LifeMiles offering unprecedented 200% bonus sale (there’s a reason, though)

Throughout the years, we’ve seen LifeMiles run countless mileage sales, but the largest I can recall was a 155% bonus (which, coincidentally or not, came one month after Avianca filed for bankruptcy protection). 

It seems that desperate times call for desperate measures, because from now till 26 September 2020, 2 p.m SGT, LifeMiles is offering an unprecedented 200% bonus on miles purchases. This is far and away the biggest bonus that’s ever been offered. 

Buy LifeMiles with up to a 200% bonus

I’ll definitely want to talk about the wisdom of buying LifeMiles right now, but first, the details.

LifeMiles members can purchase miles with the following bonuses from now till 26 September 2020, 2 p.m SGT:

• Buy 1,000-50,000 miles: 150% bonus (1.32 US cents/mile)
• Buy 51,000-100,000 miles: 175% bonus (1.2 US cents/mile)
• Buy 101,000-200,000 miles: 200% bonus (1.1 US cents/mile)

LifeMiles does not impose fuel surcharges on redemptions, and here’s how much it costs for selected Business/First Class awards out of Singapore. The full award chart can be found here. 

During LifeMiles’ previous sale, they promised not to change their award charts until January 2021 at the earliest, so that provides some kind of reassurance (assuming the program is still around). 

Even though we do not intent (sic) to change our award rates, for the members who purchase this promotion we will honor these award tables until at least January 2021.

With price of 1.1 US cents/mile, you could achieve some pretty phenomenal redemptions in Business and First Class, and the lack of fuel surcharges only sweetens the deal. 

Of course there’s a but coming…

What does Avianca’s bankruptcy mean for LifeMiles?

On 10 May 2020, Avianca filed for bankruptcy protection in the United States after failing to meet a US$65 million bond payment deadline. Avianca took pains to emphasize that the filing was voluntary, and have positioned it as a temporary measure to buy time for reorganization. 

Now, LifeMiles is a separate legal entity from Avianca, owned 70% by the airline and 30% by a private equity firm called Advent International. 

The fact that it’s a separate legal entity means it’s unaffected by the filing- it has its own bank accounts, its own balance sheet, its own liabilities. That said, Avianca accounts for 27% of all LifeMiles’ gross billings (and probably more indirectly- banks only buy LifeMiles because Avianca exists), so its fortunes are still tied to Avianca’s. 

That symbiotic relationship is reflected in the fact Moody’s downgraded LifeMiles’ debt instruments from B3 to Caa1 (with a negative outlook) after Avianca’s bankruptcy filing. Investment-savvy folk will find the report well worth reading.

At the end of August, it was reported that the Colombian government had agreed to lend up to US$370 million to Avianca, but if the worst still happens and LifeMiles goes under, here’s some things you’ll need to consider:

• Your LifeMiles may not have any more value
• Your yet-to-be-flown tickets redeemed through LifeMiles may not be honored, even if the flights are operated by other Star Alliance carriers. Generally speaking, cross-carrier reimbursement for award tickets only takes place after the flight is flown, not when the ticket is issued. Therefore, carriage may be refused if LifeMiles isn’t around to pay the operating carrier 

Given how unlikely international travel is over the next six months (or even more), these are things you’ll definitely want to keep in mind. 

What else do I need to know about buying LifeMiles?

Although a 200% bonus on LifeMiles might have been the deal of the decade a year ago, there’s a reason we’re only seeing this offered now. The risk of holding LifeMiles has increased exponentially, and it’s only fair that the acquisition price comes down to reflect that reality. 

I’m sitting this one out (and for the record, I don’t earn any commission from LifeMiles sales), but if you nonetheless decide to purchase LifeMiles, the usual caveats apply: 

• Don’t buy them speculatively. Only buy them if you have a confirmed trip in mind and have found award space on LifeMiles (you don’t need to have any miles in your account to search for award space)
• You can’t redeem Singapore Airlines First or Business Class cabins on selected routes with LifeMiles
• LifeMiles may not see the same award space as other Star Alliance partners. Just because you see something on Aeroplan or United doesn’t necessarily mean it will appear on LifeMiles
• All changes and cancellations must be done through the Avianca call centre; they cannot be done online. It costs between US$100-200 to cancel an award ticket, depending on your origin and destination
• LifeMiles tickets can be redeemed for anyone you choose

LifeMiles expire after 12 months of account inactivity, but you shouldn’t be holding on to them for that long anyway, especially not right now. 

What card should I use for LifeMiles purchases?

LifeMiles purchases are processed directly by Avianca in USD, meaning that they code as foreign currency airfare spend. You’ll want to use one of the following cards to maximize the miles you earn:

	Earn Rate	Remarks
UOB Visa Signature Apply here	4 mpd	Min S$1K max S$2K FCY spend per s. month
DBS Woman’s World Card Apply here	4 mpd	Max S$2K per c. month
UOB Lady’s Card Apply here	4 mpd*	Max S$1K per c. month
UOB Lady’s Solitaire Apply here	4 mpd*	Max S$3K per c. month
SCB Visa Infinite	3 mpd	Min S$2K per s. month
DBS Altitude Apply here	3 mpd	Max S$5K per c. month
S. Month= Statement Month | C. Month= Calendar Month *Must declare travel as quarterly 10X category

Conclusion

A 200% bonus is unheard of for LifeMiles, but it counts for little if buying them causes you to lose sleep at night. 

Although Singaporeans can technically travel to Brunei and New Zealand now, it’s kind of pointless if no one wants to let us in. Moreover, there’s no knowing when the government advisory against travel to other countries will be lifted, which means you may be holding your LifeMiles a lot longer than you’re comfortable with. 

So as big as this bonus may be, it’s a hard pass for me. 

(HT: Jkai)