Buy United miles for 2.2 cents each and get a free 7 night hotel stay. Sort of.

Recently, United sent out emails inviting customers to earn 25% more miles when they convert hotel and car rental points into United miles.  Registration is required and bonus miles are capped at 20,000.  This offer is valid through November 30th 2013.

UnitedTransferBonusUpTo20K

Under most circumstances, transferring hotel points to United miles is a bad idea.  Most transfer ratios are poor and a 25% bonus isn’t enough to make up for that.  One exception is Marriott’s RewardsPlus Hotel + Air Package.

The general idea of Marriott’s hotel + air packages is that you can book a 7 night stay with Marriott points and earn back airline miles in addition to the stay itself.  This has always been a decent deal, but it was recently improved by Marriott and United’s new “RewardsPlus” partnership.  Via RewardsPlus, you can now get 10% more United miles from a hotel + air package than you would get if you redeemed the package for other airline miles.  For full coverage of the RewardsPlus Hotel + Air Package, please see my prior post on the subject: When to convert United miles to Marriott points.  The conclusion there was this: it’s always a good idea to opt for a travel package if you’re planning a 7 night Marriott award stay in a category 5 or higher hotel.

Here is the RewardsPlus hotel + air package chart with the 10% bonus included, but before the 25% bonus:

Marriott_hotelplusAir_RewardsPlus

Now, with the 25% transfer bonus promo, it should be possible to get both the 10% bonus rate shown above, plus an additional 25% bonus (capped at 20K miles).  If you’re planning a 7 night Marriott award stay, then this is a clear no-brainer.  If not, the deal might still make sense for you…

Buying miles

If you’re short on miles and want to buy them, United usually charges 3.5 cents per mile plus a 7.5% excise tax.  In my opinion, that’s ridiculously expensive.  An alternative is to buy Marriott points for 1.25 cents each, and use those points to book a RewardsPlus Hotel + Air Package.  That way, you’ll get miles and a 7 night hotel stay at a lower cost than United would charge directly.  One big complication is that Marriott only allows each person to buy up to 50,000 points per calendar year, and the cheapest Hotel + Air Package costs 200,000 points.  You can pool points with your spouse towards an award redemption, but that still limits you to 100,000 points total.  We’ll come back to this, but first let’s look at what would be possible if you could buy as many points as you want…

For the sake of argument, let’s assume that you’re able to buy the 270,000 Marriott points needed for the category 1-5, 7 nights + 132,000 mile package.  That would cost you $3,375 in exchange for 132,000 miles and a 7 night hotel stay.  Your cost per mile would be 2.6 cents.  With the current 25% bonus (capped at 20K miles), though, you would really get 152,000 miles at a cost of 2.2 cents per mile.  While I wouldn’t recommend buying miles at that rate unless you have a specific near-term use for them, it’s a pretty good deal for valuable United miles, and an extremely good deal when you include the value of a 7 night hotel stay.

Point reality

In real life, you can’t buy 270,000 points from Marriott in time for this promotion.  However, if you have enough Marriott points to make up the difference, this could be an excellent use of those points.  If you don’t have enough Marriott points, another option is to convert United miles to Marriott to make up the difference.  As long as you transfer fewer United miles than you get back from the package, you’ll come out ahead.

An example, and a few options

Between my wife and I, we have 112,000 available Marriott points.  We could buy 88,000 Marriott points and use our combined points to pay for the cheapest of the travel packages (which requires 200,000 points).  This would cost us $1100.  With the combined 10% RewardsPlus bonus and 25% transfer bonus, we would receive 68,750 United miles.  This is like buying United miles at 1.6 cents each and redeeming our 112,000 Marriott points for a 7 night stay.  Pretty good!

Alternatively, we could look to the high end of the chart.  For 270,000 points we would get the same 7 night category 1-5 stay plus 152,000 United miles.  To get the points required, we could buy 100,000 points for $1250 and we could transfer 58,000 United miles into Marriott points.  With this approach, we would end up 94,000 United miles ahead.  This would be like buying United miles at 1.3 cents each and, as before, redeeming our 112,000 Marriott points for a 7 night stay.  Nice!

