Use Airline Miles or Pay Cash? How We Decide

[plane2port]

In this forum the topic often comes up whether or not someone is getting a good value for their airline miles. This is something that is foremost in my mind whenever I am shopping airfare.

 

I fly mostly on award tickets, and have gotten my adult kids into the game as well. I put together a blog post showing all of our flights this spring. For most we used award tickets, but we also paid cash for some (In fact, the first cash trip on the list was to meet our cruise on the Norwegian Pearl in Los Angeles.)

 

For the award ticket flights, I've calculated our cost per mile for each ticket.

Caution-- nerdy number crunching ahead!

 

http://www.plane2port.com/use-airline-miles-pay-cash-decide/

[FlyerTalker]

Good explanations of your thought process and evaluations. Thanks for putting that together and posting.

[vwrestler171]

I learned something with that blog. Everything made perfect sense to me. Thanks for posting it

[Ashland]

Great picture you opted to use....Does he ever fly with you;):D

[lovevacadays]

Thank you for posting this. I have miles with a Citi Advantage card so American Airlines. I've never used miles before. I just started looking at airfare for our cruise in December. Boy, Orange County to Fort Lauderdale at the times I want is expensive right now. I believe I have enough miles to use for a coach ticket but I was really hoping to buy a coach and use 30,000 to upgrade to first class (which is the amount American told me I would use).

 

I'm hoping airfares go down but not sure if they will. I still have plenty of time. I'm cruising with 5 family members but they will al be flying out of different airports.

 

Yikes. I really would love to go first class but I just might have to use my miles for the coach ticket.

[Globaliser]

In this forum the topic often comes up whether or not someone is getting a good value for their airline miles. This is something that is foremost in my mind whenever I am shopping airfare.

 

...

 

For the award ticket flights, I've calculated our cost per mile for each ticket.

Caution-- nerdy number crunching ahead!

There are two things, though, that many people will also want to add in to the calculation.

 

The first applies to everyone, and is that the cost of an award ticket is not simply the miles that you spend on getting the ticket. You also forego the miles that you would have earned on the cash ticket, had you bought it. So, for example, your son A's one-way ticket to London may have had a headline cost of 20,000 miles, but he probably also gave up earning something in the region of 4,000 miles. Taking the cash price of $550, the headline saving using 20,000 miles was 2.75 cents per mile, but if you take a true mileage cost of 24,000 miles, the saving was more like 2.3 cents per mile.

 

The second will be of interest to fewer people, but is still important to some: you don't earn anything towards higher-tier frequent flyer membership if you fly on an award ticket. If the perks of higher-tier membership are important, then there can be a real additional cost if flying on an award ticket means that you don't qualify for a particular tier, even if the cash value of this cost can be difficult to quantify.

 

In addition, an easier-to-quantify cost is that if you miss a higher tier, you can earn fewer miles on future flights because of the status bonus that sometimes applies. That could (for example) see you earning only 4,000 miles on a future one-way cash ticket to London when with a status bonus you might have earned 8,000 miles.

 

The status bonus can also complicate the calculation of cents per mile. If your son A would have earned a status bonus of 4,000 miles on a cash ticket, then by using miles for the ticket the net mileage cost of the award ticket would have been 28,000 miles - thus making the saving only 1.96 cents per mile.

[plane2port]

Good explanations of your thought process and evaluations. Thanks for putting that together and posting.

 

Thank you. This is high praise coming from you (one of our resident experts.)

 

I learned something with that blog. Everything made perfect sense to me. Thanks for posting it

 

You're welcome, glad you learned something from it.

Edited June 10, 2016 by plane2port

[plane2port]

Great picture you opted to use....Does he ever fly with you;):D

 

Yea, that's my fly buddy.:D

[plane2port]

Thank you for posting this. I have miles with a Citi Advantage card so American Airlines. I've never used miles before. I just started looking at airfare for our cruise in December. Boy, Orange County to Fort Lauderdale at the times I want is expensive right now. I believe I have enough miles to use for a coach ticket but I was really hoping to buy a coach and use 30,000 to upgrade to first class (which is the amount American told me I would use).

 

I'm hoping airfares go down but not sure if they will. I still have plenty of time. I'm cruising with 5 family members but they will al be flying out of different airports.

 

Yikes. I really would love to go first class but I just might have to use my miles for the coach ticket.

