Is This the Right Time to Buy Airline Points and Miles?

On a similar note...
On a similar note...

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If you’re thinking about purchasing airline points or miles, now may be the right time to bump up your account for an upcoming adventure. Although purchasing points is generally not recommended because the price usually exceeds the redemption value, it may prove beneficial when there’s a significant discount or when a small purchase gains you the remaining miles necessary to purchase a specific award ticket.

With the ongoing coronavirus pandemic, the travel industry has seen major restrictions and many airlines are selling points at their lowest rate ever. Here’s a breakdown of some offers and when these expire; check your carrier’s site to see updated promotions.

A word of caution on buying miles and points

First, let’s pump the brakes ever so slightly on the whole concept of buying miles and points. As a general rule, we do not recommend buying miles and points speculatively. Because it can be fairly straightforward to earn miles and points through credit card welcome offers, buying miles and points should NOT be your primary strategy for earning.

With the travel plans of many of us a bit up in the air (pun intended), you’ll want to be extra cautious about buying miles and points. While many airlines are currently allowing free changes and cancellations on bookings, purchases of miles and points are non-refundable. So make sure that you won’t need that cash before you make your purchase.

Alaska Airlines

Alaska Airlines is offering miles for the lowest price in recent history. As a Mileage Plan member, you can unlock a mystery bonus with up to 60% off when you buy miles through May 31, 2020. The number of bonus miles you’ll receive depends on your individual offer and how many miles you purchase. You can check your specific bonus offer on Alaska’s Buy Mileage Plan miles website.

Remember that Alaska Airlines is one of the only airlines to allow a stopover even on a one-way award ticket, which is another reason their miles are so valuable. NerdWallet values Alaska miles at 0.9 cent per mile, so keep that in mind if you are looking to purchase.

Hilton Honors — up to 100% bonus

Hilton Honors also offers regular bonus promotions on buying their points. Currently there is a 100% bonus on purchasing Hilton points. You need to buy at least 10,000 points to get the bonus, which would let you purchase Hilton points at a rate of 0.5 cent per point. This is equal to the value of normal Hilton points according to NerdWallet calculations.

Again, you’ll want to do the math yourself to see if buying points makes sense or not. One option we found where buying points could make sense was at the Hilton Garden Inn Vienna South.

A room there in September cost 20,000 points per night compared to $139 per night if you pay in cash. Remember too that with Hilton, you get the fifth night free and don’t pay resort fees on award stays. So for a five-night stay, you’d pay 80,000 Hilton points, which can be purchased for only $400 with the current 100% bonus promotion. Comparatively, you'd pay $695 if you paid in cash.

Southwest Airlines

Southwest is currently running a point sale through May 22, 2020, where you can save up to 45% off the regular purchase price.

Here are some examples of what you would pay during their sale:

  • Purchase 5,000 points for $103.13 (regularly $137.50).

  • Purchase 15,000 points for $226.88 (regularly $412.50).

  • Purchase 25,000 points for $378.13 (regularly $687.50).

Once you break the 15,000-point threshold of the sale, you’re buying points at just over 1.5 cents per point. NerdWallet values Southwest points at 1.4 cents per point, so if you need some Rapid Rewards points to top off your account for a redemption in the future, now is the time to buy — the regular rates are considerably higher.

American Airlines

American Airlines recently ran a promotion where you could earn up to 65% in bonus miles when you purchase through American Airlines. When that promotion ended, the airline started a May offer allowing you to earn up to 100,000 bonus miles when purchasing miles. You can check out American's Travel Deals and Offers page for updated promotions.

If you had bought the maximum of 150,000 miles to get the best rate, you would have gained 97,500 bonus miles and it would have cost you a total of $4,650.66. That’s a value of 1.88 cents per mile (compared to a NerdWallet value of 1 cent each). Here are a few American Airlines AAdvantage redemptions that you could use those miles toward:

The bottom line

Again, while it absolutely makes sense to avoid travel during the current coronavirus pandemic, if you want to lock in future travel now, consider buying miles and points as one potential option. Based on current promotions, this could be as good a time as any to purchase points or miles if you have a specific redemption plan in mind for the future. But with current travel restrictions, there’s no guarantee when normal travel routes will resume and what award availability will look like.

If you’re looking to book within 11 months, you can usually search award availability on most carriers to get a feel for what’s being offered. As long as you understand the risks involved, this could be a great time to bank some miles at a significant discount and use them for upcoming travel.

How to Maximize Your Rewards

You want a travel credit card that prioritizes what’s important to you. Here are our picks for the best travel credit cards of 2020, including those best for:

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