Not many people probably know you can buy points from pretty much all airline and hotels out there. It kind of seems counterintuitive to buy points but there are plenty of situations where it can make sense and save you a ton of money on travel.

The Basics

Airlines and hotels actually sell their points to their co-branded credit card issuers. That’s how you are awarded points after you make a purchase. In fact, American Airlines made over $1 billion dollars on selling miles each quarter of 2022. Airlines also mortgaged their frequent flyer program to the banks to generate immediate cash during the pandemic to the tune of $6.5 to $10 billion each. They took out a loan based on the future earnings of each program.

Additionally, airlines and hotels will sell points and miles directly to you. Let’s look at some scenarios where it makes sense to buy points and miles.

Topping Up Your Balance

This has actually come up a number of times this months when helping clients book award flights. We found some great flights for them but they were just short of the total number of miles needed to book it, so our solution was to buy some miles to top off their account. One needed about 24,000 miles for a trip to South Africa and the other needed 35,000 miles for a trip to Thailand for his honeymoon.

In both of these cases it would have been better for each of them to sign up for a new credit card and get a huge sign up bonus but we didn’t have time for that. For both of them it was around $500. Not bad considering we got them business class seats which would have cost over $8,000.

Buying miles can range anywhere from 1 to 3 cents per mile and airlines fairly regularly have sales where you can get miles cheaper or they’ll have bonuses on your purchase where you buy a certain number of miles and you get 40% more (essentially a discount).

Avianca Lifemiles is one program who regularly offers bonuses on milage purchases. Every month for at least the past two years they’ve offered anywhere from a 135%-170% bonus on miles purchased. Normally, you can buy miles for 3.3 cents per mile. So if you purchased 200,000 miles it would cost you $6,600. However, if you waited till they started running a 140% bonus promotion, you would get 480,000 miles for the same $6,600. So instead you could buy 84,000 miles and they would give you an additional 117,600 miles, totaling 201,600 miles for only $2,772. That’s an effective price of 1.38 cents per mile.

Buying Miles for a Specific Flight

Say you don’t have a ton of miles, it can make a lot of sense to buy miles for a specific flight to save a ton of money compared to purchasing a flight outright.

Avianca charges just 87,000 miles each way for Lufthansa First Class. If we were to buy the 174,000 miles needed for the roundtrip during one of their promotions we could pick up those miles for $2,400. That’s an incredible deal compared to paying outright for the flight that would normally cost almost $12,000.

Another client did something similar to this to upgrade a flight home from Australia. He was booked in Premium Economy and United offered him an upgrade to business class for 30,000 miles. He had already burned through all of his Chase points and United miles for another trip over Christmas so we needed to buy the miles. It ended up costing $714 to buy those miles and upgrade to business class on the 15.5 hour flight home.

Buying Points for Hotel Stays

The same thing can be done for hotels. You can buy hotel points for relatively cheap to top off your balance or buy enough for your full stay.

Let’s take a look at the St. Regis Maldives where we stayed last year. You could use 114,000 Marriott points per night or you could pay $2,401.

As you can see, this is for the same room on the same date. Granted, nobody is going all the way to the Maldives for just one night but it still works out.

Don’t have enough or any Marriott points? Just buy them! Marriott also has a promotion going on right now where you get a 40% bonus on all purchased points. So you can buy the points needed for this stay for only $1,062. That’s way better than the $2,401 and would actually save you $1,338.50 per night .

Now both of these examples are extreme with a flight on Lufthansa First Class and a stay at the St. Regis Maldives, but hopefully you can see how much cheaper this can be than outright paying for expensive flights or hotels.

Buying hotel points can be great for when a hotel should normally be cheap but rates are way higher than what you are expecting.

Keep Points and Miles From Expiring

Some programs will expire your points after no activity in a certain amount of time. This is extremely annoying but it is what it is. These points and miles are sitting on their balance sheet as a liability so they want you to use them or lose them. If you’re in a crunch and need to have some activity in your account to prevent your miles from expiring, buying 1,000 points can be a good way to do it. There are a number of other ways to get activity such as through an online shopping portal or using a co-branded credit card, but those sometimes take a few weeks to a month to post.

Things to Consider

While buying points and miles can be a great way to top off an account to complete an award booking, or even outright buying the miles for the trip, there are always more economical ways of doing things. Being rewarded with points and miles from credit card spend and sign up bonuses is by far the easiest and cheapest way to accumulate them.

I would never speculatively buy points and miles just because there is a big discount or bonus for doing so. Programs devalue all the time and they can be without notice. So that 87,000 mile flight on Lufthansa that is available today may skyrocket in price to 150,000 miles without notice. If you are going to buy points its a good idea to always have a specific and immediate redemption in mind. Meaning, you should be about to book the trip but don’t have enough in your account to do so.

My recommendation is always to earn transferable points from issuers like American Express, Chase, Citi, or Capital One. Many of these issuers allow transfers to overlapping programs. So if, for example, you are booking a flight on Singapore Airlines but don’t have enough American Express points, you can always transfer what you have from there and then transfer the rest from Chase, Citi, or even Capital One.

Wrapping Up

Buying points and miles can be a useful strategy when it comes to booking award trips and hotels. It can help you top off your account, buy the points needed for cheaper than the cash price, or even to keep your account active and to keep points from expiring. The most important thing though is to make sure you have a specific redemption in mind or else you could be stuck with points that you paid a lot of money for and no way to use them.

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