 

It's hard to know when to pull the trigger. I would be wary of holding off on getting an award ticket for flying in December, which is a high-demand time.

 

In my experience, American will offer additional award seats at the last minute, but then you are looking at paying the $75 close in fee. One thing you might consider is booking the coach award ticket with the intent of changing it to a business class ticket should it become available. You would have a $150 change fee, but you could look at that as your cost of "insurance" that you would at least be able to use your miles.

 

Hope you get to use your miles on this trip.

[plane2port]

There are two things, though, that many people will also want to add in to the calculation.

 

The first applies to everyone, and is that the cost of an award ticket is not simply the miles that you spend on getting the ticket. You also forego the miles that you would have earned on the cash ticket, had you bought it. So, for example, your son A's one-way ticket to London may have had a headline cost of 20,000 miles, but he probably also gave up earning something in the region of 4,000 miles. Taking the cash price of $550, the headline saving using 20,000 miles was 2.75 cents per mile, but if you take a true mileage cost of 24,000 miles, the saving was more like 2.3 cents per mile.

 

The second will be of interest to fewer people, but is still important to some: you don't earn anything towards higher-tier frequent flyer membership if you fly on an award ticket. If the perks of higher-tier membership are important, then there can be a real additional cost if flying on an award ticket means that you don't qualify for a particular tier, even if the cash value of this cost can be difficult to quantify.

 

In addition, an easier-to-quantify cost is that if you miss a higher tier, you can earn fewer miles on future flights because of the status bonus that sometimes applies. That could (for example) see you earning only 4,000 miles on a future one-way cash ticket to London when with a status bonus you might have earned 8,000 miles.

 

The status bonus can also complicate the calculation of cents per mile. If your son A would have earned a status bonus of 4,000 miles on a cash ticket, then by using miles for the ticket the net mileage cost of the award ticket would have been 28,000 miles - thus making the saving only 1.96 cents per mile.

 

These are really important considerations (especially the first one) and I should start adding in the foregone mileage in my calculations.

 

I don't think I'll ever get to the point where I am considering using the miles to gain status, but those who fly mostly with one airline should definitely consider it.

 

Globaliser, you are a quant after my own heart!

[iancal]

We use our air and our hotel awards cafefully.

 

We will use the air awards for one some transatlantic trips if we cannot score a good airfare. Same with other destinations. If there is a very attractive air fare we would rather buy a ticket and save the points for another time. We also use them for business class tickets when possible. This gives us a better return on the points and a more enjoyable flight.

 

We typically redeem hotel awards in areas where the rates are highest for us instead of using Hotwire or Priceline, etc,

Edited June 10, 2016 by iancal

[Gardyloo]

I want to mention a different angle on the same topic, that of buying miles instead of tickets.

 

Frequently you'll see threads on this board complaining over the high cost of one-way flights, usually related to people taking transatlantic repositioning cruises, e.g. Miami to Barcelona in the spring. How to get home from Spain?

 

If you have a cache of frequent flyer miles/points, fine. Most airlines now allow (and some like American insist) that awards be booked as one-way trips; for a round-trip or open-jaw itinerary, you need two awards.

 

But if you don't have a bunch of miles and/or don't want to obtain another credit card or max out the ones you have, you can purchase frequent flyer miles from the airlines. Depending on the airline, you'll usually spend around 3 cents per mile for small numbers of miles (for example to "top up" an existing balance.)

 

However, sometimes - typically a couple of times a year for major airlines - you can buy miles while they're on sale, or they come with a bonus. American Airlines, for example, recently had a sale where buying 100,000 miles got the per-mile price down to under 2 cents per mile. Usually buying miles online takes around ten minutes or less.

 

So take the Barcelona - US flight above. In the spring, AA requires 20,000 miles for a one-way economy award flight from anywhere in Europe to anywhere in the US (except Alaska and Hawaii). If your purchased miles cost 2c apiece, that makes a one way ticket $400, usually WAY less than a purchased one-way ticket. Business class is even better - 55,000 miles for $1100, buying a flat-bed seat (with connecting domestic first class) which would probably cost double that if purchased for cash. You might need to pay cash for some taxes (or the dreaded BA fuel surcharge) but it's still a savings. And yes, you won't earn any miles for that flight, but with (for example) American's new spend-based mileage credits, no great loss. (Use a an airline-branded credit card for the mileage purchase and get the spend miles for that at least.)

