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You can use United miles to pay for some United credit card annual fees - but should you?

May 18, 2020
4 min read
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In a time when some consumers are short on cash and most aren’t sure when they’ll start traveling again, non-travel redemptions have increased in popularity. Usually, redeeming your points and miles for statement credits and other non-travel redemptions provides much less value than you could get from redeeming for hotel nights or flights. In fact, TPG's Samantha Rosen even wrote a post begging readers not to use their points on Amazon and Seamless.

Although the best use of United miles is generally booking flights, that's not really an option right now. Luckily, some United credit cardholders now have a new option for using their United miles. As DansDeals reported, cobranded United cardholders who had an annual fee billed in March, April or May can now use United miles to reimburse their annual fee.

TPG's Summer Hull found that she could redeem 30,000 United miles to cover the $450 annual fee on her United Club Card (card no longer available for new applicants; replaced with United Club Infinite Card) that was billed in May. This means that she'd get a value of 1.5 cents per mile from this redemption.

You can use 30,000 United miles to reimburse the United Club Card's $450 annual fee.

Should you redeem United miles to cover your annual fee?

Considering that TPG's valuation of United miles is 1.3 cents each and you can get a value of 1.5 cents each towards your annual fee, mathematically the answer is yes. But, each traveler values their miles and their travel rewards credit cards differently.

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Here are a few other aspects to consider:

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  • Have you been targeted for other offers? With coronavirus concerns disrupting travel, Chase may be offering a spending challenge or waived annual fee for cardholders who aren't currently finding value in their card.
  • Do you want to keep the card? Airline cards can provide significant value with benefits like lounge access and/or a checked baggage allowance. But if you aren't sure when you'll start traveling again, you may want to downgrade or even cancel your card instead of using miles or cash to pay your annual fee.
  • How many United miles do you have? If you don't have ample United miles in your account, you may want to save the miles. Especially if you have a post-pandemic trip in mind.
  • What value do you usually get from your United miles? If you usually get more than 1.5 cents per mile from your redemptions when using United miles, you may prefer to save your miles for future use.

Related reading: How to redeem miles with the United Airlines MileagePlus program

How to redeem United miles towards your annual fee

If you decide to pay for your United credit card's annual fee using United miles, you can do so here. Remember to check on Chase's website whether your annual fee was billed in March, April or May as well as the cost of your annual fee before using your miles.

Even though my United Explorer Card's annual fee wasn't billed during these months, I was still given the option to redeem United miles to offset my annual fee. But, I didn't hit the submit button, since it was unclear what would happen to my miles since my annual fee wasn't billed during an eligible month.

One interesting aspect is that partial annual membership fee reimbursement is allowed. This means that you can use any number of miles. For example, I could zero out my United mileage balance by redeeming all 661 miles for a $9.92 reimbursement toward my annual fee.

Bottom line

If your annual fee is billed in March, April or May for a cobranded United credit card, it's certainly worth considering whether you should pay using United miles at a rate of 1.5 cents per mile. Especially if you're currently trying to conserve cash but have ample United miles.

Featured image by (Photo by John Gribben for The Points Guy)

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Our points-obsessed staff uses a plethora of credit cards on a daily basis. If anyone on our team wouldn’t recommend it to a friend or a family member, we wouldn’t recommend it on The Points Guy either. Our opinions are our own, and have not been reviewed, approved, or endorsed by our advertising partners.
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TPG featured card

Best For Occasional United Flyers
TPG Editor‘s Rating
Card Rating is based on the opinion of TPG‘s editors and is not influenced by the card issuer.
4 / 5
Go to review

Rewards

1 - 2X miles
2XEarn 2 miles per $1 spent on dining, hotel stays, and United® purchases
2XEarn 2 miles per $1 spent on dining including eligible delivery services
1X1 mile per $1 spent on all other purchases

Intro offer

60,000 Bonus Miles
Earn 60,000 bonus miles after you spend $3,000 on purchases in the first 3 months your account is open.

Annual Fee

$0 Intro for First Year, then $95.

Recommended Credit

670-850
Good, Excellent
Credit ranges are a variation of FICO© Score 8, one of many types of credit scores lenders may use when considering your credit card application.

