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Is an upgrade now your best use of United miles to Europe?

by on Mon December 2, 2013 • No Comment
United business class upgrade miles

United BusinessFirst class seat

Now that United is about to substantially raise the prices on awards in First and Business Class to Europe, Asia, and other far away places next year the old advice on when and where to best use those miles is starting to change.

For example, it used to be that using your miles for a 100,000 mile Business Class award to Europe was a slam dunk in value – beating out the other option of upgrading with miles and paying an extra fee.

Now, with higher prices for award tickets and lower prices for full cash business class tickets that’s looking less clear. So what do you do with your hard-earned United miles via the Chase Sapphire Preferred® Card or the United MileagePlus® Explorer Card?

Let’s take a popular romantic destination, Paris. Here are your paid options for travel next summer roundtrip from the East Coast:

  • Coach: $1,299
  • Business: $3,474

With miles your options are:

  • Business Class  Award – United flights: 115,000 miles + $144 in taxes / fees  (almost no availability though)
  • Business Class Award – Partner flights – 140,000 miles + $144 in taxes / fees (better, but still slim availability)
  • Coach to Business Upgrade – $1,299 + $1,100 co-pay + 40,000 miles
Airfare / TaxesCopayExtra taxesTotalMiles spentMiles earnedNet miles costSavings per mile
Upgrade$1,299 $1,100 $0$2,399 40,0007,29832,702$0.033
Award - United flights$144$0$144115,0000115,000$0.029
Award - Partner flights$144$0$144140,0000140,000$0.024
Business class fare$3,474

We factored in your cash outlay, the cost of paying for a Business Class ticket in cash, and the net miles you will spend (since with an upgrade you will earn miles for your coach ticket).

And while an upgrade means a really big cash outlay – almost $2,500 – in terms of dollar savings per mile you use it is a better deal than the ‘free’ award ticket at United’s new, higher prices. You’re getting over 3 cents per mile in savings, versus just 2.4 cents if you’re stuck using a Partner award.

So if you are cash-rich and miles poor, then this is a decent deal. Unfortunately most of us are miles rich and cash poor and spending over $2,000 on airfare isn’t an option. In that case of course, using miles for an award in Business Class (if you can find one at the Saver levels) is still a very good deal.

And there are other advantages to an award instead of upgrading…

  • You can confirm your seat in Business in advance. Upgrades usually have to be waitlisted so you may not know if you will be sitting in Business Class until the moment your plane is about the leave the gate. United can sometimes hold back upgrades to the very last minute as it tries to sell seats for cash.
  • You can take advantage of stopovers. This is the ‘priceless’ part of a traditional mile award. You’re free to fly to another city during your trip, like Rome for example, and stay as long as you’d like (up to about a year), then go on to your destination, Paris in this case and stay as you’d like. Normally this will cost you hundreds of extra dollars in airfare, but it’s a benefit included in every award ticket.

Some of the benefits of upgrading include…

  • You earn regular and Premier qualifying miles. Since you’re traveling on a paid coach ticket you’ll earn miles that count for Premier elite status as well as regular miles you can use toward future upgrades or award flights.
  • You can take the most convenient flights. Using a Saver mile award often means you’re stuck taking an extra connection or two, or going on days that don’t fit your schedule well. Paying in cash and upgrading gives you a better shot at traveling on the flights you want – your days and your times – and with the most direct routing.

So while upgrading from Economy to Business on United doesn’t come cheap thanks to huge co-pays and high fares to Europe next summer, you shouldn’t think of it as a waste of your miles. In fact, it’s a very good value all things considered.

Of course, if you choose a different mile program – like American Airlines – you’ll find an even better deal. While an upgrade on American will cost your 50,000 miles roundtrip, you only pay $700 in cash for the co-pay – a savings of $400 versus United. That’s well worth spending an extra 10,000 miles.

> See credit cards that earn American AAdvantage miles.

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