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4 Tips to Deal With Airline Devaluations

Airline Devaluation
Written by Charlie

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Lately, the hits seem to just keep on coming. We have seen Alaska, Southwest, Delta, and United devalue their award programs. It is a near certainty that the merger will give American Airlines and US Airways the cover they would like to create a new award chart which will devalue those miles as well. These changes are unfortunate for all, but especially unfortunate for the casual traveler who has been saving up miles for a while to be able to take a once in a lifetime trip or for those families who have been saving for a family vacation. These trips just became a lot more expensive. So, what can be done to deal with these airline devaluations?

4 Tips to Deal with Airline Devaluations

While these tips can be valuable to everyone, it is important to know that some of them are contradictory – in other words, don’t try to do them all! šŸ™‚

1) Become an Airline Expat

While the US airlines seem bent on changing the award amounts required for travel, foreign airlines are still healthy alternatives. Yes, they have made changes as well (like Air France/KLM), but there are so many airlines in each alliance that there remain a lot of options for the savvy traveler. There are a couple of ways you can do this.

  • Credit travel to other airlinesĀ – If you do fly domestic airlines, start crediting your flights to a different partner airline for mile accrual. Not only will you begin to accue miles for redemption in these other programs, but you could also earn elite status with them. This is very helpful in certain circumstances – for example, if you earn Star Alliance Gold status with a foreign airline, you will have access to United and US Airway lounges when flying on domestic itineries.
  • Use credit cards that accrue in other airlines or can transfer to other airlinesĀ – Even though Chase’s Ultimate Rewards has American Express beat with the value of the transfer partners (for now), American Express has the benefit of depth with their airline transfer partners. There are many foreign airlines that Membership Rewards (Amex) can transfer to. Also, Starwood Preferred Guest points transfer to many foreign airlines as well.
Airline Devaluation

Many partner airlines to credit United flights to

I am currently working on a future post that will highlight some of the best partners to credit your US-based airline miles to. For now, just remember that it is possible to credit miles to another program and that you can then redeem those miles out of those foreign accounts for Star Alliance award tickets. Another plus to redeeming awards from a foreign account is that the fees for changing/refunding the miles are typically much lower than they are from US airlines.

Pros to transferring/earning miles in a foreign program

  • Benefits accessible to foreign elites that may not be available to US airline elites (such as lounge access on domestic tickets)
  • Easier elite levels to reach
  • Elite memberships lasting longer
  • Taking advantage of foreign airline award sweet spots (such as ANA’s distance based system)
  • Having access to premium award seats that US based airlines may not have (such as first class on Korean Airlines – cannot be booked with Delta miles)

Cons to transferring/earning miles in a foreign program

  • Possibility of foreign programs changing more often than US airlines (if there is a smaller membership, the airline may not feel it is too big to change rules)
  • Fuel surcharges (unfortunately, many of the airlines do assess fuel surcharges on award tickets)
  • Longer time to transfer/post miles to a foreign program (it took 2 months for some US Air flights to credit to Aegean)
  • Harder to reach/understand foreign airline phone representatives

2) Go for Gold

If you are already crediting miles to a US airlines (such as Delta), you may want to continue doing so until you reach the Gold Medallion level (or higher, depending on the airline). This is because as you reach certain elite levels, you will earn elite bonuses on the award miles that you pick up. For instance, when you reach Delta Gold, you will earn 100% miles on what you fly. So, if you fly 2,500 miles, you will earn a total of 5,000 award miles. Being close to an elite level that will increase your award mileage earning is enough of an incentive to credit some more miles to your US airline.

Elite mileage bonuses differ from airline to airline (with Delta being the most generous at 100% for Gold), so you may need to adjust your earning strategy based on the required miles for the elite level. With the minimum bonus of 25% for elites, elite bonuses are enough to help your mileage accrual be devaluation proof.

Airline devaluation

Delta’s elite benefits showing elite bonus miles

3) Target Your Travel Plans

With all the great credit card bonuses over the last few years, many people would apply for as many of them as possible. Since that time, banks have become more strict in their approving applications (especially Barclays) and airlines have devalued those miles that were earned. So, what should the applying and spending strategy be for most people post-devaluation?

Airline Devaluation

Which card(s) will best suit your travel plans? Stay focused!

Target your travel plans! By this, I mean to select your travel for the next couple of years and earn miles based on those travels. Instead of applying for just any credit card bonuses, plan your credit card applications towards fulfilling your travel goals. Here is an example:Ā Person A wants to take a family vacation to Europe with his wife and two kids. His plans had been to use United miles for the flights and Club Carlson hotels for the lodging. His goal should be to apply only for cards that have points that transfer to United (Chase Ink Bold, Chase Ink Plus, Chase Sapphire Preferred) and Club Carlson credit cards. When the 50,000 point Southwest bonuses come up, he should pass on those offers. Those points do not do anything for the European vacation and they take away from the Chase cards he could apply for (the limits that Chase has per customer).

The last thing you want to do is to have to meet minimum spending on cards that are not going to help fulfill your travel goals (since that spend could be better used on your cards that doĀ fulfill your travel goals). Plus, some of those cards may work better for future travel and the rewards may expire before those travels come to pass. No matter how good a credit card bonus might look, do not let it interfere with your travel plans. Keep your spending and applying targeted!

4) Keep It In the Pot

This tip worked before the airline devaluations – do not transfer your points out of the flexible programs you have until you need them. This works for Membership Rewards (American Express), Ultimate Rewards (Chase), and SPG points. Each of them have many partners you can transfer to. You want to hold them where they are until you know your travel plans. The reason is that something may happen to the program you transfer to before you end up using them. This happened to me recently with Air France. They had a great transfer bonus on Membership Reward points and I knew I was going to need Air France miles. The problem was that Air France devalued their program before I have had a chance to put everything in place. As a result, I lost out on a lot of Membership Rewards that may have been better used in a different program.

The tip here is to not worry about saving your points in the program. None of them expire so you are not in danger of losing them (unless you close the cards that earn the points in Ultimate Rewards and Membership Rewards). Just spend, earn, and spend until the time comes when you are ready to book your trip.

Airline Devaluation

Some of the transfer partners of Membership Rewards

Summary

As the game changes, there will always be a way to continue playing the game. We just need to play it a bit smarter as time goes on. What are your tips for dealing with the airline devaluations?

Editorial Note - Opinions expressed here are author's alone, not those of any bank, credit card issuer, hotel, airline, or other entity. This content has not been reviewed, approved or otherwise endorsed by any of the entities included within the post.

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About the author

Charlie

Charlie has been an avid traveler and runner for many years. He has run in marathons around the world for less than it would cost to travel to the next town - all as a result of collecting and using miles and points. Over the years, he has flown hundreds of thousands of miles and collected millions of miles and points.
Now he uses this experience and knowledge to help others through Running with Miles.

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