Not so sure I agree with this. Award tickets have pretty decent flexibility for changing dates and can generally be refunded, and the miles put back into one's account, for a modest fee.

100% ACK. I usually book my tickets way in advance to lock in a vacation and then fine-tune the itineries over the course of the year. Sometimes, if not always, the departure times get changed and this normally gets the modest fee waived.

Currently I am holding two saver/standard tickets to LIH in April, one on United, another on NW. Each airline had only one open seat. I am pretty sure that another seat will become available sooner or later or two for another week. The absolute worst case would be to actually travel on different airlines but arrival/departure times are within 1.5h.

Even if the fee does not get waived, I gladly pay it for the flexibility the award tickets provide.

One thing to consider is that tickets to Canada take the same amount of miles as domestic tickets, but they usually cost more. For example, I fly regularly from San Francisco to Montreal. Restricted tickets are usually around $350. Often they are over $400. Once in a while there will be a sale and they'll be under $300.

So I often use my FF miles for this trip. It almost always gives me more value per mile than any other "domestic" award.

Ed

I love how the airlines tell you it's against the rules to buy or sell miles - but then they offer to sell you miles, give them away to people of their choice, transfer miles if you pay a fee, etc.

My friend said the miles are worth a solid 1.5 cents and that's the flat going rate. But then how is it that the airlines offer to sell them to you at 3 cents?

OK, so help me out here.

I have always attempted to accrue DL Skymiles to use for awards on South African Airways (between US and SA).

80,000 Skymiles for a coach ticket on SAA
120,000 Skymiles for a business class ticket on SAA

Approx. prices I have encountered for these same tickets (paying cash)
$1,000 for coach
$6,000 for business class

Using everyone's math
$1,000 / 80,000 = 1.25 cents per mile (not too great)
$6,000 / 120,000 = 5.00 cents per mile (very good, the higher cents per mile the better)

Now, I am faced with the following dilemma
Trip to Europe - DL Skymiles 50,000 coach, 90,000 business
Cost - About $700 coach, $3,800 business (just quick Orbitz price checks)
700 / 50,000 = 1.4 cents per mile
3,800 / 90,000 = 4.22 cents per mile

Perhaps answering my dilemma, I should pay cash for the coach ticket But, if I want to go business, I would be wise to use miles. The higher cents per mile, the better.

Right?

Usually, but there are times when I have a glut of miles and not as much cash sitting around. In that case, I'd rather get the 1.4 cents per rather than have to come up with $700.

Really, you have to figure out what it's worth to you. I redeemed 50K for an unrestricted coach a few months ago for a ticket that was last minute, but could be purchased for ~$500, so that's about 1 cent per mile. At the time I had 300K miles in my account, and I'd rather spend out of that instead of paying the cash, and an unrestricted award was eligible for upgrades rather than being stuck in coach the whole trip on a 25K award (that wouldn't work anyway for the non-Saturday schedule I wanted).

Figure out what works for you, and go with that. I'm sticking with around 1 cent each for an airline mile, but even that's flexible depending if I might need an unrestricted ticket for changes, or something else I can't get from the purchased ticket. I know people always want to get the best value (and I do that a lot), but I also want to make sure I can do what I want, when I want even if that isn't the theoretical optimal use. Be happy.

Best value may be to buy coach and upgrade!
 

The question is what will an upgradeable ticket cost. If it was say $1,400 you would be saving $2,400 for 40000 miles. That is about 6 cents per mile and you would also be earning say 8,000 miles. Valued at 1.6 cents that is worth $128. If they will be used for international travel they are worth 2 to 6 cents. You can add these values to your savings/point value calculations.

Be happy. That is an excellent point. If you have the miles and are able, go with it. Of course, I know my travel plans now and in the future, know my mileage balances, know my level of tolerance for a ticket price, read FlyerTalk and can make the well-educated choices. I guess it was a little like when I was thinking about buying a new computer. Old one, buggy, slow, none of the latest features I wanted. As the advertisement says, just do it. Is it more important to "work the system" or sit around waiting for a better offer, you will never do anything.


Also an excellent point! I always tend to overlook the upgrade with miles option because some of the routes I travel only had ticket-for-miles options rather than buy a ticket and upgrade options. But, mshaikun, that is good advice. Generally inexpensive ticket, upgraded to business or first and still earn miles. In addition, your calculations are also helpful!

