Frequent Flier Miles are one of the most sought-after reward programs in the world today, generating more than 67 million members in the United States and between eight and nine trillion unredeemed miles. Frequent travelers can often be seen on airplanes and in airport terminals, calculating their Frequent Flier balances and trying to determine when they will have accrued enough miles to afford a trip to Cancun or Hawaii.
Frequent Flier Miles are undoubtedly valuable to those who hold them, especially to people who travel often and who look
forward to the day when they have earned enough miles to fly for free to any destination in the world. Miles can also be redeemed for hotel stays, meals and rental cars, and are afforded by Frequent Flier credit cards that offer free miles as rewards for purchases.
Frequent Flier Divorce Disputes
What is the value of a frequent flier mile? In most cases, it doesn’t matter because it will be redeemed for airline tickets, but in the case of a divorce, determining their value has become an increasingly common problem.
Emotions run high during most divorce proceedings, and the division of property can be a grueling and mentally draining ordeal. Divorcing couples argue over personal property, children, assets, debt, and…Frequent Flier Miles? When one partner or the other has earned a significant amount of Frequent Flier Miles, it will often be disputed in court as divisible property.
It has become more and more obvious that Frequent Flier Miles are valuable assets, especially when they have been accrued in large numbers. Most airlines prohibit the transferring of miles from one person to another – even in the case of divorcing couples – so other arrangements must be made. This begs the question: Are Frequent Flier Miles property?
Frequent Flier Miles accrued during the marriage are usually considered divisible property, though this decision varies by state. In most cases, the miles are considered a marital benefit that is subject to division in court.
The most popular method of dealing with Frequent Flier Fliers during a divorce is for the court to assign a monetary value to the miles. In 1999, a court in Minnesota ruled that each Frequent Flier Mile was worth $0.02, though this is far from standard. It is difficult to assess a monetary value for something that is redeemed for services, and not for cash.
Furthermore, the value of the miles is subjective depending upon which airline they adhere to. For example, miles earned through Continental Airline’s OnePass program might be more valuable than those earned through Southwest, or vice versa. The benefits given to customers of different airlines vary widely, and this poses a difficult problem for courts and mediators.
A common solution is for divorcing couples to allocate miles for equal benefit. For example, they might set aside a certain number of miles for their children to use when traveling back and forth from college. In other situations, one partner may be allowed to keep the miles, but must in turn pay for the other partner’s vacation to Orlando, Florida. It depends upon the amicability between spouses and their ability to reach decisions that will benefit them both equally.
If no terms can be reached between divorcing spouses, the decision will be left to the court. If a monetary value is assessed, the partner that keeps the miles will be forced to add half the value to a monetary settlement. If the court determines that the Frequent Flier Miles are not property, then the issue will be expunged permanently.
How to protect the miles you earned
No marriage is expected to end in divorce, but statistics show that the likelihood is increasing exponentially. When it happens, both partners should exercise prudence in researching factors like Frequent Flier Miles. If you or your spouse have accrued a significant number, it may become an issue.
- Research State Laws. Each state carefully delineates the laws concerning divorce and the division of property. Contact your lawyer or research the laws that govern these types of property, and use those facts to determine your best course of action.
- Get the Inside Scoop. Before the divorce even sees a court room, talk to your spouse about the subject of Frequent Flier Miles. Find out what his or her position is on the division of miles, and plan your strategy accordingly.
- Make a List. If you plan to use a mediator in the division of property and assets, make a list of acceptable terms that you will consider concerning Frequent Flier Miles. The first option on your list should be the one that you prefer, and only disclose the other options when the first is overruled. This will help protect your interests and will prevent undue arguing during mediation.
- Contact the Airline. Find out what the rules are pertaining to Frequent Flier miles. Determine whether or not the miles are transferable, because if they aren’t, you will have to allow the court to assess a monetary value.
