Folks Really Do Pay $10,000+ for Airline Tickets!

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Emily and I use miles and points to travel First Class, but there are some people who actually pay to fly First Class!

Folks Really Do Pay 10000 For Airline Tickets

British Airways First Class

No One Pays Retail?

In trip reports from our $32,000+ honeymoon in Paris for only $2,000, our Second Honeymoon in Bora Bora, our Spring Break in Maui, and our Second Anniversary to Italy we listed how much money we saved using miles and points.

Sometimes readers will comment that hardly anyone pays retail price for Business or First Class tickets.

Many Businesses Pay Full Price

Some businesses pay for Business or First Class tickets for their employees because it means an opportunity to network and generate new sales, as this article from the Huffington Post explains.

Folks Really Do Pay 10000 For Airline Tickets

Flying Business Class Could Bring Networking Opportunities

Other companies allow for Business Class tickets if a flight is a certain length as discussed in this thread on Flyertalk.

Universities Sometimes Buy Business Class

Some universities allow for Business Class tickets to accommodate medical disabilities or special needs or if “the time and convenience of the traveler and time away from the University” play an important role in needing to fly in Business Class.

Certain Government Officials Fly Business Class on Long Flights

The government allows employees to travel in Business Class for a variety of reasons such as if the total flight time is longer than 14 hours or if the government would save money.

Some Individuals Splurge for Special Occasions

Some individuals are willing to pay for Business and First Class tickets.

This thread on Flyertalk focuses exclusively on good deals for Business and First Class tickets.  Since it has 222 pages of discussion, more than a few people are buying Business and First Class tickets.

And there are threads like this each year.  For instance, San Francisco to London in First Class for $3,633 or $2,455 for Business Class.

Folks Really Do Pay 10000 For Airline Tickets

Business Class From San Francisco to London for $2,455

1.   Luxury Travel

In my interview with Debbie from Traveling Well For Less, she and her husband paid for Business Class tickets for a trip to Australia and Tahiti.

2.   Honeymoon or Anniversary Travel

Other people will splurge and buy Business or First Class tickets on their honeymoon or anniversary, especially to places like Paris.

Folks Really Do Pay 10000 For Airline Tickets

Honeymooners Want to Fly in Business or First Class to Paris

3.   Comfort Or Medical Need

Brian, The Points Guy, frequently mentions that he prefers to travel in Business or First Class because of his height.

Things to Consider

People often confuse the price they would pay with the value they would get.  At some point I’ll write a series on it, but for now we’ll just cover a few basics.

1.   Value You Would Get

You shouldn’t calculate how much you saved based on what you’d be willing to pay because that’s not a good indicator of the true “value” you’re getting.

In other words, there is a DIFFERENCE between the cost of an item and the value of the item to you.

A better indicator of savings is to calculate the cost if you had to pay and what it cost you with miles.

If you want to buy a Mercedes E-Class Coupe that sells for $52,200, but you are only willing to pay $48,000 and a dealer will sell it to you for that price, is your savings $0 since $48,000 was all you wanted to pay?  No, your savings is $4,200 because that’s the difference between what it cost and what you paid.

Some folks think, “I would never pay $50,000 for a car.  I’d pay $25,000 tops.  So I’m not saving any money!”

But then they would never get to experience a Mercedes E-Class Coupe.  Meanwhile the rest of us are having a $50,000 Mercedes experience for less than the price of your Hyundai.

The same can be said for using miles instead of cash for airline tickets.

Let’s say you want to go to Brussels this summer.  A First Class round-trip ticket in August would cost 160,000 United Airlines miles.  And there are lots of ways to earn United Airlines miles!

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You’ll Only Pay 160,000 United Airlines Miles and ~$55 in Taxes & Fees for a Round-Trip First Class Flight From Chicago to Brussels, Belgium

But what if you had to pay for your First Class flight?

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The Same Flight Will Cost You a Whopping ~$8,630 in Cash!!!

You’re saving ~$8,575 in cash by using miles!

2.   Price You Should Redeem At

Emily and I rarely, if ever, pay for airline tickets.  Instead we use our miles and points.

When deciding if you should use miles or points vs. paying cash, it helps to know what price you should redeem your miles for.  Ask yourself if you’re getting a good value for the miles and points you’re using or would you be better off paying cash?

You could pay ~$27,500 to fly in First Class from New York to Auckland, New Zealand.

