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With the deadline for elite status qualification looming, this week TPG Contributor Nick Ewen discusses strategies to help you earn or maintain your status into the new year.
2015 is rapidly approaching, which means we’re also in the home stretch for elite status qualification. Once the calendar flips, the balances for all of your elite qualifying miles and segments (as well as dollars and points for certain airlines) will reset to zero. Fortunately, you still have time to (re)qualify, so this week I’ll discuss ways to get yourself over the elite status threshold for the domestic legacy carriers. On Tuesday I offered tips to help you (re)qualify for elite status with American Airlines and/or US Airways, and yesterday I shifted the conversation to Delta and United qualification with miles and segments.
Today I’ll delve into the new revenue requirements introduced to the SkyMiles and MileagePlus programs this year. You’ll need to make sure you meet both mileage/segment and revenue thresholds if you want your elite status to continue beyond February 28, 2015. In this post, I’ll go through the various ways of hitting (or avoiding) these requirements, and clear up some common myths around Medallion® Qualification Dollars (MQDs) and Premier Qualifying Dollars (PQDs).
For starters, let’s quickly review the spending thresholds for each airline. Here’s what it looks like on Delta in 2014:
And here’s the same chart for United in 2014:
One of the biggest questions surrounding these new revenue-based qualification requirements was what exactly counts as a “qualifying dollar”? TPG wrote a detailed break-down of Delta MQDs and United PQDs back in 2013, and generally speaking, they’re very similar. Both carriers award elite qualifying dollars for the base fare of flights, including carrier-imposed surcharges, but excluding government-imposed taxes & fees. You accrue MQDs on flights operated by Delta, and you accrue PQDs on flights operated by United and Copa Airlines.
In addition, both carriers allow you to meet these spending requirements by flying on partner airlines. However, in these cases the tickets must be issued by either Delta (starting in 006) or by United (starting in 016). Finally, both carriers allow you to accrue MQDs/PQDs on purchases of Economy Comfort (Delta) or Economy Plus (United). Note that this was not the case on Delta when the MQD requirement was initially announced, but the following verbiage is now found on the MQD page of Delta.com:
“Effective January 1, 2014, Economy Comfort and Preferred Seats purchases made through a Delta channel (including delta.com, Fly Delta mobile app, Delta Reservations, Delta kiosks, and select Delta airport locations) are included in MQDs.”
The other (small) difference is that United includes the 7.5% U.S. Excise Tax in the calculation of PQDs, while Delta does not. For example, I found one-way non-stop flights from JFK-LAX that were $148.10 on both carriers. Both of them excluded the $5.60 September 11th Security Fee, the $4.50 Passenger Facility Charge, and the $4.00 U.S. Federal Segment Fee from elite qualification. However, Delta splits out the $9.35 U.S. Tax as a separate item that doesn’t accrue MQDs. United includes it with the $124.65 base fare to award 134 PQDs.
Fortunately, both carriers offer ways around these requirements:
- Credit Card spending: Both Delta and United allow most elite members to get out of revenue requirements through credit card spending. If you put $25,000 on your co-branded credit card (including the Gold Delta SkyMiles® Credit Card from American Express, Platinum Delta SkyMiles® Credit Card from American Express, Delta Reserve® Credit Card from American Express, United MileagePlus Explorer Card, or United MileagePlus Club card), then you don’t need to meet the MQD/PQD requirements. However, this does not apply to Premier 1K on United. Regardless of how much you spend on your MileagePlus card, you must earn at least 10,000 PQDs in order to (re)qualify for that top tier status.
- Reside outside the U.S.: Another similarity between these two programs is that they only apply to elite members based in the U.S. I’ve read reports of Medallion members changing the address in their SkyMiles profile just to get out of the requirement. This is not a strategy that I would recommend unless you legitimately live outside the U.S. Both of these airlines have the IT resources necessary to identify fraudulent address changes. If you live in Chicago, suddenly change your address to somewhere in the UK, but continue booking flights that originate from Chicago, I’m confident this behavior would be flagged.
