To buy or not to buy…Airline & Hotel miles

When I talk about my miles, people usually say “I don’t fly to get miles” or “I don’t have a credit card with miles” and will tell them that they can buy miles to build up their accounts for a dream trip but also issue a bit of caution with this approach.  For the most part buying miles make sense if you need to top off an account – for example, I currently need 4,000 miles to top off to 110,000 miles which is an international business class ticket to Asia, South Africa, South Pacific (New Zealand/Australia) to name a few options.  I don’t own the USAirways credit card. I have no plan on flying them anytime soon or staying at a hotel to credit back (you can opt to collect airmiles with hotel stays instead of hotel points).  I can shop online with their portal (but I don’t have $4000 to shop with) or look to buy USAirways miles.  There is currently a targeted email offering a mileage buying opportunity which I am mulling for more than a top off.

In the past, I’ve participated in the buying of miles when I had specific trips in mind, namely a Toronto trip and a Seattle trip.  Both of these tickets at the time were running close to $600 each.  I first looked at my dates to ensure that the low point value of 25,000 miles total for the roundtrip flight was available for each destination (didn’t want to buy miles I couldn’t use).  The promotion at the time was $700 for 50,000 miles so for me this represented a savings of $250 for each ticket/trip, for a total savings of $500.  I thought it was a good investment at the time but as always a bit of risk is involved.  In this case, both trips fell through and I had 50,000 miles in my account.  I ended up using those miles toward my South Africa trip which cost 110,000 miles plus taxes.  So while I had a “reward” ticket, I essentially paid $700 + taxes for a ticket that was worth over $4,000+ so even with the cash paid, a good deal for me.

In the miles game, USAirways miles are easy to collect by using their credit card, buying the miles or using their online shopping portal(once I learned Nordstrom was a partner I no longer ordered shoes in the store, not when I can earn miles with USAirways as well as my Nordstrom points (a double dip of points).  The tricky part is that redemptions U.S. domestic are usually too expensive in mileage and the 25,000 low value ticket hard to find for one person (me). I can’t imagine trying to find a family’s worth of tickets at that level. That said, I generally use my USAirways miles to redeem on their partners rather than the airline itself as the return on investment is better in my opinion.

For this promotion, I was searching for some vacation options this year and had a bit of fun & frustration as I could usually find the outbound but not the inbound reward ticket.  For example, a flight to Portland (PDX) would cost cash $614 but if I could find a low value 25,000 ticket the points would cost $455 (cost for 26k miles so I have 1,000 left) – I could find the flight out for 12,500 (always promising) but then the flight home was 30,000 points (crazy!) for a total of 42,500 points!  That’s insane and would cost me more than the cash value of the ticket $614 so in this case the buying of points is a no go.  My rule of thumb is 25,000 points is used for tickets that would cost more than $550 but that’s my value, other people have their own threshold of how to redeem miles.

For an international USAirways ticket, I would love to know who (if anyone) actually spends the ridiculous mileage -I did a search for Amsterdam (AMS) in the summer for a potential trip I am mulling over and the cost in miles is 350,000 miles per ticket in business class – yes you read that right 350,000 per person, per ticket + $100 taxes.  The cash price for the ticket would be $5,000 in business and $1,500 in coach and would earn miles along the way.  In my scenario above with the current mileage buying promotion (which limits you to 100,000 miles) you would need to spend $6,125 to buy those miles – paying more than the cash price.  So if we use that as a conservative estimate, there are people out there wasting their mileage buying power (unless they have millions of miles and don’t care) and the airlines love them.  The airlines promote the FREE award ticket – don’t be fooled there is definitely a cost whether you flew the airline, spent on the credit card, bought through the mall or bought miles – nothing is really free.  The airlines also think since you think the ticket is free, you won’t do the math to find the value.  But I want you to do the math – learn the rules, play the game and redeem well.

So I’m off to buy my 4,000 USAirways miles for $75.25 (of course fees and taxes) so that my account is ready if I find the elusive reward ticket anytime soon – I have lots of vacation days to use this year and no idea where to go.  Hopefully, the travel shows this weekend and next will provide me a path.