How Much Are Capital One Miles Worth Now?

Filed Under: Capital One, Credit Cards
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Recently some fantastic changes were announced to Capital One’s mileage transfer program. Several readers asked if this impacts my valuation of Capital One miles, so I wanted to share my take on that.

I used to value Capital One miles at 1.1 cents each

Up until this change I valued Capital One miles at 1.1 cents. I should note that valuing any points currency isn’t a science, though I do try to use a pretty consistent methodology to go about valuing points.

Historically Capital One miles earned on cards like the Capital One Venture Rewards Credit Card (review) and Capital One® Spark® Miles for Business (review) could be redeemed in one of two ways:

  • They could be redeemed for one cent each towards the cost of a travel purchase
  • They could be converted into airline miles or hotel points at a ratio of up to 2:1.5

Keep in mind that the above two cards offer 2x Venture or Spark miles per dollar spent, so in reality with each dollar spent you were getting either two cents towards travel, or up to 1.5 airline miles.

How did I arrive at the valuation of 1.1 cents per Capital One mile?

  • This valuation accounted for the fairly high floor value of Capital One miles, given that they can be used at the rate of one cent each towards virtually any travel purchase
  • Then I applied some premium for the flexibility you get thanks to the airline transfer partners
  • I value other transferable points currencies at 1.7 cents each, but they have a 1:1 transfer ratio, while Capital One has a transfer ratio of up to 2:1.5; the lower valuation was intended to reflect the different transfer ratio and fewer lucrative transfer partners at a good ratio

Capital One miles can be redeemed towards virtually any travel purchase

I now value Capital One miles at 1.3 cents each

With the recent announcement, two positive changes are being made to the value of Capital One miles:

  • Capital One is adding four mileage transfer partners — British Airways Executive Club, Choice Privileges, TAP Air Portugal Miles&Go, and Turkish Airlines Miles&Smiles
  • Capital One is introducing 1:1 mileage transfers to nine partners (while others will have a 2:1 or 2:1.5 ratio); the 1:1 partners include Aeromexico Club Premier, Avianca LifeMiles, Cathay Pacific Asia Miles, Choice Privileges, Etihad Guest, Finnair Plus, Qantas Frequent Flyer, TAP Air Portugal Miles&Go, Wyndham Rewards

Some people have asked if I now value Capital One miles at 1.7 cents each, since that’s what I value other transferable points currencies at.

While my valuation of Capital One miles absolutely has increased, I’m not valuing them at 1.7 cents each. Rather my new valuation of Capital One miles is 1.3 cents each. Why the increased valuation, but not to the level of other points currencies?

Well, because only limited partners allow 1:1 transfers, and they’re not necessarily the most useful programs:

  • Even at a 1:1 ratio, there are very few circumstances where transfers to Aeromexico Club Premier, Choice Privileges, Finnair Plus, Qantas Frequent Flyer, TAP Air Portugal Miles&Go, and Wyndham Rewards, make sense
  • At a 1:1 ratio there’s potentially value to be had with transfers to Avianca LifeMiles, Cathay Pacific Asia Miles, and Etihad Guest

So yes, 1:1 transfers are great and increase the value of Capital One miles. However, the variety of programs you can transfer miles to at that ratio is limited, and can’t yet compete with Amex Membership Rewards, Chase Ultimate Rewards, and Citi ThankYou.

There’s definitely room for my valuation of Capital One miles to grow, as more 1:1 transfer partners are added. However, for the time being I think 1.3 cents per Venture or Spark mile is a fair valuation. And ultimately that makes both the Capital One Venture Rewards and Capital One Spark Miles for Business good cards for everyday spending, since they offer 2x miles per dollar spent, which I value at a 2.6% return (based on my new valuation).

You can now transfer Capital One miles 1:1 to Cathay Pacific

Bottom line

Some fantastic changes have been made to Capital One mileage transfers, including four more partners being added, and transfers to nine partners now being at a 1:1 ratio. My initial instinct is that this increases my valuation of Capital One miles from 1.1 cents to 1.3 cents each.

The reason I don’t value Capital One miles at 1.7 cents each (like other transferable points currencies), is because of the limited number of useful 1:1 transfer partners.

With these recent changes, what do you value each Capital One mile at?

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  1. Interesting. I believe you value Ultimate Rewards at 1.7 cents per point. Would you recommend putting unbounded spend on a Capital One Venture for a 2.6% return (2 miles per dollar, 1.3 cents per mile) over a Chase Freedom Unlimited for a 2.55% return (1.5 miles per dollar, 1.7 cents per mile)? Even more of an interesting question given the cash value of CFU unbounded spending is 1.875% with a companion CSP (versus 2% with Capital One Venture) while the cash value of CFU unbounded spending is 2.25% with a companion CSR (versus 2% with Capital One Venture).

    If only Capital One Venture added 3x dining/supermarkets to this card, they could have a clear winner

  2. I think my exact words yesterday used “closer to”. Which this indeed is. 😉

    So what you seem to be implying is this still puts the Venture significantly behind Citi DC + Prestige/Premier or AMEX BBP in value as a 2x “everywhere” card (2.6 vs 3.4 cpp hy your valuations), while there are some nuances: if you have significant non-USD spend in catchall categories, the BBP and DC have international transaction fees that wipe out most of the value, and the BBP has a spending cap. That and simplicity (instead of having multiple cards).

    That, and the VentureOne is actually better as a no annual fee card than any UA/AA/DL no annual fee airline card, if you’re earning (in effect) 1.25 miles transferable to a variety of programs. In fact, there may be a case to make that if you’re a casual flyer who isn’t attached to an airline and you don’t need free bags, and you just want a free flight with no annual fee, this may be the best card for you.

    Maybe a comparison of the three ecosystems and cards in them is in order while we’re all waiting for green lights for first class caviar and showers?

  3. At 1.3 cpp, this barely tops the late, great USAA Limitless @2.5% cash back. The annual fee puts it under.

  4. I agree. 1.3c seems reasonable, though maybe 0.1c too generous (;-)) given the lack of good 1:1 transfer partners

  5. I disagree that the value should be calculations including outsized weighting on flexibility. Not that Capital One are worth a lot more, but too many flexible point currencies are overvalued (hello Chase Ultimate Rewards!). The value of any travel points currency should never exceed a maximum redemption rate of any partner or internal transaction. If Asia Miles for Cathay Pacific is truly worth $.013 per point, then so be it. I believe that other currencies like Citi ThankYou or Amex Membership Rewards are worth a close proximity to the OMAAT valuation of $.017. Since the pandemic, those maybe have drifted downward closer to $.015 per point. Other travel points currencies shouldn’t be valued higher because of “flexibility”. Maybe the captive earning schemes should be valued lower (a penalty). Capital One Venture card has raised its game and can truly compete now, however I’m not sure I will switch over to it.

  6. Ben – I have the same question as Anthony — CapOne Venture vs. Chase Freedom Unlimited (with CSR) for every day spending. Would be interested to hear your point of view!

    I don’t have CapOne Venture today so not sure if it is worth it given the $95 annual fee considering the return on spending is virtually break-even with Chase Freedom Unlimited unless there is something else I am missing? Of course, CFU has no annual fee and I plan to keep CSR regardless of this decision.

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