Tag: devaluation

Bank Points Aren’t Safe From Devaluation

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I got a breezily worded letter in the mail yesterday from Citi. “You may not have gotten a copy of the ThankYou Terms And Conditions when you signed up for your card,” it said. “Don’t worry, there’s nothing you need to do.” The letter included a link to the ThankYou rewards terms page which didn’t really show anything obviously untoward. There was a section on shutting down accounts for suspected fraud which seemed fairly aggressive, but banks tend to be aggressive about fraud, so this wasn’t exactly a surprise. And Citi hasn’t been a bad actor in this regard (unlike Amex).

Well, that all changed today. Citi announced a devaluation of ThankYou points, effective 7/27/2025 (at least they gave some advance notice, unlike most airline programs). The following transfers are being devalued:

  • 1,000 ThankYou Rewards Points are transferable for 800 Emirates Skywards points (20% devaluation)
  • 1,000 ThankYou Rewards Points are transferable for 700 jetBlue TrueBlue Points (30% devaluation)
  • 1,000 ThankYou Rewards Points are transferable for 1,400 Choice Privileges® Points (30% devaluation)
  • 1,000 ThankYou Rewards Points are transferable for 700 Wyndham Rewards® Points (30% devaluation)

This seems kind of … random? Emirates, jetBlue, and Wyndham Rewards are some of Citi’s least valuable transfer partners. Choice Privileges used to be somewhat valuable, and sometimes still is for niche redemptions, but they have been devaluing the program like crazy.

So far, if you have a Citi Strata Premier, it looks like only Emirates is being devalued. The other programs don’t appear to be (yet). However, it’s hard to say whether this is an oversight or what, because it’s Citi we’re talking about. They’re consistently inconsistent.

Will this really amount to much? It’s hard to say. Airlines have been devaluing their points, but apart from HSBC, banks haven’t really gotten in on the game yet. Instead, bank points have been effectively devalued because of all of the devaluations of their transfer partners.

I think this sets a bad precedent. Banks don’t devalue money in your bank account, why should they devalue your points? People keep their points with a bank program because these programs have been relatively stable and predictable, with a floor value of at least one cent per point. There are even transfer bonuses when transferring points into certain programs, which has somewhat helped to offset devaluations.

That being said, I’ll be re-evaluating my participation in the Citi ecosystem. I have been putting all of the spend I reasonably can through Citi cards in order to earn ThankYou points. However, if the value of these are going down, there’s a lot less reason to participate. After all, I can effectively earn Choice points at the existing ratio in the new Wells Fargo program, using the same card pairing of a 2% cashback card (which is convertible to transferable points) with a travel rewards card (the Wells Fargo Autograph Journey). There aren’t as many airline transfer partners, but I have spent most of my Citi points on hotels anyway. Given Citi’s $95 annual fee, I’m thinking of dumping my cards with them and switching to Wells Fargo’s program instead. It’s relatively hard to earn Citi points (there aren’t opportunities for huge transfer bonuses like with the other issuers) and the only really good transfer partners other than Choice are the I Prefer and EVA programs. If I had the ability to earn a ton of points through spending, the card product would be more attractive, but we try to avoid spending actual money over here at Seat 31B. So, it’s a complicated decision. Mine will probably be “churn and burn” though – Citi is already setting the precedent of devaluing your points in the bank, so doing more of it will likely prove irresistible.

LEAKED: Devalued British Airways Avios Award Chart

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British Airways today announced that they will be devaluing the Avios award chart starting on May 30th for partner redemptions. What they didn’t provide is any details of what the devaluation looks like. “We’re devaluing your points,” they said. “But we won’t retroactively raise the prices on any bookings you have already made!”

Although the new chart isn’t available, it has been programmed into the British Airways computer system for booking agents. So, by asking the right questions, I was able to piece together what I believe to be the award chart for the short and mid-haul flights most commonly booked with Avios (the Avios chart generally isn’t a good deal for long haul flights, so I didn’t focus on these). What are the results? They’re not as bad as I expected, and are in line with the recent LifeMiles devaluation. It’s clear that British Airways is trying to remain competitive with LifeMiles, and it’s possible that their credit card partner Chase leaned on them to do so given the 30% bonus currently available for transfers to Avios.

Surf’s still up!

