United Cardholders Can Redeem Miles Toward Annual Fee, But Should You?

AwardWallet receives compensation from advertising partners for links on the blog. Terms Apply to the offers listed on this page. The opinions expressed here are our own and have not been reviewed, provided, or approved by any bank advertiser. Here's our complete list of Advertisers.

Offers for the United℠ Explorer Business Card are not available through this site. All information has been independently collected by AwardWallet and has not been reviewed or provided by the card issuer. Some offers may have expired. Please see our card marketplace for available offers.

Over the last few years, the United MileagePlus program has been steadily losing value, with yet another devaluation unveiled just a few weeks ago. But while United has been making award redemptions more expensive, it's also offering new options for redeeming MileagePlus miles.

Amidst the onslaught of credit card updates and program changes, United has rolled out yet another new way to redeem miles, and this one is actually a decent deal. United MileagePlus cardmembers can now redeem United miles at 1.5¢ per mile to offset credit card annual fees.

Non-Flight Redemptions

With MileagePlus miles, you have a few redemption options for things other than standard award bookings. For example, you can use United miles to pay for a United Club Membership (between 0.73–0.76¢ per mile) or use miles to offset cash airfare paid with a United co-branded credit card (1¢ per mile). Neither of which presents a particularly compelling value.

Due to the financial instability brought on by COVID-19, loyalty programs started cutting back on non-travel redemptions in late March. Simultaneously, credit card issuers began offering statement credits, bonus points and other changes to keep cardmembers from canceling their credit cards.

One of the focal points for these new initiatives has been the airport lounge memberships offered for holding the premium co-branded cards of major airlines. These include:

With all of these clubs closed for the foreseeable future, cardholders have been hard-pressed to justify the higher annual fees.

Annual Fees Payable with United Miles

United's newest redemption option may blunt the pain of not being able to travel right now. Noticed initially by DansDeals, United has started allowing co-branded cardholders to redeem United miles to offset the annual fees for some cards. Even better, the conversion pegs United miles at a surprisingly reasonable value of 1.5¢ each.

As you can see below, I was given the option to redeem 6,333 miles to offset the $95 annual fee on my United℠ Explorer Business Card:

Key Terms

It's worth noting that this form also allows for partial annual fee reimbursement. For instance, the annual fee for my United Explorer Business Card (which is now closed to new applicants) is $95. If I only wanted to use my miles to cover $50, I could put $50 in the dollar amount and redeem a smaller quantity of miles. This could be a way of getting value out of an otherwise unusably small amount of miles.

Lastly, United has designed this menu for cardholders whose annual fee has posted in the last three months. However, it's also accessible for those with annual fees posting in other parts of the year. It's unclear what would happen if cardholders are dishonest with the month that their annual fee posted. However, I would advise against trying this. United will deduct your miles immediately, and you may have trouble getting those miles back if there's a matching error with Chase.

Final Thoughts

I have mixed feelings about this. While 1.5¢ is a reasonable value to assign United Miles—even marginally higher than what I assign them—Delta and American have responded to the same issue by offering statement credits to qualifying members holding their respective premium credit cards.

With that in mind, we've heard that United has also recently offered statement credits to some premium cardholders. But unlike American and Delta—who are issuing these statement credits automatically—United requires that you call to request it. Unfortunately, there's no guarantee that you'll receive the credit, but it's worth calling and inquiring.

In the end, award flights are still the best way to use United miles. However, 1.5¢ per mile is a respectable redemption. When travel is uncertain, and finances are tight, redeeming United miles to offset an annual fee could be an acceptable way to keep an account open without spending the cash.

Would you use United miles to reimburse an annual fee at 1.5 cents each?

The comments on this page are not provided, reviewed, or otherwise approved by the bank advertiser. It is not the bank advertiser's responsibility to ensure all posts and/or questions are answered.

Leave a Reply

Your email address will not be published. Required fields are marked *

**You may receive 5 bonus AAdvantage miles for leaving a comment (Details/FAQ)


  • It was a more compelling option when the miles used to expire.

  • Most frequent flyer sites value United’s mile as low as 1.0 cents per mile. I may be worth alot more if you choose well so I would say at 1.5 cents, is middle of the road. Just my 2 cents 🙂

  • I will just cancel my card if there is no offer to waive the fee… I can’t travel right now and this card does not make sense for the next year or more…

  • I think that this is a good idea and may boost retention rates on their credit cards.

  • What’s the point of paying the annual fee with miles when you are a very frequent United flyer and often redeem flight awards?

    • JT Genter says:

      It’s a great option for those who have United miles, are short on cash right now, and are hoping to keep open an account (for future travel perks, to maintain the credit line, avoid a credit score drop, etc.)

  • It all boils down to CPP and 1.5 cpp is actually on the high end for United. I’d ABSOLUTELY pay the fee with miles. Think of it this way too, you’re not earning miles when you pay your fee. You may as well burn miles when there is literally no opportunity cost.

    • Good point. Using miles for flights doesn’t count toward status whereas cash does. May as well put the cash toward airfare rather than your credit card bill.

  • could be a sign of devaluation to come as there are too many miles floating out there.

  • Interesting idea, UAL is looking at ways to burn off its miles liability?

    • I instantly came to the conclusion of United trying to clean up their books as soon as I read the headline.

    • Where does the money typically go though? The $95 goes to Chase so how does paying these miles to Chase work?

      • That’s a really good question. Are we paying the miles to Chase? If so do they go into the pot of miles that that isers receive when they transfer URs to United?

  • It is very tempting. We mostly do one international trip each year and one smaller trip closer, so not a lot of travel. I have a United card and have found that so far it really hasn’t done much for me because of having enough points, availability etc. I was thinking MAYBE I would keep it one more year, but with Covid and other things changing our plans it is really on the chopping block. If I am able to pay points for fees it might just save it. But then, our card isn’t eligible since it hasn’t been billed yet so it is a moot point for me now.

  • I just redeemed miles to cover my card’s annual fee. 1.5 cents/mile is pretty good value for United miles (higher than what I’d value them at, especially right now).

  • I have been looking for another airline to use as my #1. United might be the one thanks to this post. And If I can pay off annual fee by miles, that works for me

  • I had the United Club card and had also put about 28k spend on it last year. I called in april when my fee was due and didn’t get any offer. I just downgraded to the no-fee United Explorer card.

  • At 1.5 cents, I think this is a reasonable redemption. I would consider it.