This is why I love Flyertalk! ^ ^

That's been my experience in the 9 years that I've been travelling...

---

Yes, yet it is surely not gettiing any easier these days! :)

In any case, using your miles for something, rather than waiting and waiting for a better time or a certain special case, is an increasingly good idea, IMHO!


Frequent-flier mileage could be in jeopardy if big airlines go under

http://www.mercurynews.com/mld/mercu...9587568.htm?1c

My own rules-of-thumb are to
- value miles @ 1.5 cents when acquiring, though this is a rough guide. I generally won't spend more than 1 cent in their acquisition.
- upgrade international tickets with miles as best option, redeem for international premium cabin travel as second best option

But I currently have 2 tickets on hold with AA miles that represent 9 cents/mile... LAX-PPT-AKL-SYD-MEL-LAX in F on TN & QF, each ticket costs 145k miles and prices out @ US$13k. :)

---

Yes, little doubt that Gary is doing very well! :)

http://www.flyertalk.com/forum/showthread.php?t=355914

Maybe my travel patterns are unusual, but I generally use my miles for domestic tickets when I need a triangle trip or open jaw - especially when smaller/pricier airports are involved. I've redeemed about 8 domestic tickets in the last year or so - and I have yet to redeem miles for a ticket I could have purchased for under $500. None of these trips were last minute - although I have used miles for pricey last minute trips as well.

I do fly in/out of some pricier airports - but have burnt over a million FF in the last couple years all in coach - receiving mroe than a 2 cents/mile value. Until this ceases to be possible - I will use 2 cents/mile valuation.

(Premium Int. Awards give the best cost/mile - but unless you would be willing to pay significantly more for a business seat than econ - the extra miles are probably not worth it).

another case
 

flights from the east coast to the dominican republic can now be had for $250 to $350 on major airlines

this same trip will cost you 25k ffm on united and 35k ffm miles on the other majors

for a lot of people its better to pay the ticket fare and save the miles for another trip

==========
you should also differentiate bewteen the value of a USAIRWAYS FFM vs another airline

a quick check on ebay is showing 25k US FFmiles from $150 to $250

==

my general rule is if the ticket is less than $350 to buy it, rather than using 35k ffm, as i value the miles at about $0.01 per mile

----


Yes, I think the concept of applying somewhat different values for different carriers, just as different values for different flyers' planned uses, is probably valid. Thanks! :)

-Mark

=======
i ende up buying a ticket to the DR for next week
price was $314
approx $194 in fare
approx $120 in taxes

since i'd have to pay the taxes anyway

FOR ME
it was a better deal to pay the $194
(actually $144 as i bought a $250 off credit on ebay for $200)
rather than use 25k american ff miles or 35k from continental/delta/nwa

I agree jessej. :)

Again, FWIW, for me personally, the greatest value still is in using 'em for a nice UG! :)

-Mark

Of course if other carriers follow these horrendous new fees imposed by AA, I could likely be using my miles for something else, sadly! :(

http://www.flyertalk.com/forum/showt...=361184&page=1

-Mark

Looks like I value them a lot more
 

I typically don't award fly during high seasons and usually am able to plan my travels up to a year in advance. Since I also live in a major hub, YVR, for many common destinations eg LHR, YYZ, HKG there are many cheap tickets or discount airlines. I would value my miles at least 2 cents if not more based on my previous awards: (all values in CAD)
2003 Dec YVR - MAI return CAD 650/25K = $0.026
2005 Jan - Mar YVR - LAX - EZE, EZE - GIG - YVR Business CAD 6000/75K = $0.08
2000 May - Jun YVR - LHR - MAD, SXF - YVR Business CAD 3500/60K = $0.058 (1999 CP, RIP, redemption rules)
2005 Feb EZE - UIO, LPB - EZE CAD 1000/40K = $0.025
2001 Jan - Mar YVR - LAX - SCL, overland, SSA - GIG - YVR CAD 3000/60K = $0.05
2002 April YVR - YYZ - EWR, EWR - YVR CAD 1000/25K = $0.04

And my greatest sucess
1998 Dec/Jan HKG - AKL - SYD, huge open jaw PER - HKG = 60K plus a SYD - AKL -SYD separate segment for 15K. Convinced the ticketing agent to let me get off at AKL instead of SYD on the outgoing leg since I had a return the same day on the other reward.

