Nothing new here. The smart money stopped collecting Aeroplan a few years back. Whilst there were certainly opportunities with mini RTW in F and others since, for the most part that could have been achieved cheaper and more effectively in other programs.
you and I know that it is terrible - most of the flying public doesnt.
But its never been NEGATIVE value before
A lot of the flying public can get a decent value from AE redemptions flying UA. I am not singing their praises or anything (I'd like a way out!), but there's ways to avoid the scamcharges, as everyone knows.
I can always keep the taxes/fees for my redemptions under $100, which I am okay with. If they start scamcharging for the UA flights, that's when I will jump ship...
The price is 60000 miles + $605.40 in scamcharges on AC metal via YUL.
The retail price of the ticket (L fare) is $762.55
This means your 60000 points covers exactly $157.15 or 0.26cpm value.
now, take into account that you are also giving up earning 7922 UA miles (L fare)
Even valuing those points at 2cpm (which is what you can buy them from UA for) - thats an opportunity cost of $158.44
Therefore, by using your AE points - you are actually LOSING MONEY (on top of 60000 points you spent!)
Let's not overdo it.
Proper arithmetic says that you are comparing paying 60000 miles + $605.40 vs. paying $762.55 and gaining 7922 miles. Which yields a value of 762.55-605.40 for 60,000+7922 miles. That is, 15844/67922=0.23 cents per mile. Careful, not 2 cents, 0.2 cents. $0.0023/mile.
Surely Aeroplan loves you if you pick such a reward.
Proper arithmetic says that you are comparing paying 60000 miles + $605.40 vs. paying $762.55 and gaining 7922 miles. Which yields a value of 762.55-605.40 for 60,000+7922 miles. That is, 15844/67922=0.23 cents per mile. Careful, not 2 cents, 0.2 cents. $0.0023/mile.
Surely Aeroplan loves you if you pick such a reward.
Those 7922 UA miles given up have a monetary value of $158.44 - thats the lowest valuation based on buying them outright - of course as an elite of any sorts - the monetary value is higher
so the equation is
60000AP+$605.40=$762.55-$158.44 (opp cost)
doing some grade 9 math:
60000AP=$762.55-$158.55-$605.40
60000AP= (-$1.51)
yes, its an extreme example, and noone here would use such an award, but I am sure everyone here knows somebody who has used a Y award to Europe at some point not realizing they are actually getting below zero value for their points.
yes, its an extreme example, and noone here would use such an award, but I am sure everyone here knows somebody who has used a Y award to Europe at some point not realizing they are actually getting below zero value for their points.
But that's the point, isn't it?
Still, you take an extremely poor example of using Aeroplan miles, but next when valuing your UA miles, you pick a relatively high value, which is not really consistent with the latter. Plus, using Aeroplan but accumulating on UA is not a terribly useful comparison. Not of much use to some of us.
The way I do it is based upon using *and accumulating* on Aeroplan.
No matter how you look Aeroplan miles have been seriously devalued. But for people with status, 2 cents/mile is not an unrealistic valuation. For mom and pop, I would say 0.8. Not 0.2...
I have recently purchased miles at 2 cents/mile. But then the ticket included minimal Aeroscam co-pay.
No matter how you look Aeroplan miles have been seriously devalued. But for people with status, 2 cents/mile is not an unrealistic valuation. For mom and pop, I would say 0.8. Not 0.2...
I have recently purchased miles at 2 cents/mile. But then the ticket included minimal Aeroscam co-pay.
2cpm is a very realistic valuation for UA miles. I actually think its kinda low, given the lack of scamcharges. Even for an economy ticket - you often would get better value.
now anything above 1cpm is probably a stretch for Aeroplan.
Add to it, that it can be argued that Aeroplan is twice as hard to earn from flying nowadays.....
