What is the Value of the United Mileage Plus Frequent Flyer Program?
Mileage Plus is the frequent flyer program from United. Awards are classified as either Saver or Standard. As you might surmise, Saver Awards require less miles to obtain, but come with blackout dates and capacity control restrictions, whereas Standard Awards do not. Note that United is a member of the Star Alliance (a partnership of more than 20 airlines aimed at extending their collective global footprint).
Key Assumptions for Calculating the Value of United Mileage Plus miles
PlasticIQ needs to make some assumptions in order to estimate the value of the United Mileage Plus program:
- PlasticIQ needs market prices for various flight destinations to properly value Mileage Plus miles. As such, we rely on our Detailed Analysis of Flight Costs.
- United offers both Saver and Standard Awards. United Saver awards are limited in quantity and generally much more difficult to find. Since Standard Awards are generally twice as expensive in terms of miles required, PlasticIQ assumes that all redemptions are in the form of United Saver Awards. This means to get the valuations we estimate below, you’ll need to book well in advance. You can view the United Awards Chart for more detailed information (effective June 15, 2011).
- PIQ assumes travel is allocated 25% to domestic (within US) and 75% to Asia, given Asia represents the best redemption values. We exclude travel to the EU due to its slightly lower valuations, though frankly the differences are relatively minor.
- PlasticIQ has applied a 5% non-cash penalty to the value of United Mileage Plus miles. See our Rules of the Sky for more details.
Bringing it All Together: PlasticIQ’s Best Estimate of the Value of United Mileage Plus Miles
The table below brings it all together–the miles required by route, the average pre-tax market-rate price for these tickets, assumptions around what routes are flown and in what proportion, and finally, any value adjustments due to the non-cash nature of the awards.
|From||To||Award Type||Miles Req’d||Pre-Tax Mkt Price||$ value/mile||Assumed travel %|
|US||Japan, North/South Asia||United Saver||65,000||$775||$0.0119||75%||$0.0089|
|Total post 5% penalty||$0.0111|
As you can see from the table above, PlasticIQ estimates that United Mileage Plus miles are worth roughly $0.0111 each. While not an exceptional value, its also not bottom of the pack. Feel free to check out Frequent Flyer Mileage Valuation Comparison, for a good side-by-side view.
You can learn more about (or apply for) the United MileagePlus® Explorer Card here.