MilesBuzz! - Is $300 still the "rule of thumb"?

When deciding whether to use 25,000 miles for a domestic award ticket, I seem to remember a "rule of thumb" that said if the same ticket can be purchased for $300 or less, buy it and save the miles for a more expensive ticket or for upgrades. Do most FT'ers still follow this rule?

There is no correct answer. Some say $300, some $500. It depends on what the typical airfare is and what the airfare for the dates you want to travel.

If you live in a low fare city, then you may want to use the award instead of paying $300. If you live in a high fare city, then you may seize the opportunity to buy a $300 ticket and use the award only for $500 tickets.

My guess is that San Diego is a moderate to low fare city but I don't know. SFO/OAK tends to be lower. Kansas City and Phoenix tend to be low fare cities. Montgomery, AL and Rochester, NY seem to be high fare cities. Sometimes, LaGuardia is a high fare airport.

i flew to australia from new york this past xmas in business class using 125K miles. the ticket was roughly $10K if i paid for it with currency.

judging from that very positive experience, i would only use miles if i thought the coach ticket was really out of line. otherwise, i would rather save the miles to take a long trip in business (like to cape town or australia again, for instance).

I too only use my miles for long trips in business -- or for last minute flights where no discounted fares are available. I believe that maximizes the value of your miles. Of course, if you have so many miles that you're having trouble using them, that fact would trade my equation.

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by fly co to see the yanks:
i flew to australia from new york this past xmas in business class using 125K miles. the ticket was roughly $10K if i paid for it with currency.

judging from that very positive experience, i would only use miles if i thought the coach ticket was really out of line. otherwise, i would rather save the miles to take a long trip in business (like to cape town or australia again, for instance).</font>

Hey Fly Co, I assume you flew Quantas on a CO award? How was it? Did you get to take a peek into the F cabin - and regret not getting an F award?

I want to make this trip soon, but I think that I'll really want to go in first...

For me, it depends on the airline. On AA, I earn and burn a lot of miles. I would redeem 25K for a $300 ticket in a heartbeat. I have Gold status, so flying in coach on an award ticket would be a tolerable experience. If I want to fly biz to Europe a few months down the road, I know I have enough miles for that ticket, too.

On other airlines where I earn and burn slowly, my miles are most closely earmarked for certain trips - usually international business class. So I'd be less likely to jump at a domestic redemption if it set me back a year or two from a key mileage level.

I think the rule of thumb used to be higher. Pre 9/11, the most expensive common routes in the US domestic tickets were around $400 for coast to coast, but with the increase in discount fares cutting this substantially, IMHO 25,000 miles is worth $250 or less. This is based on me trying to trade RTFC (free round trip vouchers) for $200 vouchers on the same airline to no avail. However as some have pointed out, the value in miles to money is not linear. If you spend in excess of 80,000 miles for an award, usually flying comfortably over a large body of water, the value of the ticket is worth many, many times 3 US domestic awards.

My discussion on this on my web site below should be of use. Click on Value of Miles in the left menu.

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Free Frequent Flyer Miles (http://home.earthlink.net/~pgary/MilesFrame.html)

I thought a Business Class ticket on QANTAS was only 105,000 miles?

My bar for using 25K miles for an award is about $315. If I can purchase a ticket for less than that, I will buy it rather than use the miles.

I usually plan my leisure travel well in advance and search fares almost daily so paying more than about $280 for a domestic coach ticket almost never happens.

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by notsosmart:
Hey Fly Co, I assume you flew Quantas on a CO award? How was it? Did you get to take a peek into the F cabin - and regret not getting an F award? </font>

i actually flew cathay business for 125K. i hear that AAmericAAn got rid of this AAwAArd. not sure if that is true....

it was great. despite two 9+ hour flights, two 13 hour flights, and two 5'ish hour flights just to get to australia (through hong kong), it actually flew by pretty quickly. cathay is great and so is ambien. http://www.flyertalk.com/forum/wink.gif

Last April the wife and I flew round trip from Newark to Sydney on Quantas (business class) for 125,000 CO OnePass miles each. Yes, I peeked into First, and what I saw looked like something out of Star Trek, with futuristic sleeping pods. I was happy in business, though. We got on the plane, they fed us dinner, we slept for seven hours, they fed us a full late-night meal, we watched two movies (on our own individual screens with 18 channels), they fed us breakfast, we landed.