 

On more than one occasion I've found a business class trip that I couldn't cover with miles, so I've put the seat on hold, gone online and bought the miles, then turned around and redeemed them 15 minutes later.

Edited June 10, 2016 by Gardyloo

[Clay Clayton]

One thing you might consider is booking the coach award ticket with the intent of changing it to a business class ticket should it become available. You would have a $150 change fee, but you could look at that as your cost of "insurance" that you would at least be able to use your miles.

QUOTE]

 

Perhaps with the recent changes to their program, the change fee you mention is indeed the case, but in my experience (not much only have done it once) I was able to upgrade myself from a business award to a first award simply by asking (and donating an additional 12,500 miles of course);)

 

I join the other posters in praising the logical way you described your decision making process. Ours is similar except we rarely use our points for short haul flights. Even when they are expensive, we rarely get anywhere close to the value per point that one gets on business class awards. For example, to get to our cruise last April, we used DH's Delta points to fly on AF in business from IAH to MUC. According to my spreadsheet, the cost of the tickets on the day we booked them would have been $7,803 each which works out to a value of just over 12 cents per point. On the return we didn't do as well mostly because of that dang BA surcharge (and how cheap BA sells their first class), our points were only worth a little over 6 cents each...but in both cases this was much better than what we would typically find on a domestic flight.

 

Thanks again!

[4774Papa]

In this forum the topic often comes up whether or not someone is getting a good value for their airline miles. This is something that is foremost in my mind whenever I am shopping airfare.

 

I fly mostly on award tickets, and have gotten my adult kids into the game as well. I put together a blog post showing all of our flights this spring. For most we used award tickets, but we also paid cash for some (In fact, the first cash trip on the list was to meet our cruise on the Norwegian Pearl in Los Angeles.)

 

For the award ticket flights, I've calculated our cost per mile for each ticket.

Caution-- nerdy number crunching ahead!

 

http://www.plane2port.com/use-airline-miles-pay-cash-decide/

 

Thanks, your post was helpful.

 

I almost never use our miles for domestic air travel. Since I have the Platinum Delta Skymiles card once a year, I get the companion certificate for use in the CONUS for DW that costs only $99.

 

Also, when we take a transatlantic from Europe, I have found it best to use miles for the one-way ticket to Europe.

[chauffeurboy]

I currently have no status with AA, but have been adding approximately 2500 miles per month from credit card purchases/bonuses. (Currently have 85,000 miles)

 

We are planning a cruise from Singapore to Hong Kong in Feb 2018.(Flying out of Toronto) Based on the current award levels either for milesaver or anytime awards, we are looking at purchasing the economy and paying for the upgrade to business class with miles. Business class in my mind will be a necessity given the 22 hrs flight time.

 

How difficult is it to secure an upgrade with miles? How far in advance will I be required to book? Would I be right in assuming that I will need to be booking at 12:01am 331 days prior to the flight? (The earliest possible moment) Or would I be better off waiting to purchase the miles when they are on sale and getting the two round trip award tickets.

Edited June 11, 2016 by chauffeurboy

[4774Papa]

I currently have no status with AA, but have been adding approximately 2500 miles per month from credit card purchases/bonuses. (Currently have 85,000 miles)

 

We are planning a cruise from Singapore to Hong Kong in Feb 2018.(Flying out of Toronto) Based on the current award levels either for milesaver or anytime awards, we are looking at purchasing the economy and paying for the upgrade to business class with miles. Business class in my mind will be a necessity given the 22 hrs flight time.

 

How difficult is it to secure an upgrade with miles? How far in advance will I be required to book? Would I be right in assuming that I will need to be booking at 12:01am 331 days prior to the flight? (The earliest possible moment) Or would I be better off waiting to purchase the miles when they are on sale and getting the two round trip award tickets.

 

I can't answer you question about an upgrade.

 

However, we did a cruise from Singapore to Dubai and due to the long flights from JAX to ATL to Paris to Singapore, we broke up the trip by staying a day and a half in Paris to recuperate before the Paris to Singapore flight.

 

We did it in tourist.

[FlyerTalker]

AA specialists can give more details on upgrading with miles. In general, that has become much more costly and is a poor use of miles - depending on the carrier, you may need a certain fare class to be eligible and/or have co-pays that significantly boost the cost of the paid ticket. The days of upgrading with a handful of miles from the "cheap seats" is long gone.

