American Airlines

Friends don’t let friends share miles: Is paying to share miles ever a good idea?

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Is paying to share miles EVER a good idea?

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Why should you ever pay to transfer them?! Unless the program in question has some sort of household account pooling or similar, they are going to charge you to transfer your miles. It’s almost never a good value.

As an example, I got an email from American Airlines today offering me “up to” 30% off the cost of Sharing Miles.

Woo hoo! 30% off!!!!!!!!!!!!!!!!

Not so fast….   with this “promotion” it would cost me $62.50 to transfer you 5,000 miles or $100 to transfer you 10,000 miles.

I value American Airlines miles at somewhere around 1.5 -2 cents a mile. That’s the minimum I’d ever redeem for. Of course my goal is always business class redemption that get much more value, but that’s a floor. If I’m getting less than that long term, I’m going to stop caring about earning them.

With this “promotion” it will cost me at minimum 1 cent to send you the miles. I’m also losing the miles myself. So if we just use the “floor” valuation, I’m paying 1 cent to transfer and losing 1 cent in value – costing me a total of 2 cents to GIVE AWAY my already hard earned miles!

“But,” you say, “I want to send my daughter on a great trip, so I wanted to gift her the 50,000 miles!”

That’s really nice!! Did you know you can just buy a ticket in her name with your miles? No fees at all?  So the fact that you can always redeem awards for anyone you choose eliminates that need.

That leaves only the edge case of “my friend/relative is just 1,000 miles short of an award so I thought I’d help out!”

Well, it would be nice if you could just gift your miles to them in that case, but you can’t. You’d pay $12.50 to ship those miles over (and lose the value of your miles).  They could just buy them outright for $29.50. But that’s not even the p0int, because if you read blogs like this one enough, you also know that there are loads of ways to earn top off miles. If they need AAdvantage miles to top off, they could create an AAdvantage Dining account, spend $30 on a dine, and get 1,000 bonus miles.

So remember,

Friends don’t let friends share miles.