Folks Really Do Pay 10000 For Airline Tickets

First Class From New York to Auckland for ~$27,500

Or you could use 225,000 American Airlines miles to fly First Class on Cathay Pacific.   There are also plenty of ways to earn American Airlines miles.

Cathay Pacific doesn’t release their First Class award seats until closer to travel so I can’t show you a screenshot of availability.

By redeeming 225,000 miles instead of paying $27,487 for a First Class ticket, you’re getting a value of ~12 cents per mile ($27,487 / 225,000).

The Same Idea Also Applies to Hotels

As mentioned earlier, Paris is a popular honeymoon destination.

The Park Hyatt Paris-Vendome’s makes it extremely appealing.  And the suites are spectacular!

You Could Treat Yourself to 2 Nights of Luxury at the Park Hyatt Paris – Vendome

Emily and I Used Our Hyatt Points to Stay at the Park Hyatt Vendome-Paris for Free!

Paying for your room at the Park Hyatt Paris-Vendome could cost ~$1,000 per night!

One Night at the Park Hyatt Paris Vendome Costs ~$750

One Night at the Park Hyatt Paris Vendome Can Cost ~$1,000!

Because the Park Hyatt Paris-Vendome is a Category 7 hotel, it costs 30,000 Hyatt points per night.

So I’d much rather use my Hyatt points to stay for free, than pay $1,000 for 1 night!  Especially because there are so many ways to earn Hyatt points!   

Bottom Line

Believe it or not, there are some folks who pay for Business and First Class airline tickets.

Some companies pay for Business Class tickets so their employees have networking opportunities.  Universities and the government will pay for business class travel if it’s medically necessary.  And other people are willing to pay for Business or First Class tickets because it’s a special trip or they want the extra comfort.

The value you get from using miles isn’t the same as the “price” you should redeem your miles.

The value you get from using miles isn’t only a price tag, it’s a memorable experience you wouldn’t otherwise be able to get.  And it’s extremely valuable for those of us who want Big Travel with Small Money!

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19 responses to “Folks Really Do Pay $10,000+ for Airline Tickets!

  1. Of course we pay for premium cabins. Which is why spongers like you can get there for next to nothing!

  2. Douglas E. Little

    Hi D. & E.,

    I enjoy reading your blog and find a useful bit once in a while but, what I would really like to know is all the ways you are earning free or cheap travel. Would you please reveal all the ways you accumulate miles, avios, points, and manage to stay in fancy hotels so often. I manage to wring a few miles from the credit card sign on bonus game each year but, you two must be really creaming it! How about coming clean? Do you have any corporate sponsors and how much do you spend each year? What so you say? Fair question?

  3. Dear CEO, Sounds like you need to do some work in your own CEO financial department, if you aren’t taking advantage of these opportunities. Having excellent credit is a must for employees these days, in order to “get the job”, have lower car insurance premiums, better home interest rates, etc. The latter are rewards just as credit card bonuses are for people living the right way and doing the right thing.

  4. “Or you could use 135,000 American Airlines miles to fly First Class on Cathay Pacific.”

    how is this possible for a round trip? AA does not allow transfer via Asia on the way to New Zealand… it would have to be two awards… 215k miles round trip.

    can you please explain how you got this award for 135k AA miles?
    thank you.

  5. I agree that there is a difference between the cost of an item and the value of that item to an individual. It bothers me when people insist that one is not “saving” a certain amount of money by using points/miles because one would not be willing to pay the asking price in cash. Your analogies are good. The same goes for retail shopping, for example, I recently bought a designer gown for 30% of the regular price, so I saved 70% and it doesn’t matter that I wasn’t willing to pay full price. Thanks for the post!

  6. @Douglas E. Little – If by creaming it you mean my spouse and I have been approved for 35 new credit cards in exactly 25 months (through Daraius’ tutelage… Thank You Very Much Daraius!) then yes, it can be done. But if you’re just wringing a few miles each year, you’re leaving untold tens of thousands of dollars in free travel on the table.

    Through credit card sign up bonuses, the minimum spend required, the retention offers and transfer bonuses, I’ve earned over two million miles/points in only two years. And that doesn’t even include all the free Hyatt nights.

    In those two years and one month, I’ve earned miles/points as a hobby faster than I can spend them. Daraius, on the other hand, has been doing this for way more years than I have, and considering he’s doing it as part of a full time job, well, let’s just say some people play the game more seriously than others.

    What say you Douglas? Fair answer?

  7. “Meanwhile the rest of us are having a $50,000 Mercedes experience for less than the price of your Hyundai.”

