Originally Posted by blueeyes_austin
Hm. Just exchanged 260K miles for two business class trips from Cairns from Austin. In January (high season). If you want to buy seats on those flights it will cost your $2500 a piece...IN ECONOMY. The business class seats are $10K a piece.
Now, tell me again about these miles being worth 1.2 cents each....
Actually everyone values miles differently. Just because you can get a $12,500 First class ticket for 125,000 miles does not mean the miles are worth 10 cents each.
If you were planning to pay $12,500 then maybe (minus the lost opportunity to earn miles) so say they are worth 9 cents
However if you would not pay the $12,500 then the miles are worth what you would pay to fly coach, plus to value to you of the upgrade.
If you make an average salary and were in First - Would you downgrade for $10,000 cash. Most folks would as its as much as $1000 an hour! But would you downgrade for $500. Some would some wouldn't. Determine what cash you'd downgrade for and that's the value to you. Or conversely - How much would you pay at the gate to upgrade from Coach to Buisness or to First in cash. Thats the value to you. Someone making just $50,000 would probably not be as prepared to pay $1000 each way as someone making $300,000.
As regards the airlines, the poster who mentioned TWA was right
TWA valued miles at 0.08 cemts each
25,000 miles = $20 = Incremental cost of fuel and food