10/18/24

When Buying Miles is the Smartest Move

Welcome to this week's edition of The Leverage Letter, where we break down strategies that can save you thousands on flights with smart, simple travel hacks.

This week, we’re discussing buying airline miles, an often overlooked tactic that can unlock serious savings, especially for premium travel.

Imagine snagging a business-class seat for less than half the retail cost, all by purchasing miles during the right promotion.

Let’s get into it. 

Here’s everything you need to know about buying miles wisely.

Watch for Bonus Offers

Airlines frequently run promotions on miles purchases, sometimes offering 50% or more bonuses. These promotions can reduce the per-mile cost and make buying miles a better deal than paying for a ticket outright.

How it works:

• Many airlines offer quarterly promotions, where you can buy miles with up to a 100% bonus. So, instead of 50,000 miles, you’d get 100,000 for the same price.

  Lifemiles Promo:

Example:

• Air Canada recently offered a 30% bonus, reducing costs to ~ 1.7 cents per mile. Buying the miles during the promotion turns an $8,000 business-class seat into a $1,400 purchase.

Aeroplan Promo:

Pro Tip:
Check airline websites and sign up for sale alerts from programs like Avianca LifeMiles, American AAdvantage, or United MileagePlus. Promotions typically run for 1-2 weeks, so timing matters.

Compare Miles Cost to Cash Price

Buying miles only makes sense if you’re saving money on the ticket. A simple comparison between the cash price and the cost of buying miles can reveal whether it’s worth it.

How to evaluate:

1. Check the cash price: Look up your desired flight on Google Flights or the airline’s website.

2. Calculate the cost of miles: Multiply the miles you need by the promotional price and compare it with the cash fare.

Example:
This American Airlines Flagship First-class seat from New York to Rome costs $12,900. But you can buy the miles needed for the roundtrip for only $3,400 — $9,000 in savings.

Quick Tips:

• The best value for purchased miles is often on long-haul flights and premium cabin fares.

• Before you buy, ensure there’s award seat availability for your dates.

Redeem for Premium Cabins

Buying miles is typically most valuable for premium business and first-class seats. These tickets are expensive when purchased with cash but can offer great value when booked with miles.

Why it works:

• Airlines set their award seat prices based on miles rather than the cash value of the seat. That means you’ll pay the same miles whether the ticket costs $3,000 or $10,000.

• The cost per mile is often lower than the cost per dollar, especially in premium cabins, where you can redeem miles for 4–5 cents in value.

Example:
A first-class ticket from Los Angeles to Sydney could cost $10,000, but by buying 120,000 miles for $2,500 during a sale, you’re getting a 75% discount.

Additional Tips:

• Don’t wait for last-minute flights: Purchasing miles ahead of time, especially for long-haul premium cabins, can save you even more.

• Book early: Award seats for premium cabins can go fast. Booking as soon as you see availability ensures you maximize your mileage investment.

Maximizing Your Mileage Purchase: What to Keep in Mind

While buying miles can offer incredible savings, it’s not always the right choice. 

Here are a few final tips to ensure you’re getting the best deal:

1. Use Miles for Specific Trips, Not Speculatively
Only buy miles if you have a trip planned or a specific redemption in mind. 

Airlines can change award prices or change the value of miles, so speculative purchases can backfire.

2. Leverage Credit Card Bonuses
Consider using a credit card with bonus points on travel purchases or a new card with a welcome bonus. 

For example, the Chase Sapphire Reserve® earns 3 points per dollar on travel. Accumulating those points could offset the cost of the mileage purchase.

3. Look for Free Cancellation Policies
Some airlines allow free cancellations on award bookings. With American Airlines, for example, you can cancel award tickets without penalty. This can allow you to lock in great award fares even if your travel plans aren’t 100% final.

Final Thoughts: When Buying Miles Makes Sense

In the end, the decision to buy miles comes down to value. 

If you’re getting more per mile than the cost, it’s worth it. Here’s a quick recap of the best times to buy miles:

• During bonus promotions (20% or higher).

• When booking last-minute or international flights.

• For premium cabin seats, where the per-mile value is higher.

At Freemium Traveler, we specialize in helping you leverage points, miles, and rewards programs to maximize your travel experiences without maxing out your budget. 

From choosing the best credit cards for your spending habits to knowing when and where to buy miles, we’ve got you covered.

Ready to take your travel to the next level? 

With the right strategy, let us help you save thousands on your next flight.

Interested in personalized strategies to optimize your points and miles?
Join our community and make the most of your travel rewards today.

Happy travels,

Ade O

The Leverage Letter