United Airlines Launching “Money + Miles” Awards

United Airlines Launching “Money + Miles” Awards

17

United Airlines is introducing a new way to redeem MileagePlus miles, though the implementation will be slow.

United’s new Money + Miles awards

As of August 25, 2021, United MileagePlus is launching a new Money + Miles ticketing option:

  • This allows customers to use a combination of money and miles to make ticket purchases
  • Customers can redeem as few as 500 miles to reduce the cost of their ticket
  • This new payment method will roll out slowly, and will initially only appear in a handful of domestic markets, when booking through united.com or the United app

Personally I haven’t yet been able to find any markets where this redemption option is possible, though please report back if you see any. As United describes this in a memo to employees, this is intended to “allow customers to use miles much sooner than ever before,” and means customers “no longer need to save miles for years.”

United customers can now redeem part miles and part cash for a ticket

More options are good, the implications are bad

Is this new redemption opportunity good, or should we be worried about the implications? I’m of two minds here.

On the one hand, more redemption options are on the surface a good thing, especially for infrequent flyers. For those who aren’t particularly loyal to an airline (or who don’t want to get involved in the points game), an international business class ticket might seem unachievable. Being able to use your miles to slightly reduce the cost of your ticket might be a worthwhile opportunity. For example, that’s the gist of the new loyalty program Allegiant Air just launched, and I think it’s brilliant, at least for Allegiant’s customer base and business model.

On the other hand, there’s reason to be skeptical:

  • It’s unlikely the redemption value will be great here on a per mile basis, since this creates such an easy way for people to easily cash out their miles
  • With many major frequent flyer programs increasingly adopting a revenue based redemption model, my concern is that this will lead to lower redemption values in the future
  • United isn’t the first airline to introduce this general concept, as Delta SkyMiles has the “Pay With Miles” option for co-brand credit card holders, allowing members to reduce their fare by $50 for every 5,000 SkyMiles redeemed; while United will offer more flexibility (allowing redemptions in even smaller increments), following Delta’s lead on loyalty isn’t usually a good thing for value maximizers
  • As I said, I haven’t been able to find a flight yet where this new option is available, but I think it’s a sure bet you won’t get more than one cent of value per mile, and I’d speculate that the value will be even less than that (if I had to guess, I’d say 0.7-0.8 cents of airfare per mile sounds about right)
This new option probably won’t be great for premium redemptions

Bottom line

As of today United Airlines is rolling out a new Money + Miles ticketing option, allowing members to redeem part miles and part cash towards the cost of a ticket. This is only slowly being rolled out in a few domestic markets, but should be expanded on a wider scale soon.

While more redemption options are a good thing on the surface, I always have concerns about the bigger picture implications, and the potential for a program to increasingly become revenue based and reduce the value of miles.

What do you make of the concept of United’s Money + Miles awards?

(Tip of the hat to @BrianSumers)

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  1. Sam

    Lufthansa offers the same but the value is soo so bad that i find myself getting annoyed that LH is that cheeky enough to even offer this possility.

  2. SUSAN KOHLER

    I like this idea. Used to use it all the time on northwest when it wad around. It's an old concept, but s worthwhile one.
    Great News!

  3. Paul

    Would still earn some miles for the flight?

  4. Laurent Chaix

    I believe Alaska Airlines has had this option for many years. I have used it many times. I love it.

  5. Eskimo

    Hey @DCS, good opportunity for you to cash out your miles now.

    1. DCS

      Hey @DCS, good opportunity for you to cash out your miles now.

      Why should I when, due to COVID-19, I will be able to retain my 1K status to Feb 2023 without spending much real money? I will still be flying UA as a 1K for a while, so I do not need to cash out my miles.
      However, by end of Feb 2022, I plan to 'purchase' the SQ Gold status...

      Hey @DCS, good opportunity for you to cash out your miles now.

      Why should I when, due to COVID-19, I will be able to retain my 1K status to Feb 2023 without spending much real money? I will still be flying UA as a 1K for a while, so I do not need to cash out my miles.
      However, by end of Feb 2022, I plan to 'purchase' the SQ Gold status by transferring ~250K UR points to my SQ account, so that if UA should decide to reinstate their prohibitive pre-pandemic 1K (re)qualification requirements, I would just focus on requalifying for SQ Gold, and drop the UA 1K status (as UA 1MM, I am a lifetime UA Gold/*G, however).