ClipperCFX

I save my miles for international upgrades (50,000 on AA from coach to Business) and tickets for the kids when they accompany me/us.

Also flew my Mother here last month on an award ticket.

Captain Mike: Hi! What's the average over-the-transom price of the tickets you would have to buy instead of use your miles?

That's how I go at it. We used miles last year to fly associates to Toronto (expensive city) from Pennsylvania and Kentucky. Not a lot of distance, but over $300 each to BUY the tickets, so miles seemed cool. Earlier in the year, flew the kids out to CVG from SAN and could have had the paid tickets for a little under $300.... miles seemed the best way to go there, too.

Cashing in for ourselves, we have a higher threshhold, unless we are already assured of top-tier status from purchased miles. Missing the top status after December 'cause we cashed in 50,000 miles in February seems kinda dumb. But if I already have my (eg, 75,000 NW miles) by October, I am more likely to believe that cashing in miles at the end of the year is worth it, no matter what the cost of the alternative tickets. That is, of course, unless I would owe more taxes otherwise. You see, it becomes terrifically complicated for some of us.

Also, miles tickets on many airlines are flexible, and can be changed. In that case, they may reasonably substitute for higher priced tickets if YOU KNOW YOU WILL NEED the flexibility. Otherwise, why pay for it?

We also preserve miles for last minute, unforeseen trips. If the airline ticket would have otherwise cost $2200, the miles are MUCHO MOLTO VALUABLE.

For you guys, I expect it should just come down to an evaluation of the cost of purchase vs. mileage tickets, {allowing for the likelihood of survival of the airline -- a necessary consideration these days -- uncashed, orphaned miles are worthless). Can you buy the equivalent tickets for XX $$?? Then hold the miles; otherwise, cash them.

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"It was the epoch of belief, it was the epoch of incredulity..."

My new miles strategy has been to redeem miles only for family and friends... makes you look good http://www.flyertalk.com/forum/biggrin.gif

aloha

p.s. Flying out of HNL, anything in F/J is what I usually book with my miles, if for myself.

I value miles at 2.5 cents each and never use them for tickets of less than $500 (I know that is just 2 cents!!!). I really like to use them for unexpected last minute trips if seats are available or best for international upgrades.

I flew to Rome last year using 80,000 miles to get two upgrades that would have cost me over $5000. That is about 6 cents per mile. I used many points to go business class to London, again getting a value of over 4 cents per mile. My trip to New Zealand and OZ had a value of almost 10 cents per mile.

Don't waste points on $300 tickets unless you have so many you don't know what to do with them. If you do, donate some to charity. That way they make a difference.

I use mine for last minute trips and international premium tickets. My best use was 4 years ago when I was able to get a TWA flight from STL-BOS to see Roger take on Pedro in the ALCS. I got the ticket the day before the flight, was given the last empty seat on a trip that would have cost ~$1600 to buy. Of course I would not have paid that amount, but it was still a good use of miles.

140K miles for Cathay F to Australia was also an excellent value.

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by mshaikun:
Don't waste points on $300 tickets unless you have so many you don't know what to do with them.</font>

I have made an exception in certain cases when I had 25000 points that I knew would expire before I could use them on an expensive ticket. I felt it was better to get something for the points than nothing.

Ed

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by suranyi:
I have made an exception in certain cases when I had 25000 points that I knew would expire before I could use them on an expensive ticket. I felt it was better to get something for the points than nothing.

Ed</font>

Correct. Like my cashing in 50,000 USAir miles for 2 R/T tix on United to Chicago from here. Saved me $500 on the tix and I got to use miles of dubious future viability.

Thanks everyone, for your thoughts. San Diego tends to be a "low fare" city, especially on transcons ($175 - $250). While the flights from SAN to the midwest are slightly higher ($330 or so), I like the idea of saving the miles for last minute domestic emergencies or international upgrades. We flew to Israel on AA/BA several years ago in business class and it was terrific. As retirement approaches, I'd like to begin stockpiling miles for those kind of treats.

