Why Mileage Multipliers Are a Raw Deal

Aug 19, 2015

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At a time when airlines are pulling in record profits, TPG Senior Points & Miles Correspondent Nick Ewen explains why buying miles to go with your next flight might boost your carrier’s bottom line, but it probably won’t help your own.

When you purchase a flight on a major US carrier, you’re often given the option to purchase a variety of trip extras like discounted lounge access, in-flight Wi-Fi passes or priority airport services. While these add-ons might make your trip more enjoyable, there’s one type of extra that is typically a terrible deal. In this post, I’ll examine the various options for boosting your mileage accounts on tickets across four major airlines, and highlight how these mileage multipliers are typically not a cost-effective way to earn your next free trip.

Alaska Airlines is one of the few programs left that will match your status from another airline outright.
Alaska Airlines allows you to purchase miles at a discount when booking revenue tickets online.

Alaska Airlines

Alaska has the most limited option for boosting your account balance, as the “Fly & Buy Miles” program is only offered during the initial purchase of a revenue ticket on Alaskaair.com (including flights on partner carriers). TPG used this option back in 2013 to help get enough Alaska miles for a first-class redemption on Emirates’ A380. When you get to the Add-ons page of the checkout process, you’ll see a box at the top that allows you to purchase Mileage Plan miles at a discount:

Alaska Fly & Buy miles

The bonus miles price out at 2 cents per mile plus a 7.5% federal excise tax, bringing your effective purchase price to 2.15 cents apiece. This is slightly higher than TPG’s most recent valuations, which peg Alaska miles at 2 cents apiece. However, it does represent a somewhat significant discount from the regular price of Mileage Plan miles, which usually cost 2.75 cents apiece plus the same 7.5% tax (for effective rate of just under 3 cents per mile). As a result, you’re saving over 27% by purchasing miles in this fashion.

In addition, since these miles are purchased directly from Alaska, they should be eligible to earn 3 miles per dollar if you use your Alaska Airlines Visa Signature Credit Card (or 3x Membership Rewards points by using your Premier Rewards Gold Card from American Express). However, when you purchase miles through the normal channel, the transaction is processed through Points.com, and thus won’t earn any credit card category bonus. Note that Alaska sometimes offers promotional discounts for purchasing miles, so you should crunch the numbers and make sure you’re getting the best deal.

This option was actually quite appealing when TPG was booking his Emirates trip, but has since become a less attractive value proposition, partly due to a price increase, but also because you can no longer use this option in a cost-effective manner on refundable tickets. Alaska offers the following language in the Terms and Conditions of the program:

“Fly & Buy Miles purchased with a ticket that is later refunded will be subject to additional fees at the standard rate of 2.75 cents per mile plus applicable taxes.”

I interpret this to mean that you’ll be charged again for the miles you purchased (this time at the standard rate), bringing your total purchase price to over 5 cents per mile! That’s clearly a pretty poor value proposition.

Still, if you’re looking for a way to top off your account for a specific Alaska award redemption, this could be a good option. The miles are awarded separately from those earned on the flight, and normally post to your account immediately (but may take up to 2 business days). They also don’t count toward elite status qualification, and this option isn’t available when booking award reservations.

A quicker way to boost your Alaska account is by opening the Alaska Airlines Visa. This card is currently offering a sign-up bonus of 25,000 miles upon approval (mine posted exactly one week after my application), and comes with a yearly companion ticket benefit that can easily cover the $75 annual fee. Note that you may be receive a similar offer plus a statement credit when you apply for the card while booking an Alaska flight.

American's Mileage Multiplier program allows you to double or triple the miles you earn on a given flight.
American’s Mileage Multiplier program allows you to double or triple the miles you earn on a given flight.

American Airlines

American offers a slightly broader program known as the Mileage Multiplier, which allows you to double or triple the number of AAdvantage miles you earn on a given flight at a cost of approximately 3 cents per mile. There are three ways to do this:

  1. By calling American
  2. When you check-in for your flight on AA.com
  3. At an airport kiosk

Note that the link above indicates that this option is also available during the online reservation process, but I was unable to replicate this across several bookings.

The number of miles you’d earn through this option depends on the length of your flight(s), and these miles post separately from those you earn by flying. Miles generally show up within 48 hours, though most will post before you even land.

Unfortunately, this is a pretty poor value proposition, as TPG only pegs AAdvantage miles at 1.7 cents apiece, and American’s regular price for purchasing miles is 2.95 cents apiece (plus a 7.5% federal excise fee and a $30 processing charge). In addition, the program regularly offers promotions for buying miles — the current offer gives you a 35% discount through September 3rd. If you max out the promotion and purchase 100,000 miles, your price drops to roughly 2.1 cents per mile.

If you’re in need of AAdvantage miles, you’re probably better off opening an American Airlines co-branded credit card like the Citi / AAdvantage Platinum Select World Elite Mastercard (currently offering 50,000 bonus miles after spending $2,500 in the first three months) or the Citi / AAdvantage Executive World Elite Mastercard (currently offering an increased sign-up bonus of 75,000 miles after spending $7,500 within the first three months).

Transferable points can hedge against unexpected program changes (like Delta's slew of recent devaluations).
Delta has two different options for boosting your account balance when you take Delta-operated flights.

