Do I use award or buy ticket?
 

I'm trying to determine what people think is the dollar-for-mile cutoff point. In other words, at what point do you buy a ticket instead of using an award so you can earn miles, or use the award because the ticket cost more than the miles you would earn are worth.

For example, I'm looking at going roundtrip from Indianapolis to Oslo. With my elite status, I would earn about 18,000 miles for the trip if I bought the ticket. The ticket cost $700.00 or it would be 50,000 miles for an award ticket.

What would you do? Is there a magic number for how many miles you should get for every dollar spent?

Hope this makes sense. Thanks!

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[This message has been edited by scruffy (edited Dec 15, 2003).]

This is such a personal decision. Everyone has their own value they put on their miles. Further, everyone has a different mileage balance. If you have a lot of miles, then use them. If you don't, then buy the ticket.

Would you lose your elite status if you didn't buy the ticket? Are you considering any trips that might be more expensive and a better value for miles (I used miles this summer for Barcelona, which would have cost $1,400 in coach in peak season). Just depends what alternative uses you might have for the miles, and what YOU value them at. Different flyers perceive a different value, depending how they use the miles.

Welcome to FT http://www.flyertalk.com/forum/smile.gif

Howdy,

I'll share my decision matrix, but understand - this matrix works for me; I'm sharing not thinking anyone would use the identical decision branches; but rather to demonstrate how I arrive at my decisions and to encourage others to think along these lines.

This matrix is based upon the following:

1. I am EXP with American.
2. Wife is PLT with American.
3. Son is GLD with American.
4. Family loves to travel; and does so often.
5. I fly weekly, mostly domestic.
6. Clients will pay for me to stay over a weekend and pick up the cost of an additional ticket if I do so. (I normally fly M-F week1, M-F week2; when I bring my wife out for a weekend, I fly M week1-Fweek2 giving me a Saturday stayover; wifes ticket also has a Saturday stayover (Fweek1-Su/Mo week2) this is often cheaper than my two standard tickets and more than makes up for the added hotel cost - additionally the client has me for 2 additional days (The Friday and Monday I would normally fly)).
1. What is the cost of a roundtrip domestic ticket in F?
7. I can upgrade myself and my family on domestic or international tickets at will (1 class upgrade) I've been lucky - and have always gotten the upgrades I wanted.

The decision:

1. Is someone other than me paying the airfare? If so - always buy ticket. I find it messy to turn around say, "Mr. Client, the cost would have been $x.xx".

2. Is the ticket below $500 domestic, $750 hawaii, $1000 international?

3. If and only if two above is true - am I traveling with family?

4. If three above is true, can I upgrade? If this is true; then purchase ticket.

5. Am I traveling alone? (can't imagine when one above would not cover this situation but it's possible I guess). Calculate mile earned value at .025 cents per mile and subtract miles earned value from ticket cost. If ticket now fits inside four above; buy ticket.

6. Else book award ticket in F or J.

This assumes that flying I pay for I generally travel with family; and then I generally fly family in first class when possible. Also note that I have a very high chance of getting my upgrades to clear.

Note: YMMV

Keep the faith,

Pakse

p.s. For what you described in your post - I would buy the ticket. However, for me - the earned milage never changes my elite status; I am averaging 175k miles a year business travel alone.

As they say YMMV. For me, it's a different situation. I absolutely love traveling, but have no funds to do it. I travel a little bit for work (2 domestics & 2 internationals per year). So, I take what little miles I get from this travel and combined with credit card miles and I always book free vacation travel. I don't worry about the value of miles, because frankly I wouldn't be able to go on vacation if I had to pay for them. It's like my grandmother used to say, "Even if the Hope Diamond was on sale for 50% off, I still couldn't afford to buy it." So, while miles are worth something different to everyone, so is the value of vacation travel. For some, it's a luxury simply to score economy seats on a good route to Europe. I love FT because it gives me all kinds advice on how to put together these trips.

Here's the way I would value your trip. You can buy miles from the airline for 2.5 cents (usually limited to 10,000 miles). So we can assume the miles are probably worth a little less than that. I use 2 cents but to be real conservative let's say 1.5 cents. So the 18,000 miles you will earn are worth $270. subtract that from the ticket price of $700 leaves $430 divided by the 50,000 points to get a value for your points spent of .0086 or about half of the 1.5 cent value established above. If we make the same calculation for the above and value miles at 1 cent then the value of your miles is 1.04 cents. This does not take into consideration the value of the miles toward requalifying for elite status next year. All this to say that if the miles are worth at least a penny to you then it is probably better to buy the ticket. Oh yeah I almost forgot. Don't forget to calculate in the value of purchasing the ticket with an airlines credit card which usually gives 2 miles per $ or 1,400 miles.


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"A day without FF Miles is like a day without SUNSHINE"

[This message has been edited by Superd1 (edited 11-05-2003).]

I was in a somewhat similar situation in terms of dollars vs. miles. My wife and I are going to Europe and it costs 50k or $850. My wife seldom travels by plane unless it is with me and often on my miles. I score the ticket for her with my miles and purchase my own ticket. That way I get the miles in my account and they are not accumumated in her orphan account. My trip is from the east coast and is open jaw and would not amount to as many miles are your RT to Oslo, but nonetheless, saving $850 from the cost of taking the trip means that we have $850 more to spend on the trip and I do not have to worry about mile devaluation.

If I can get at least about 1.5 cents a mile in redemption, I think that is acceptable. If I can get 2 cents a mile or more, which I usually can with flights to South America, I am well pleased. If there are no flights available for the "normal" rate of miles, I am annoyed, like the rest of you probably are!

While you can see everyone has there own opinion. I never use my miles domestically unless the fare is really really crazy over $1000 which is rare unless last minute.

I like to fly overseas. So therefore I build my miles until I am able to do. Then I figure the money that I would have spent on a ticket and use that for spending money or partying money. Depending on where you are going.

KT

while it may sound stupid, me in college can afford an annual fee for a credit card once a year but generally not a 300-400 plane ticket, so although it may not be a great idea I bank the miles until I need them. My family just moved to tenessee, so generally my parents will pay for my ticket, but when I want to suprise them or they don't have the extra cash to fly me and I really want to go see them but don't have the cash myself I use my pts, even if 25,000 pts only equals a 308 dollar ticket, that's 308 bux I didn't have that I now am able to go see my rents and my little brother. So for me it is a little different game, but still out to earn as many as possible, but most pts earned are through CCs.

I think the Value of Miles page on my web site below would be useful to this discussiion.

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Free Frequent Flyer Miles

Yes we all have a different way to view miles. here is how I decide.

I used to keep them to fly the Concorde. Done. Then I kept them to get a loved one to fly it too. Done. No more Concorde now, and I have no other big plan that would cost me much less using miles.

So I do not keep more than about 100 000 miles unused, airlines change their policies too fast. When I have this kind of miles, I treat myself to business or first class, particularly transatlantic, particularly when there are no cheap tickets (Summer, Christmas).

I value miles at 1 cent, and deduct the earned miles from the price of a ticket to calculate the "real" cost. If the ticket is worth less than the amount of miles for an economy award, I generally buy it. If it is worth more, I sometimes treat myself to first or business (particularly because it often means economy will be full).

Finally I think it is still good to have about 50k miles aside, in case of emergency : last minutes tickets are often expensive while miles bargains are often available...