    Can you expand on this example a bit more?

    In your example, the $48,000 you’re willing to part for the Mercedes Experience is more than the price of Hyundai. How is it less?

  8. @ram – I had the same question but then realized it must be an analogy to BIG travel, small money.

  9. Board of Directors

    CEO meant to say we sometimes pay for premium cabins especially with United and Delta going to a qualifying spend system for elite status but as a company we leverage points and miles to lower our travel expenses on our income statement. BTW CEO has been removed by the board for excessive spend on premium cabins!

  10. We always fly in premium cabin and see all the chancers (bloggers) photographing seas, food, etc so that an army of spongers can get all excited reading about what is behind THAT curtain.

  11. We bought a plane for half of what our execs spent on travel in 2011. The annual operating costs have been a fraction of that (maybe 20%), and we now have a policy that any commercial flights must be in economy.

    The best part: no bloggers allowed.

  12. @CEO I’m not sure if you are being honest or just joking about paying to fly in premium cabins all of the time because if that were true you most likely would not read blogs that teach using miles/points. However, if it is true, then please know that many travelers save up money for years to pay for a trip of a lifetime and they take pictures of everything for their memories. These travelers may be the people you see taking pictures. Thanks!

  13. The only way airlines are able to support these biz and first class cabins is by selling tkts. Upgrades and FF awards do not generate money to cover the costs. Economy tkt just cover the basics and more recently generate small profits, while biz seats are huge profit makers. Econ tkt create the flight frequencies so that biz class seats can be sold, and flights can make big profits for revenue management and day of departure specialists departments at airlines and to keep big spenders out of private jets. People like MMS are making money from banks, and when airlines were in need of financing that was an important part of the equation but now, airlines are profit machines and banks are having trouble keeping airlines from de-valuing FF programs and screwing bank customers. Frequent Flyer programs are a sunset industry. They are increasing turning into scams because airlines no longer need them and in the USA are insulated from liability and due process law suits and even contract dispute lawsuits by recent Supreme Court decisions. Sure there is a game here, but things are changing and the end is near. Lufthansa and other airlines are already selling more biz class seats to leisure travelers with restricted biz class fares/rules to try to weed out the FF mileage tkts. This is an industry wide trend not discussed by MMS.

  14. Dear Shana – I don’t read blogs at all, this one cropped up when I google searched something and I felt compelled to add my 2 cents. I did not realise that there is an army of full time chancers (bloggers) who do nothing else but boast about how cheaply they got somewhere or stayed somewhere they clearly do NOT belong to. As for your example I have nothing against someone enjoying a trip of a lifetime – just try not to make a spectacle of yourself.

  15. Sounds like the 1%er CEO doesn’t like the fact that the top 20%er (or whatever) is “intruding” in his space. We have good credit and know how to play the points game that the banks promote. Why do you think they advertise these rewards cards so heavily? Because a large percentage of the population doesn’t know how to play the game, and will be paying oodles of interest charges on credit card balances. We are simply good money managers and know how to play the game by the rules the banks set. Gee, isn’t that how a CEO became a CEO, by playing a corporate game?

  16. It must be annoying for the first class folks to deal with all the photography that takes place up there. ha ha ha it’s not me I’ve never been “upfront”.

  17. CEO, I think you are the one making a spectacle of yourself. This is my first time commenting ever. I’m so entertained by your posts that I feel compelled to add my 3 cents.

    A successful CEO is best at motivating people and adding value. I don’t see you doing either, so I have to conclude you’ve failed as a CEO here. Your 2 cents is indeed just … 2 cents.

    You don’t get to decide if someone belongs or don’t belong. If they end up there, they belong there. Maybe you should take your 2 cents somewhere else where it is appreciated, MR. ceo.

  18. If you use points for first class instead of paying cash, you only “save” the retail price of the first class ticket if you were to willing to pay the retail price.

    You are getting a lot of value, but it’s not direct savings. Here’s an example –

    Let’s say I want/need to go to Paris. If I don’t have any points or miles to use and my cash budget is $1000 and economy tickets are $500 per person, I pay that and fly economy. If economy tickets are $4000, I can’t pay, so I don’t go.

    Now if I have miles to use for an economy seat and I use those my miles, I didn’t save $4000. I saved what I was willing/able to pay ($1000). The value of those miles is even more than $4000 because the miles enabled me to go when I couldn’t otherwise.

    If miles help you move up in class, then miles enabled you to experience first class and fly in more comfort.