Having enough hotel points for a free night does not automatically mean you should use them. Sometimes a Reward Night is outstanding value. Sometimes paying cash and saving the points is the better decision.
The useful approach is to compare the real cost of both options, not simply the number shown on the booking screen.
Step 1: Calculate the value per point
The basic calculation is:
Cash price you would otherwise pay ÷ number of points required = value per point.
For example, if a room costs £250 or 40,000 points:
£250 ÷ 40,000 = £0.00625, or 0.625p per point.
That gives you a starting point for deciding whether the redemption is attractive compared with the value you normally expect from that currency.
Step 2: Use the cash rate you would genuinely book
Do not compare points with an expensive fully flexible rate if you would actually book a cheaper member rate.
Likewise, if flexibility matters and the cheap cash rate is non-refundable, comparing a flexible Reward Night with a flexible cash rate may be more realistic.
Step 3: Account for the points you give up by not paying cash
A cash stay can earn base points, elite bonuses and promotional points. A Reward Night generally does not earn points on the room rate itself.
That means a £200 cash booking may effectively cost slightly less than £200 once the value of the points earned is considered.
Do not overcomplicate this, but on expensive stays or during a strong promotion the difference can be meaningful.
Step 4: Check taxes, fees and extras
A reward booking can sometimes cover taxes that would be charged on a cash rate, while resort fees, service charges or extra-person fees may still apply depending on the programme and hotel.
Always compare the final amount you would actually pay rather than the headline room price.
Step 5: Consider flexibility
Reward bookings can be extremely useful for speculative travel. With IHG, for example, the number of points required can change after booking, but your original booking remains locked at the amount you reserved.
If the points price subsequently falls, you can consider cancelling and rebooking at the lower rate, provided award inventory is still available and the cancellation rules allow it.
This makes checking existing reward bookings periodically worthwhile.
Step 6: Consider what else those points could buy
Points have an opportunity cost. Spending 80,000 points to avoid a £300 bill may look attractive until you discover that the same 80,000 points could cover a £600 hotel on another trip.
That is why a personal target value is useful. It creates a simple line below which you would normally pay cash and above which you would normally consider points.
When cash is often better
- The cash rate is unusually low.
- A lucrative hotel promotion is running.
- You need the spend or qualifying activity for status.
- The points price is disproportionately high.
- You are saving points for a more expensive destination.
When points are often better
- Cash prices are inflated by an event or peak date.
- The points price has not risen by the same proportion.
- You need flexibility.
- The redemption produces a strong value per point.
- Paying cash would materially increase the cost of the trip.
Do Reward Nights still count toward status?
This depends on the programme. Under IHG One Rewards, Reward Nights count toward elite-status qualifying nights and Milestone Rewards, even though points are not earned on the room-rate equivalent.
That distinction is useful: using points does not necessarily mean giving up progress toward night-based status.
What about Points & Cash?
Points & Cash can be useful when you are short of points, but understand what you are buying. With IHG, the cash portion is effectively used to purchase additional points for the Reward Night. If the booking is cancelled within the applicable rules, the points return to your account but the cash used to buy them is not refunded as cash.
My current IHG-specific benchmark is explained in How Much Is an IHG Point Worth?.
Related points & loyalty guides
- Hotel loyalty schemes for beginners
- What are my points worth?
- Buying points and miles
- Booking hotels for a family of four with points
My rule: compare, do not hoard
Hotel points exist to be used, and programme pricing can change. There is little benefit in accumulating a huge balance indefinitely simply because you are waiting for a theoretically perfect redemption.
Equally, spending points just because they are available can destroy their value. Run the comparison each time: cash price, points price, foregone earnings, flexibility and what else the points could buy.
IHG reference: IHG One Rewards FAQs.
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