Booking future travel gets the most value for your mileage, but you can also go shopping (or grab a gift card) today.

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Credit: Getty Images (1). Art: Jillian Sellers.

If there's one thing globetrotters with oodles of airline miles in their rewards accounts would like you to know, it is this: using miles to purchase anything other than rewards travel is rarely the most cost-effective option—yes, even if you and the kids have been skipping air travel for (we can't believe it either) a whole year already.

In fact, airline reward programs are often structured to discourage such purchases, typically providing less than a cent per airline mile when consumers opt for gift card redemptions or merchandise. Plus, amid the COVID-19 pandemic, a few cash-strapped airlines have ceased retailer gift card and merchandise programs altogether. (American and Delta, to name a few.) Though Delta still allows program participants to purchase Delta gift cards, which can be redeemed for flights or Delta vacations.

"Airlines miles are a currency made up by the airlines, but during a time where airlines are posting billion-dollar losses," Andy Medearis, founder of the website Deals Points, tells Parents. "The last thing that an airline wants to do is convert their made-up currency into actual dollars to purchase gift cards and merchandise for customers."

Be that as it may, the reality in a world impacted by a global health crisis is that many people are simply not eager to hop on a plane and travel. So rather than let hard-earned flight miles simply evaporate, would-be traveling parents are looking for ways to put their points to good use—perhaps purchasing items for their household and family.

But what's the most cost effective way to do that given the insights of Medearis and plenty of other travel rewards experts like him? The first step is doing your homework.

Know where you'll get the most value for airline miles

Medearis has spent his fair share of time studying the true cost of non-travel rewards purchases. Most of the time, he says, the value you'll get for making everyday purchases with airline mileage is about one-quarter of what you'd receive redeeming those miles for travel. But for those looking to use their miles right now, here's his advice.

"If you don't plan to travel at all over the next two years, and you're really hurting for cash, I would go for gift cards over the merchandise option. It's usually a slightly better—but still very low—value," Medearis says.

Take United Airlines' rewards program for example, which still offers the ability to cash out miles for gift cards and merchandise. When using miles to obtain retailer gift cards, you'll generally get about 0.3 cents per mile, according to Medearis' calculations. For merchandise purchases, which through United's program can be anything from Dyson, to Bose, to Cuisinart products (all of which look very tempting and useful) the rewards value drops further, to as low as 0.2 cents per mile in some cases.  

Apple products meanwhile, which all the cool kids want, are probably your worst choice.

"If it's an item that would cost you $1,000 when buying it through Apple, it's going to cost you about 300,000 miles, which is roughly equivalent to $4,500 if you used those miles towards air travel," Medearis says. "And most people don't even have that many miles anyway."

So, in light of this disappointing news, what does Medearis suggest? Think a domestic family getaway, perhaps someplace you can visit by car.

"Hotels and vacation packages are still a good deal and a lot of people are still doing domestic vacations," he says. "It could be a much better deal than gift cards or merchandise."

In the case of United, you'd get about 0.5 cents per mile for booking a hotel stay, while Delta offers a relatively generous 1 cent per mile, Medearis says.

Credit card reward programs offer better redemption value

For those who are members of credit card travel reward programs, the news is slightly better. Maybe even much better in some cases. 

You'll get more for value for travel rewards points when shopping for useful household items or other non-travel related purchases such as gift cards. In addition, many credit card companies are ramping up incentives right now to make using points for living expenses more attractive.

During the height of the pandemic, travel educator Barron Damon used credit card travel rewards points from American Express and Capital One to purchase a rolling, stand-up desk for his 14-year-old home-schooling son, continuing education courses for himself, and a pickleball set for the family, among other things.

"In past years, I wouldn't have done that because you're spending 4,000 points here, 6,000 there, when I could go stay at the Solamar Hotel with all of those points," Damon, creator of the Business of Life travel education website, tells Parents. "I'm willing to give up that night at a nice hotel for a portable desk, but some of the other purchases we may not necessarily need during normal times." 

Damon is clearly not alone. American Express reports seeing 26% more membership rewards points used to shop on its site in the last year. 

In February, the company also launched the Shop Small Marketplace, a hub designed specifically to allow members to purchase products from small businesses, including technology items, beauty products, home goods, lifestyle and more. 

"When COVID-19 began, we saw a huge shift in our card members' spending," Chris Cracchiolo, senior vice president and general manager for global membership rewards and loyalty benefits at American Express, tells Parents. "With travel restrictions in place globally and consumers staying home, we've seen more card members use points for everyday purchases, particularly online shopping compared to previous years."

The gift card redemption options available when using credit card programs can also be a smart and fun family choice, particularly when you keep your eye out for price reductions on the gift cards, says Damon.

"You can even allow your child to pick out a gift card for a specific store that they like," says Damon. "And sometimes the rewards programs lower the price of the gift cards. Usually, it costs about 2500 points for a $25 gift card, but sometimes they slash the price to just 1500 points."

Retail purchases and cashing out

Yet another valuable way to use your credit card reward points is to pay for purchases on retailers' websites during checkout. This includes making purchases on e-commerce behemoth Amazon, which became the go-site for countless Americans amid the pandemic.

"Amazon will let you use a variety of different points programs to convert during checkout: Discover, American Express, Chase, Citi, Capital One, and Hilton all participate," Erik Budde, CEO of GigaPoints tells Parents.

Budde is also a fan of the cash-out option available from many credit card travel rewards programs, particularly amid a pandemic when families may be looking for ways to make ends meet.

"Most points cards will give you options to cash out via statement credits," explains Budde. "Chase is one of the best, providing a penny a point for statement credit. So, if you have 25,000 chase points they will take $250 off bill, which is a good way to straight cash out because you can spend that money on anything."

Legendary for his globetrotting lifestyle and know-how, Johnny Jet racks up more than 100,000 flight miles annually in a typical year without blinking. Suffice it to say he has miles to burn. And what is he choosing to do with his reward miles while grounded by a global pandemic? Unfortunately, it's not merchandise or household purchases.

One last suggestion: 2022 travel

He recommends (if not flat-out urges) using your miles to book future travel, pointing out that it will always be the best, most cost-effective use. Sure, booking travel may be a bit of a gamble right now. And it may not be the suggestion you came to hear. But in some ways, booking future travel has never been a safer bet either. Here's why. 

"There's no penalties," Jet tells Parents, noting that most airlines are waiving all those annoying and pricey cancellation and rebooking fees.

"I can get those miles back if I need to cancel, so I have five trips booked with my rewards right now, one trip for every month starting in April," says Jet. "I'm not going to take all of those trips, but when it's safe to travel again I'm going to travel. So, if it is not safe yet in April, I'll cancel that trip and we'll try again in May, and if it's still not safe then, I'll cancel that trip too and we will try again in June."