Are Frequent-Flier Deals a Good Deal? – WSJ.com

British Airways destinations

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Thoughts relating to Are Frequent-Flier Deals a Good Deal? – WSJ.com.

Pretend your mileage is a product that you have to ‘buy’ (earn or purchase bonus miles) and ‘sell’ (redeem for tickets or upgrades).

Cost Price

Travelers who buy frequent-flier miles pay about 3 cents per mile, but then they typically redeem them for tickets at 1.5 cents each—or even less.

Sale Price

Redeeming miles at the right time (there’s actually a seat on a flight you want) and for the right ticket is what’ll determine if you make a ‘profit’ or not.

United believes savvy road warriors, not just infrequent fliers, are taking advantage of the bonus mileage offers. When redeemed for upgrades or for last-minute tickets, miles can deliver more than 3 cents of value apiece, sometimes up to 10 cents a mile or more.

It turns out buying 140,000 miles for $4,139 and redeeming them for an award ticket (you have to pay a fuel surcharge, too, of up to $600) is cheaper than buying a first-class ticket, which starts at more than $12,000 for a Seattle-London round-trip. You buy miles for 3 cents apiece and redeem them for a ticket worth at least 8.6 cents per mile.

You have to do the math.

It turns out buying 140,000 miles for $4,139 and redeeming them for an award ticket (you have to pay a fuel surcharge, too, of up to $600) is cheaper than buying a first-class ticket, which starts at more than $12,000 for a Seattle-London round-trip. You buy miles for 3 cents apiece and redeem them for a ticket worth at least 8.6 cents per mile.

The math works for business-class tickets, though not as dramatically. For Seattle-London tickets, British Airways tickets start at $5,037. Buying 120,000 miles from Alaska costs $3,548. Even after the fuel surcharge, you’ll save more than $1,000.

Alaska offers bonus miles a different way as well: The airline gives customers the chance to pay extra when buying a ticket to add 1,000, 2,500 or 5,000 “Fly and Buy” miles to the mileage earned. Paying for an extra 5,000 miles costs $117 tax included, or 2.3 cents per mile. That’s a discount to outright mileage purchases—buying 5,000 miles separately from a ticket on Alaska costs $148 tax included.


When to Redeem

There’s not magical solution — it’s all very hit or miss.

  • Redeem for Upgrades. On the whole, upgrades have been quite ‘profitable’ for me. Especially from economy plus to business class — British Airways specifically which is nice since I have a credit card that earns BA points.
  • It helps to have  ‘elite status’ or find seats at the last minute.
  • Plan in Advance. I hate telling people that but it’s true.
  • Look for Last Minute Seats
  • Unless it’s an emergency, I shy away from redeeming “anytime” awards.

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