    2. Eskimo

      @DCS

      I thought that was the whole point of cashing out. Because you have all your status benefits without having to worry of requalifying (specifically PQP), it's the best time to burn miles rather than paying cash.

      I do suggest you try ask SQ (nicely) about status match. Even if no one seems to pull it off, SQ did admit it exists. But no blogs really deciphered it at all.

      From SQ website:
      "Members...

      @DCS

      I thought that was the whole point of cashing out. Because you have all your status benefits without having to worry of requalifying (specifically PQP), it's the best time to burn miles rather than paying cash.

      I do suggest you try ask SQ (nicely) about status match. Even if no one seems to pull it off, SQ did admit it exists. But no blogs really deciphered it at all.

      From SQ website:
      "Members who upgraded from KrisFlyer Elite Silver to KrisFlyer Elite Gold after 1 March 2021 from any status match programmes or accelerator campaigns will not be eligible for the rolling of Elite miles"

    3. DCS

      Actually, I have no need cash out my UA miles. I am a UA 1MM and, thus, lifetime Gold and lifetime *G, so there are benefits to keeping UA miles around. I will cash them out 'naturally' by simply redeeming them as necessary without replenishing them because I would be crediting all the miles to SQ even when flying with UA on revenue tickets(which I'd started dong before the pandemic hit).

      Interesting idea about asking...

      Actually, I have no need cash out my UA miles. I am a UA 1MM and, thus, lifetime Gold and lifetime *G, so there are benefits to keeping UA miles around. I will cash them out 'naturally' by simply redeeming them as necessary without replenishing them because I would be crediting all the miles to SQ even when flying with UA on revenue tickets(which I'd started dong before the pandemic hit).

      Interesting idea about asking SQ for a status match...they might just do it because of their 'bad blood' with UA.

  6. HeathrowGuy

    I see Miles + Cash / miles for discounts as the way to go to keep people like me engaged to FFPs going forward. With much more disposable income for travel, buying a ticket is more attractive to me than playing the corny games for expensive and restrictive award redemptions. With more aggressively priced longhaul Biz tickets guaranteed to become a thing, something like using 30,000 miles for $300 off a ticket is a more...

    I see Miles + Cash / miles for discounts as the way to go to keep people like me engaged to FFPs going forward. With much more disposable income for travel, buying a ticket is more attractive to me than playing the corny games for expensive and restrictive award redemptions. With more aggressively priced longhaul Biz tickets guaranteed to become a thing, something like using 30,000 miles for $300 off a ticket is a more attractive proposition than using 300,000 miles for limited award space.

    1. khatl

      But if you're redeeming with the right programs, that 30k miles is ~75% of a one way biz class from NYC to MAD on Iberia.... which is worth double, and then some, of the $300 discount you'd otherwise be getting

    2. Tony

      Why do you bother to accumulate miles in the first place if you just want to cash them out at 1 penny/mile? There're plenty of other ways to get cash rebates at a better rate for your spending.

    3. Eskimo

      @Tony

      So you are telling @HeathrowGuy to not put any FFP the next time he flies because he redeems them at 1 penny/mile? And tell @HeathrowGuy what is your other ways to get cash rebates at a better rate that also stops him from redeeming his miles?

      Also, why bother living in the first place if you will eventually die?

    4. HeathrowGuy

      For context, I'm a FFer "old head" (20+ years). Started back when I was a student, in the days when premium cabin tickets (domestic and intl) were sold at far higher multiples over the lowest Economy fares compared to today. More importantly, at my peak in the FFP game, premium cabin awards were offered under MUCH more attractive pricing and routing terms than today (e.g., 90K miles J roundtrip on Star partners to SE Asia...

      For context, I'm a FFer "old head" (20+ years). Started back when I was a student, in the days when premium cabin tickets (domestic and intl) were sold at far higher multiples over the lowest Economy fares compared to today. More importantly, at my peak in the FFP game, premium cabin awards were offered under MUCH more attractive pricing and routing terms than today (e.g., 90K miles J roundtrip on Star partners to SE Asia using UA miles, and with little/no award metering).

      To your point, FFPs have been progressively sliced, diced, and diluted to the point they're not nearly as compelling in the overall value proposition of travel. Doubly so when premium cabin pricing is much more attractive, and gives me far more freedom of choice than an award. Using 30,000 miles for $300+ towards a sale J fare purchase for a destination and itinerary I actually want is more appealing than spending 4x as many miles to be constrained into the destinations and metered flight options United wants to offer.

    5. Eskimo

      For context, I'm also a FFer "old head" (20+ years).

