Compensation: Should You Take the Cash, Miles, or a Voucher From an Airline?

If you’re a frequent traveler, things will inevitably go awry at some point. We’ve all had it happen: delay after delay, overbooking, staffing issues, mechanical failures, downgrades, and even the smallest issues, like your IFE screen not functioning or your seat not reclining.

Thanks to the 2024 U.S. Department of Transportation refund rule, travelers are entitled to refunds if a flight is cancelled or significantly delayed by the airline and they choose not to rebook or travel.

Under the current administration, the DOT just withdrew a proposed rule that would have compensated passengers for delays and cancellations regardless of whether or not they chose to rebook or travel. However, there are so many other ways travel can go wrong, and airlines might offer compensation in the form of cash, miles, or a voucher that you can use for future travel if they do.

In the heat of the moment (especially if you’re tired, angry, or frustrated), you might not have the clarity to determine if you’re getting the right deal. These choices usually mean you have to do some math or consider your future travel and financial needs, and picking the right one is essential.

So set those emotions aside the next time you have a stressful travel situation and let us help you evaluate whether you should accept cash, miles, or a voucher from an airline.

Types of Compensation

Depending on the situation or the particular travel inconvenience you’re faced with, airlines may offer compensation. You may have a choice, or not. That said, it’s always worth asking politely for a different kind of compensation (or more of the one you’re offered) if you think it’s unfair or not the right fit, though the airlines may not honor your request. In most cases, here’s what you can expect the airlines to offer you:

• Cash: Airlines might offer you a cash refund for all or some of your flight costs. You might get lucky and be offered more than you paid, especially for situations like bumping or downgrades.
• Frequent flyer miles: You might be offered this if you purchased your ticket with miles or as compensation for something like a broken IFE screen or other travel woes. Depending on the airline, these may or may not expire, but they should have the same limitations as the frequent flyer miles you earn when you fly or spend on co-branded credit cards.
• Voucher: A voucher is a coupon you can use to book travel on the same airline. Be wary of expiration dates and other limitations when accepting vouchers — make sure to read the fine print. Some airlines make this clearer than others. Airlines may offer additional vouchers for hotel stays, food, and drinks if a significant enough delay warrants it. 

When To Accept Cash

You might have heard the saying “cash is king,” and that’s the truth. Cash is the most flexible option, and we can all use it. It’s not limited to just airline tickets — you can use it for groceries, school fees, or whatever you need. Accepting cash is never a bad idea, especially if you’re offered a full refund, or, in certain cases, more than you spent on the ticket in the first place.

If you’re given the choice between cash and miles or a voucher, you might want to accept the cash if:

• You’re not a frequent traveler.
• You don’t understand much about how to maximize your points and miles.
• You don’t plan to travel anytime soon.
• You don’t plan to fly this airline anytime soon (or ever).
• You really need cash for something else.

When Not To Accept Cash

You might not want to accept cash if the value of the points and miles you’re being offered is much higher or if the voucher offers an additional bonus. I’ll explain both of these below.

When To Accept Miles

In my case, cash isn’t always king. I actually prefer points and miles, because, well, I’m a points and miles junkie. And, in many cases, the value of points and miles is often higher than the cash value — if you know how to maximize them.

Cash always has the same value. If you get $500, that’s worth $500. But you can often get a much higher value out of travel rewards, which is why I hold a 8 different travel reward credit cards and just 1 cash-back credit card.

Comparing Cash to Miles

One cent is always just 1 cent, but frequent flyer miles can be worth significantly more.

Imagine you were offered $100 or 10,000 Iberia Avios. Upgraded Points values Iberia Avios at 1.25 cents per point, which means that 10,000 Avios would be worth at least $125.

However, I’ve gotten extreme value from those miles, up to double-digit cents per point. For example, Iberia recently had a sale, during which I was able to get a one-way ticket from Madrid to New York (JFK) for just 6,400 Iberia Avios.

Cash rates were $463 for the same one-way ticket.

This means I was able to get a valuation of 7.2 cents per point, which is much higher than 1 cent per point. If I had accepted the 10,000 Avios, I would still have a few thousand of them left, plus a plane ticket. If I had accepted the $100, that would have been less than a fourth of my ticket, and I would still have had to pay hundreds more to get the ticket — and I’d have nothing left over. If Iberia offers me Avios, I’m going to take them over cash any day because I know I can extract a higher value from them.

