Given the new onslaught of readers from all around the world this week, we here at OMAAT are operating on somewhat of a “back to basics bootcamp” mentality, to welcome those new to miles, points and “gaming” the travel industry — and also to remind regular readers that we can all lose sight of common sense from time to time when we’re caught up dreaming of champagne and caviar service at 35,000 feet.
Nearly everyone I know has some sort of airline- or hotel-affiliated credit card, though very few of my friends know what to do with all the points they accrue. I find myself scratching my head when my friends tell me they have 50,000 miles generated from credit card spend on Airline A, which they hate, because they love flying Airline B so much more.
More to the point, I’ll see friends excitedly “cash in” 25,000 points — or far more — for a domestic economy ticket, simply because it’s possible and because the credit card companies have taught us, as a society, that you can get a free roundtrip domestic economy ticket! is an aspirational goal.
Now, there are certainly instances when domestic coach awards can make sense, especially around holiday periods when ticket prices might border on criminal…. however, in those peak periods, it’s unlikely you’ll be able to snag a “low-level” 25,000 mile roundtrip to begin with.
While there’s a mantra on this website to “earn and burn” versus hoard miles, the sweet spot in the value of miles is long-haul premium cabin travel, which can cost upwards of 150,000 miles per roundtrip ticket, depending on airline and destination. So it is worth building up your mileage vault and not draining it in 25,000-50,000 increments on domestic trips that might only cost $300 out of pocket. Credit card signup bonuses, which can earn you as much as 100,000 miles off the bat, really help in this regard.
That said, knowing when to use miles and when to save them is a bit of an art, so let’s walk through some basics and some scenarios where paying makes more sense than using miles, and vice versa.
Miles and points do have a value (though that value can be subjective).
Ben, from time to time, will publish what he considers the “value” of an airline or hotel program’s mile or point currency. It really ends up being entirely subjective, of course, but it’s certainly helpful to know how the points stack up against each other, and to assign them a dollar value.
Let’s look at the US domestic airline programs, since this is sort of the focus of my post (more or less).
Ben assigns the following value to US programs:
- Alaska Mileage Plan: 1.6 cents per mile
- American AAdvantage: 1.8 cents per mile
- Delta SkyMiles: 1.3 cents per mile
- Southwest Rapid Rewards: 1.4 cents/point
- United MileagePlus: 1.4 cents per mile
- Virgin America Elevate: 2.0 cents/point.
Very roughly speaking, this would mean that you shouldn’t use miles for a domestic roundtrip unless the ticket is rather pricey.
For example, at the lowest level of award availability — 25,000 miles roundtrip, which is universal across Alaska, American, Delta and United (Southwest and Virgin operate on a different currency system, more or less, so aren’t comparable) — you’d still want to pay for a ticket out of pocket if that same itinerary cost $400 on Alaska, $450 on American, $325 on Delta, or $350 on United.
But I see people breaking this rule constantly. What’s much worse is when I see people use “standard award” redemptions — i.e., redemptions for domestic roundtrips that can cost substantially more than 25,000 points — on tickets that aren’t much less than $500 roundtrip.
And I get it — the cash outlay can “sting” and feel a lot more real than simply dipping into “free” miles you earned on your credit card, or through flying.
Keep in mind, though, that you don’t earn any miles or elite qualifying points on an award ticket, but you do on a paid ticket. So while you’re paying $500 for a ticket, you’re putting additional miles into your account for future travel.
Even when the math works out and you might want to consider a redemption, it’s worth considering other reasons why you might want to save your miles for something other than a domestic ticket in coach.
The value proposition gets a lot better in first and business class, even domestically.
Low-level roundtrip domestic tickets in first class can be had on the legacy carriers for 50,000 miles. Using Ben’s valuations above, this means that redeeming miles for a first class ticket makes sense if the ticket would cost more than $800 on Alaska, $900 on American, $650 on Delta or $700 on United.
While paid first class tickets are definitely trending downward in price, and while you’ll occasionally see roundtrip first class fares from, say, LAX to Washington, D.C. for around $900 (in which case, on American, at least, it might still be better to purchase the ticket outright), most first class tickets on mid- and long-haul flights within the US cost $1,000 and up. There is considerably more value in using points in this case, versus on an economy ticket.
Is domestic First Class way better than domestic economy? Yes.
But keep in mind that while domestic First is nice, and the free Bloody Marys are great, and it’s nice to have the extra legroom, you’re still on a ~5 hour flight at most. By the way — please, please don’t redeem 50,000 miles for a 2-hour flight from New York to Florida or from Denver to L.A. just to sit in First.
There are longer flights, sexier destinations and far better premium cabin experiences to be had if you use your miles to fly internationally.
It also goes without saying to always search Google Flights, Kayak, or your preferred airline’s website to see how much a paid first class ticket would cost on your trip. Sometimes first class is far less expensive than you’d think.
