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Through April 20, 2015, United is offering up to a 30% discount on purchased miles. The size of the discount depends on the number of miles you buy, with the largest 30% discount kicking in at 30,000 miles purchased.
United miles normally cost 3.5 cents per mile plus a 7.5% tax, bringing the full price to 3.76 cents each. During the sale the prices are:
- 2k to 4k miles, 10% off: 3.39 cents per mile
- 5k to 14k miles, 15% off: 3.20 cents per mile
- 15k to 29k miles, 20% off: 3.01 cents per mile
- 30k to 150k miles, 30% off: 2.63 cents per mile
Buying 30,000 miles–the fewest you need to purchase to get the biggest bonus–costs $790.13.
Is This a Good Deal?
No, this is a terrible deal. Since United’s huge devaluation last year, I value United miles at around 1.5 cents. While the bottom line on all mileage sales is that they’re a good deal if you have an immediate, high-value use and not a good deal otherwise, there are few United awards for which you’ll get more than 2.63 cents of value per mile.
Math
To figure out if you have a high-value use, use this simple expression:
(A – B) / (C + D)
- A: Value of the award. Important: this is the lesser of the cash price and your subjective value.
- B: Taxes on the award
- C: Miles used on the award
- D: Miles you would earn if you purchased the award ticket with cash
This will spit out the dollar value you are getting for your miles. If that number is greater than 0.02, and you can book the dream award now, buy during this promotion. Otherwise, don’t buy.
Bottom Line
You can buy 150,000 United miles for 2.63 cents each. That’s way too high to buy speculatively. Hopefully cheaper sales come along.
United sales are processed by points.com, so you do not get category bonuses on cards that bonus airline or travel purchases like my latest card, the Citi Prestige® Card which offers 3x on purchases from airlines. (By contrast, AA’s sale of miles for 2.00 cents each is processed by AA, so you do get bonus points for buying the miles with a Prestige.)
Just getting started in the world of points and miles? The Chase Sapphire Preferred is the best card for you to start with.
With a bonus of 60,000 points after $4,000 spend in the first 3 months, 5x points on travel booked through the Chase Travel℠ and 3x points on restaurants, streaming services, and online groceries (excluding Target, Walmart, and wholesale clubs), this card truly cannot be beat for getting started!
Editorial Disclaimer: The editorial content is not provided or commissioned by the credit card issuers. Opinions expressed here are the author’s alone, not those of the credit card issuers, and have not been reviewed, approved or otherwise endorsed by the credit card issuers.
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Thankx for the insight into buying miles. Keep up the outstanding work on keeping the airlines true to their clients.
The Airlines marketing believes in stupid clients.