Why You Should Use Your Air Miles As Soon As Possible Due to the Pandemic

Are you sitting on a pile of air miles bonus points? You might want to use them before they drop in value, as liabilities associated with airline loyalty programs in the US skyrocketed during the pandemic, making a devaluation threat likely in 2021.

Pandemic has created a surplus of unused miles

A recent LendingTree analysis shows America’s five largest airlines (Delta, American Airlines, United Airlines, Southwest, and JetBlue) collectively owe frequent flyers $ 27.5 billion in free airline tickets, nearly 12% more than last year. … All of this is understandable: consumers continued to accumulate glasses during the pandemic despite not being able to use them for travel.

These unused air miles are the responsibility of the airlines.

It turns out that airline credit card loyalty programs are even more lucrative than the main airline business. However, due to a sharp drop in flight revenues last year, the American aviation industry lost $ 35 billion . As a result, airlines have taken on debt to cover costs, using their loyalty programs as collateral.

The next step for quickly paying off this excess debt will be cost cutting by airlines, which is difficult as airlines already have high operating costs. This makes loyalty programs an attractive target – as Bloomberg points out , airlines looking to strengthen their balance sheets could reduce the value of those rewards or restore policies that allow miles or points to expire. As Jay Sorensen, president of consultancy IdeaWorksCompany, told the Wall Street Journal , “You have a return flight, delayed demand and excess miles. We are determined to devalue. “

The cost of air miles decreases over time.

Over the years, we have seen the value of air miles decline as airlines steadily increased the number of points or miles required to qualify for a free flight. As Dan Reed of Forbes puts it :

In truth, carriers have been gradually devaluing their frequent flyer miles over the years. They did so even before the pandemic began, and then United discounted their MileagePlus miles in April 2020 and did it again last October. Delta did it in October and then again in February this year. In April of this year, Southwest discounted its Rapid Reward miles by 6.5%. And there are many experts now warning that more such moves are likely, and maybe even inevitable, somewhere between now and the end of the year, if there is no new surge in the number of Covid-19 cases and deaths in the United States.

This does not mean that all airlines will drastically devalue their loyalty programs. Airlines don’t want to alienate customers (which is actually loyalty), so instead, they can set limits on when and where you can book flights. In any case, it will still prevent you from finding good deals.

Use your glasses whenever you can

As a general rule of thumb, if you want to keep the full value of your miles, the sooner you book, the better. Otherwise, to maximize your value, consider flexibility in your flight dates and destination, as great deals can get a little harder to find.

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