IHG point value

Suppose you find a cash rate at an IHG hotel and you also have the option to buy IHG points. How can you tell whether redeeming points is actually cheaper than paying cash?

Assume IHG points can be purchased at cpp. After factoring in a % credit-card cashback and a % portal cashback, your effective cost becomes $v=$cpp.

Now suppose the room’s base rate is $r=$ $, and taxes and fees add $t=$% bringing the total cost to $s=$ .

Paying cash earns you $m=$ points per dollar spent on the base rate, or $mr=$ points in total, worth at your valuation. Your shopping portal returns % of the base rate (), and your credit card returns % of total price (). After subtracting all of these benefits, the net cost of paying cash is .

If a redemption costs $p$ points, then to come out ahead you need $pv\le$, which gives a maximum sensible redemption cost of points. Equivalently, you should only redeem points when their effective value is at least cpp. If you have the old IHG card which gives you 10% redemption rebate, then effective value of cpp is sufficient.

Finally, suppose IHG also lets you buy a bonus bundle: points for $. Applying the same rebate logic, you effectively spend for points, or cpp.