Want to get the best value for your miles? Try using them when high-priced flights are unavoidable.
Listen as Rick Seaney digs deeper in the details, making this complicated process easier:
Redeem Miles for Expensive Trips
This is when I use my miles:
- Last-minute emergencies
- Business travel
- Vacations to far-flung and/or expensive destinations
What Miles are Worth
You want to get good value for your miles, but the experts differ on what that is. A good rule of thumb:
- Try to get one and three-quarters cents in value per redeemed mile
Here’s an example of how that works: 25,000 mile domestic round-trip flight – Redemption rate works out to a value of $437
These are goals to shoot for, or what I call my pay cash magic numbers:
- For domestic round-trip flights: $475 for short to medium flights
- Domestic coast-to-coast round-trip flights: $525
- Mexico, Caribbean, Canada round-trip flights: about $625
- Mainland/Hawaii round-trip flights: $750
Note: This upward rounding takes into account the following:
- Minimal domestic taxes
- Value of miles lost by not paying cash
- Higher redemption rates for flights between the mainland U.S. and Hawaii
Longer, More Expensive Flights
It used to be conventional wisdom to pay cash for overseas flights (across the Atlantic or Pacific); not so much anymore due to the high cost of these tickets. However, if you are miles rich (say you have 60,000-plus) and are looking to take an international flight of six hours or more, I think using your miles to save $1000 is a great idea.
Pitfalls? Hear Rick Seaney tell editor Anne McDermott all about them:
Pitfalls to Avoid
Buying miles: If miles are worth one and three-quarter cents, don’t pay two and three-quarters cents unless you’re close to a specific award level and need to top off your miles account.
Fuel surcharges and taxes: Free tickets are hardly ever free thanks in large part to fuel costs and other extras you’re required to pay, so be sure to add these numbers to your total ticket price calculations.
Loss of cash miles: Remember to figure in any miles you might have added to your account if you had you paid cash for your ticket.
Devalued miles: Miles programs can change at any time – as is the situation with Delta’s program – so it’s smart to use miles if you have them.
Popular destination gotcha: Airlines don’t have as many empty seats as they did five years ago, so redeeming miles at the optimal lower mile amounts can be tricky for popular vacation destinations.
Miles expiration dates: Don’t have any flights or activity on your miles account within 18 months? Watch out – in that time frame, many airline miles expire.
Merger questions: Airline takeovers and mergers can be scary but the reality is that most airlines retain the best of the each merger partners’ miles program.
Non-stops vs. connecting flights: The quickest route isn’t always popular as airlines often blackout all lower level awards on non-stops to popular destinations.
Redemption fees gotcha: If you wait too long to redeem a free ticket – such as inside a couple of weeks of departure – this gotcha will get you to the tune of up to $100.