Delta Air Lines

Delta offers two different methods for boosting your mileage earnings: Mileage Booster and Award Builder. The chart below breaks down the key differences between the two:

Mileage Booster Award Builder
Cost 1.97 – 2.9 cents per mile 2.8 cents per mile
Available increments 1,000 – 3,000 miles 1,000 – 3,000 miles
Applicable ticket types Both one-way and round-trip award and revenue tickets Round-trip, revenue flights only

Delta’s regular price for purchasing miles is a whopping 3.5 cents each plus 7.5% in taxes (about 3.76 cents apiece total), so these options are both superior. You can also use these options an unlimited number of times each year, while you can only purchase 60,000 miles annually using the standard method. However, TPG pegs Delta miles at just 1.2 cents each, so even at its cheapest, neither Mileage Booster nor Award Builder make sense. Let’s take a closer look at each:

Mileage Booster

This first option is more flexible and tends to offer a slightly better value (though I still don’t recommend it). You can choose to purchase 1,000; 2,000 or 3,000 miles for specific itineraries at a cost of $29 (2.9 cents per mile), $44 (2.2 cents per mile) and $59 (1.967 cents per mile), respectively. This option is available to all SkyMiles members traveling on Delta-marketed flights within the US, Puerto Rico and the US Virgin Islands.

Mileage Booster can be added to your flights in three ways:

  1. At the time of booking
  2. After booking through My Trips on Delta.com
  3. From the Trip Extras menu when checking in for your flight online

I currently have a one-way award ticket booked for this December, and when I pull up the itinerary, I see this option under Trip Extras:

Delta trip extras mileage booster
The Mileage Booster option shows up under Delta Trip Extras.

These miles still post if your flight is canceled or you’re rerouted. However, if you make a voluntary change to your flight, you’ll forfeit the bonus miles and will not receive a refund. Keep that in mind before purchasing if your plans aren’t set! For complete information, check out the Mileage Booster FAQ page.

Award Builder

Delta’s Award Builder option works a bit differently. Instead of purchasing miles alongside a specific itinerary, you actually purchase these miles separately. Then, when you complete a round-trip revenue flight on Delta, the bonus miles will appear in your account. Each option has the same effective purchase rate of 2.8 cents apiece. Again, this is slightly better than the regular Buy Miles price, but still well over TPG’s most recent valuations.

There are a few other things to keep in mind with this option:

  • Award Builder only applies to round-trip, revenue flights.
  • You can purchase up to 9 Award Builders at one time (3 from each increment), though you can purchase as many as you like each year.
  • Each Award Builder expires 1 year from the date of issue.
  • If you’ve purchased multiple levels of Award Builders, they’ll post in descending order of mileage value (e.g., 3,000 miles, then 2,000 miles, etc.).

For complete information, check out the Award Builder FAQ page.

Like the other examples discussed above, it tends to be easier (and cheaper) to boost your SkyMiles account by applying for a Delta American Express card like the Gold Delta SkyMiles® Credit Card from American Express, which currently offers 30,000 bonus miles after you make $1,000 in purchases on your new card within your first three months.

United 787 featured
United is unique in that you can actually purchase both redeemable miles AND Premier Qualifying Miles on existing flight reservations.

United Airlines

The final major airline that offers this option is United, though its program is a bit different. Like Delta, the carrier has two mileage multiplier options: Award Accelerator and Premier Accelerator. These two options work together to help you boost your MileagePlus account balance, or to boost your account balance and purchase additional Premier Qualification Miles (PQMs) if you’re working toward Premier status on United.

There are two ways to take advantage of these programs:

  1. When viewing your itinerary on United.com
  2. When checking in for your flight

Like with Alaska, the miles (and PQMs) you purchase will post to your account within 24 hours, so you don’t need to wait until your flight to boost your account (or premier-qualifying balance). In addition, you must be on a United-issued ticket (including award tickets), but you could be traveling on other airlines. Finally, you can only use this option once per itinerary, and you must purchase Award Accelerator in order to add Premier Accelerator. If you buy Award Accelerator but not Premier Accelerator, you can’t go back and change it, so be sure to decide before purchasing.

Unfortunately, there’s no standard rate at which these two products are offered. United.com offers the following explanation:

“The specific number of miles offered and the purchase price may vary by member based on the length of your flight, your itinerary and other criteria. Miles available for purchase may not be directly related to the miles you’ll otherwise be earning for your flight.”

As a result, you won’t know the actual mileage amount and price for these two options until you check your specific itinerary, and you may see different rates for different trips. You’ll even see fluctuation in the purchase price from day to day or even hour to hour! The United forum at FlyerTalk has yearly threads where travelers report their offers, and I found the following ranges in the 2015 version:

  • Award Accelerator — 1.8 – 2.7 cents per mile
  • Premier Accelerator — 7 – 15 cents per mile (these rates tend to skyrocket as the end of the elite status qualification year approaches)

TPG pegs United miles at 1.5 cents apiece, so even the low end of the Award Accelerator spectrum isn’t a great value (though it’s still better than the regular purchase price of 3.5 cents per mile each plus 7.5% in taxes). However, if you have a specific need for the bonus miles and the offer you receive will get your balance to the desired amount, it may be worthwhile.

Once again, a better idea might be to open a United co-branded credit card like the United MileagePlus Explorer Card from Chase. This card is currently offering a sign-up bonus of 40,000 bonus miles after you spend $2,000 on purchases in the first three months.

Placing a value on the Premier Accelerator is a bit trickier, since everyone values elite status differently. If you know that you’ll be close to a given status threshold and you can extract a lot of value from the next level, the Premier Accelerator could make sense. However, a quick mileage run will likely be cheaper, especially if you can take advantage of a great flight deal.

Bottom Line

On the whole, these options tend to be poor value propositions, even in cases where they offer a discount from the standard Buy Miles price for a given carrier. I would generally recommend applying for a credit card or taking advantage of airline shopping portals as much easier (and cheaper) ways to earn bonus miles.

What are your experiences with these mileage booster programs?

Editorial Disclaimer: Opinions expressed here are the author’s alone, not those of any bank, credit card issuer, airlines or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

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