Enticing ads may have you wondering if it is worth it to purchase airline miles. The answer depends on how many miles you need to buy, where you are going and what class of service you want to fly.
Most airlines charge 2.5 to 3.5 cents per mile. You’ll also have to pay a 7.5 percent U.S. federal excise tax and some airlines also charge a processing fee. If you are starting out with zero miles, you would have to pay well over $750 to qualify for a round-trip award ticket, but I don’t know any city in the United States or Canada that costs that much with an advance purchase.
Most long-haul flights are in the $300 range. If you have 20,000 miles, then depending on the price of your ticket, it may be worth purchasing 5,000 miles to get an award ticket. You’ll have to figure out whether purchasing miles makes sense.
Another thing to be aware of is that during peak seasons such as summer and the holidays, you may need 50,000 miles for an award ticket. For some destinations, such as Australia, it seems impossible to find award seats year-round. Always check award-seat availability before you purchase miles.
For expensive tickets, it can be worthwhile to purchase miles to reach an award ticket. For example, fares from Dallas to Canada can be more than $600 round trip, so using a combination of accrued miles and purchased miles can be worth it.
Upgrading your ticket to Europe can be a good reason to purchase miles because business-class fares can be expensive. For example, flights to Paris can cost $4,000 round trip for a one-stop flight and more than $5,000 for a nonstop flight. Even if you have no miles, purchasing miles for a business-class upgrade can be worth it. For example, we saw a round-trip fare from Dallas to Paris in coach class for $1,096 and it would cost you $1,881 with tax to purchase enough miles for a round-trip upgrade, for a total of $2,977, instead of $4,000.
Be smart when you redeem frequent-flier miles. Some airlines charge 50,000 miles, plus up to $700 in fees for a round-trip upgrade to Europe. Make sure your coach-class ticket can be upgraded before you purchase.
Plan ahead; some airlines charge a fee if you have less than a 21-day advance for redeeming award tickets. Allow for up to 72 hours for the miles to be deposited into your account.
Southwest recently started selling points for 2.5 cents per point; it would cost you $150 for 6,000 points, which is really a $100 value. If you’re thinking about buying points, remember you will pay a 50 percent premium, but if you need only a few more points, it may be worth it. Southwest offers double points systemwide for flights through Nov. 15. You have to register at www.southwest.com/nationwidedoublepoints.
Southwest subsidiary AirTran has a similar offer with double A+ credits on domestic and triple on international flights through Nov. 14. Visit www.airtran.com/doubletriplecredits for details and to register. Because these two airlines combined carry more domestic passengers than any other airline, competitors might match these promos.
There are offers at the airport that will give you double miles for your flight, but that is a sucker bet. You will pay a premium.
Instead of purchasing miles, consider signing up for an airline affinity credit card that offers generous bonus miles. Some cards offer 40,000 bonus miles for signing up and the annual fee is often waived for the first year.
A couple of years ago, British Airways offered a 100,000 bonus for signing up for a new credit card. While that is a nice amount of miles, British Airways charges fuel surcharges on award flights to Europe; so along with other international taxes and fees, you could pay $700 for an award ticket to Europe. You would be better off using those miles for travel on code-share partner American where tickets will not have the added fuel surcharges.
Destinations include flights within the United States and from the continental United States to Hawaii, Canada, Mexico, the Caribbean and Central America.
There are many ways to increase your miles that offer more bang for your buck than purchasing miles. With the holidays coming up, you can earn bonus miles by shopping online and clicking through from airline website online shopping malls to retailers. The bonuses vary by retailer, with some offering 10 miles per dollar spent.
Tom Parsons is CEO of bestfares.com.