For targeted accounts, Alaska Airlines is offering the chance to transfer up to 40,000 Mileage Plan miles to another program member without a transfer fee. This could potentially save you hundreds of dollars and really increase the value of your overall balance, as I outline in this post.
Normally I don’t recommend that people transfer miles between accounts. With limited exceptions, most airlines charge a hefty penalty. It can still be ridiculously expensive to transfer miles vs. just buying them outright.
For example, United Airlines is currently running a 30% sale on mileage transfers and gifts. The normal price of $630 to transfer 40,000 miles that you already earned is being discounted to $450, or 1.125 cents per mile. If you want to give someone miles (that is, while keeping the miles you already have) then that will cost $1,053.50 for 40,000 miles, or 2.633 cents per mile. I wouldn’t pay either price.
However, Alaska’s deal is worth considering because it’s completely free. There is a cap of 40,000 miles. I’m not sure if it would be possible to engage in multiple transfers, but I might try. Why?
First, the value of your miles does not scale linearly with absolute number.
- If I have 25,000 miles I can book one round-trip domestic award for myself and save $300-500. This is my baseline value.
- If I have 70,000 miles I might be able to book a one-way international business class award, but how do I get back? Paying cash for the other one-way return ticket is going to be very expensive and maybe even the same as if I paid for the entire round-trip journey. Let’s assume I pay $4,000 to get home, so no real savings overall.
- Furthermore, what about my companion? I need 280,000 miles to book two round-trip tickets for my wife and myself. This would save $8,000 on the price of two round-trip tickets and countless hours in marriage counseling.
So while 25,000 miles is sort of useful, trying to redeem 70,000 miles for one person is actually a bad thing — at least in my household. I try to save up for large redemptions whenever possible.
Second, miles are worth a lot more in the account of someone who has elite status. If I have the status with a particular program, my wife and I will credit the miles to my account. If she has the status, we’ll credit to her account. That way we take advantage of perks like upgrades on award travel and waivers on change or cancellation fees.
So you see it’s usually better to concentrate your miles in one account. If you’ve been targeted with this promotional offer from Alaska Airlines, I urge you to consider it.
