Today, I had 2 people asking me about things related to United miles. Here are their stories:
Person A scenario
I have a coworker at work who got the Chase Hyatt card recently (the ones that gets you 2 free nights at ANY Hyatt worldwide.) He didn’t have a particular redemption in mind; he just thought it was a good deal. I told him that wasn’t the smartest move, which it isn’t, but he countered back, “Well, if I need it again in 2 years, then I can just get the card again.” He had a good point there. Since Chase moved from ‘one bonus per lifetime’ to ‘one bonus every 24 months,’ this changes my decision on whether to keep my IHG and Hyatt cards.
Anyway, back to the story, he told me that he’d trade me the 2 nights so I could use them at the Park Hyatt Sydney or Tokyo if I booked him a free award airline ticket. At first glance, I thought he was crazy, but as I thought about it some more, if I were to use Hyatt points to book the PH Tokyo (which I had planned to do), it would have cost me 60K points for 2 nights. A roundtrip award ticket to Asia on United costs 70K miles. Since both programs are transfer partners with Chase, you can value them equally, and see that he’s only slightly winning (10K) in the exchange. Of course I told him that he can’t trade me the 2 nights for 60K points since that doesn’t benefit me any, and that he’d have to discount it some. Side note – my coworker only got into the miles and points game recently when I’ve been telling him about this for the past 2 years, and so I like to make fun of him for that. His current strategy is to rack up Asiana miles using his Asiana AMEX cards since he gets 2 miles per dollar at grocery stores. Anyway, I looked up to see if there was any flight availability for him:
Sure enough, there was availability! And since his flight was within 21 days, that’s why the fees are $75 higher (I have no status with United). I then looked at the cash cost of the one way ticket:
So it looks like the one-way ticket costs $1092. At 35K points, that’s a value of 3.1c, which is a pretty good value for United miles. When you factor in the value that he’s getting for my 70K United miles, it’s now a lot greater than the 10K points difference. He asked me what I wanted extra, and I told him I’d think about it. Shortly after he asks, “So you want me to rack up miles for you then?” BINGO! I told him he’s going to have to make lots of Walmart runs for me to make up the difference, just like a pimp would do. =)
Scenario B
I had another person today who told me she wanted to rack up lots of United miles because they have lots of ‘saver’ availability (aka cheapest award rate availability). I agreed with that, but I wasn’t sure if she meant that for domestic or international trips. I immediately assumed she meant domestic trips. Most of my coworkers and friends don’t travel internationally much; most of their award redemptions are domestic flights. So I went to check a random round trip award flight from SEA-IAH in April and got this:
Most people would probably ignore the $388 cash cost and go, “Hmmm, 25K miles sounds cheaper than $388, so I’ll use my miles.” Let me stop there by saying that this was me 5 years ago before I got into the miles and points game. At the time, if a redemption was greater than 1 cent a point, it was a good redemption. But let’s do the math here – $388 / 25,000 miles = 1.55c of value. That is only half the value of the SEA-NRT one-way flight above. I realize not a lot of people want to travel internationally and would rather use the miles for domestic flights, and that’s fine but just know you’re not maximizing the value of your miles.
Conclusion
The point of this post is that not all United redemptions are the same. For me personally, I have a stash of about 500K United miles right now. I would rather save them up for 1) last minute domestic trips (which are usually very cash costly) or 2) international premium cabin travel. I realize I run the risk of another devaluation, but that’s inevitable. For domestic flights, I find myself booking more cash and using Arrival points just because 1) I can generate Arrival points pretty cheaply and 2) I’m very frugal and like to maximize everything. If the hotel or air redemption isn’t netting me at least 2.2 cents of value, I’m going to use Arrival.