As this and every other thread on this topic suggests, there are numerous examples where someone has "valued" their miles at 4, 5, 6, or more cents each because they redeemed a business or first class award to some international destination for which a ticket costs $10,000+. That same individual may also have redeemed 25K miles for a $500 domestic coach roundtrip somewhere making the miles worth 2 cents each. So what "value" does this individual place on his/her miles? I would argue that if the person was willing to redeem at 2 cents/mile, that is really how they view a mile's value and the 4-6 cents/mile redemption was simply a great deal.

In my view, we should be viewing "value" as the hurdle rate for using an award, i.e., what is the lowest fare that a person will opt to use miles (an award) for rather than purchasing the ticket. Anything above that is gravy. This is straight-forward and eliminates many of the inconsistencies present with valuing miles based on highest value achieved or some hypothetical redemption.

For what it's worth, my hurdle rate is about 1.35 cents/mile. That is, if I can get that "value" or more from an award redemption, I'll use the miles, otherwise I'll purchase the ticket. (I say "about" because I value miles from some airline programs, such as AA, UA, and US at slightly more than 1.35 cents each, and miles from others, such as CO, NW, and DL at somewhat less than 1.35 cents each.)