Is mile hoarding good strategy for AA's transition to revenue based earning?
#1
Original Poster
Join Date: Aug 2007
Location: SNA
Posts: 67
Is mile hoarding good strategy for AA's transition to revenue based earning?
All my AA travel is discretionary, leisure discount business or first. For me it seems my mile earning opportunities will seriously diminish once AA switches over to a revenue based earning system in late 2016. Rather than burn all my miles down before March 22's devaluation might it make sense to hold on to a good chunk until after the transition is complete? Yeah, I know about the "Earn and burn" philosophy, but maybe this transition case is an exception?
#2
Join Date: Feb 2009
Location: USA
Programs: Chase Sapphire Reserve, WFBF
Posts: 1,573
All my AA travel is discretionary, leisure discount business or first. For me it seems my mile earning opportunities will seriously diminish once AA switches over to a revenue based earning system in late 2016. Rather than burn all my miles down before March 22's devaluation might it make sense to hold on to a good chunk until after the transition is complete? Yeah, I know about the "Earn and burn" philosophy, but maybe this transition case is an exception?
Miles have never gotten more valuable over time.
Rate of earnings has nothing to do with it. If you hoard your miles now, you will not earn more in the future. You will have more to spend later, but at the expense of having less to spend now. So, unless you have no use for them now, why wouldn't you spend them now, while the value is known, rather than later at some unknown lower value?
#3
Suspended
Join Date: Aug 2010
Location: DCA
Programs: UA US CO AA DL FL
Posts: 50,262
Hoarding miles is no different than hoarding $ without investing it. Over time it will be worth less and that is inevitable.
Doesn't mean you need to dump all your miles today, but nobody believes that what they earn today will keep them going forever it they sew it into a mattress.
Doesn't mean you need to dump all your miles today, but nobody believes that what they earn today will keep them going forever it they sew it into a mattress.
#4
FlyerTalk Evangelist
Join Date: Aug 2007
Location: SEA, but up and down the coast a lot
Programs: Oceanic Airlines Gold Elite
Posts: 20,386
In real terms, not only is there expected massive inflation on things like rent, food and gasoline, your boss will cut your pay. In that environment, holding on to currency that will soon be devalued instead of spending it is foolish.
#5
Join Date: Oct 2005
Location: SFO/OAK ex DCA ex ALB
Posts: 625
I'm in a similar spot -- I've burned a lot of my miles but really wanted to use a good chunk of what I have left for a second honeymoon of sorts -- something along the lines of F to Asia 2. But now we have a kid who is still too young to leave with grandma and grandpa for a week, so I'm probably stuck waiting a while. (And I can't exactly take that trip now by myself. ) I'm one of those people who historically only books the type of awards that just got the biggest cost increases, so I'm considering stocking up as much as I can now and hoping that I still have enough for more than just that one trip when the time comes. Either way I'm kinda screwed. Thanks, Dougie.
#6
Join Date: Jun 2013
Location: Roswell, GA
Programs: AA EXP 2.8m,Lifetime PLT, Hilton Diamond, IHG PlLT, SPG Gold
Posts: 3,191
Is mile hoarding good strategy for AA's transition to revenue based earning?
What I have done over the last few years is
Using miles for my wife and myself for travel over the Christmas period (we got married dec 31) so every year so far we have been able to travel F to international places
Keeping in mind I always keep about 150k in reserve
Using miles for my wife and myself for travel over the Christmas period (we got married dec 31) so every year so far we have been able to travel F to international places
Keeping in mind I always keep about 150k in reserve
#7
Join Date: Oct 2012
Location: NYC
Programs: AADULtArer
Posts: 5,681
I'll use 1 cpm in this example, others can use the number they see fit...
If you have 500,000 miles in an account, that's a cash equivalent of 5000 USD
Would you keep 5000 cash in a drawer?
I hope not.