Capt. Mike asks about a domestic coach award.

Compared to an international business class award, the dollars saved with a domestic coach is less (for example, J class LAX-SYD is very expensive). However, some look at travel only in terms of miles and a J class award would not be worth paying for much more than coach. From that perspective, domestic coach awards may be a better deal. For example, one might be able to save $500 each time for 2 coach awards ($1000) which would cost 50,000 miles. A trip from the US to Europe also cost 50,000 miles but less than $1000.

In short, different answers for those with different perspectives.

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by notsosmart:
Hey Fly Co, I assume you flew Quantas on a CO award? How was it? Did you get to take a peek into the F cabin - and regret not getting an F award?

I want to make this trip soon, but I think that I'll really want to go in first...

</font>

I did a RT from JFK to SYD a few years ago in business. Business was nice, I got a quick look into First which looked a whole lot better. Looked like it was full of Leather Recliners. I was fine in Business, so unless you have more miles than you know what to do with its probably not worth going up to first.

I did a couple of domestic Qantas flights as well, Qantas' domestic business class is nothing special (and there is no first).

[This message has been edited by FrequentStark (edited Jan 27, 2004).]

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by FrequentStark:
I was fine in Business, so unless you have more miles than you know what to do with its probably not worth going up to first.</font>

For the small marginal mileage cost of going F instead of J, there is a large increase in comfort and service. BA and CX both have very nice J service, but both airlines have F class that will keep you talking about your experience for years. Add to that the use of F lounges, which offer pretty good food and drink, and the extra miles have been put to good use.

BA F now costs a lot more miles that J. Last year I picked up an F ticket for 100,000 miles when a J ticket would have been 80,000. Seemed silly not to upgrade to F for the cost of 2 Jaguar test drives.

Airfares have been so low for so long that they are cheaper than 20 years ago when adjusted for inflation.

That being said, I think it is better to use miles only to upgrade, since you are re-earning them on the purchased ticket you are upgrading! This is what makes travel to Australia or New Zealand such a bargain if you upgrade.

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by SFOTRAVELER:
[B]Airfares have been so low for so long that they are cheaper than 20 years ago when adjusted for inflation.
</font>

Well, if we adjust for inflation, then airfares SHOULD be getting cheaper, as airplanes today are more efficient (lower operating cost), and service quality poorer... http://www.flyertalk.com/forum/smile.gif

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by mshaikun:
I value miles at 2.5 cents each and never use them for tickets of less than $500 (I know that is just 2 cents!!!). I really like to use them for unexpected last minute trips if seats are available or best for international upgrades.

I flew to Rome last year using 80,000 miles to get two upgrades that would have cost me over $5000. That is about 6 cents per mile. I used many points to go business class to London, again getting a value of over 4 cents per mile. My trip to New Zealand and OZ had a value of almost 10 cents per mile.

Don't waste points on $300 tickets unless you have so many you don't know what to do with them. If you do, donate some to charity. That way they make a difference.</font>

I think that your point is well taken, but there are those who really want a free ticket and do not have enough to get a free one in first/business class. It has been discussed a lot the idea that first/business class are OVERPRICED compared to what many flyers would be willing to pay. For me, if I have enough miles so that my wife and I both fly for free, that means that I can have more money available to travel further. I would rather do that than buy tickets, upgrade with miles, and have less money for the trip. Of course, it all depends on your available miles and money.

Still, I would probably prefer NOT to redeem for a $300 ticket, there are much better uses for the miles. But it also depends on what a person would do with the miles otherwise. If you prefer international destinations, higher class of service, or those with better redemption rates, then save them for that. If the only thing that you need miles for are domestic cheapies, then use them because it is better to save money than keep unused miles forever.

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by quinella66:
I think that your point is well taken, but there are those who really want a free ticket and do not have enough to get a free one in first/business class. It has been discussed a lot the idea that first/business class are OVERPRICED compared to what many flyers would be willing to pay. For me, if I have enough miles so that my wife and I both fly for free, that means that I can have more money available to travel further. I would rather do that than buy tickets, upgrade with miles, and have less money for the trip. Of course, it all depends on your available miles and money.

