Giving miles or points through a gift registry
By Tony Mecia | Published: July 8, 2014
Dear Cashing In,
Last week, my nephew posted on Facebook that he and his fiancee have created a gift registry for frequent flier miles for their wedding this fall. I need to get them a wedding gift and would love for them to be able to travel. Is there any reason I shouldn't do that? -- Liza
A lot of times, gift registries bring to mind fine china, fluffy towels or no-stick frying pans. But nowadays, all kinds of companies have established gift registries to allow you to spend money, er, make a big day special.
Yes, as you note, Liza, it is now possible to set up gift registries to receive frequent flier miles. Some hotel chains allow the same option with their points programs.
But just because you can, should you?
The problem is that generally, buying or donating miles or points is not a good deal. Sure, it's a good deal for the recipient. What's not to like about padding additional miles or points into an existing account? But as a giver, you might want to stick with the gravy boat or electric wok off the department store registry.
Let's do some quick math. Take United Airlines, which says "friends and family will enjoy fulfilling the recipient's travel wishes and will also appreciate the no-guesswork giving that a MileagePlus gift registry offers." If you're buying miles, they cost $35 per 1,000, plus a 7.5 percent excise tax. According to United's reward travel chart, domestic round-trip flights start at 25,000 frequent flier miles, for flights of more than 700 miles each way. That's $875 for a round-trip domestic flight -- assuming you could find award seats available. US Airways also runs a miles registry and charges the same price. In both cases, you'd do much better just paying for a flight.
A slightly more appealing way to give miles is to transfer miles from your account. Maybe you've accumulated them through travel, or maybe through spending on a rewards credit card. With United, transferring miles costs $15 per 1,000, plus a $20 per transaction processing fee. So that round-trip award ticket is now $395. With US Airways, sharing 25,000 miles costs $298.75. More reasonable, but remember that you've already spent something to accumulate these miles, and you could simply cash them in for a ticket for the registry recipient at no cost.
Hilton also allows points transfers to a gift registry. It charges $12.50 per 5,000 points. A one-night redemption at a low-level Hampton Inn (Category 2) costs 10,000 points, so that's $25. To stay somewhere nicer for a night, you'd probably have to burn more like 50,000 points, which would come to $125 to transfer. That's not a horrible deal. Hilton says its points registry is "the perfect way to celebrate a wedding, anniversary, birthday, graduation or other special occasion," and the hotel chain encourages you to spread the news on Facebook and Twitter.
Still, you might be better off giving something more traditional. Or if you really want to give the gift of travel, consider a gift card for an actual dollar amount. You might even be able to purchase that gift card using miles or points through an online shopping mall. That's likely to be much more flexible and a better value than donating points to a gift registry.
It's great you want to give your nephew something he wants. But you can find a better way to give it to him.See related: 7 signs you need to cash in your rewards -- now!, When you can, can't transfer rewards points
Meet CreditCards.com's reader Q&A expertsDoes a personal finance problem have you worried? Monday through Saturday, CreditCards.com's Q&A experts answer questions from readers. Ask a question, or click on any expert to see their previous answers.
- Options for business cash back cards – If you're signing up for a business cash back card, you have a lot of options. Be sure to calculate ahead of time which kind of cash-back deal can give you the most rewards ...
- Beware of checks sent with your card statement – If you receive convenient checks with your card statement, you might be tempted to use them, hoping to get rewards. Not only will you get no points for using these checks, but you could end up paying high fees ...
- Using rewards to fly first class – If you want to use your points to upgrade your seat category on a flight, it could still cost you money ...