To transfer or not to transfer: What to do with Capital One miles

Aug 12, 2020

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Because Capital One miles are still one of the newer transferable currencies, it can be confusing figuring out whether it’s worth transferring your miles or redeeming them for a fixed value.

In today’s post, I’ll guide you through the pros and cons of each option and provide concrete examples so you can make the best choice for your award travel needs.

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In This Post

Eligible Capital One cards

These are the Capital One cards that are eligible for transfers to the program’s airline and hotel partners:

The information for the Capital One Spark Miles and Spark Miles Select cards have been collected independently by The Points Guy. The card details on this page have not been reviewed or provided by the card issuer.          

(Photo by Isabelle Raphael / The Points Guy)
(Photo by Isabelle Raphael/The Points Guy)

Unlike most travel transfers with other card issuers, Capital One transfers for most partners are at a 2:1.5 ratio — not 1:1. It’s not the easiest number to wrap your head around but fortunately, Capital One has a handy tool to show how far your miles will go prior to making the transfer.

Related: Complete guide to Capital One transfer partners 

The statement credit option

The Capital One® Venture® Rewards Credit Card and the Capital One® Spark Miles® for Business offers 2x miles on all purchases along with the ability to redeem your miles for statement credits towards any qualifying travel expense. Capital One defines travel expenses as purchases made from airlines, hotels, rail lines, car rental agencies, limousine services, bus lines, cruise lines, taxi cabs, travel agents and time shares.

Related: How credit card issuers define travel and dining purchases

The pros

1. It’s simple

The beauty of travel statement credits is that you can make all of your travel reservations any way you’d like. For example, you can book directly with the travel provider, go through an online travel agency or even work with a traditional travel agent. As long as the purchase codes under one of the above merchant categories, you can use your Capital One miles to “erase” these transactions. There are no award charts to consult, no blackout dates or capacity controls to worry about and no additional taxes, fees and surcharges to pay.

Get statement credit for any travel purchase (Photo by Chris Dong/The Points Guy)
Get statement credit for any travel purchase. (Photo by Chris Dong/The Points Guy)

2. You have flexibility

Capital One’s definition of travel is broad enough to include purchases that you otherwise couldn’t effectively use your points and miles for, such as taxis, bus fares or rail lines. These types of rewards set award travelers free from large airlines and chain hotels and lets you redeem rewards for stays at small, independent hotels and flights on any airline in the world.

Related: Savvy rewards travelers focus on transferable points for the most flexibility

3. Awards are treated like regular purchases

Unlike many award bookings, you can use your Capital One earnings in this way and still get points and/or miles for your award travel. Hotel stays or flights booked with your Venture or Spark Miles card should also count towards elite status qualification, and if you already have status, you should also be eligible for perks like upgrades and bonus points.

The cons

1. It only gets you a fixed value

The downside to using Capital One miles for travel statement credits is that you’ll always receive a fixed value of one cent per mile redeemed. Granted, this is a solid rate of return, considering both the Venture and the Spark Miles cards offer unlimited 2x miles for every dollar (giving you a return of 2%). But at the same time, you’ll never be able to redeem your miles this way to find an exceptional award that offers you any more than one cent in value per mile redeemed.

Related: A guide to earning transferable points

The option to transfer rewards to travel partners

United 787-8 Business Class (Photo by Zach Honig / TPG)
If you’re looking to travel in premium classes, like United’s 787-8 business class, you’ll likely be better off transferring your Capital One miles to airline partners. (Photo by Zach Honig/The Points Guy.)

With its addition of transfer partners, Capital One joins other major card issuers in offering you a way to transfer your credit card rewards directly to airline and hotel miles. This can open up ways to get outsized value from your miles, but it also has a few potential pitfalls to consider.

As a reminder, Capital One offers numerous programs from which to choose, and these partners range from exceptional to ho-hum. The points transfer at a 2:1.5 ratio for all but four of them (indicated below):

Capital One has also indicated that it plans on adding more transfer partners in the future. For complete details on this process, be sure to check out our post on how to transfer Capital One miles to airline partners.

Related: The best ways to redeem 300,000 Capital One miles

The pros

1. You have the potential to redeem miles for exceptional value

According to TPG’s latest monthly valuations, the most valuable partner on this list is the Avianca LifeMiles program, which are worth 1.7 miles apiece. When adjusting for the 2:1.5 transfer ratio, that means that each Capital One mile is getting you 1.275 cents of value, which is greater than the 1 cent that you’d get when redeeming for statement credits towards travel purchases.

ANA First Suite, booked using Avianca LifeMiles (Photo by Chris Dong/The Points Guy)
ANA First Suite, booked using Avianca LifeMiles (Photo by Chris Dong/The Points Guy)

But as award travel enthusiasts know, there’s always the chance to redeem your miles for exceptional value. For example, Avianca LifeMiles and Air Canada Aeroplan are two of the best programs for booking awards on Star Alliance carriers. And if you can redeem LifeMiles for a Lufthansa first-class award without fuel surcharges, then you’ll find yourself receiving far more than 1.7 cents per mile in value.

For more information on maximizing these transfer partners, read our posts on:

2. You can combine miles with existing balances

There are times where you have a frequent flyer account with a decent-sized balance but one that’s not quite large enough for the award you want. This is a great time to have access to transferable rewards like Capital One miles. For example, if you had credited a flight to the Qantas frequent flyer program, but you lacked enough for an award, then you could transfer some of your Capital One miles to top off that account and book the ticket.

