When buying a plane ticket, how do you decide whether to cash in your frequent flyer miles?

August 1, 2009 6:45 AM

When you buy a plane ticket, how do you decide whether to cash in your frequent flyer miles, or pay cash and earn the miles?

I have a specific decision to make that's prompting this question:

I've accumulated about 50,000 frequent flyer miles on a major airline over about 5 years of personal domestic travel. I'm going to Buenos Aires in September, one-way, economy, and I can either:

a) buy a ticket for about $450-500 (on two different airlines that I don't normally fly, with 2 stops on the way, about 16-19 hours trip time), or

b) spend 20,000 miles (on "major airline", 1 or 2 stops along the way, 14 hours trip time).

To buy the one-way ticket on "major airline" would cost around $1800 or more and I'd earn 5800 frequent flyer miles. Way too much for me to pay!

How do you decide whether to spend the miles or the money? I've really never been sure when to cash them in, but I'd sort of like to do that now because I could use the $$ to help secure an apartment, settle in, etc. (I'm moving there on my own without a job to pay for moving expenses.) But I'm also a little hesitant because I wonder, is this really getting the best value for my miles? Should I save them for later?

For what it's worth, I'm probably going to be in South America indefinitely after this trip and I'm unlikely to fly the "major airline" to travel between cities and countries there. However, I may use it to come back to the US for visits (such as at Christmas). Thanks for your advice!

posted by inatizzy to travel & transportation (14 comments total)

My first thought is that you should use the miles because
A) you never know how long they'll be good for. The airline could go out of business or phase out the frequent flyer program. (It seems I hear rumblings about that all the time, though I don't know that it's ever happened.)
B) in the future when you want to use those miles for a specific date, there may not be seats left (sometimes they limit the number of frequent flyer reward seats per flight.)
posted by needs more cowbell at 6:56 AM on August 1

That sounds like a good mile deal, use the miles.

I tend to save miles to use for longer trips like this. They're not worth much on short flights (1-2 hours). I've done Sydney->Shanghai roundtrip on points, for example, at Christmas when the flight cost would be much higher than usual.
posted by wingless_angel at 6:58 AM on August 1

I've heard that roughly speaking, for decisions like this one, a mile is worth about one cent. So spending 20,000 miles is like spending $200; use the miles.
posted by madcaptenor at 7:22 AM on August 1

It depends on whether or not you fly enough to earn elite status. I fly a lot and the benefits I get out of earning status each year make it all a lot more pleasant. For that reason I tend not to use miles until I've reached the status level I want. And even then I generally miles on international upgrades or family.

In your case, even if you're trying to achieve status, I'd use the miles, given the price options. You can always arrange a long weekend before the end of the year on a cheaper flight if you're close to hitting your status level.

If you've already achieved status for the year then using the miles is a no-brainer. Likewise if you don't fly enough to worry about achieving status.
posted by idest at 7:30 AM on August 1

I think you should use them. In my experience, it's more likely that they'll go to waste in the future if you don't use them, than it is that you'll regret using them.
posted by mercredi at 7:43 AM on August 1

Unless you fly a lot of domestic and international flights many times a year then you are better off using them. Flying only once or even less a year and you risk using them. If you have plans then use them. If you use them, then don't waste them on a multi-stop trip. I would look for direct or at least 1-stop trips.

You might want to even consider splurging and using all of your miles for first or business class. Coach sucks for long trips.
posted by JJ86 at 7:51 AM on August 1

Are you sure you can use frequent flyer miles for a one-way ticket? Usually they are restricted to round trips, even thought the miles may be quotes as each way.
posted by smackfu at 8:01 AM on August 1

I value miles at approximately 2 cents/mile, a cutoff used by many on Flyertalk to decide whether a mileage run is cost-effective or not. Use the miles.

On many airlines, there are many award tickets that are not a cost-effective use of miles. For example, a domestic round trip scheduled a month in advance will probably cost you less than the $500 I value the 25,000 miles at. But with miles, you can book the trip at the last minute (if seats are available, which they frequently are not), and add a second stopover location for the same price, whereas if you pay cash, both of these things will add much to the price. The fact that your ticket is one-way is making the cash price unreasonable, while in miles terms it's half as expensive as a round trip.

The point about the miles going to waste is a good one. It's also always possible that the program will change or the airline will go bankrupt, in which case your miles might be worth much less in short order.
posted by grouse at 8:06 AM on August 1

You may want to research round-trip ticket prices as well as one-way ticket prices. Airlines almost never discount one-way prices, but with a two-way ticket you may get a better flight for less than a onw-way ticket. When you get to your destination, simply throw away the return ticket
posted by Wooden Doll at 8:40 AM on August 1

Are you sure you can use frequent flyer miles for a one-way ticket?

Actually, it looks like American does allow this: "AWARDS MAY BE USED ONE WAY OR COMBINED FOR ROUND-TRIP OR MULTI-CITY TRAVEL"

Have you checked whether the 20k reward is actually available?
posted by smackfu at 9:25 AM on August 1

Miles tend to get less valuable over time (and frequent flyer programs get worse, not better). I use them as soon as I can.
posted by meta_eli at 9:37 AM on August 1

I save them for things I could never actually afford, like international first class flights. Getting 125,000 miles is much easier than the $10,000+ a seat like that sells for. (I can't imagine ever being rich enough to be willing to pay that much money. But it is nice when it's free!)
posted by jrockway at 10:41 AM on August 1

The scenario you outlined in your question seems to favor using your miles. Use them without regret.
posted by Burhanistan at 11:34 AM on August 1

Sounds pretty unanimous in favor of using the miles. Thanks for such convincing arguments, everyone. :) I'm sold. In fact, I think I'm going to go one step further and see if I can't make it a multi-city trip!

@smackfu: the 20K reward is still available on a number of dates in September, and my departure date will depend on that. that may be moot if I add a stopover. but thanks for thinking of that possibility, I appreciate it!
posted by inatizzy at 12:00 PM on August 1