How do you value a point?

[JohnK]

But how many should one save before using or "for a rainy day".

The how many is not really relevant.

I was expecting a lot of rainy days. Life gets in the way and now I find there is no alternate use for them. Doesn't mean the points are not worth anything though.

How much is that $50 in your pocket worth?

 

[burmans]

But how many should one save before using or "for a rainy day".

100K? 400K?

Sure you can have a target figure, say 560K for that ATW business class trip of a lifetime .

Note that points are not $$$, their value can be varied at the whim of the programme.

Once upon a time I could book (and did) MEL-PER-BME-ASP-AQY-ASP-CNE-BNE-MEL for myself and SWMBO on QF in Business class over three weeks for 37,500 points and $0 in +++ each.

I agree with all of this, the fact that Qantas can vary (or go bust) does indeed mean that you may need to apply a discount factor to future redemptions. Personally I don't totally agree they aren't like $$$, money can be devalued too (the place you have invested can go bust, it may seem remote but it certainly does happen. But yes certainly much less likely).

However even if a future redemption has less value than a current one, that doesnt mean it has none. Frankly a current redemption have have little value too if you use your points for something you dont really want but are just doing to use up your points.

 

[casanovawa]

If you use a simple process of how much do the points cost to get, compared to how much spend would whatever the cash fare i am willing to pay equal and if the points (plus taxes) come out lower then you are getting 'value' out of the points and benefiting by accumulating them, if you did the sums and the points (plus taxes) come out higher cost than the cash fare then you are putting money in the pockets of some airline/bank etc (which is what they want)... The cost and benefit go together to equal value (or not)...

Once you have done the sums it at least gives you ball park averages for you to work with, you can then redeem for something that isn't value with the full knowedge that your making a conscious decision, most people have no clue of how to work out a ball park average and make decision after decision in ignorance... As they say knowledge is power and I like to have as much of that as possible....

Anything roughly over 1 cent is also the cost at which i will stop attaining points as I can't predict the future and while yes J class redemptions currently will almost certainly be valued at more than this (and so its a sensible investment if you can find them to where you want to go), it gives plenty of wiggle room for taxes and surcharges to go up and devaluations to occur and they still have a benenficial value... It also allows for some quick calculations at the shop, paying bills, comparing between programs or when applying for something rather than ascribing them some 3 decimal point value...

Once again, adjust it for your own circumstances and aspirations and if you like donating money to big businesses (especially the trick of no activity in your account for 18 months...)

 

[serfty]

...

How much is that $50 in your pocket worth?

In the short term about $47 and a pot of beer in the local RSL. (maybe 15 minutes)

I rarely have more than a few small notes in my pocket these days ... but I did hit the ATM at lunchtime.