</font>

I agree with what you're saying here. Let's say I have mumblety-mum thousands of miles, enough for a coach ticket or an upgrade. I have two choices:

1. Buy a coach ticket and upgrade. Advantage: A nice seat for the trip.

2. Use miles to get a coach ticket. Advantage: Several hundred dollars (at least) more to spend at the destination. Or enough money left over to take another trip another time.

I ALWAYS choose the latter. Taking more trips cheaper is much more important to me than having a nice seat.

Ed

I would roughly say about $225 or so for every 10,000 miles...depending when and where you are going.

So, say if you go to S America and your coach ticket runs close to $1000, then maybe use miles.

But, if you go to Europe in the low season and your ticket costs $500, by all means buy it, it is no only cheap...but you get mega miles...

Caribbean destinations usually are good for mileage awards...reason being you don't get a lot of miles... plus you may be able to fly to more than one destination on one ticket...such as say, flight to US Virgin Islands or Netherlands Antilles and stopping in San Juan on the way in or back.

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by worldtraveler19:
I would roughly say about $225 or so for every 10,000 miles...depending when and where you are going.

So, say if you go to S America and your coach ticket runs close to $1000, then maybe use miles.

But, if you go to Europe in the low season and your ticket costs $500, by all means buy it, it is no only cheap...but you get mega miles...

Caribbean destinations usually are good for mileage awards...reason being you don't get a lot of miles... plus you may be able to fly to more than one destination on one ticket...such as say, flight to US Virgin Islands or Netherlands Antilles and stopping in San Juan on the way in or back.</font>

Going anywhere over 6 hours begs for business or first class. Sure, a $400-500 ticket to Europe is relatively inexpensive, but that only gets you coach. You could use miles to upgrade, but the changes to many airlines awards now have upgrade awards requiring almost as many miles as an award for a free BC/FC ticket. The economics on that just don't make sense. I redeem for coach domestic award tickets (except Alaska/Hawaii) and BC/FC just about everywhere else.

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by MileKing:
Going anywhere over 6 hours begs for business or first class. Sure, a $400-500 ticket to Europe is relatively inexpensive, but that only gets you coach.</font>

For some of us, coach is fine. I've flown across the Atlantic or Pacific 14 times in the past few years, and I've never had a first class seat in my life. Coach was perfectly fine for me.

As I've said on other occasions, I would ALWAYS make two trips in coach rather than one trip in business or first. My goal is to maximize my travel, not my comfort.

It may help that I'm 5'4" tall, which is somewhat shorter than average.

Ed

I agree First Class or Business is great, but if you get the correct seat in coach, it's not bad! I mean, you don't get the big seat,the toiletry bag, the china and the fancy meal or the individual DVD...but if you are lucky enough to get an exit row seat (and in most airlines elite passengers can reserve these in advance)..they it is fine, and you are paying a lot less than paying full care business or coach.

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by MileKing:
You could use miles to upgrade, but the changes to many airlines awards now have upgrade awards requiring almost as many miles as an award for a free BC/FC ticket. The economics on that just don't make sense.</font>

This varies greatly by airline, and the economics will vary depending on the elite status of the passenger and other bonuses involved with the paid ticket.

Example: an AA Plat buys a $400 R/T coach ticket. Since he is signed up for about a dozen different promotions, I'll conservatively say he earns 10,000 Q-miles towards next year's qual, and 30,000 miles total. He upgrades for 50K, so his total cost for a Biz ticket is $400 + 20,000 miles. His added benefit is that he just earned 4 domestic upgrade credits, a bunch of Q-miles, and moved 30K closer to Lifetime levels.

Or he can book a 90,000 mile award seat in Biz. He loses all of the above benefits, but gains some changeability and some stopover flexibility.

For most choices like this, I've chosen to buy the ticket an upgrade. I've even done it when I went coach one way and biz the other, due to availability. (Only because of MRTC would I do this.) If I really wanted a stopover, that might change things. (I'd still look at the costs of purchasing two tickets though.)

