Should You Redeem Your Miles for Merchandise?

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Miles are essentially free money, but there’s no reason not to look for the best deal possible when redeeming them. If you have trouble earning enough miles for an award flight or you simply don't fly often, you might be tempted by airline offers to buy merchandise with your miles.

For example, United and Southwest both offer shopping portals, where you could redeem your miles for things like gift cards, magazine subscriptions, Cuisinart mixers or Apple Watches. If you were going to buy those things anyway, should you just use your miles to pay for them? In short, the answer is no. Merchandise or gift cards are almost never a good use of your miles or credit card points. The mark-up for merchandise is usually insanely high and you'll get much more value for your miles by redeeming them for flights.

Why you shouldn't redeem your miles for merchandise

Your points are worth more if you redeem them for flights

You should always aim to get the baseline value of your airline miles, which NerdWallet calculates every year for the major U.S. carriers and a handful of international ones. Most of the time, redeeming your miles for merchandise will get you nowhere near the baseline value.

Let's use an example. United charges 59,700 miles for 3rd generation AirPods. Those same AirPods cost $179. That means you would be getting a value of 0.22 cent per mile. Meanwhile, NerdWallet values United miles at 1.2 cents each. That means those 59,700 miles could get you a $597 round-trip flight, instead of a $179 set of AirPods.

What else can you buy besides flights with your miles?

Okay, merchandise is usually a bad idea, but that’s not the only non-flight thing you can buy with points. Some airlines also allow you to use points or miles toward:

  • Hotel stays. American Airlines’ AAdvantage program offers rooms at the DoubleTree by Hilton in Downtown Los Angeles for 35,700 points per night. On Kayak, however, rooms sell for $188. Each point is worth .52 cents, so a hotel stay offers about twice the value of AirPods, but half that of a flight because one AAdvantage mile is worth 1.5 cents.

  • Car rentals. 5,100 AAdvantage points gets you a Ford Focus for a day in Los Angeles. You could also rent one yourself a similar compact car for $22 per day. This gets you about .43 cents per point.

  • Experiences. Most recently, companies have begun to offer customers opportunities to use their points to buy — or bid on — experiences, like exclusive concerts or celebrity encounters.

  • Lounge day passes. American Airlines offers day passes to its Admirals Club lounges for 5,900 miles or $59. Because that's a value of 1 cent per mile, that's not far off the baseline value, and probably worth doing if you're not going to use your AAdvantage miles for a flight anytime soon.

Other options to redeem your points if you don't want to fly

If you’d really prefer not to leave your house, and you’re convinced that buying a coffee maker with your miles is a rotten deal, you can always:

  • Donate your miles. Most airlines offer members the ability to donate their miles to partnered charities, who can use them to fly volunteers or beneficiaries. For example, the American Red Cross uses miles to fly volunteers to conduct disaster relief efforts.

  • Redeem your miles for someone else. Transferring your points to someone else usually costs money, but you can book award flights for other people with your miles. Do you know anyone who wants to take a trip? If family members have been badgering you to visit, maybe you can fly them to see you.

It’s worth noting that donating points does not provide any tax advantages. If that’s what you’re after, you might get a better value by redeeming for something higher-value and donating the cash value to charity.

Don't waste your miles on merchandise

Flights — particularly first or business class — are almost always the best value per point. But perhaps you truly can’t get away from work or other obligations, or would prefer to stay home, rather than travel. Or maybe you’ve changed loyalties, and would like to concentrate on earning points with another airline. Then simply using up your points may be worth more to you than getting the best bang for your buck, and a night at a hotel — or even a sewing machine — might not be such a bad idea.


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