I like the use of award tickets for open jaw, one stop and business class flexibility.

Congrat's, sng8888, on your success. :)

FWIW, I've not claimed an award all year, despite my feeling that my FF miles are worth less and less all the time.

For many of the younger folks around, the excerpt below may be especially interesting and more than simply a history lesson. It helps confirm how much more "effprt" is required these days, as campared to when I first started flying, thirty five years ago:

---

Pan American WorldPass and How Last Became First.

By the time the late '70s rolled around, the experience of flying had been downgraded from glamorous and elite to mundane, overcrowded, and as torturous as a never-ending bus trip...

... In a classic marketing moment, several major airlines decided that their best customers deserved to be singled out and rewarded for frequent travel. And thus, the frequent flyer programs were born.

These programs were really exciting for participants. At last, the airlines made a distinction between the tourist and the trooper. Flying for free and upgrading to first class were the big come-ons and frequent flyers went to great lengths to make sure they stayed abreast of every new perk and bonus mile route. It is important to understand what a big deal the frequent flyer programs were at that time...

...The core promise of Pan Am's program was to reward individuals who flew a specific number of miles on an annual basis with a "world pass." This pass was an actual gold-colored plastic card that entitled you and a companion to fly anywhere on Pan Am's extensive worldwide system, first class, free for thirty days.

This strategy was a winner from day one. No other airline even remotely had such an award, nor could any of them match the worldwide route structure that Pan Am was famous for. The effect was immediate. WorldPass electrified passengers, Pan Am employees, and the trade press. Adam's focus on giving the customer something that was truly exciting and "richer" than the competition turned the whole industry inside out and left them scrambling to catch up.

So last-in became first in frequent flyers' minds. The initial direct mail enrollment package sent to 80,000 frequent flyers contained a free round-trip domestic ticket good at any time within the next six months -- no blackout dates, no ifs, ands, or buts other than the requirement to enroll in WorldPass.

Response rates to this one letter were more than 50 percent. Probably an all-time high in direct mail history, with the exception of responses to letters from the IRS!

http://www.dmnews.com/cgi-bin/artpre...ticle_id=34174

---

Clearly FF miles are worth whatever you think they are valued at, depending upon how one elects to use them.

And if one does not bother to claim an award, it is quite easy to see that they are worthless, no? ;)

So I'll need to be doing some cashing in immediately! :)

-Mark

Would you have otherwise bought all of those tickets at those prices if you didn't have frequent-flier miles?

An excellent example of how many things start by giving their originator a competitive advantage, but soon become a competitive necessity if one is to remain in a market at all.

Once everyone has something like a loyalty program, one of two things will happen. Either rewards will escalate, with every airlinne trying to outdo the others, or they'll decline as the behavior-influencing value of FF programs stabilizes and the rewards just have to be attractive enough to keep too many customers from jumping ship.

The first is what I suspect led to the Pan Am offer. The second is what we're seeing the most of today.

Very true...

Fortunately for us, the hotel programs are still a few years behind the big airline programs in one key area: they aren't yet part of the broader American culture like FF miles now are. (And this "gap" between hotel and air loyalty awareness is probably even bigger internationally where there aren't Hiltons, Marriotts, and Starwoods on every streetcorner.)

Therefore, we tend to find better awards, more flexibility, and more customer-friendly aspects within the hotel programs.

But I'll stop talking about it now. I wouldn't want to, you know, raise awareness or anything... ;)

I suspect that the answer from sng8888 concerning whether or not they'd be buying them is no. Just a guess! ;)

And I certainly do agree with you about the hotel programs, using SPG as an example. And keeping it quiet is [robably a good idea too! :D

Mark

FWIW, I just found this and thought it was somewhat interesting. Miles are now so highly commoditized that they are literally listed a a genuine form of currency:

Privately-issued currencies

Several large companies issue points to their customers, to be redeemed for products and services produced by that company. Often, a network of companies will join to share in the offering and redemption of points. While these can hardly be considered stable currency systems, they present many of the same features as "legitimate" currency: they are a store of value, issued in discrete units; they are controlled by a central issuing authority; and they have varying rates of exchange with other forms of currency. For example, frequent flyer miles can be bought using U.S. dollars...

