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Your frequent flyer points are worth money. Are you using them and how much are they worth?

As a frequent airline passenger, you are amassing miles. What are these miles actually worth?  It may seem hard to figure this out, but it is really pretty simple.  The value of each mile is anywhere from one US cent to three US cents.  If you are wondering what this actually means, try to do the math.  If you have accumulated 25,000 miles and you want to reserve a flight, and each mile is worth one cent, the flight you want to take should have a price of at least $250 USD.  If a mile is worth two cents, then select a flight which costs $500. 
 
The idea is to make use of your miles in the most cost-efficient manner.  In this case, if you are thinking of purchasing a ticket with a price a lot less than $250, you might want to reconsider.  It may not be worth it to use your miles for this flight.  Either save them for another time, or consider taking a different flight.
 
A lot of travelers don’t think about what their miles are really worth and it’s a shame –they could be making much better use of them! 

Thinking about selling your miles?

The same idea is relevant to the new websites which offer to exchange your miles for cash or some type of merchandise.  Studies have been done which prove that the products these sites offer generally cost more when bought with your free miles, so it is really not worth it to make one of these deals.  Can you imagine going into Starbuck’s and paying $50 for a cup of java?  Better not to deal with one of these transactions unless you don’t believe you will be flying with that particular airline again.  Try to work with only two or three airlines – in this way you will make the best use of your mileage. You don’t want to lose money while trying to save money – so be smart.

Getting Help

Some people are so busy that they don’t have a minute to consider how to take advantage of their frequent flier miles.  Airlines recognize this and have turned it into a moneymaking venture.  For people who are constantly traveling, you can call a company to help you get the most out of your miles.  These companies will administer your miles for less than $30 a year.  They can organize all your accounts and let you know if your miles are about to run out or direct you to a good deal.
 
The truth is that if you are not one of those people who are getting on and off planes like some people get into their cars, it is probably not worth your while to hire such a company.  However, if you have what looks like a million miles to manage, it can be a good idea.  You don’t want you miles to expire, so use them constructively….if you let them go, it’s the airlines that are benefiting. You are entitled to make the most of them because you paid for them!  So keep track of them sensibly and get help if you need it.

A Few Pieces of Advice for the Smart Flyer

  • Accumulate frequent flyer miles in only one or two programs.  Some plans include a number of airlines. Doing this will make your miles more manageable.
  • Don’t let those miles expire!  If you have miles about to expire, check into converting them into an “award certificate” which gives you more time in which to use them.
  • Be creative about collecting miles – check out credit card companies or airline programs that have partners such as rental car businesses and hotels.  There is more than one way to build up miles!
  • Don’t forget that your goal is free flights – not huge collections of miles.  You might enjoy watching the miles add up, but make good use of them.  They won’t do you any good if you don’t take advantage of them.

Remember!

Most people don’t realize that you are paying for those frequent flier miles - they are not handed to you for free.  There are people who just throw them away, thinking they are not worth real money.  This is absolutely wrong.  The airlines understand their customers and they know that many of them let their miles expire…. and they make more money every time one of us does!
 
Check out the Frequent Flier News site to get all the latest information about how to make the most of your miles.           
 
 
By the way, frequent flier plans do just as much for the airlines as they do for you.  An airline that has a good program keeps its customers coming back, because people stay loyal to the airline which awards them the miles.  They are gaining your loyalty and keeping your business. 
 
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