IHG hotels: Points or pay?

The site Daily Getaways periodically offers travel deals. Recently, they offered the ability to buy packages of IHG Rewards points at a price per point ranging from $0.0056-$0.006 depending on the size of the package. (If the valuation of travel rewards points does not make a lot of sense to you, The Points Guy publishes monthly articles about the current valuation of various programs' points and miles and how he arrives at these valuations.) Last year, after my first trip to Europe due to their larger number of European properties than other chains I had been primarily using, I decided to focus the bulk of my hotel stays with IHG in order to build my point balance. I considered buying a package from Daily Getaways but held off as the $0.006 price point was not a drastic discount to The Point Guy's valuation of these points at $0.007. And note, those valuations assume you can get rewards stays that allow you realize that value. That's a key point to keep in mind as we look at how I might use the points.

Earlier this week, I took another look and thought these packages might be a good way to "prepay" hotel stays that I am planning to make later this year. As I noted in my last post, I am a huge Georgia Tech football fan; I have attended 94 straight games, home and away, and I hope to push "The Streak" past 100 games this fall. As you can imagine, that's a fair number of hotel stays! With the football schedule now out, I decided to look at whether it would be cheaper to go ahead and book paid stays for this fall or to buy packaged points and make these game weekend reservations with reward stays. 

You may be asking why I would buy points if I have been focusing on building up my IHG balance. It's a good question. The main goal of building the balance was to reduce expenses for future trips to Europe. Having picked up the international travel bug and not being able to afford to go as often as I would like, I prefer to hold these points for the relatively more expensive European stays rather than use them for stays in the US that are typically affordable. 

As I began to learn more about accumulating travel points and miles, one of the first rewards credit cards I acquired was the Chase IHG Rewards MasterCard. (I will go into my thoughts on the points and mile "hobby" in a future post.)  I was able to able to qualify for an 80,000 point bonus after spending just $1000 over the initial three months of using the card. One of the benefits of this card is that 10% of your points used for reward stays - up to 100,000 points annually - are rebated. That effectively makes the net price of these package points $0.0050-$0.0054 each. Why not check and see if it would ultimately be cheaper to book my football stays with purchased points rather than simply paying for them?

Finally, another benefit to buying the points now is spreading out my travel spending. Most of my travel expenses - aside from any potential "large scale" vacations - come during the fall. Conversely, very little of my spending comes during the winter and spring. Buying the points now could smooth out those budget peaks and valleys somewhat.

In an upcoming post, I will walk you through my analysis as to whether to use points or simply pay for my rooms.