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Everybody Wants Your Money

Written by Nickel - 4 Comments

Everybody Wants Your Money

While booking a flight reservation for an upcoming business trip the other day (with my trusty Amex Delta Platinum, of course) I was reminded of the fact that just about everybody wants your money. Not only that, but they’re willing to dream up some pretty bad deals in hopes of getting a piece of it.

In this case, I’m talking about the “Mileage Booster” program, which allows you to purchase additional miles when booking a flight. Here’s what they’re offering:

  • 1000 extra miles for $29
  • 2000 extra miles for $39
  • 3000 extra miles for $59

If you do the math, you’ll see that’s roughly 2-3 cents per mile.

Given that frequent flyer miles are (arguably) worth about a penny each, this isn’t a particularly good deal. Yes, I’ve been able to redeem miles at a rate of roughly $0.02/mile in the past but that’s getting harder. And really, even if you can consistently get $0.02 (or even $0.03) in value per mile, why would you pay that much for miles up front?

Sure, there are some fringe cases where another thousand miles or so might bump you over the top for an upcoming trip but, in general terms, you’re tying up your money in something that’s a break even endeavor at best, and which might actually lose money.

Who knows? Perhaps there are business travelers out there who are taking advantage of this and slipping it past their employers for reimbursement. Not only is this dishonest, but it’s not even close to being worth the risk. Trade my job for a few thousand frequent flyer miles? No thanks.

Or maybe they just catch people who buy the extra miles on an impulse without giving it much thought. To protect yourself against this, be sure to do the math when faced with a “special” offer such as this.

Published on August 13th, 2012
Modified on August 15th, 2012 - 4 Comments
Filed under: Frugality, Travel

About the author: is the founder and editor-in-chief of this site. He's a thirty-something family man who has been writing about personal finance since 2005, and guess what? He's on Twitter!

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4 Responses to “Everybody Wants Your Money”

  1. 1
    William @ Drop Dead Money Says:

    I think your last thought captured it – impulse buying. And I like your cost analysis.

    That said, I have to confess to buying some of those miles. Our last trip to Africa mopped up our last United miles, but we were still a few short. It was cheaper to buy the few miles we still needed than to buy another ticket. So we actually were glad that option existed.

    So, now and then those miles make sense. What percentage situations like that make up is hard to tell, though.

    But I like the cost calculation method – good job! :)

  2. 2
    infamousdx Says:

    I agree. If miles aren’t less than a penny per mile, I’m not buying.

  3. 3
    Lance@MoneyLife&More Says:

    I agree that a lot of extras are just that, an extra cost, not a deal. You really have to be diligent these days to make sure you aren’t paying for extras you don’t need.

  4. 4
    Johan Says:

    If it is company travel, then it is your employer who pays the bill and you who collect the miles. In that case, it can make sense to go for the more expensive ticket and get additional miles… A bit unethical in my mind, but I suspect that is there target here.

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