 

As for "breaking up" the flight. Note that unless you have a fare that allows for a free or low-cost stopover, you will also be "breaking" the fare. It won't be from AAA to BBB, but rather AAA to XXX as one fare added to XXX-BBB as the second. Generally, on an international itinerary, if the stop is less than 24 hours, it is a "connection" and you can utilize a through fare. If more than 24 hours, it is a "stopover". Depending on your fare rules, you may have a free stopover (often available on Singapore, Turkish, Korean and others) or a nominal cost stopover fee. Or you may have the combination of two point-to-point fares added together. Check the fine print.

[plane2port]

This is copied right from the AA website:

 

 

Mileage upgrade awards

 

Use your miles to upgrade to the next cabin on most domestic and international flights. Request your upgrade award by calling American Airlines Reservations.

 

• Co-pays may be applicable when upgrading from select fares (excluding those booked in J, R, D, Y and B)
  
• Upgrades are not available for fares that do not earn mileage credit
  

I highlighted the applicable wording in red. Award tickets don't earn miles, so would not be eligible to upgrade with miles.

[Gardyloo]

I currently have no status with AA, but have been adding approximately 2500 miles per month from credit card purchases/bonuses. (Currently have 85,000 miles)

 

We are planning a cruise from Singapore to Hong Kong in Feb 2018.(Flying out of Toronto) Based on the current award levels either for milesaver or anytime awards, we are looking at purchasing the economy and paying for the upgrade to business class with miles. Business class in my mind will be a necessity given the 22 hrs flight time.

 

How difficult is it to secure an upgrade with miles? How far in advance will I be required to book? Would I be right in assuming that I will need to be booking at 12:01am 331 days prior to the flight? (The earliest possible moment) Or would I be better off waiting to purchase the miles when they are on sale and getting the two round trip award tickets.

First, AA doesn't fly to Singapore (and very few flights to Hong Kong) and you can't use miles to upgrade from an economy fare on partner flights (probably Cathay Pacific between HKG and SIN.)

 

How hard are upgrades to score? Just as hard - harder, even - than straight awards. And they NEVER show up as available when flights open for booking, and upgrades usually "clear" anywhere from a couple of days to a few hours before the flights depart. In heavy business routes like North America to SE Asia, the airlines are accustomed to last-minute purchases in premium cabins by business travelers who have to get there right now, never mind the cost. So they're NOT inclined to release award or upgrade seats until they're very sure those seats won't be sold for megabucks at the last minute.

 

And the cost in miles and co-pays is very high - 25,000 miles and US$350 in each direction on top of the base fare. If you value your miles at 2c apiece, that's like adding $1700 (2 x copays plus 50K miles @ 2c) on top of your coach ticket, and for a longshot at that. Right now an AA round trip from YYZ to HKG for next February is running US$1400 and change, so the total would be $2100 out of pocket plus the miles, each.

 

If you have 85K AA miles already and are adding 2500 per month for a year, that will give you something like 115,000 a year from now.

 

AA charges 72,500 miles each way for a straight business class award, so you'd need 175,000 more miles to come up with the necessary 290,000 for straight awards. At 2c apiece, that would come to $3500 for two business class tickets, or $1750 per person, $350 less out of pocket per person than the coach + upgrade cost above. Hope that makes sense.

 

Note that the straight award would allow the open-jaw you need; with the AA economy + upgrade plan you'd have to buy the HKG-SIN one way ticket separately (using cash or miles for a partner flight) since AA doesn't fly on its own metal to SIN. With the straight awards, you could use AA, Japan Airlines, Cathay Pacific, or any combination of those airlines to get there and back, while the upgrade approach would limit you to AA only.

 

Or, you could fly in Cathay Pacific's great premium economy cabin nonstop from Toronto to Hong Kong for US$1900 round trip and earn numerous AA miles in the process.

 

And there are periodic business class sales that you could capture. Recently Delta Airlines was offering round trips in business class from Canadian cities to Asia for under US$2000. The fares are gone now, but

they were plentiful around a month ago, for travel good through the end of the year.

 

You have TONS of time to think this through; you can't book until eleven months out, and don't assume that there will be available award seats on the first day. Seats are released into award/upgrade inventory throughout the booking window, and as I said business class is often held back until quite late in the day.

[TruckerDave]

 

Or, you could fly in Cathay Pacific's great premium economy cabin nonstop from Toronto to Hong Kong for US$1900 round trip and earn numerous AA miles in the process.

