Frequent flyer points are a fantasy currency that fluctuates depending on how you use them. This makes it difficult to know what they're worth -- or whether you're squandering their potential value. This infographic breaks down the dollar value of 1000 points when purchasing everything from flight upgrades to commercial goods.
When it comes to frequent flyer points, your spending power largely depends on what you're buying. Some purchasing options represent considerably better value than others.
Finder.com.au recently crunched the numbers for Qantas and Virgin frequent flyer programs in Australia. They looked at four different point reclamation methods and calculated the value return on 1000 frequent flyer points. Here are the results...
As you can see, a flight upgrade represents much better value than commercial goods from an airline website: you're looking at an extra $80 per 1000 points spent. The same goes for booking economy flights. As Finder explained on its blog:
"We examined the points required to book flights from Sydney to Perth on ten different days, as well as the dollar cost of those flights. In this case, the value returned for every 1000 points works out to be about $13. This is more than twice the value obtained by purchasing goods."
If you have points that are about to expire and you aren't planning to travel anywhere, use them to purchase goods so they don't go to waste. Otherwise, you're much better off putting them towards an upgrade or flight.