Mostly just a thought experiment

Please don’t misunderstand me: I am not recommending that you buy Marriott points for this deal.  This post was simply my thoughts about how this deal could be leveraged, without much thought about whether one should do it.  While this will be a really good opportunity for some, for most it doesn’t make sense. Consider doing this if you already have a lot of Marriott points, you need United miles (and can’t get them more cheaply in time for when you need them), and you can make good use of a 7 night stay.  Definitely do this if you are planning a 7 night Marriott award stay anyway.

You can find the full RewardsPlus Hotel + Air package chart here.  Keep in mind that in all of my examples above, I chose packages for category 1-5 properties.  While there are some gems out there, the majority of the most desirable Marriott properties are category 6 and above. 


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Comments

  1. Would it be possible to transfer Ultimate Rewards Points to Marriott and then use those points to participate. I know you have focused on Marriott before, but it has never made much since for me. Where is the sweet spot hotel-wise on the reward plus chart?

    • benji: Yes, you can transfer Ultimate Rewards points to Marriott to do this, but its not the best use of those points unless you are doing so mainly to get enough for a travel package. First: use Marriott points; Second: buy Marriott points; Third: Transfer United miles to Marriott; Last resort: transfer Ultimate Rewards. I think that the closest to a sweet spot is to find a really nice category 5 hotel for the travel package redemption. That won’t be easy, but it should be possible.

  2. The best use of UR is to transfer to UA/Hyatt. ’nuff said.
    Although you can transfer them selectively as above to be able to MAKE USE OF a package, if you can not otherwise do so, due to lack of points.

    Marriott transfers to UA at an utmost 40% ratio.
    During a package, a part of it moves at 1:1 ratio.
    So you are improving the value of a marriott point in UA terms.
    And since 1 UA is > valuable than 1 MR, you get extra value.

    With this you get 25% extra = 1:1.25 (capped at 20), so 80=100 UA
    With rewards Plus, you can get 80:110 ratio ( the total amount depends on package)

  3. This seems like a good example of why it’s nice to have a decent amount of points in various programs. You don’t want to hoard excessively, but you also want to have enough points sitting in a program to take advantage of opportunities like this when they come up.

  4. Great heads-up. It probably won’t make sense to change my Mexico trip since I booked when the Marriott was a Cat5, and is now a Cat6. But, very well could work for Beijing…just not sure what good places to stay there yet that are located well to get to the various sites.

  5. Assuming someone already has 145k marriott points (purchased or otherwise) and desires to book a 7 day Marriott stay, then transfering UR to Marriott to complete the travel package is a great deal.

    Of course, someone will argue that if you do this without first buying the max Marriott points, then youve effectively redeemed your UR points for 1.25c apiece. Someone else might argue they were going to transfer to UA anyway, and got a 10% bonus plus 25% bonus on the first 20K.

  6. Great post! As you said, while this isn’t something that I think is persuable for most people, it’s this kind of out of the box thinking that has me checking your blog everyday.

  7. Greg, this is an insightful post, like so many :) Quick question, can you split the award stay when redeeming the travel packages with Marriott? E.g. 4 night in Marriott Beijing and 3 nights in Shanghai Marriott (category 5) and transfer to United? Or does it have to be a 7 night award stay in one hotel? Thanks

    • Tania: Great question. I don’t know. I’ve talked with three Marriott reps. Two said no, one said yes. I didn’t have a specific redemption in mind at the time so I haven’t tried it yet.
      .
      john: Plink will replenish the Amazon and Walmart gcs soon.
      .
      Telnar: Great question. No, I don’t know the timing.

  8. Do you know the timing of the various events when redeeming for a flight + hotel award and the degree to which the hotel portion is locked in?

    I’m thinking of booking a week at a Marriott for a trip in spring 2014. If I do that soon, will I get the United miles in time for this promotion (which ends Nov 30th)? What happens if I need to make changes to the hotel reservation later? Can I change the hotel dates? Can I change to a different hotel (perhaps adding points if I switch to a higher category hotel)?

  9. @Telnar,
    You can always change the hotel reservation to a different hotel. And you can even call in to member service to upgrade your hotel category to a higher level (This is good about 2 years ago, not sure if this has changed), just need to pay the difference in points.

  10. Nice deal but I do not have any travel plan in a hotel in Nov. I will bring my family to Orlando, FL in mid- and late dec, but that is too late?

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