Haording is not a strategy, it's asinine
If you have 500,000 miles in an account, that's a cash equivalent of 5000 USD
Would you keep 5000 cash in a drawer?
I hope not.
Haording is not a strategy, it's asinine
#8
formerly gemini573
Join Date: Jun 2003
Location: LAX, HKG, and BKK
Programs: CX Emerald, WOH Globalist, Marriott Platinum, AA Lifetime Platinum, Virtuoso, Prive, STEPS, STARS
Posts: 2,233
As others have echoed, NO WAY! Don't hoard miles. And if you're looking to travel in fcl using miles be it on AA or ow carriers, you're going to have a tougher time finding them. There won't be any fcl on the 772 in the near future. Only 77Ws, which AA has roughly 20 of them. .
#9
Join Date: Feb 2009
Programs: AA 1MM, Hyatt GP Platinum, *wood Gold
Posts: 173
Among the planned changes in 2016 are higher mileage requirements for some awards, so hoarding is an especially bad idea now. This is all the more reason to book your 2016 award travel ASAP. I'm not thrilled by the developments regarding the number of RDMs/$ for flights, but considering all the alternative ways of earning RDMs, it's something I can just live with so long as EQM earning remains the same.
#10
Join Date: Oct 2007
Location: Left
Programs: FT
Posts: 7,285
Partly true but in areas where redemptions went down, for those who redeem in this area, this is not true. So people who travel short distances domestically by sitting on miles did see them increase in value as of March 22.
#11
Join Date: Oct 2007
Location: Left
Programs: FT
Posts: 7,285
I would also add the those saying this is negative have failed to factor in that in the last few years, miles were way cheaper to get. From churning, buying and converting with bonuses.
I'm just saying it ain't as definitive as all the experts here seem to suggest.
Many flyers were commuting for work using some pretty free miles from BA before they woke up and changed some cheap redemptions created by a devaluation. Hell, I saw friends go back and forth between yyz and lga for nothing two and three times a week for months.
I'm just saying it ain't as definitive as all the experts here seem to suggest.
Many flyers were commuting for work using some pretty free miles from BA before they woke up and changed some cheap redemptions created by a devaluation. Hell, I saw friends go back and forth between yyz and lga for nothing two and three times a week for months.
#12
FlyerTalk Evangelist
Join Date: Dec 2003
Location: LAX
Posts: 10,908
The idea of spending before deval only makes sense of you spend on smth you plan to spend on to begin with - not on unnecessary trips just for the sake of burning miles.
I'd rather take 20% deval and still go to places i want to visit later than burn 100% on some quick trip in C or F.
YMMV of course
#13
Join Date: Oct 2012
Location: NYC
Programs: AADULtArer
Posts: 5,681
Would you instead go and just spend it on random stuff?
The idea of spending before deval only makes sense of you spend on smth you plan to spend on to begin with - not on unnecessary trips just for the sake of burning miles.
I'd rather take 20% deval and still go to places i want to visit later than burn 100% on some quick trip in C or F.
YMMV of course
The idea of spending before deval only makes sense of you spend on smth you plan to spend on to begin with - not on unnecessary trips just for the sake of burning miles.
I'd rather take 20% deval and still go to places i want to visit later than burn 100% on some quick trip in C or F.
YMMV of course
Ymmv, I agree.
#14
Join Date: Jul 2009
Location: Sonoma
Programs: ex-ExPlat, AA Lifetime Platinum
Posts: 161
agree 100% with azepine00. i have already booked most of my desired travel between now and next June so i am not going to just "burn miles" on unwanted trips. i will take the devaluation and use the remainder on future special trips.
#15
Join Date: Jun 2008
Location: Everywhere you wanna be
Programs: AA EP | UA 1K
Posts: 1,657
I'm not going to spend miles just for the sake of spending them. People seem to forget that award prices/levels for some regions actually dropped. But sure lets go with the mass hysteria even though UA has higher redemption levels on partner airlines.