Video SRQ: What Are British Airways Avios Worth?

TPG reader Dani has racked up some British Airways Avios and tweeted me with a question about how much they're worth:

"What would you say is the dollar value of British Airways Avios points (for less frequent flyers than yourself)?"

As with all things points- and miles-related, the value of Avios depends on what you redeem them for. The good news for Dani is that you don't have to be a frequent flyer like me in order to be able to get a ton of value out of them.

Though it can be confusing for some folks because British Airways are distance-based, meaning the number of miles you need to redeem for an award is based on the distance you will be traveling. While that means you'll be using more Avios for longer flights or itineraries, it also means that you can get tremendous value out of expensive short-haul flights.

I value British Airways Avios conservatively at about 1.5 cents each, so strictly in monetary terms, if you're getting a better rate than that, you're doing well.

For example, the route from New York to Miami roundtrip on British Airways' Oneworld partner, American, can be very expensive depending on the time of year and how close in you book your ticket, but because BA doesn't charge last-minute award booking fees, and the distance is just about 1,000 miles, you only need 15,000 Avios and $5 roundtrip for an award ticket next week.

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That same itinerary would cost you $604 on American.

That yields a value of just about 4 cents per Avios - not bad!

Another great example is flights from the west coast of the US to Hawaii. While most other airlines charge around 35,000-40,000 miles roundtrip, British Airways requires just 25,000 Avios for a roundtrip award ticket like this one from Los Angeles to Honolulu.

That saves you having to spend $447 on the same ticket!

Another way to get great value from your Avios is to use them to upgrade a paid fare. To calculate base Avios for a flight you can use the handy Avios Calculator, and you put in the itinerary you want to fly and then the cost of upgrading from one class of service to the next is half the number of Avios you need for an economy redemption. (Just note: these upgrades are only available from the following booking classes: British Airways: J, C, D, R, I, W, E, T, Y, B, H; American Airlines and Iberia: J, C, D, Y, B.)

So for example, it costs 20,000 Avios each way for an economy award ticket on British Airways, meaning you'd only need 10,000 Avios each way to upgrade a paid ticket. Where this might make sense is if you could shell out the cash for a Premium Economy ticket and then use Avios to upgrade since that cabin jump is usually worth thousands of dollars.

In this example, you're paying a whopping $2,465 for Premium Economy and then 20,000 Avios to upgrade (ah, summer travel!).

But if you were to pay for Business Class, those same flights would be $5,847.

So those 20,000 Avios would be worth $3,382, or 16.9 cents each! Granted, we're still talking about a lot of money here, but if this is in your wheelhouse, an upgrade is a great way to stretch the value of your Avios.

If you've been diligent and have been racking up a lot of Avios and a super-premium redemption is within your reach, another great redemption option is First Class on Cathay Pacific for 210,000 Avios roundtrip from the west coast of the US and Canada to Hong Kong.

You're using 210,000 Avios and paying $321 in taxes, but that same ticket would cost you $15,685!

That seems pretty inflated to me, but still, that's the price it's going for right now, which means even though you'd be redeeming 210,000 Avios, each one of those would be worth 7.3 cents each. Another great value.

So there are plenty of ways to pull a lot of value from Avios, whether you're a frequent flyer or not, especially if you're been racking up a lot of Avios thanks to recent lucrative credit card offers and Amex transfer bonuses.
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