What are ff miles worth in cents/mile?
 

I used to use United ff miles only to upgrade from coach M or H fare to Business seating ORD-BKK and valued my miles at about 4-5 cents/mile. Now that the program requires money too to upgrade and the amount of miles has been lowered, what are miles worth in cents/mile. What do people think and how do they figure this?

Miles are worth the replacement cost divided by the number of miles, which varies depending on redemption. I value mine at $0.01 as a conservative estimate, but I also usually redeem for coach tickets.

Illustration: ARN-DXB: $588 for a ticket or $50 + 35,000 miles = 1.54cpm, if there is award availability.

I don't think there's any fits all value for miles. I think it depends on what you are using them for would cost without them.

If for example I use miles for what would be a $300 ticket that's half the value if I used them for a $600 ticket.

I use mine for *A business class rewards, so I get a very high c per mile figure if I do the straight comparison. However, I would never buy such tickets myself - I'd buy the cheapest Y tickets, so the alternative calculation would be the $ cost of the economy ticket divided by the number of miles used - a massively lower c per mile figure. But then I get great pleasure out of the C ticket whereas I would get great pain out of the Y ticket. So the true number is somewhere between the two, but I haven't the faintest where.

Valuation is very much an individual matter. No two people value miles the same way. The only fact that I always push is that "value != cost". A ticket that costs $5,000 is not (necessarily) worth $5,000, so you have to determine the actual value of any given ticket to you before you can even think about some sort of valuation per mile.

Well it depends how you're using the miles.
If you're trying to accumulate them hopefully they'll be cheap.
If you're trying to redeem them hopefully they'll be worth a lot.
That all being said, if you need to get somewhere right now for free, a cheapo ticket paid with miles may be worth spending a whole bunch on.

I value my UA miles might be different than others, I collect them and give them to in-law on C she is happy and Karung99+1 is happy and I am happy too, so the value is what we put on ourself.

I usually redeem for Y tix for family members on vacation trips, typically domestic. As such I also use a floor of about 1 c/mi. As I'm paying 50K miles (the "saver" awards were a cruel hoax inflicted upon us last time they downgraded the value of mile for domestic Y seats) $500 is an approximate break point - if I'd pay more than that, I'll cash in miles.

That being said, when I have a lot of banked miles, I may use them on tix that are a bit cheaper.

Although I don't think banking is a good idea, I do like to keep enough around for emergency trips when I may need to pay a lot more $$ for the ticket that still costs 50K miles.

I successfully get domestic saver tickets within a day or two of when I want to fly the "kids" most of the time, as long as it is not a holiday. Just today I cashed in 15K plus $120 for a $480 ticket next week - was worth it to me.

For myself I redeem for International J or F and I wouldnt pay the dollars it cost so they are "priceless" <g>

YMMV

I think the right answer as a default is $.01 per mile. That's certainly the direct conversion rate using Choices.

Yeah, it clearly depends what you do with them, and this is a case where opportunity cost plays a big role. I mean you can clearly get more cents per mile redeeming them for a C ticket to Europe, but you can get 2 European flights in Y for the same price. Clearly you get much higher cents per mile if you get the C tickets since they're usually quite a bit more than double the Y tickets.

That being said, for redeeming Y tickets on *A rewards I've done pretty well, 2-3 cpm versus what it would have cost to buy the tickets outright. I'm happy with that.

My best use though, has been upgrading government fares (which book in Y) to Europe. For 10K miles each way, I can get a seat that costs probably $2-3,000 more. Now we're in the tens of cents per miles range. :)

I agree with this - depends on the situation.
I have used 15,000 miles on $350 ticket, and
I have used 55,000 miles on a $850 ticket.

No one rule of thumb is really viable.
My general rule of thumb is $0.015/mile

I don't consider upgrade usage applicable, since you can find System-Wide upgrade for $200 or less sometimes, but of course you have to have a higher fare ticket.

This is a very good way of using miles

The highest value of ff miles is for business or first class travel, but this is only true with qualifications. Yes, if you get a reservation you want on a SuperSaver Award and if you don't miss your flight or need to make any last minute changes, you can at the end feel happy that you got travel that would otherwise have cost you a dollar amount that equates to several cents per mile. On the other hand, when you fly on an award ticket, you've got to figure that if you miss your return flight, or if you need to come back early or late, you are probably going to have to buy your return ticket at a high price with cash or with more miles (no longer SuperSaver) if you even have that option. Plus, you don't get EQM which may or may not matter.
Even your city of residence enters into how valuable ff miles are. Let's say you live in SFO and want to fly to Munich in business class on LH. You can sometimes get a Z fare for that one hop flight for about $2K RT. But let's say you live in Las Vegas. LH doesn't offer that same deal from Vegas. It doesn't even offer the same deal for a couple of hundred bucks more. Sure, for a couple hundred extra you could add on your own LAS-SFO plus SFO-LAS on another airline, but if you misconnect that's your problem to solve at your own expense.
This is why putting a value on ff miles is such an individual process.