Frequent Flyer Mile: The most commonly-known points systems are the frequent flyer miles issued by major airlines. The first such system was issued by American Airlines. Other customer loyalty incentives have followed this model, including points systems offered by soft drink manufacturers such as Pepsi. Subway tokens, issued by city transit authorities, can be considered a highly specialized form of currency...

http://encyclopedia.laborlawtalk.com/Monetary%20unit

---

Also, FWIW...

... Don't overpay for miles..

...There are two ways to assess this. The first is to figure out the cost per mile. The industry standard values a mile at two cents...

...If it takes you four years to accumulate 25,000 miles from your credit card, enough miles for a free ticket, and your annual fee is $50, you paid $200 for that ticket. As long as you book an award ticket that would have cost more than $200, you've gotten a good deal. If the cost in annual fees ends up higher than the dollar value of your award flight, you are not making the best use of your credit card...

...Take advantage of promotions

Sometimes airlines offer special deals that are only available to affiliated cardholders. For instance, Delta offers "Always Double Miles," an ongoing promotion that allows SkyMiles cardholders to earn double miles for groceries, stamps, Delta flights and other items. On top of that, American Express will from time to time offer double miles on every purchase for SkyMiles cardholders. It's good to sign up for these promotions and try to time big purchases accordingly, so you can maximize your miles.

In addition, certain airlines, such as American, offer award discounts on certain routes to cardholders. These offers let you book free tickets for fewer miles, saving you both money and miles. The best way to find out about these promotions is to receive the credit card's targeted mailing and e-mail newsletters. You also may want to check the credit card's website once or twice per month, as well...

http://www.usatoday.com/travel/deals...8-column_x.htm

Also don't forget the opportunity cost of miles, particularly on long distance flights. I generally value miles at something more than 1 cent per mile. I have a trip to Romania, it prices out to around $600 dollars. I can get there using 50,000 UA miles. But if I pay for it, I get to keep those 50,000 miles plus since I get double miles as a prem exec, around 18,000 additional miles. So the question is, would I rather have 68,000 miles or $600. In this case I took the miles.

I find this type of valuation confusing. If you use your miles to get a First Class award valued at $5000 but there is no way you would've paid $5000 for First Class out of your own pocket it's a stretch to value your miles at $5000. Instead, your miles are worth what you wouldn't have paid otherwise which might be $200 for a coach ticket.

Here is a little different twist. I use all my miles for premium class international tickets. I would probably not pay the $5000 to $10,000 that the tickets cost. I probably would pay $2500 +/-, but do not think they are available at that cost. At 6’ 3” and 210 lbs. coach seats offered today make traveling on long haul flights a real bad experience. The other choice is not to take the trips. This was my choice until I discovered new ways to accumulate miles. I therefore value my miles at more than 2.5 cents per mile but probably not 5 to 10 cents per mile. As you can see I am really not sure how much my miles are worth. What I do know is I am enjoying travel because of my miles.

I have never been able to answer this question. I earn all my miles naturally. I couldn't physically do a MR, although I maximize by miles as frequently as possible with Credit Cards and other partners.

I only redeem for intl first vacation flights. My last redemption was 250,000 miles for $23,500 in airfare (2 tix). That's 9.4c per mile. Would I pay $23,500 for a vacation in airfare? No way. When I go to redeem, however, I make sure I get all Flagship and I hit near 10c. That is the only measure I can use -- to me it is "am I getting good bite for my miles?" I figure, I can't be doing this forever, so might as well go places I wouldn't pay for otherwise.

Now if I stopped flying I would probably value them against J. _That_ is what I would pay for. That same ticket would now cost $11,000 for 180,000 miles. That's 6.1c per mile. In this example, I'm not flying anymore so would I go on 180,000 miles in MRs, spend about $4,400 based on what I've seen here, get probably EXP, and save $6.6k ? Based on the Elite + monetary savings, yes, I would.

The answer? More than my fictional 2.5c. :)

I value them at a combination of the actual $ spent combined with the amount of my time it takes to accumulate.

Buy & Gifting miles @ 2.6 cents is worth it to me. Reason - no time spent away on MR's. It also results is reasonable costs of business class international tickets.

