<font face="Verdana, Arial, Helvetica, sans-serif" size="2">Originally posted by Statistician:
MKE-MR is correct. There are two groups of people... One is for those that have few enough miles that they need to place a value on what they have in order to evaluate a decision of whether to pay for a trip they intend to make with miles or $$. Those people should probably evaluate using the "what they would have otherwise paid" rule, which I believe is somewhere around 1.25 cents for breakeven. The other group is for those who accumulate so many miles so fast that they can spend them all on whatever they please. For those people, there is no point in attributing a value because they should go wherever they want and always fly first class. Those folks have earned that situation by spending the time on the aircraft to earn those volumes of points, so it becomes more of a scenario of being a truly elite customer instead of obtaining a currency to be evaluated.</font>
I beg to differ, and actually believe you have it backwards. Almost everyone who travels regularly and is posting on FlyerTalk, i.e. those who rack up the miles, most certainly attribute a value to those miles. However, we don't necessarily agree on what that value is. These folks use their miles very judiciously.
Most of the people who don't travel regularly and have relatively few miles are the ones who don't assign a particular value to their miles. These folks target an award level, redeem when they get there, and pay little/no attention to what the cash cost of that travel might be. Thus, you see people redeeming miles for coach tickets to Orlando or on the US Airways Shuttle from DC to NYC, tickets that could usually be purchased for well under $200 each.
I have more than enough miles (around 3 million) yet don't fly first class on all my award trips. Yes, I am going FC to Hawaii in October on award tickets. But I flew on a coach award ticket to Bismarck last August. For shorter flights, I feel you get better value redeeming for the coach awards.
For what it's worth, I value my miles at about 1.32 cents each. That doesn't mean I don't get more "value" for them; I frequently do. That figure represents my hurdle rate, i.e., if I can buy a ticket for less than that I will rather than use miles for an award.