      But the problem is, we can't go back and redeem miles in the past.
      Yes I still miss the days of round the world business for 240K. The open jaw stopover freebies. Or the insane routings that was allowed.
      Today, on some crazy dynamic price, you can't even get across the Pacific. But cash prices have gone down too.
      And yes...

      For context, I'm also a FFer "old head" (20+ years).

      But the problem is, we can't go back and redeem miles in the past.
      Yes I still miss the days of round the world business for 240K. The open jaw stopover freebies. Or the insane routings that was allowed.
      Today, on some crazy dynamic price, you can't even get across the Pacific. But cash prices have gone down too.
      And yes if you're savvy and flexible you can still find good deals today, but for most people it's just going to sit there doing nothing until it gets devalued further or expired on some programs, and cheaper J fares just make 1 cent more attractive and simpler.

  7. JBM

    With Delta, the full mileage of the flight still counted towards medallion miles (or, at least, it did when I flew them ages ago). I wonder if the full price of the flight pre-points will count towards PQPs. If so, that’s a great way to use miles to get PQPs, but I doubt United would do that as it’s inconsistent with their goal to increase cash spend in exchange for PQPs.

  8. Trey

    It remains to be seen what avenue United takes on this; more like Delta where you reduce the price of the ticket by using your miles or in the tune of BA Avios where you reduce the cost of your award ticket in avois by paying part of it was cash. As a flyer, the avois + cash option sometimes makes sense for economy or premium economy seats..and even short haul business seats.

    1. Levi

      It's perhaps worth noting that Delta has two means of paying for a ticket partially with cash and partially with miles.

      "Cash + Miles" effectively is an award ticket where you're effectively paying cash to buy a round number of miles, typically at a rate well in excess of 1 cent/mile, but lower than the usual 3.5 cent/mile price for a normal mileage purchase (e.g. a Comfort+ award might be 25,500 miles roundtrip (excluding taxes)...

      It's perhaps worth noting that Delta has two means of paying for a ticket partially with cash and partially with miles.

      "Cash + Miles" effectively is an award ticket where you're effectively paying cash to buy a round number of miles, typically at a rate well in excess of 1 cent/mile, but lower than the usual 3.5 cent/mile price for a normal mileage purchase (e.g. a Comfort+ award might be 25,500 miles roundtrip (excluding taxes) or 15,500 miles + $180). This is available to all SkyMiles members.

      "Pay With Miles" allows 5000 mile increments to be redeemed for $50 off the cash price (I believe excluding taxes) contingent on having a Delta cobranded Amex and paying for the remainder of the ticket with an Amex.

      Obviously for any cash/miles breakdown there's an implicit exchange rate between miles and $. For the 25.5k mile award I listed, the corresponding cash price came to $355, so the all miles and then cash + miles each give a better redemption value than Pay With Miles.

Featured Comments Load all 17 comments Most helpful comments ( as chosen by the OMAAT community ).

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DCS

Actually, I have no need cash out my UA miles. I am a UA 1MM and, thus, lifetime Gold and lifetime *G, so there are benefits to keeping UA miles around. I will cash them out 'naturally' by simply redeeming them as necessary without replenishing them because I would be crediting all the miles to SQ even when flying with UA on revenue tickets(which I'd started dong before the pandemic hit). Interesting idea about asking SQ for a status match...they might just do it because of their 'bad blood' with UA.

Eskimo

@DCS I thought that was the whole point of cashing out. Because you have all your status benefits without having to worry of requalifying (specifically PQP), it's the best time to burn miles rather than paying cash. I do suggest you try ask SQ (nicely) about status match. Even if no one seems to pull it off, SQ did admit it exists. But no blogs really deciphered it at all. From SQ website: "Members who upgraded from KrisFlyer Elite Silver to KrisFlyer Elite Gold after 1 March 2021 from any status match programmes or accelerator campaigns will not be eligible for the rolling of Elite miles"

Eskimo

For context, I'm also a FFer "old head" (20+ years). But the problem is, we can't go back and redeem miles in the past. Yes I still miss the days of round the world business for 240K. The open jaw stopover freebies. Or the insane routings that was allowed. Today, on some crazy dynamic price, you can't even get across the Pacific. But cash prices have gone down too. And yes if you're savvy and flexible you can still find good deals today, but for most people it's just going to sit there doing nothing until it gets devalued further or expired on some programs, and cheaper J fares just make 1 cent more attractive and simpler.

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