When and Why Buying Frequent-Flier Miles Makes Sense
When and Why Buying Frequent-Flier Miles Makes Sense
Is Buying Frequent-Flier Miles Ever a Good Idea?
Purchasing frequent-flier miles can be a worthwhile decision under certain circumstances, especially when you can obtain more value from redeeming the miles than it costs to purchase them. Here are some key points to consider:
Financial Benefits of Purchasing Miles
Cost-Effectiveness: The primary factor in determining whether to buy miles is the cost per mile versus the value you can get from redeeming them. For example, if you can buy miles at a discounted rate during a promotion, you might be able to redeem them for more value than their purchase price. For instance, if you can buy 20,000 miles for $200 (1 cent per mile) and redeem them for a flight that would otherwise cost $500, you are getting a good deal.
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Promotions and Bonuses: Airlines often run promotions where you can buy miles with a bonus. For example, Air Canada Aeroplan occasionally offers a 100% bonus, effectively halving the cost per mile. Such deals can make purchasing miles more attractive.
Personalization and Gamification: Airlines are leveraging data to personalize offers and experiences for their members. Gamification techniques, such as offering badges and progress trackers, are also becoming common to engage customers more effectively.
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Credit Card Partnerships: Many airlines have partnered with credit card companies to offer co-branded cards. These cards allow members to earn miles not just from flying, but also from everyday spending, making it easier to accumulate miles for future travel.
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When to Buy Miles
Topping Off Your Account: If you are just a few thousand miles short of a big redemption, buying miles can make sense. For example, if you need 2,000 more miles to book a flight and the cost is $94, it might be cheaper than buying a regular ticket.
Planning for Future Travel: If you have specific travel plans and know you will use the miles, purchasing them during a promotion can save you money in the long run. However, be cautious of devaluations, where the number of miles required for a reward can increase.
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International and Premium Class Travel: Purchasing miles can be particularly beneficial for international flights or premium class travel. For instance, using miles to book a business-class flight on a partner airline can offer significant savings compared to the cash price.
Conclusion
Buying frequent-flier miles can be a good idea if you can get more value from redeeming them than it costs to purchase them. Look for promotions, consider the flexibility of the program, and plan your travel accordingly. Always do the math to ensure you are getting a good deal, and be aware of potential devaluations and changes in program terms.