They can't be worth more than they are selling for
 

Here's one way to put an upper limit on the value of ff miles. Go to www.usair.com, then Dividend Miles, then buy miles, and you will see that you can buy USAir's ff miles right now on half-price sale for 1.385 cents per mile. Compare USAir's *A award chart with United's. On paper, at least, USAir's *A award chart shows fewer miles in many cases than United's *A award chart. Whether or not USAir's ff miles will get you where you want to go as easily as United's probably depends on the route and date. I have used United ff miles for business class TATL travel on USAir and USAir ff miles (bought at a penny a mile on sale) for business class TATL travel on LH. Currently UA is selling its ff miles for 3.295 cents per mile. But if you can get an LH TATL flight using either US or UA miles and you can buy US miles right now for 1.385 cents per mile and you want an LH TATL flight, it is hard to argue that UA ff miles are worth more than 1.385 cents.

Mileage value becomes greater if you are booking international flights or from small domestic cities that are costly to reach UA hubs. Many travelers have learned to maximize the mileage value by being selective on when you use them. Also being 1K lets you optomize the use of your miles- we book flights with mileage, but replace them with bought flights when the prices go down. Cancelling mileage flights have no cost at 1K level, and availability of mileage flights are much better at the 1K level.

Is there a consensus on how to value RDMs used to upgrade to domestic F? I'm 2p, so no SWUs, but no copay either. I only ever use RDMs for 15,000 mile upgrades on flights over 2000 miles -- E.g. IAD-LAX,SFO,LAS, or SEA. FWIW I'm tall (6'3") and value the extra recline for my back, but wonder if I'm squandering a "better" use for my miles.

Mileage follows the rules of elasticity vs inelasticity. If someone is rich and willing to fork out $10k for an international flight in F, then 100k miles really are worth $10,000 ($0.10/mile) and I should be able to, theoretically, sell miles to that rich person at, or just less than, that rate. However, if I'm incredibly poor, but really really really want to go to Africa from Europe, then I'd have to take the cost for the cheapest economy flight (on any airline) I can find and divide it by the number of miles for an economy flight.

Applying it to my trip below, it would be $1100 on Emirates/60k AA miles = $0.0183/mile.

I recently redeemed 100k (AA) miles for CDG-CPT one-way and NAI-CDG one-way on BA in F. This would have cost $9905.

However, I would have never spent this much of my own money for luxury, so I value the miles usage based on what I would personally be willing to pay, which might be around $2000, or $0.02/mile for a comparable flight. In other words, if I had bought economy tickets for $1100 and the agent offered an upgrade to longhaul F, I would probably shell out $450 each way for luxury pods vs stuffy coach when traveling long haul for pleasure with my wife.

You could also factor in the opportunity cost of what you would have earned (how many miles) if you were to pay for the flight. The die hard would also factor in the potential risk factor that you wouldn't hit status by booking a long haul award flight.

I value them with approx. 2 cents per mile. My reasoning is that I would pay twice the lowest economy fare to fly in business or first class. So if a fare is approx. 1k US$ and I can get the same flight for 100000 k miles and sit in business then I consider this a fair deal.
Also this is then a confirmed C or F seat and no waiting game for upgrades to clear.

I put a little higher value on my miles, approximately 3 cents/mile. I only use my miles to fly to Canada, with tickets ranging between $700-$850 for non-stops. Cheers

Has been said many times on this thread - it all depends on what you want/need and have...

http://boardingarea.com/blogs/unroad...s-redemptions/

This is a reasonable way to look at it. Of course, one certainly can't count on being offered upgrades for sale, and I enjoy knowing for sure I'll be in F or C.

What hasn't yet been mentioned is that there is usually a real cost associated with earning miles. For instance, I pay Chase $140 per year for their MP Platinum card, which gives me vastly more miles than their free cards. To get some of those miles, I fill up my gas tank at stations with pay-at-the-pump (because that doubles the number of miles earned), and these are usually a few cents/gallon more expensive than paying cash at competitors. Finally, often I fly UA even if their tickets cost a bit more.

The bottom line is that if I spend, say, 135k miles on an F ticket to Asia, the total cost is about the same as (or maybe a bit less than) an economy ticket. But I like F better, and what "pays" for the added value of F is really just having to suffer the inconvenience of using saver awards and of waiting for my mileage balance to grow large enough to buy vacations for the whole family in F. To me, that's a very reasonable bargain. The deal is less a financial one than a psychological one, so for me it's hard to conclude what the financial worth of miles is.