So while it’s, again, an entirely subjective matter as to what you do with your points, consider that while dropping 50,000 miles for a roundtrip flight from San Francisco to Tampa up front might be nice, dropping 62,500 miles for a one-way trip from San Francisco to Hong Kong in Cathay Pacific’s legendary First Class might be way nicer.
International travel is the sweet spot…
Everyone who reads this blog has a different reason for doing so. Some people love the challenge of “gaming the system.” Some people love the idea of “getting stuff for free,” even if we’ve established nothing is really “free.” 😉 Some people just love to travel. And some people love the idea of attainable luxury.
Given that I could drool at one of Ben’s fancier trip reports for hours, I think I’d consider myself a member of that very last category.
International First Class — the realm of suites, obsequious service, $150 champagne, swanky airport lounges that make an Admirals Club look like a homeless shelter — is the holy grail of this blog, it would seem.
Ben’s beloved Cathay Pacific first class cabin is certainly lovely. I’ve flown it — it’s fantastic. And it only cost me 62,500 AAdvantage miles one-way.
Think about that. American is probably trying to sell you on “Business/First AAnytime” one-way award from LAX to Boston for 55,000 miles one-way. So for 7,500 more miles, you can fly to another country, nearly 3x the distance, and on a world-class premium product… instead of in American’s crappy domestic first class cabin with inedible food and sometimes cranky flight attendants.
But don’t buy all the hype. When international first class awards and business class awards are available on a long-haul route, Ben is right: spend the incremental points and fly First on a foreign carrier (it makes less sense to do so on American or United, where the international first cabins are an afterthought).
But Business Class is super nice too, you guys!
Really. It’s lovely. Ben and I have differing opinions on this, but international First Class is one of those dream-vacation, once-or-twice-or-three-times-in-a-lifetime things to do. He flies First Class like you or I might take an Uber.
Business class, however, costs less miles, has (generally) much more award availability, offers decent food and even champagne, and is totally comfortable for a 7- to 15-hour flight. Ben loves Cathay Pacific business class, for instance, and with good reason (he loves other airlines, too, just so you know – but Cathay’s one of the most attainable using miles).
…but you should sometimes still pay for a ticket. Even in business class.
Generally, there’s been a trend lately in airlines offering more reasonably-priced international business class fares. This isn’t always the case, but we’ve seen some really incredible fares over the last year or so:
- West Coast cities to Madrid for $1,450 on Air France, KLM, Alitalia and Delta in business class
- West Coast cities to Paris or Amsterdam for $2,000 on American and British Airways in business class
- Dallas to Brussels for $1,850 on SkyTeam carriers in business class
- Dublin to the US (including West Coast) for $1,700 on oneworld and SkyTeam carriers
- And who can forget Washington to Beijing for $450 on American Airlines in business class (this was a “mistake fare,” but was honored)
In each of those instances, buying a ticket outright — while maybe not “cheap” in absolute terms — is infinitely preferable to redeeming miles for the following reasons:
- When you buy a ticket, you choose the dates, times, and routing. You can buy multiple tickets. You don’t have to worry about being flexible for award availability — the itinerary is on your terms.
- Paid business class tickets earn more miles (both redeemable miles and elite-qualifying miles, for those who care) than economy tickets, and on a longhaul trip, those miles can add up. You could get 20,000+ elite- and redeemable miles, or more, from such an itinerary. That’s huge. You could do a couple bargain-basement business class fares and earn elite status with any of the major airlines.
- The math works out. Yes, those fares are all well north of $1,000, but let’s use Delta SkyMiles as an example. A roundtrip award to Madrid, for instance, on Air France would cost you 125,000 miles plus a not insignificant amount of taxes and fees. Meanwhile, valued at 1.3 cents per mile, we’d see you “spent” $1,625 in miles on top of taxes and fees… or you could have just spent $1,450 or so and gotten a paid ticket on your own preferred schedule.
Of course, plenty of business class itineraries price out at $3,000 and above. First class itineraries cost $5,000 and up, at least. Very few of us can pay that out of pocket. Miles become the real value in these cases.
But, again, before you redeem 125,000 miles and up on an international business class redemption… check out this blog, search on FlyerTalk for cheap business class fares and look online. It may make more sense to pay for business class tickets in cash and use those miles for airline status and the perks that come with it.
Miles and points really are a currency. Just as you wouldn’t spend $20 on a paper clip, you also shouldn’t spend 25,000 AAdvantage miles on a Phoenix-to-Salt Lake City roundtrip just because you have the miles and it seems “free” to redeem them.
There are legitimate reasons to use miles for domestic economy tickets, especially when traveling as a family and especially when paid tickets are prohibitively expensive. If you have a million miles to spend, by all means – this is a good use for them.
But if you’re reading this blog because you want to be sipping champagne on a flat bed over the Pacific Ocean, you ought to save those miles so you get a much better bang for your buck.