferred points is worth more than your other non-transfer options. For instance, your other best option with Starpoints is hotel stays. Many people report getting several cents per point from using their Starpoints for hotel awards using the Cash & Points option–even after its recent devaluation.

4. The best use of a transferable program is often topping up an account that is just short of an award. If you’ve got 85,000 United miles and want to book a roundtrip business class ticket to Europe, your miles are practically useless. Transferring in 15,000 UR points to reach 100,000 provides immense value, taking you from having no ticket to having the business class ticket in hand.

And this is often the best way to think about the transferable-points programs. Don’t get the Ink Bold thinking it’s 50,000 more United miles or 50,000 Southwest points. Instead pursue strategies to get huge amounts of United and Southwest miles other ways, and use your 50,000 Ultimate Rewards when you’re just short of the miles needed for an award in one of its partner programs.

I love transferable points programs for their flexibility and immense value. They should be a key component of any miles enthusiast’s strategy for maximizing frequent flyer miles.

Chase Sapphire Preferred

Earn 80,000 Chase Ultimate Rewards Points after you spend $4,000 spend in 3 months

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