I think of miles like cash. It's nice to have some, but miles/cash loses value everyday when it is unspent or saved. Since there is no way to invest or earn "interest" on miles, it's earn and burn!

Have 770K or so in AS... try burning a bit- did 102.5K last year, but soo easy to earn them with AS... everyone in my family finally has a passport - as of DEC - so should do a nice burn in F or J this year... drop my balance down to 200K or so perhaps.

Alrighty, when people speak of miles loosing their value or being devalued, I am confused.
At what rate are they loosing their value? 1% a year, 10% a year?
So a mile in 2000 is worth what now in 2011? 1 mile in 2000 = .75 mile in 2011?

I understand when airlines increase mileage redemption's like what DL is trying to do, can cause miles to lose value, 25,000 miles to 32,500, -30% in miles value. But that doesn't seem to be the norm or an annual occurrence.

And approx 99.99% of FT members know miles don't earn interest ,so that doesn't need to be repeated, ever!

I am a hoarder, I don't travel for business, so miles comes a little bit more expensive for me. But given there is some devaluation of miles over time, is it really worth it to earn and burn because you believe the miles could loose some de-minimus value in a year's time realistically.
I just want an understanding of this concept? I am not saying its wrong, I am just want to understand that mentality and maybe I am just plain being ignorant.

PS
I just hope its not the same concept a banker will tell me, if you deposit your money into a saving account you could be earning interest, and not in the checking account where it earns no interest. Really banker, really, a whole freaking 1.5% annualized of my $100 monthly deposit is going to affect my finance or life how? But where I have earned 100,000 miles on the non-interest checking account, now that can effect my life. I can save that for a rainy day or emergency, but $18 in interest a year, 5th of Jack on a rainy day.
I guess I should have put down the bottle of Jack awhile back.

I have only used miles for:

• Free flights for family members (or rarely, friends)
• Flights for myself when family insisted that I be in place X at time Y

Have yet to use my miles on myself for vacation. Perhaps one day I will have to take that RTW trip in F!

Over the past 5 years, I know both UA and AA have raised the redemption levels but they are within tolerable range - between 5K to 10K in the most part, except the UA to Australia, which went from a very undervalued 90K to 120K to now 135K in J. UA gave 6 months notice when it changed the level from 90K to 120K (on South Pacific alone). When it did a systemwide increase, again it gave 6 months notice.

AA modified the rules of OneWorld award on how to calculate the distance traveled from a Beeline format to an actual miles flown format, largely because the abuse of redemption - people redeemed for Beeline 20K miles flown as calculated, but actually flew like 40K miles with convoluted routing so they could experience J and F cabins as much as possible... It is of little wonder AA finally changed the rules.

The bigger devaluation is in the area of Upgrade award - it went from miles only to miles with co-payments and the co-payments keep going up - that is where it hurts those who mainly fly cheap tickets to maintain their status but use miles to upgrade so the flying is more comfortable.

Of course, taxes and fees used to be absorbed by the airlines but that was may be well over a decade ago... So you can call that a devaluation as well. I remember AA used to have a hotel discount certificate as well as a car rental free day certificate when redeemed a flight award, and it absorbed the taxes and fees.

So the devaluation is there, but the degree is different in each individual's eyes largely depends on What do you use your miles for. For us, the devaluation is tolerable so we use them as we need them but do not deliberately burn them. In fact, for the off peak season between Europe and East Coast, we are willing to sit at coach, albeit in exit row, for 20K one-way rather than 50K business class when it is daylight flight. However, for the 14+ hours to Asia, no way we would claim coach awards. So we use miles the way we see fit, and feel comfortable having 7 figures combined balances.

AW shows 5.1M across all programs so I guess that makes me a hoarder. LOL like you didn't know that already.

That's funny

For us, we tend to save them with some specific goals in mind, though out planning tends to go out a year or two in advance.

One factor is if you're earning/burning as a single person, a couple, or family with kids. With 2 others in the household to get places, braces to pay for, college expenses coming up, etc we have much more need to cash in miles if we're going to go on some cool family vacations.

If I were by myself, I bet I'd have more miles than I could use at the moment. And more than likely I'd be using the miles for upgrades or lounge membership.

I'd say, think about places you'd like to go, make plans for when & where and then get some good use out of the miles. All in all it's a balancing act and highly individual. But as others noted, devaluation hits eventually so use 'em while you got 'em

I try to keep enough to take my family of 4 on a decent trip at any point in time. A few years ago I was a little over 2M and starting burning them a little more rapidly - both kids were over 2 and we took a several flights over a couple years. Now I have about 800K which feels about right.

+1. I have around 1M miles across different programs. Our family takes one big trip a year and some smaller ones. I don't really have a target for balances: miles are just so plentiful these days that the balances seem to accumulate.

To answer OP's question, I still try to get at least 2 cents/mile on redemptions.

Since most of my travel is MR / weekend vacation, I don't like to use my miles as that would mean I don't get EQMs. However, I am not made out of money, so I will use miles when I have to be some exact place on some exact date and flights are pricey.

I try to keep around 100K-125K in my account, partially because I really like the idea of having enough for a trip in business to most anywhere in the world.

+1. This, exactly! I don't know whether the easy methods of today will vanish tomorrow. I accumulate and use what I need to.

I have such trouble bringing myself to spending miles, in part because redemption is so damn difficult (especially on DL where I have the most miles right now) ... but I have spent a good bit on US the past year (eight awards total for a little over 500k), in part because I 'bought' 500k worth in late 2009 with their silly Holiday promotion.

Right now I have what I call 'useful' balances (at least 25k miles) in AA (250k), BA (250k), CO (35k), DL (500k), F9 (40k), UA (50k), and US (400k) plus awards on WN, so in total I'm at 1.5 million between my various accounts, add in my wife's accounts and we're probably a hair over 2 million. I consider myself 'poorer' in hotel points, though I've got enough to spend several weeks in luxury hotels if I wanted just between Hilton (450k) and Hyatt (230k), with lesser, but still useful, amounts in Marriott and Priority Club. I also have an AMEX Membership Rewards account and Diners Club Rewards account with 30k+ each (I redeemed 50k out of AMEX last month for the DL MQM promotion) giving me some liquid points that can go in several different places if and when needed.

Despite what several have said on this list, in the absence of explicit devaluation through an airline increasing the number of miles redeemed for specific routes or distances, FF program miles enhance in value every time ticket prices go up. Whether this increase is less than or greater than the inflation rate over the next few years remains to be seen.

Whether you should accumulate miles or burn them depends on your goals. Many on FT including my self want to maintain our elite status. At the moment my EXP status on AA has more value to me than my million plus accumulated miles. From my EXP status I get upgraded to F on essentially all my domestic flights and I get upgrades (SWU) to Business Class on four international flights. This is more important to me than redeeming miles for any of these trips as this would mean earning less miles and possibely loosing EXP status.

My personal goal is to retire in 5 or 6 years and then start redeeming for long haul international F tickets.

My advice to the OP is to develop a plan that works for you. Everyone one of us is different.

while I don't earn enough miles to give any advise on, I do personally believe in this statement at least that's how I treat all the miles I earn whether via flying or more recently via credit card bonuses.

I used to hoard. I still kinda do, but I redeem regularly now. I have to fly to Asia to see family every 6 months, so it only makes sense to burn on internatinal J or F.