Why We Chose It

This card is geared toward both frequent and occasional United flyers alike, and offers plenty of elite-like benefits like free checked bags, priority boarding and a discount on in-flight purchases. It also racks up miles at a steady pace on a variety of purchases including dining and hotels, putting that next award ticket within reach sooner.

Pros

  • Earns 2 miles per $1 spent on United, dining and hotels
  • First checked bag free for the cardholder and a companion
  • Priority boarding
  • 25% off eligible inflight purchases
  • Up to $100 credit every four years for Global Entry/TSA PreCheck
  • $0 intro annual fee for the first year, then $95

Cons

  • Day-of-travel perks limited to United and some partner flights
  • Other United cards have higher earning rates on some purchases
  • You might get more use from transferable points instead of United miles
  • Earn 60,000 bonus miles after you spend $3,000 on purchases in the first 3 months your account is open.
  • $0 introductory annual fee for the first year, then $95.
  • Earn 2 miles per $1 spent on dining, hotel stays, and United® purchases
  • Up to $100 Global Entry, TSA PreCheck® or NEXUS fee credit
  • 25% back as a statement credit on purchases of food, beverages and Wi-Fi on board United-operated flights and on Club premium drinks when you pay with your Explorer Card
  • Free first checked bag - a savings of up to $140 per roundtrip. Terms Apply.
  • Enjoy priority boarding privileges and visit the United Club℠ with 2 one-time passes each year for your anniversary
  • Get one-year complimentary DashPass, a membership for both DoorDash and Caviar that provides unlimited deliveries with $0 delivery fees and lower service fees on eligible orders. After that, you are automatically enrolled in DashPass at the current monthly rate. Activate by 12/31/24.
Best For Occasional United Flyers
TPG Editor‘s Rating
Card Rating is based on the opinion of TPG‘s editors and is not influenced by the card issuer.
4 / 5
Go to review

Rewards Rate

2XEarn 2 miles per $1 spent on dining, hotel stays, and United® purchases
2XEarn 2 miles per $1 spent on dining including eligible delivery services
1X1 mile per $1 spent on all other purchases
  • Intro Offer
    Earn 60,000 bonus miles after you spend $3,000 on purchases in the first 3 months your account is open.

    60,000 Bonus Miles
  • Annual Fee

    $0 Intro for First Year, then $95.
  • Recommended Credit
    Credit ranges are a variation of FICO© Score 8, one of many types of credit scores lenders may use when considering your credit card application.

    670-850
    Good, Excellent

Why We Chose It

This card is geared toward both frequent and occasional United flyers alike, and offers plenty of elite-like benefits like free checked bags, priority boarding and a discount on in-flight purchases. It also racks up miles at a steady pace on a variety of purchases including dining and hotels, putting that next award ticket within reach sooner.

Pros

  • Earns 2 miles per $1 spent on United, dining and hotels
  • First checked bag free for the cardholder and a companion
  • Priority boarding
  • 25% off eligible inflight purchases
  • Up to $100 credit every four years for Global Entry/TSA PreCheck
  • $0 intro annual fee for the first year, then $95

Cons

  • Day-of-travel perks limited to United and some partner flights
  • Other United cards have higher earning rates on some purchases
  • You might get more use from transferable points instead of United miles
  • Earn 60,000 bonus miles after you spend $3,000 on purchases in the first 3 months your account is open.
  • $0 introductory annual fee for the first year, then $95.
  • Earn 2 miles per $1 spent on dining, hotel stays, and United® purchases
  • Up to $100 Global Entry, TSA PreCheck® or NEXUS fee credit
  • 25% back as a statement credit on purchases of food, beverages and Wi-Fi on board United-operated flights and on Club premium drinks when you pay with your Explorer Card
  • Free first checked bag - a savings of up to $140 per roundtrip. Terms Apply.
  • Enjoy priority boarding privileges and visit the United Club℠ with 2 one-time passes each year for your anniversary
  • Get one-year complimentary DashPass, a membership for both DoorDash and Caviar that provides unlimited deliveries with $0 delivery fees and lower service fees on eligible orders. After that, you are automatically enrolled in DashPass at the current monthly rate. Activate by 12/31/24.