What's the AAdvantage(tm)?

September 12, 2006 1:11 PM

Why would I want to purchase Air Miles? Specifically AAdvantage Miles. Is the cost of purchasing miles saving you money on the cost of a flight? i.e. Is the value of air miles greater than their purchase value when redeemed for a flight?

If it costs me $250 to purchase 10,000 miles, will redeeming them save me more than $250 on my flight?

posted by medium format to travel & transportation (10 answers total)

I think one reason you might buy some is if you almost have a free trip somewhere and need to buy a few miles in order to get the free trip.
posted by Amizu at 1:14 PM on September 12, 2006

Just bought ten thousand or so miles on Frontier to get from 40 to 50 K so my wife and I could go to Mexico. Turned a 1200 cost for two tickets into about 300, but moreso booking was just easier since both were done simultaneously.

Not sure about other reasons.
posted by docpops at 1:18 PM on September 12, 2006

In general, buying miles is for when you are close to a certain award level and it makes financial sense to buy miles instead of a ticket.

For example, let's say you have 23,000 miles but need 25,000 miles to get a free flight. Buying the 2,000 miles is likely cheaper than buying the ticket for the flight.

The airlines have priced the miles so that it's not a good way to avoid airfare costs. It's simply a way for them to generate some money as they move the mile soff their books.
posted by Argyle at 1:29 PM on September 12, 2006

Amizu and Argyle are right. I had almost enough miles to get 2 tickets to Peru this summer (66,000 out of 70,000). I paid ~$150 for the 4,000 miles, plus ~$150 for taxes and fees on the 2 tickets, so I ended up with round-trip airfare for 2 people at about $300. This is compared to the $800 each it would have cost me if I had just bought the tickets outright.
posted by sbrollins at 1:34 PM on September 12, 2006

In general, buying miles is a poor value. If they were sold at their value, people might buy them instead of tickets. The exact value of a mile depends on what you use them for, but most arlines seem to have settled on between $.02 and $.03 per mile. It would be most cost-effective to use purchased miles to obtain a really expensive ticket, like international first-class where the actual cost would be enormous. In that scenario, you can sometimes find an award that is "worth" $.07 or $.08 per mile. If you play around with the numbers, you will find that it usually only makes sense when you have almost, but not quite, enough miles to get a ticket.

There have been exceptions, such as the legendary promotion where you got a better value per meal in miles for frozen dinners than the cost of the dinners and a few enterprising souls bought hundreds, even thousands of them.

The downside of using miles is that award tickets are notoriously difficult to obtain and you may not be able to travel when you want to. You will find some astonishingly spirited debate on this topic at www.flyertalk.com if you want real nitty-gritty.
posted by Lame_username at 1:41 PM on September 12, 2006

be aware that many miles (like those on the kelloggs packages that you can buy off ebay now) are pretty much worthless. they are hevily restricted or have a soon due date.

if you are close to an award and looking to save a few bucks of a business class ticket, a mileage run or a platinum challenge (= 16,000 miles in a 90 days period, starting either on the 1st or the 15th of the month) might make sense.

take a look at flyertalk.com - you will find all the experts there.

flyertalk.com american airlines Aadvantage forum
posted by krautland at 1:56 PM on September 12, 2006

btw, AA used to offer lifelong first class flights to anyone willing to front $500.000 int the late eighties. the thing was available only for a very limited time but there are stories about a guy who goes by the name (pseudonym?) jack vroom who still holds one of those passes and in the meantime has racked up 28 million AAdvantage miles.
posted by krautland at 2:02 PM on September 12, 2006

I just saw that http://aadvantage.blogspot.com has all the dirty details on the platinum challenges.
posted by krautland at 2:09 PM on September 12, 2006

I travel infrequently for business and signed up just for the hell of it.

Two years in a row I have converted my paltry 5k worth of miles into a handful of magazine subscriptions. Whoopty ding, but it's an easy way to get a little back.
posted by unixrat at 2:33 PM on September 12, 2006

I don't know about airmiles in the states but in UK some kind of bonus miles can be useful if you need to make a very short foreign trip, not including a saturday night, which otherwise works out expensive.
posted by londongeezer at 2:40 PM on September 12, 2006