Part 4 - Misconceptions: The Value of Points are Minimal due to High Fees
Updated: Sep 30, 2021
In our final post in this series, I want to take a close look at another complaint that I often hear about collecting points, that the taxes and fees when booking award flights are so high that the value of the points are minimal.
Picture this scenario, you save tens of thousands of points for your “free” flight and when you go to book the flight you learn that there will be $600+ in taxes, fees and surcharges. Then you look on Expedia and find that you could book a revenue flight to your destination during a seat sale for a similar amount of money and no points. You throw up your hands and declare that points are useless. The frustration is perfectly understandable.
Let's take Aeroplan, for example (though this is not an exclusively Aeroplan issue). While there is no getting away from taxes and airport fees, Aeroplan also passes on certain fees called “YQ” when you redeem points on an Air Canada flights and certain other Star Alliance carriers. These charges generally consist of a fuel surcharge and can be considerable, in the hundreds of dollars or even over $1,000. Unfortunately, it makes flying on Air Canada metal using Aeroplan points hardly worthwhile (Note that there are some exceptions domestically where short haul flights on Air Canada can provide some outsized value).
So, what to do about this problem? Again, it comes down to being flexible. Aeroplan does not charge YQ for all Star Alliance carriers. So, when you are searching for flights it’s important to know what carriers you should be focussing booking your flights on. The following Star Alliance carriers either do not impose YQ or have low YQ charges when redeeming flights with Aeroplan:
Aegean Airlines Air India Air New Zealand
Avianca Airlines Brussels Airlines COPA Airlines
EgyptAir Ethiopian EVA Air
SAS Singapore Airlines South African Airways
SWISS TAP Air Portugal Turkish Airlines
The point being, when you are searching for award flights, you should be focussing on flights operated by the above airlines whenever possible if you want to keep the additional fees to a minimum.
In addition, there are other means of avoiding YQ, such as having your flight originate in a country that prohibits YQ charges. Also, there are situations in which you can avoid YQ when changes to flights occur on an already booked flight award. Both situations provide an opportunity to book and fly a carrier with normally high YQ, but we will leave a detailed discussion of those situations for future posts.
It's also important to know what types of points to use in different situations. For example, using British Airways Avios points to fly British Airways from North America to London will rarely be a good use of Avios points. The charges and fees will almost always be so high that simply purchasing a ticket would be better value. However, British Airways Avios has some great sweet spots, typically being shorter flights. Last March I used my Avios points to fly my family of five from Seattle to Los Angeles on American Airlines for only 7,500 Avios points and $7.37CAD per person. I also recently flew my son and his girlfriend between Cairns and Sydney, Australia on Qantas for 10,000 Avios points and $24.92CAD per person; and between Sydney and Brisbane, Australia for 4,500 Avios points plus $21.59CAD per person. Since I booked those flights, British Airways Avios underwent a slight devaluation last year such that, today, the points required for those flights would be slightly higher, though Avios still provides good value on short-haul and mid-haul flights.
The key then is to know what points to use for a particular situation and know what airlines to fly in order to avoid or reduce surcharges and fees. With a bit of effort and due diligence it is quite easy to avoid or at least reduce the fees that your award flights will be subject to.
In future posts we will go into greater depth on the best strategies to use to book flights on Aeroplan and other frequent flyer programs. Hopefully this series of posts have shown you the real value that collecting airline points can provide and has dispelled some of the misconceptions about collecting and redeeming airline points.