Some of the airlines where Upgraded Points values points at higher than 1 cent per point are Alaska Airlines Atmos Rewards (1.6 cents per point), Korean Air SKYPASS Miles (1.6 cents per point), and American Airlines AAdvantage Miles (1.4 cents per point). If you have a choice between miles and cash on any of these airlines, it may be more lucrative to accept the miles, especially if you think you can maximize them for a high value.

You might also have better luck negotiating miles or voucher amounts than cash. An airline might not budge on a cash amount, but you could see some wiggle room with miles, especially if you ask nicely. This isn’t a given, but it’s definitely worth a try.

If you aren’t sure how or when to use your miles, browser extensions like Points Path or websites like Point.me or Seats.aero can help you figure out how to get the most out of your miles.

When Not To Accept Miles

If you’re an absolute beginner or don’t have the time or knowledge to book travel using miles, don’t accept them. Don’t accept miles if you plan to use them for gift cards or Amazon purchases. Finally, if you tend to let your miles expire, don’t accept them. Take the cash instead.

When To Accept a Voucher

Vouchers can be valuable, especially if they offer a higher value than a cash amount. During the COVID-19 pandemic, many airlines offered bonus vouchers where you’d get an additional percentage if you accepted the voucher. For example, perhaps you would be offered $500 in cash but $600 in a voucher.

Here’s what to consider if you’re offered a voucher (or the choice of a voucher vs. cash or miles):

• Is there an expiration date? Many vouchers are only valid for a year. It might be worth negotiating a longer expiration date or taking another method of compensation if you know you won’t be traveling anytime soon.
• Can you use it on partner airlines? Some vouchers can be used on partner airlines, so you have more options for using them.
• Who can use it? Some vouchers are only for you, but others can be used to buy a ticket for someone else, which makes them more valuable.
• Are there blackout dates? Years ago, I got a voucher with United. When I went to use it, I realized there were many blackout dates, including the entire summer, making it nearly impossible to redeem. Make sure to understand and be aware of the fine print, especially the blackout dates.
• Can you use it more than once? If you don’t redeem your voucher for its full value, can you use it again? Or will you lose the rest of the value if you don’t redeem it in full? Find out before you commit.
• Will travel insurance cover trips paid for with a voucher? If you plan to insure the trip you’d use the voucher on, ask the insurance company if they’d cover the voucher amount, as this can be a gray area.
• Are you traveling again soon? As with miles, if you aren’t traveling anytime soon or don’t plan to fly this airline again, a voucher won’t do you much good.

When Not To Accept a Voucher

If you aren’t traveling any time soon, won’t fly again with that airline, or the voucher you’re offered has strict limitations and expiration or blackout dates, you might want to try your luck at getting cash instead. Remember, if you wait for an airline to cancel (or significantly delay) your flight, you’re eligible for a refund if you choose not to travel. In certain cases, patience is key if you don’t want to accept a voucher,

Which Is Best for You?

Personally, I almost always go for the points and miles if given the choice, especially if they’re equal to or more than the cash amount. I also always request more points and miles (nicely, of course, and based on what went wrong) to see if they’ll give me more, though it may not work.

However, my circumstances are not your circumstances. Each travel drama is unique in how it unfolds and what the airline may offer you. Your own situation matters — how savvy you are with points and miles, if you plan to travel soon, or if getting an infusion of cash would be helpful at that time. Cash is always the most obvious and convenient option. Still, the possibility of getting additional value by opting for points and miles or getting a bonus amount added on to a voucher should be a factor in your decision.

The choice is yours to make, so weigh your options and select what works best. And if the airline isn’t offering what you want, you can always ask.

Final Thoughts

Travel brings lots of joy and fun, but there’s always room for error. Having an airline ruin your vacation can be extremely frustrating, but it doesn’t have to be the end of the world (or your trip).

In fact, it might just be the beginning of your next trip, depending on what kind of compensation you decide to accept for your troubles. Pick the one that’s right for you — cash, voucher, or miles — and enjoy the rest of your trip.