I now value miles by what they would bring on the open market. Some may find it hard to believe but there's definitely a small segment of people out there that will beat a path to your door for the opportunity to purchase miles - not awards - for at least 3.5 cents/mile. I'm not talking about rubes that just fell off the turnip truck but rather knowledgable and informed people that already know about programs where miles can be purchased/transferred directly via the airline (for example in AA's case via the buyAAmiles/giftAAmiles/shareAAmiles programs) but they still need even more miles and are willing to pay good money for them.

I have redeemed 110K FF miles for a business class ticket on Singapore Airlines whose J/C ticket prices averages is about $3K-4K. If you can redeem your miles for business/first class ticket for international travel, then your mile value is going a long way.

As mentioned several times earlier in this thread and in other threads, the undiscounted price tag an airline puts on a ticket you can also get for X miles is not a measure of the value of miles, unless absent the miles you would have been willing to pay that price out of your own pocket for that ticket. If you would not, the value of miles to you depends on how much you would have been willing to pay for it.

perhaps this has been said somewhere in this thread....if so i apologise for the repeat...

the biggest devaluation in miles is the cheaper fares currently available...20-25 years ago, an advance purchase ticket to many us cities was around $500 in y, while a walk up was around $1000, so roughly, 25k mi's was worth 2cts on an advance purchase & 4cts on a walk up, and saturday nite stays were required for the cheaper fares...in those days, the senior coupon packs @ $300 were a good deal plus could be used for standby and sat nite stay wasn't required...recently, i got a tue-thur [same week] coach ticket for my wife dfw-lga for $225 all in which would be less than 1ct/mi on an award plus maybe an expedite fee.

traditionally, i would use mi's for last minute tickets for family and for long haul upgrades, valueing the mi's at the net cost saving, which i believe is realistic even though i probably wouldn't pay for j [except for my wife who won't go on long hauls in y, which fortunatly, i haven't had to do].

anyway, i believe that lower fares are responsible for considerable mi devaluation, particularly for people that use them for domestic trips..

That may be true for avg Joe. Miles likes $, your value will depend on how you spent it as many FTers are aware of.

This may be true, but I'd prefer devaluation to being stuck in a market (GTF) with high fares. "well yes Honey, we have to pay $400 to fly 500 miles, but just think how valuable our frequent flyer miles are!" ;)

Depends on the market. I use 15k UA for MCI-DEN on occasion, and 25k NW for MCI-DTW. Those are short, but expensive, trips. Oddly enough, award seats are usually available on those, even when the airfare is $400+.

For those awards, it's easy to calculate the redemption value in terms of real cash in pocket. 1.5 or 2 cents or whatever that I was really going to have to spend.

For some other awards, I don't even bother calculating a redemption value...I just do it because it sounds fun. Upgrading to Europe for example...what's that worth? I don't know...I probably wouldn't spend even $500 of my own cash to upgrade, so technically not even a penny a mile. (The airlines may ask a ten grand or a million dollars for that seat, but that doesn't matter: I wasn't going to pay that to begin with.) But I still get a kick out of those redemptions...

Cast my vote for only using miles for premium long-haul (transoceanic) service. Last summer, LAX-TLV, was either $1500 in Y or $3400 in CO BF -- the 200k miles (Sleazypass) per BF ticket was well worth it, since paying $10k+ for 3 tix was a nonstarter.

Similarly, for next summer, it's LAX-Italy in AA F & BA J -- but I booked earlier and got them at 125k miles per. When I priced the tix, given the super-high fares ex-LHR, it was $11,380 per -- that's a 9 cent mile. Again, it's not really worth that much -- but when my wife (who thinks we're "only" flying in J) gets pointed toward the Flagship Suite at boarding... :cool:

Yeah, its nice to say that one should only use miles for premium transoceanic service. But you gotta have the miles to do it! You just used up 400,000 miles and 250,000 miles, respectively, on the two trips you mentioned. I, on the other hand, just surpassed 50,000 UA miles after about a year of collecting. So I just will never earn enough miles to spend them on the kind of trips that you say they should ONLY be used on. Unless I save for years and years and years, and what's the fun in that?

I use mine, typically, on expensive coach tickets within North America. Often for California to Montreal, which tends to be expensive compared to most transcontinental routes.

Ed

This is an excellent point. Other viable domestic redemptions are small airports - particularly in the west/northwest. For example, a $250 to DEN will become $500+ going into ASE.