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Leisure Gift Guide

How to Give a Plane Ticket as a Gift

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Buying a plane ticket these days is easy...relatively speaking. But buying one as a gift for a friend or family member who lives across the country?

The process isn't hard, but it can be tricky, and there's even more fine print than you usually have to worry about, so we've gone ahead and read it for you.

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Gift Idea #1: Buy the ticket outright

Concept: If you know precisely where as well as when your friend wants to fly, the airlines will permit you to pay for or redeem mileage toward a ticket that you can book in your friend’s name.

Considerations: If you use your mileage to book a ticket in your friend’s name, do it online. During the transaction you’ll effectively be transmitting a waiver permitting your miles to go toward the cost of your friend’s ticket. The airline will e-mail your friend his ticket and you confirmation of delivery.

Whether you’re paying with miles or not, avoid booking this kind of ticket over the phone, as you might be required to make a trip to your nearest home airport to sign a waiver permitting the booking; likewise, avoid gifting a paper ticket, as the airline might insist it be sent to you directly, since you’re the credit card holder. Along these lines, some airport ticket agents concerned about fraud may have an issue when your friend can’t present the credit card you used to book the ticket. Verify with your airline ahead of time that you as the credit card holder will not be traveling with the person to whom you gifted the ticket and see if you can have that fact noted on your friend’s reservation.

Gift Idea #2: Load up an airline gift card

Concept: Your friend can use an airline gift card toward the purchase of a plane ticket.

Costs: Whatever denomination you choose to load on the card. Most airline gift cards don’t expire or incur monthly depreciation fees.

Considerations:

— An airline gift card can only be used as cash, not to buy miles, so mileage accounts are irrelevant, unless you also want to share miles with your friend to upgrade whatever seat he buys with the card.

— A gift card is a good bet as long as you’re sure that the ticket your friend wants to buy – assuming you know where he wants to go – costs about the same or less than the same ticket purchased with miles.

— Not all airlines offer gift cards and not all offers are flexible: Delta sells a gift certificate only valid for a year, maximum denomination $350.

A related idea: Travelocity enables you to give a friend a vacation package gift certificate in a denomination of your choosing. The certificate’s redeemable for a pre-bundled package that at a minimum typically includes a plane ticket and hotel. Depending on the destination, the package could wind up costing you the same or less than the plane ticket alone.

Gift Idea #3: Giving Miles

Concept: Buy new miles or transfer your existing ones to a friend, who may redeem them for the flight of his or her choice. Your recipient must have a mileage account with the same airline.

Costs: American, Delta, and U.S. Air charge about a penny a mile to transfer your already-earned mileage into a friend’s account and 2.5 cents or more to buy and deposit new miles into that account. Most airlines also levy a $30 processing fee to deposit the miles. And check out this double dip: When your friend redeems the gifted miles he’ll pay a service charge, ranging from $20 to $150 depending on the airline and how soon he books before departure. There’s no way to cover the cost of the service charge in advance, so reimburse your friend for that fee and any ticket taxes.

Considerations:

— Your costs for gifting and redeeming miles should never exceed the cost of buying the ticket outright;

— Airlines limit how many miles you can transfer to a single recipient annually. There’s also a cap on how many transferred miles your friend can receive per year as well as on how many total transferred and purchased miles he can receive per year. For instance, American limits a recipient to 15,000 transferred miles and a total of 40,000 combined transferred and newly-bought miles annually.

— Gifted miles may expire if the recipient doesn’t fly within 12-18 months of receiving them.

— Mileage seats are capacity-controlled, meaning if seats redeemable for 12,500 miles run out, you may be doling out twice as much mileage for a seat in the same cabin.

When gifting miles doesn’t pay: For a round-trip ticket on American from NYC to San Francisco you’d need 25,000 miles, assuming a 12,500 mile seat for the lowest economy fare is available each way. It would cost you $180 (15,000 miles times one cent plus $30) to transfer the maximum 15,000 miles to his account, another $250 to buy the other 10,000 miles, and $57.50 more to cover his mileage redemption service charge and taxes. Your total: $487.50. The cost of buying a ticket outright for that same flight: $310.

When gifting miles does pay: Delta permits you to transfer up to 60,000 miles to a single recipient. For a similar NYC-San Fran flight requiring 25,000 miles, you’d pay $280 and no redemption fee if your friend booked 21 days or more in advance. Cost of the flight outright: $355. By the way, if your friend had booked that Delta flight one day later, aka 8-20 days before departure, you’d be stuck with a $75 redemption fee, which jumps to $100 for booking 4-7 before, $150 3 days or less before. So unless your buddy’s in a hurry to hit the streets of San Francisco, ask him to be careful about when he books.

Consider another mileage gifting scenario for American, this time for a round-trip flight from New York to London, which would cost 20,000 miles each way, space permitting for the economy off-peak seats. Adding the $180 for the 15,000 transferred miles to the 25,000 purchased mile cost of $625 brings your subtotal to $805. Figure in a $50 award service fee if your friend books 7-20 days in advance (only $20 if he books 21 days or more out) and your cost of gifting him the ticket is $855. The cost of the ticket outright: $1,032.

Bonus: Gifting miles will typically earn you bonus miles for your own account. Through the end of the year, stay on top of which airlines may be temporarily waiving their mileage giving/receiving caps. And keep an eye out for special incentives: for the remainder of 2009, US Air will double down, matching up to 50,000 miles per transaction any miles you buy or share with a friend.

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