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Airline travel has been notoriously challenging this summer. If you find yourself among the many travelers who are dealing with delayed or canceled flights, the airline may offer you compensation in the form of either miles or cash back. But which one is the better option for you?
How much are airline miles “worth”?
Miles are great if you travel frequently and can use them to book a free or discounted flight in the future. But they’re not as flexible as cash, which you can use to book any flight or cover other travel expenses. When a flight is delayed or canceled, you may be given the option of receiving trip delay or canceling reimbursement in the form of miles or cash back. In order to determine which option is best for you, you need to understand the value of miles.
Typically, airlines miles can be valued at 1.5 to 2.5 cents per mile. If the number of miles you are being offered at this value is worth more than the value of the cash back, you may be better off taking the miles.
How to choose between airline miles and cash back
Beyond just the value, here are some other things to keep in mind when you’re trying to decide whether you’ll get a better deal with the miles the airline is offering or straight-up cash back:
Cash back is more flexible than miles. On the other hand, cash back is obviously a more flexible form of compensation than miles. With cash back, you can book any flight you want, on any airline. You’re also not limited to using your compensation within a certain time frame like you may be with miles. And if you don’t fly often, the value of miles may decrease over time as airlines make changes to their programs.You’re entitled to a cash refund. If your flight is canceled or there’s a major delay, you’re typically entitled to a cash refund for the full cost of your ticket. So even if you’re offered a voucher for future travel or miles in lieu of a cash refund, you do have the option to ask for the cash instead. However, the value of the miles rebate may be worth more than the value of the cash refund, especially if you travel frequently and know how to get the most out of your miles.Miles value varies by program. The value of miles also varies depending on the airline’s rewards program. For example, redeeming United Airlines MileagePlus miles for international premium cabin flights will typically give you a higher return than redeeming them for domestic economy flights. So if you’re offered a voucher for future travel on United, and you know you’ll be flying internationally in the near future, it may be worth taking the miles over the voucher.Should you use miles or cash back when booking a ticket?
Since different miles have different values and no miles are as flexible as cash back, you’ll always need to decide the best way to book a ticket. As a general rule, you should always book with the least costly option. If your miles are worth $100 but you can book a ticket for $80 in cash, it makes more sense to book with cash. But if the same ticket costs $120 in cash, it makes more sense to book with your miles.
Additionally, you’ll need to keep expiration dates for miles and vouchers in mind. If you can book a ticket for $100 in miles or $80 in cash but your miles are going to expire in two months, it still may make sense to book with miles if you won’t otherwise have a use for them or be able to extend the expiration.