.

 

This part alone will almost get enough EQM's for elite status as well when buying Prem Econ. Then add on the HKG-SIN part and that should be more than enough EQM's for elite status. May need to add a few AA metal segments and possibly some EQD's but at least the mileage part will be covered. :D

[Gardyloo]

This part alone will almost get enough EQM's for elite status as well when buying Prem Econ. Then add on the HKG-SIN part and that should be more than enough EQM's for elite status. May need to add a few AA metal segments and possibly some EQD's but at least the mileage part will be covered. :D

AA's dropping the AA metal requirement under the new scheme, and EQD rates for partner flights haven't been released yet.

 

I'm inclined once again to mention round-the-world ticketing options.

 

Cruise people have a tendency to use MUCH longer planning time frames than other travelers - case in point, a 2018 SE Asia cruise.

 

If chauffeurboy was planning other travels in 2017 that might take them near some place where business-class RTW tickets are cheap (relatively speaking) they might be able to really reduce the cost, and improve the comfort, of a full year's flying by using an RTW (good for a year, up to 16 flights) as a strategic means of both flying places and earning elite status in the process. Here's a blurb I posted to TripAdvisor on the subject - https://www.tripadvisor.com/ShowTopic-g1-i10702-k7409073-About_round_the_world_RTW_tickets-Air_Travel.html - which needs updating but might be of interest.

[plane2port]

AA's dropping the AA metal requirement under the new scheme, and EQD rates for partner flights haven't been released yet.

 

I'm inclined once again to mention round-the-world ticketing options.

 

Cruise people have a tendency to use MUCH longer planning time frames than other travelers - case in point, a 2018 SE Asia cruise.

 

If chauffeurboy was planning other travels in 2017 that might take them near some place where business-class RTW tickets are cheap (relatively speaking) they might be able to really reduce the cost, and improve the comfort, of a full year's flying by using an RTW (good for a year, up to 16 flights) as a strategic means of both flying places and earning elite status in the process. Here's a blurb I posted to TripAdvisor on the subject - https://www.tripadvisor.com/ShowTopic-g1-i10702-k7409073-About_round_the_world_RTW_tickets-Air_Travel.html - which needs updating but might be of interest.

 

This idea is intriguing. If you had several cruises booked departing from different areas of the world, you could position yourself to meet these cruises and also take some interesting intervening land trips with the RTW ticket. And you could do it a lot cheaper than taking an actual RTW cruise.

 

I read your post on TripAdvisor, and was wondering what updates you'd make to it at this point.

 

Thanks for the suggestion--a very interesting concept.

[Gardyloo]

Any updates would probably cover changes in route options (as a result of new alliance members, for example) and changes in various frequent flyer programs that might influence people’s choices. Nothing major.

 

Prices continue to fluctuate, as a result of changing base prices as well as currency fluctuations. For example, Oneworld has recently raised business class RTW prices for tickets bought and started in South Africa, where the continued devaluation of the Rand was leading to very cheap (in USD terms) tickets, something the airlines were obviously not happy about. South Africa is still half the cost of the US, for example, but there are other origin points that are competitive, particularly given the cost and convenience of “positioning” to/from South Africa.

 

Let me give an example of the “bang for the buck” aspects of this.

 

Imagine that you have two or three cruises planned over a year’s time. Let’s say you live in, I don’t know, New York, and that you’re planning a summer cruise in the Mediterranean, around New Years in the Caribbean, and maybe like chaffeurboy a March-April cruise through SE Asia.

 

At the moment, one of the cheaper places to start business class RTW tickets using the Oneworld alliance (AA, BA, Qantas, Cathay Pacific, Qatar, many others) is Egypt. Base price for a 3-continent RTW ticket bought and started in Egypt is around US$4700, but a 4-continent ticket is just $200 more, around $4900. Both allow up to 16 flights, limited to four per continent (six in North America) and are good for a year. Date changes are free, route changes cost $125.

 

So in our example, you fly to Cairo before the Med cruise. If you have frequent flyer miles, great; but even buying enough miles for a one-way ticket to Egypt is good value.

 

If you don’t want to visit Egypt, or are concerned about safety, you arrange it so that you don’t even leave the airport; you collect your bags, go up to the departure level, and check in for the first flight on the RTW ticket. (You’ve bought the RTW ticket online or through an Egyptian travel agent or airline sales agent before ever leaving home. It’s an e-ticket so all you need is the record locator and your passport.)

