It’s a Sale! It Must be a Good Deal - Or is it?
Expiration Date – July 20, 2015
United Airlines is offering up to a 30% discount to buy or gift miles until July 20, 2015 - you will need to log into your account to see the discount offer. But even with a discount, buying miles to keep or gift doesn’t usually make sense.
United MileagePlus bonuses are generally offered based on tiered purchase levels and this sale is no different. The more you buy, the larger the discount - up to 30% off. Miles are available in increments of 1,000 all the way up to 100,000 miles and in increments of 5,000 miles up to 150,000 miles.
During this sale you will enjoy these discounts:
15% off 5,000-15,000 miles (3.20 cents per mile)
20% off 16,000-40,000 miles (3.01 cents per mile)
30% off 41,000-150,000 miles (2.63 cents per mile)
Without a sale MileagePlus miles cost 3.76 cents per mile to buy.
As you know from prior TRVLVIP Perks and Tips, we believe the value of a United MileagePlus mile is 1.5 cents per mile, which is the value we would be willing to pay for MileagePlus miles if we could buy them for cash. It is also the minimum value we feel you should expect before redeeming your miles. To see how TRVLVIP determines the value of a rewards point or mile, see our great Tip: What in The World are my Points and Miles Worth?
So even if you buy 41,000-150,000 miles at 30% off, equating to 2.63 cents per mile, you will pay well above what we believe MileagePlus miles are worth at 1.5 cents per mile.
Does it ever make good financial sense to buy or gift MileagePlus miles? Maybe – but typically only in these scenarios:
You plan to purchase miles in order to secure a specific award flight during a discounted award promotion
“Saver Award” space is available (vs. a “Standard Award” which generally requires more than twice the number of MileagePlus miles)
You plan to secure a Business or First Class award ticket
Here is a quick calculation you can use to determine deal value:
Find an award ticket
Determine the full price of that ticket if you were to pay cash, including all taxes and fees
Add to that amount any taxes and fees you will be required to pay on the award ticket
Divide that amount by the number of miles required
If the value per mile exceeds the amount you have to pay to buy the miles then you’ve found a good deal and if not, we don’t suggest you buy the miles
Remember, purchased miles will not count toward MileagePlus elite qualification.
It rarely makes sense to buy or gift miles speculatively as it is an expensive way to acquire miles even with a discount. Once you’ve picked a location and your dates and have taken the steps to ensure award availability, make the small effort to crunch the numbers to make sure the mile purchase makes good economic sense - you will be very happy you did! Click here for United’s award charts, to review award availability and to book award travel.
And a great alternative to purchasing miles to gift to another person is to book them an award ticket using your miles. That is a much more economical choice.
Want to look a bit deeper into the option to purchase, gift or share miles with or without a bonus offer and the opportunity to acquire miles using the United MileagePlus Award Accelerator when purchasing a flight? See our great tip: United - Pros & Cons of Buying and Gifting Miles.
If TRVLVIP helped you gain a better understanding about buying United MileagePlus miles on sale, we’d love a nice note on Facebook and Twitter!
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