United MileagePlus is the latest airline to introduce an annual subscription service to purchase miles, and it’s most definitely not a good deal.
United MileagePlus’ monthly mileage subscription service
While United MileagePlus has long offered promotions on purchased miles, the program is now offering members a new way to earn miles, with an annual subscription service. With United’s new “Miles by the Month” subscription, you can purchase a set number of miles each month at a “discounted” price, and then you’re awarded bonus miles every three months.
There are three different tiers, which offer the following number of miles and costs over the course of 12 months (the price includes taxes, which aren’t reflected in the below screenshots):
- With the 3K Monthly Miles plan, you’d receive 43,200 MileagePlus miles for $1,219.08; that’s a rate of 2.82 cents per MileagePlus mile
- With the 5K Monthly Miles plan, you’d receive 72,000 MileagePlus miles for $1,806; that’s a rate of 2.51 cents per MileagePlus mile
- With the 8K Monthly Miles plan, you’d receive 120,00 MileagePlus miles for $2,709; that’s a rate of 2.26 cents per MileagePlus mile
This is a terrible value, don’t do it
United MileagePlus isn’t the first loyalty program to offer a subscription plan like this — we saw something similar from Southwest Rapid Rewards recently. I can totally appreciate the concept behind this, and in theory think this could be a win-win value proposition:
- Members will be more engaged in a program if they have miles deposited every month
- Since programs often sell miles at a discount, the cost of a subscription should offer a lower per-cost mile than you could get through any individual mileage sale, to account for the risk of miles being devalued long-term
But that’s not how this subscription service works:
- When United MileagePlus sells miles at a discount or with a bonus, you can typically purchase miles for 1.88 cents each (there’s even such a promotion right now)
- Here we’re seeing United MileagePlus try to charge a premium of 20-50% over the cost of buying miles right now, for the privilege of buying those miles over the course of a year
- What’s worse, you’re converting cold hard cash into points that can be devalued at any time
So yeah, please don’t take advantage of this. If you want to acquire MileagePlus miles, buy them during a promotion. If you don’t have the cash for that right now, just start putting money in your piggy bank, and then consider buying the miles in a year, and you’ll likely be 20-50% better off. There are simply no circumstances under which this offer is worth taking advantage of.
I can’t help but wonder how many people end up taking advantage of offers like these…
United MileagePlus has introduced a new “Miles by the Month” subscription plan, whereby you can pay a monthly fee to receive a certain number of miles over the course of a year. This does indeed represent a discount off the “standard” cost to purchase miles, but then again, nobody should be buying United miles at the regular cost.
With this offer, you’ll end up paying 2.26-2.82 cents per MileagePlus mile. This really isn’t a very good deal at all, since United often sells miles for just 1.88 cents each, and that allows you to redeem miles right away. I’d highly recommend not taking advantage of this offer.
I used to get great value from United mile redemptions, but I never see these opportunities anymore. I do see outsized value redemptions on AA, though. I never do anything to earn extra United miles anymore because of that.
I believe WN was the first airline to institute this
Makes perfect sense from UA's point of view--sell miles at 2.5 cents each, and let people redeem them at 1 cent each. They are telling us how dumb they really think their customers are.
There isn't any possible way to extract $1,219.08 of value out of 43,000 Mileage Plus Miles.
This. United is acting like a non-profit asking for a recurring monthly donation. Like the old saying, there's a sucker born every minute.
Airline are getting desperate. They have gutted mileage programs so much, people are no longer interested in using their credit cards or buying miles occasionally.
I predict that eventually, these mileage program will become worthless and Wall Street will be angry with the airlines peddling these worthless mileage programs as if they were worth billions.
I wonder if AA & DL would match this?