I use miles to upgrade transatlantic coach fares to business class.

I give free domestic tickets or upgrades to friends & family.

Once in ten years I've used miles for a domestic coach-class ticket, simply because I couldn't justify the cash outlay to fly LAX-ORD and back just to have dinner with a friend on a whim.

I use my miles frequently, and rarely have more than 3-400,000 sitting around. Right now I have the meager sum of 60,000.