What We Know

  • Hawaii West Coast sweet spot (mostly) remains intact. The price is going up by 500 miles which is manageable.
  • Mid-haul sweet spot goes away. These flights are going from 7,500 to 9,000 points which is painful however you slice it. This is going to give Delta an excuse to devalue, so I’m actually much more concerned about burning my SkyMiles than worrying too much about BA’s devaluation here.
  • British Airways isn’t moving to variable pricing. There is still an award chart, it has just been devalued.
  • Per-leg pricing isn’t changing. Every flight is priced individually so the price for connecting itineraries is sum of all of the flights. This is the same practice as currently
  • All partner flights will cost the same. It won’t be more expensive to redeem on Alaska or American versus Sri Lankan, S7 or Cathay Pacific.
  • Taxes and fees won’t change. They will remain exactly the same as they are now.
  • Pricing for business and first class is consistent. This will still be 2x and 4x the economy class price, respectively. In general, this isn’t a great deal (although there can be sweet spots such as on Cathay Pacific mid-haul business class) so Avios are best used for economy class redemptions.

Not Yet Clear

  • It seems possible that the 0-650 mile award chart is coming back for flights within North America, because short-haul flights are pricing out based on this mileage band.
  • It isn’t clear whether Iberia and Aer Lingus will also devalue their Avios programs. If they don’t devalue, and you can live with the restrictions of Iberia, this may be a better program to use in many cases.

The Chart

  • 0-650 miles: 6,000 Avios
  • 651-1,150 miles: 9,000 Avios
  • 1,151 miles-2,000 miles: 11,000 Avios
  • 2,001 miles-3,000 miles: 13,000 Avios

Want help booking a flight with Avios or any other award program? At AwardCat, we’re expert at helping you get the most for your miles.

HSBC Devalues World MasterCard Rewards Points

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I have been catching up on my mail since returning from St. Helena and South Africa, and finally got around to opening the stuff that looks like junk mail. Of course, a lot of that stuff in there is actually important, and in the miles and points world, this is pretty explosive. It’s the first notice of an overt (rather than stealth) devaluation of a bank rewards program I have ever seen.

hsbc evaluation

HSBC points are devaluing. Is the money in your account next?

Points in the HSBC Premier World MasterCard Rewards program spend like cash through a travel portal, similar to the US Bank or Bank of America rewards programs. Currently, for HSBC Premier members, the rate is 62 points per $1. However, as of April 2, 2018, the rate will increase to 80 points per $1. This is a significant devaluation, from about 1.6 cents per point in value down to 1.25 cents per point in value.

I think this is most significant because it is the first major bank program devaluation. Banks have been fairly hesitant to devalue their award programs, and I think for good reason. You don’t want to associate a bank’s brand with the idea that your assets in that bank will lose value. In fact, American Express has responded to airline award program devaluations by offering periodic transfer bonuses into airline programs. This has helped to maintain the value of Membership Rewards points.

However, HSBC crunched the numbers and must have decided that a money grab is worth the reputational risk. It’s an extremely aggressive move, because this impacts their Premier product–these accounts are for their highest value customers with over $100,000 on deposit. So, I think this is a shot over the bow. If HSBC is willing to devalue their points this much, and to do so for their highest value customers, I don’t think any bank award program is safe.

For my part, I’ll be asking my HSBC banker whether they also plan to devalue the cash in my account.

One Day Left Before LifeMiles Devalues!

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Frequent flier miles are a depreciating currency. Don’t hang onto them and never trust that they will maintain their value. The latest program to devalue is Avianca LifeMiles. You have until midnight (Colombia time) tomorrow to book under the old rates. Pay attention to the time zone so you don’t miss out!

Avianca logoThe new award chart hasn’t been published (and won’t be until the devaluation has already happened) so it’s impossible to know precisely how much the program will be devalued. Accordingly, if you have Avianca LifeMiles, my recommendation is to redeem them now.

One of the most frustrating things about the LifeMiles program is that you can really only book what is offered online, and there are a lot of restrictions. It’s really best to use the program for simple point-to-point itineraries. You can book either one way or roundtrip itineraries. Unfortunately, the LifeMiles search engine is spectacularly stupid. A lot of itineraries fail to show up, even though they are available.

To search for flights, I recommend using the United search engine, which seems to work a lot better, to find an itinerary. Ideally, look for an itinerary involving only one airline. Once you find a workable itinerary on the United page (bearing in mind that only “United Saver” or “Partner” award space will be available when booking with LifeMiles), you can search for the same dates with LifeMiles. The LifeMiles search engine allows you to skip their “SmartSearch” option (which, in my opinion, is the opposite of smart) and select an individual airline. I have tested a few different itineraries and by using this method, have been able to make successful bookings that do not show up either with the “SmartSearch” or “StarAlliance” option.

Good luck, and burn LifeMiles now while you still can. At least Avianca gave advance notice of the devaluation this time. This doesn’t always happen.