Delta Gift Cards vs. Pay With Miles: Is One “Better” Than the Other to Pay for Flights?

After Delta’s most recent SkyMiles devaluation, it seems the airline is inching closer toward points being worth about a cent each — at least when it comes to booking travel, award trips be damned.

I wrote the other day about Pay With Miles tickets being almost as appealing as some award bookings. Those are trips where SkyMiles can be redeemed for a penny each (in 5,000-point/$50 increments) toward the purchase of an eligible flight. Plus, they earn full MQM and MQS.

Reader Mike, though, opined something interesting. He said:

[The best] way to redeem Delta sky pesos is to redeem for Delta Gift cards at slightly less than 1 cent per mile. It is an inflation hedge against upcoming domestic devaluations. Gift cards do not devalue or expire.

Indeed, Delta is once again “selling” gift cards through the SkyMiles Marketplace. (Digital versions are available for fewer points than their physical counterparts.)

If we value SkyMiles at a cent each (which is a pretty fair valuation, especially these days), you’re “overpaying” when redeeming points for gift cards. For example, a $100 gift card costs you pretty much the equivalent of $111.50. At least, upfront. (More on that in a minute.)

But here’s where an interesting twist comes in: Delta gift cards actually offer more flexibility and elite status perks than Pay With Miles. So is “overpaying” actually worth it?

Loyal readers know that I stress everyone’s travel needs, preferences, and budgets are different. What works for you may sound absurd to someone else (and vice versa, of course). Some people might save their SkyMiles strictly for awards flight. You decide how you use your miles/points to use — do whatever you want.

But for those who are interested in the comparison, let’s take a look.

Delta Gift Cards vs. Pay With Miles

Here are the main similarities and differences between using Delta gift cards and Pay With Miles to book your flights.

See where the gift cards may be appealing to some folks?

Let’s break down some of the differences.

Initial Ease of Use

The nice thing about Pay With Miles is that you don’t have to spend time buying a gift card, retrieve the number and PIN, worry about losing it, etc. It’s a benefit automatically applied to your SkyMiles account if you have a Delta American Express Card.

However, be careful not to overpay on your reservation. You don’t want to blow thousands of miles for an $18 cash balance that you’re much better off paying out of pocket.

Plus, if you purchase an eGift card using SkyMiles, you have to wait seven days to receive it. That’s kind of lame.

Redeeming for Flights

Pay With Miles is valid only for select Delta itineraries. So you won’t necessarily be able to pick an itinerary you want (though I rarely have a problem). However, you’re limited only to flights marketed and operated by Delta and Delta Connection. (Delta Vacations trips may also be paid for with SkyMiles.) You also can only book Pay With Miles reservations by using Delta.com. But some people have told me they booked Pay With Miles tickets through Delta phone reps. So I guess your mileage may vary.

Gift cards, however, can be used for any Delta marketed itinerary — even if it’s operated by a partner airline (Air France, KLM, etc.).

Plus, you can use your Delta gift card to book reservations online or over the phone. Or at the airport, I guess (Does anyone do that anymore? Serious question.)

Earning Delta Elite Status Qualifications

Using our example from above, let’s say we redeem 11,150 SkyMiles for a $100 digital Delta gift card.

We use our brand new gift card to book a $100 roundtrip that has two total flights. We’ll say this is all-in (base fare, taxes, surcharges, etc.) for math’s sake.

We’ll earn:

• ~$85 MQD (Base fare and carrier-imposed surcharges. Play along.)
• Full MQM
• Two MQS
• SkyMiles based on our elite status level

Let’s say that we’re Platinum Medallions. We’ll earn nine (9) SkyMiles per dollar spent on the base fare and carrier-imposed surcharges. In our example, that’s about $85-ish. We get 765 SkyMiles.

Our net cost of the trip is 10,385 SkyMiles. (11,150 points to buy the gift card minus 765 points earned).

If we used Pay With Miles, that same trip would’ve cost us 10,000 SkyMiles — which is 385 points cheaper than what we netted with our gift card. Consider, though, that the Pay with Miles trip would earn us only:

• Full MQM
• Two MQS

Compared to Pay With Miles, we’ve overpaid by the equivalent of about $3.85. Obviously, the higher the redemption, the more SkyMiles you’ll pay. But if you really care about MQD, buying gift cards with SkyMiles might be worth it.

Gift Cards are Devaluation-Proof

People refer to SkyMiles as “SkyPesos” and “SkyRubles.” Those aren’t affectionate nicknames. (No offense to the good people of Mexico or the Russian Federation. In fact, that’s actually giving SkyMiles more credit than they deserve!) Their valuation is subject to whatever Delta decides they’re worth, for better or worse. (And lately…)

But a $100 gift card is worth $100.

So there’s also that to take into consideration.

Final Approach

Again, this comes down to personal preference. Some people might be willing to burn extra SkyMiles so they can get the MQD credit. Pay With Miles might be a better option for people who earn the Delta Amex MQD waiver or don’t care about status — as long as they’re fine being limited to Delta and regional partner metal.