The cons

1. Choosing a transfer partner and booking awards can be confusing

If booking award travel was easy, then everyone would be doing it. The result would be far fewer award seats to go around, especially in premium cabins.

Related: How to book your first award flight using airline miles

Those of us that take the time to understand the various frequent flyer programs and hunt for the best awards will often find ourselves sitting in business- and first-class seats that we could never afford to pay for otherwise. However, it takes a significant level of effort to get to this level of knowledge, and it’s a far cry from the simplicity of redeeming your miles for statement credits to cover travel purchases.

2. You won’t earn miles or elite status from traditional frequent flyer awards

If the award you’re considering will cost roughly the same number of Capital One miles via transferring or redeeming for statement credits, then it’s better to pay your flights with your credit card and erase the cost with your miles.

Lufthansa First Class, booked with Avianca LifeMiles (Photo by Chris Dong/The Points Guy)
Lufthansa First Class, booked with Avianca LifeMiles (Photo by Chris Dong/The Points Guy)

That’s because purchasing the flights directly will allow you to earn miles from the flight and will give you credit towards elite status. And if you already have elite status, you can qualify for upgrades when you book a paid ticket with your credit card instead of redeeming frequent flyer miles.

3. Transfers may not be instant

Whenever you’re dealing with a transferable currency, converting those earnings to airline miles can take some time. Fortunately, more than half of Capital One’s transfer partners receive the miles instantly. Nevertheless, a coveted premium-class award seat could be gone if there’s any sort of delay, so you’ll want to either put your desired award ticket on hold (if that’s an option) or have a back-up plan in place.

Related: How long do Capital One miles take to transfer?

How to decide for yourself

Image by krisanapong detraphiphat / Getty Images
Crunching the numbers to compare the value you’d get by transferring vs. statement credits is the best way to make a decision. (Photo by krisanapong detraphiphat/Getty Images.)

If you have a Venture or Spark Miles card, you should take some time to familiarize yourself with the best of the airline transfer partners.

Read our guides and take a look at their award charts to get an idea of where the sweet spots are. When you’re able to receive significantly more value than one cent per Capital One mile, then it will always be worth transferring your rewards to airline miles rather than redeeming them as travel statement credits.

Related: Best ways to redeem Capital One miles on Oneworld airlines

And most importantly, you need to consider the value of the lowest-priced flight you could have booked, not the current price of the award ticket you could book. For example, you might find an expensive United flight that you could book with Aeroplan or Avianca miles, and think that you’re getting a great deal. But if you could have purchased a lower-priced flight on a discount carrier (and get a statement credit), then you have to consider that price when making your decision.

Finally, be sure to compare the award rates when you’re booking a flight on a carrier that partners with multiple Capital One transfer partners. For example, Aeromexico, Alitalia and Flying Blue (the loyalty program of Air France and KLM, among others) allow you to book SkyTeam flights with their respective miles, while you can use Finnair, Asia Miles, Qantas, or Etihad to book American Airlines-operated flights.

Related: Best ways to redeem Capital One miles on SkyTeam airlines

A real-world example

For example, let’s say that you were looking at a round-trip flight from New York-JFK to Zurich (ZRH). Here are the main options for nonstop economy flights on Swiss.

  • Paid ticket: $468 (46,800 Capital One miles)
  • Award ticket through Aeroplan: 60,000 miles + ~$57 in taxes and fees (equivalent to 80,000 Capital One miles)
  • Award ticket through Avianca: 46,500 miles + ~$82 in taxes and fees (equivalent to 62,000 Capital One miles)
(Photo by Victoria Walker/The Points Guy)
(Photo by Victoria Walker/The Points Guy)

In this case, you are much better off paying for the flights directly with your card and then using your miles to “erase” the purchase via a statement credit.

However, this calculation changes significantly when you consider Swiss business class. Here are the options for getting to Zurich in business class on the same dates:

  • Paid ticket (note that this is the lowest business-class ticket but not the nonstop): $2,261.35 (226,135 Capital One miles)
  • Award ticket through Aeroplan: 110,000 miles + ~$57 (equivalent to 146,667 Capital One miles)
  • Award ticket through Avianca: 126,000 miles + ~$82 (equivalent to 168,000 Capital One miles)

For this trip, you’re now much better off transferring your Capital One miles (to Aeroplan in this case). Based on the paid ticket price and taking out the taxes and fees you’d be paying, you’re getting a redemption value of 1.5 cents per mile, slightly above TPG’s most recent valuations.

Again, be sure to carefully consider the two options do you don’t redeem more Capital One miles than you need to.

Related: Best ways to redeem Capital One miles on Star Alliance airlines

Bottom line

Capital One’s addition of transfer partners was fantastic news and has greatly enhanced the value proposition on cards like the Capital One Venture Rewards Credit Card and Capital One Spark Miles for Business.

However, this does add complexity; when should you transfer, and when should you redeem directly for statement credits? By carefully weighing both of these options using the above framework, you can make the right choice when it comes time to redeem your Capital One miles.

Related: The best Capital One credit cards of 2020

Additional reporting by Chris Dong.

Featured photo by Ethan Steinberg/The Points Guy.

Editorial Disclaimer: Opinions expressed here are the author’s alone, not those of any bank, credit card issuer, airlines or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

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