Since this is the first year that these revenue-based qualification thresholds are in place, there’s a lot of confusion over exactly how to meet them. As I mention above, you earn MQDs/PQDs on the base fare of tickets plus any carrier-imposed surcharges. However, I have read many questions about how exactly this works, so I wanted to dispel some common myths that will (hopefully) save you stress and/or money as 2014 winds down.
Myth 1: I can earn MQDs/PQDs when I purchase tickets for someone else.
Reality: Unfortunately, this is not the case. You only earn MQDs/PQDs on your own tickets. If you purchase a flight for you and your spouse with a base fare of $400 per person, you would earn 400 elite qualifying dollars, and your spouse would earn the same amount on his or her account. The source of the money used for the purchase is completely irrelevant. Your MQD/PQD balance goes up based on the price of tickets that you actually fly, even if someone else pays for it.
Myth 2: I can purchase a refundable flight for next year and then cancel it once the MQDs/PQDs post in 2014.
Reality: Just like the source of the funds used to purchase the ticket, the timing of the purchase is also irrelevant. You earn MQDs/PQDs based on when you fly, not when you buy. For example, here is my account activity from January 2013 (though MQDs didn’t count in 2013, they still show up in your account) with two flights from Melbourne, FL to Omaha, NE:
Both flights were booked in December of 2012, but the MQDs posted when the flights were actually taken.
Myth 3: I can purchase a flight but not actually fly and still get MQDs/PQDs.
Reality: These new revenue-based requirements are no different than elite-qualifying miles and segments. You actually have to take the flights you book in order to earn the MQDs/PQDs. Remember that if you don’t show for a flight you booked, you don’t forfeit those funds. You can still use them (minus a hefty change fee). If you earned MQDs/PQDs on flights you didn’t take, you could just book a flight, not show, earn the MQDs/PQDs, and book another flight with the remaining funds.
Myth 4: I can bump my MQD/PQD balance up by pre-planning flights for 2015.
Reality: Again, MQDs/PQDs only post to your account in the year in which you actually fly. As a result, you don’t get any benefits in 2014 by purchasing flights for 2015. Those MQDs/PQDs would count toward 2015 status qualification. Of course, these purchases would help you meet the credit card waiver discussed above, since that applies to the calendar year in which the purchases were made.
Myth 5: Bag fees, change fees, in-flight amenities, and club memberships will help me hit the MQD/PQD threshold.
Reality: This is explicitly addressed on the FAQ pages for both Delta and United. The only non-flight purchases that will help your MQD/PQD balances are Economy Comfort/Plus purchases, and even those purchases will only help with this year’s qualification if they are made for flights that depart in 2014.
Myth 6: If I use a voucher or eCredit to purchase a flight, I won’t earn MQDs/PQDs.
Reality: This is actually one of the nice things about the MQD/PQD requirements, as flights you book with travel vouchers on either airline will count toward the new revenue-based requirement. This can be especially helpful if you’ve volunteered to take a later flight and have some credits sitting in your account. Whatever portion you use to pay for your fare will accrue MQDs/PQDs.
Note that this doesn’t hold true for Pay With Miles on Delta, which is a benefit exclusively for holders of a Delta American Express card. In this case, the only way to earn MQDs is to purchase a first or business class ticket, and even then, you won’t earn MQDs on the portion paid in miles. In other words, if you purchase a business class ticket with a base fare of $1,000 and pay for $100 of it using 10,000 SkyMiles, you would earn 900 MQDs for the paid portion of your fare.
These new requirements definitely make you think differently about status, and whether you like it or not, they’re here to stay. Be sure to check your current MQD/PQD balance by logging into your SkyMiles and/or MileagePlus account, and double check each individual flight to make sure you were fully credited for the price you paid.
I actually found a discrepancy earlier in the year, where a flight of mine with a base fare of $332.74 only gave me 280 MQDs. A quick e-mail to Delta resolved the issue, but I would’ve been sore about missing out on Platinum Medallion requalification because of an error on their end.
What are your thoughts on the MQD/PQD requirement as we approach the end of the first year?
Know before you go.
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