On other airlines where you have to buy up to a higher coach fare before you can upgrade, or airlines on which I have no status, I am more apt to just redeem the biz award. It varies based on my current cashflow, mileage levels, and future plans with the airline in question.

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by pinniped:
This varies greatly by airline, and the economics will vary depending on the elite status of the passenger and other bonuses involved with the paid ticket.

.....

On other airlines where you have to buy up to a higher coach fare before you can upgrade, or airlines on which I have no status, I am more apt to just redeem the biz award.</font>

This was really the situation I was thinking of. Having to buy a higher fare AND then spend miles to upgrade does not seem to offer the value of simply redeeming for a BC/FC award.

I live in LA and fly to NYC a lot. I don't go to other destinations a lot (except for work). Therefore I don't feel bad about burning 25,000 on a $200 ticket

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by TimMeineke:
I live in LA and fly to NYC a lot. I don't go to other destinations a lot (except for work). Therefore I don't feel bad about burning 25,000 on a $200 ticket</font>

but, you're also burning the 5K+ (elite) miles for flying as well as any elite mileage bonuses, if applicable, and other bonuses (such as online booking bonuses or "pay with mastercard" bonuses, etc.) you may earn.

so, you are at a minimum burning about 31K miles for the $200 ticket.

i understand your thought, but i would never use miles instead of paying $200 for a transcon.

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by TimMeineke:
I live in LA and fly to NYC a lot. I don't go to other destinations a lot (except for work). Therefore I don't feel bad about burning 25,000 on a $200 ticket</font>

If I were AA Plat and was finding LA-NYC R/T for $200, I'd be falling all over myself to buy it.

This board will be happy to provide other destination suggestions for you to spend those miles. http://www.flyertalk.com/forum/smile.gif

The moral to the story is that there is no absolute correct answer to this question. It all depends on your needs and flying patterns:

1. If you are a business traveller who has maximum status and more miles than you know what to do with, then burn them at every opportunity.

2. If you are someone who needs extra flights to make status and feels that flying in other classes than coach is a priority, then use miles for upgrades.

3. If you are a person who cannot make status and just earns miles to travel as much as you can and could care less about paying extra for first class, they use miles for coach tickets that give a fair return on miles (eg. do not redeem for 1 cent per mile).

Etc. it could go on and on ....

I do not fly much at all on business anymore so I try to travel as much as I can with the miles that I have and can still earn, so I would rather use them for more flights to travel more than having a big seat at the front of the plane. I have gone first class a few times and it is great, but to me, even being 6'3", not worth anywhere near the advertised price. To me, the flight is the lowlight of the entire trip no matter what cabin I am in and I can still read my book or talk to my wife in coach, so I would rather use the miles for more free flights.

But, that is me, I am sure that everyone has their own situation. The best advice is to know the rules and understand the programs and then decide for yourself.

id never use miles for anything close to $300. save them for up's. you can use 25k to buy a $300 ticket, or you can use 20K to upgrade from a $300 coach seat to a $1000-$2500 (depending on the day or week, phase of the moon, color of the sky, etc)FC seat. plus, when you use miles for a reward ticket you're not getting the segemtns, miles or booking bonus that you would get had you paid.

The other thing that I am considering right now is the airline. I had about 30,000 miles on US and had no problem burning 25,000 for a ticket that would have been just over $300.00. I don't fly US any more and didn't want to loose the miles if US doesn't survive.

Best way to spend 25,000 miles is on short-notice, non-Saturday night stay trips which usually cost beaucoup bucks.

<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by fly co to see the yanks:
but, you're also burning the 5K+ (elite) miles for flying as well as any elite mileage bonuses, if applicable, and other bonuses (such as online booking bonuses or "pay with mastercard" bonuses, etc.) you may earn.

so, you are at a minimum burning about 31K miles for the $200 ticket.

i understand your thought, but i would never use miles instead of paying $200 for a transcon.</font>

I should have given more detail. I usually use the 25K for these flights when my wife flys with me for her ticket (she doesn't have status and won't reach it). We put our seats together, and I try to upgrade one (my seat for her)or both to first/be. Yes I am more than glad to spend $200 to earn the miles and qual miles.