 

From Cairo you fly to, say, London, then change planes and fly to wherever your cruise is departing, say Barcelona. You do the cruise, which let’s say ends in Venice. Then you fly home via Madrid (to avoid high fees on BA) and go about your business until it’s time to head to, say, San Juan for the Caribbean cruise.

 

Or maybe you decide to splurge before the Caribbean cruise with an Alaska cruise. Fly from New York to Vancouver in Cathay Pacific’s splendid business class, cruise to Alaska, then fly home from Anchorage via Dallas.

 

Anyway, then when it’s time for the Asia cruise, fly to Hong Kong and connect to Singapore, cruise back to Hong Kong, then it’s time to complete the ticket. From Hong Kong fly to Madrid, but then instead of returning to Egypt, use the provision in the ticket rules that allows you to end the ticket anywhere in the Middle East. So you finish up in Israel. Here’s a map showing the overall route.

 

Or what if your late winter cruise isn’t in SE Asia but in Australia instead? Same itinerary except you fly from New York to Sydney instead of Hong Kong, do the cruise, but then travel back to the Middle East via South Africa? This would require a four-continent ticket instead of three, but it’s even better value. Here’s an imaginary map of that.

 

You’ll probably have earned enough frequent flyer miles, and will have achieved elite status, to pay for the ticket home with miles, or just head back to Cairo and buy another one.

 

The point being, that’s a helluva lot of business class (first class within the USA) flying for five grand. Cruise people tend to do a lot of long-range planning, so doing a two- or three-year travel/cruising/flying "master plan" is not out of the question.

Edited June 12, 2016 by Gardyloo

[plane2port]

Thanks for the detailed sample itineraries. I've never booked a RTW so I just want to clarify a couple of things. In the first itinerary, it looks like your transiting JFK three times. Is that allowed?

 

CAI-LHR-BCN,VCE-MAD-JFK-YVR,ANC-DFW-JFK-SJU-JFK-HKG-SIN,HKG-MAD-TLV

 

I believe that you've already answered my second question re: open-jaws. You can have them as long as they are both in the same continent? BCN,VCE; YVR, ANC; SIN,HKG; and CAI,TLV.

 

Really that's incredible that you can do that much travel in business class for $4-5K.

Edited June 13, 2016 by plane2port

[Gardyloo]

Thanks for the detailed sample itineraries. I've never booked a RTW so I just want to clarify a couple of things. In the first itinerary, it looks like your transiting JFK three times. Is that allowed?

 

CAI-LHR-BCN,VCE-MAD-JFK-YVR,ANC-DFW-JFK-SJU-JFK-HKG-SIN,HKG-MAD-TLV

 

I believe that you've already answered my second question re: open-jaws. You can have them as long as they are both in the same continent? BCN,VCE; YVR, ANC; SIN,HKG; and CAI,TLV.

 

Really that's incredible that you can do that much travel in business class for $4-5K.

Three transits are fine; however you can't fly the same segment twice (e.g. JFK-SJU). You're limited to two stopovers (24h+) within the continent of origin (in this case Europe as the Middle East is deemed to be in Europe for RTW purposes.)

 

Open-jaws and surface segments are fine but they use one of the 16 allowed segments. If they're within the same continent they don't use one of the "continent" flights, e.g. a surface segment within Europe doesn't use one of the four allowed "European" segments.

 

Surface segments aren't permitted for transatlantic or transpacific travel - technically between IATA Regions I and II or I and III - but are okay for travel between Regions II-III (e.g. Europe/Asia or Africa/Australia.)

 

 

Good value? Oh yeah. Although AA's current revision of its FF program will impact this big time, my late wife and I would buy a 4-continent ticket every other year (using South Africa, Japan, Sweden or Turkey for the start point, depending on which was cheapest at the time) and travel on it for a year, obtaining Platinum or Executive Platinum status in the process. The following year we'd use all the miles booked in the "RTW year" to travel around, usually 4-6 business/first class segments (we'd usually earn around 140,000 redeemable miles each per RTW) then buy another RTW in year 3. Rinse and repeat.

 

That way we'd end up with 20-22 business/first flights for around $5K-$6K out of pocket (depending on fees and taxes) or something like $250 - $300 per segment. That's good for, say, SEA-DFW, dynamite for SYD-JNB.