Should You Decline the Miles You Can Earn for Renting a Car?

Mar 15, 2017

This post contains references to products from one or more of our advertisers. We may receive compensation when you click on links to those products. Terms apply to the offers listed on this page. For an explanation of our Advertising Policy, visit this page.

“Reader Questions” are answered three days a week — Mondays, Wednesdays and Fridays — by TPG Senior Writer Julian Mark Kheel.

TPG reader Ryan sent us an email to express his surprise about an extra charge on his recent rental car bill

I just reviewed my car rental receipt with Dollar Rent A Car. I didn’t recognize the “FF SURCHARGE” and was surprised to find that it’s a fee I paid to Dollar to cover the Alaska Airlines miles I “earned” through the booking. Do other rental companies charge a fee for miles?

TPG Reader Ryan

When you earn miles by flying an airline or eating at a restaurant that participates in a dining program, there’s usually no extra fee charged for those miles. Miles earned on your credit card for renting a car don’t come with an additional charge, nor do any miles you earn by going through a shopping portal first in order to book the car. So why would there be a fee for adding your frequent flyer number to the rental reservation, right?

Well, the rental car companies don’t see it that way. In fact, what Ryan experienced at Dollar is a very common practice across most rental car companies. When you’re in the process of booking and you’re presented the option to add a third-party loyalty program number to your reservation, those miles will almost always come with a fee attached.

National Car Rental notes its fee for earning frequent flyer miles right under its option to select it.

In some cases, such as when booking with National Car Rental or several other companies, you’ll see this stated clearly right next to the option to select a loyalty program, though you might still need to dive into the terms and conditions in order to figure out what the actual fee will be.

You’ll have to dig to find out that Dollar charges a fee for earning frequent flyer miles.

But in other cases, it takes extra work to realize you’ll be charged for the miles. Dollar doesn’t disclose this charge directly next to the option when booking online. Instead, you have to click on the “Local Policies, Terms & Conditions” link to find it spelled out…

Even when you see a promotional offer for bonus miles on a rental car, you’ll want to look closely at the terms and conditions to see if the extra miles are, in fact, free.

Mileage bonus offers on rental cars usually come with fees as well.

So is it worth paying for these miles? Let’s do the math using this Dollar/Alaska triple miles promotion as an example. Dollar says you’ll get 150 Alaska Mileage Plan miles per rental day, but the miles are subject to a surcharge of 95 cents per day. That means you’re effectively paying 0.63 cents per mile. Based on the most recent TPG monthly points and miles valuations, Alaska miles are worth 1.9 cents each, so buying those miles at one-third of that value is probably worthwhile.

However, if this wasn’t a triple miles promotion and you only got 50 miles for 95 cents per day, you’d be paying a much higher 1.9 cents per mile, which means you’re not gaining any value by purchasing those miles. Better to leave your frequent flyer number off the reservation in that case and save your infinitely more flexible cash for a better mileage offer down the road.

So Ryan, now you know what to keep an eye out for the next time you consider earning miles for renting a car. Thanks for the question, and if you’re a TPG reader with a question you’d like answered, tweet us at @thepointsguy, message us on Facebook or send an email to info@thepointsguy.com.

Featured image courtesy of Jeff Greenberg/Getty Images.

Chase Sapphire Preferred® Card

WELCOME OFFER: 80,000 Points

TPG'S BONUS VALUATION*: $1,650

CARD HIGHLIGHTS: 2X points on all travel and dining, points transferrable to over a dozen travel partners

*Bonus value is an estimated value calculated by TPG and not the card issuer. View our latest valuations here.

Apply Now
More Things to Know
  • Earn 80,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. That's $1,000 when you redeem through Chase Ultimate Rewards®. Plus earn up to $50 in statement credits towards grocery store purchases within your first year of account opening.
  • Earn 2X points on dining including eligible delivery services, takeout and dining out and travel. Plus, earn 1 point per dollar spent on all other purchases.
  • Get 25% more value when you redeem for airfare, hotels, car rentals and cruises through Chase Ultimate Rewards®. For example, 80,000 points are worth $1,000 toward travel.
  • With Pay Yourself Back℠, your points are worth 25% more during the current offer when you redeem them for statement credits against existing purchases in select, rotating categories.
  • Get unlimited deliveries with a $0 delivery fee and reduced service fees on eligible orders over $12 for a minimum of one year with DashPass, DoorDash's subscription service. Activate by 12/31/21.
  • Count on Trip Cancellation/Interruption Insurance, Auto Rental Collision Damage Waiver, Lost Luggage Insurance and more.
  • Get up to $60 back on an eligible Peloton Digital or All-Access Membership through 12/31/2021, and get full access to their workout library through the Peloton app, including cardio, running, strength, yoga, and more. Take classes using a phone, tablet, or TV. No fitness equipment is required.
Regular APR
15.99%-22.99% Variable
Annual Fee
$95
Balance Transfer Fee
Either $5 or 5% of the amount of each transfer, whichever is greater.
Recommended Credit
Excellent/Good

Editorial Disclaimer: Opinions expressed here are the author’s alone, not those of any bank, credit card issuer, airlines or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

Disclaimer: The responses below are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser’s responsibility to ensure all posts and/or questions are answered.