Put simply, using miles for merchandise is generally a horrible deal versus using your miles for travel.
Airlines Are Happy To Send You Fancy Electronics In Exchange For Your Miles
Most loyalty programs are happy to let you burn your miles on merchandise. But if you run the numbers, you’re getting a horrible deal. And during this pandemic, airlines may not have devalued award charts (yet) but they have raised prices in their miles for merchandise shops.
I’ll give your three examples, which I did not cherrypick. Rather, these are three items I am personally interested in and wanted to compare pricing.
A new MacBook Air from United with 256GB of storage will run your 333,000 miles.
The cost from Apple? $999.
333,000 miles for a $999 product gives you $0.003 in value per miles, far less than once cent per mile.
How about AirPods Pro to go with the new computer? United wants 83,000 miles.
The cost from Apple? $249. Again, that’s only $0.003/mile.
One more. Maybe it’s just Apple? How about some Bose QC35 noice-cancelling headphones? United wants 117,500 miles.
Bose charges $299 right now. That’s an even poorer value at $0.0025 per mile. Even at regular price ($349) you are still getting less than $0.003 in value per miles.
When It Makes Sense To Buy Merchandise With Your Miles
There are three instances when it may make sense to burn your airline miles for merchandise:
- During limited promotions (not going on now) where you can extract more than 1.5 cents per mile in value
- If you are points rich and cash poor
- If you do not intend to travel
Now that last point, I really don’t understand why you would bother ever putting airline spending on a travel card if you don’t like to travel unless you are booking travel for other people.
Once in a while it may make sense due to bonus promotions to redeem your miles, but certainly not now.
Cashback Cards: A Better Alternative
This isn’t rocket science. If it this kind of merchandise you are after, please use a cash back credit card that provides you a far better bang for your buck. If you’re buying Apple products, the Apple Card from Goldman Sachs offers 3% cash back on Apple purchases and that is an instant rebate.
Other debit cards may offer between 1-3% cash back on purchases, depending upon the category. Doesn’t that make more sense than getting less than 1/3 of a cent per point?
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Airlines like United have taken advantage of the uncertain era in which we live to devalue what a mile is worth. If you intend to travel, don’t waste your miles on merchandise. If you don’t, you should not be collecting airline miles except when you fly. And if you happen to just have miles built up that you want to burn, I still cannot recommend blowing them for such a poor exchange rate.