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Airmiles Calculation | Best Air Miles Deals - Collect Airmiles Faster, Redeem Sooner and Learn About Air Miles Credit Cards
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Airmiles Calculation

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This post was suppose to occur while I was in Toronto... and for some reason the whole system messed up and made two posts into one post. So I'm re-posting the two posts seperately. Sorry for the confusion (Random Post #4 has been updated)


I received an email a while ago discussing how the calculations I use for my 'airmiles-to-dollar' ratio isn't quite right. Basically it comes down to the fact that the reader suggested I should be using the cost difference rather then just the cost of the item. I'll take the four examples from the email and comment on them individually....

Ex 1 - I'm in Safeway, and I need two cans of tomatoes, it turns out that my favourite brand of tomatoes (Aylmer's) costs $1.50 per can, plus it has a deal where if you buy two cans, you get 10 bonus Airmiles. If I understand your calculations correctly you'd consider this $3 for 10 miles, thus 30 cents/mile. I would say that these miles are completely free: Without the deal, I would have spent the same $3 on the same two cans of tomatoes, thus the EXTRA cost for the miles is nil.

This is a good point. These airmiles could be considered Free as you were buying your favorite brand anyway but you got airmiles as an added bonus.

Ex 2 - Same as example 1 -- I plan to buy two cans of tomatoes -- except that I usually buy the generic brand since it's cheaper and I don't taste the difference. The generic tomatoes are a buck a can, so my choice is between $2 for the generic tomatoes, or $3 for Aylmer's. As far as I'm concerned, I get equivalent tomatoes, but the extra dollar I could spend on the Aylmer's nets me 10 Airmiles -- thus, those bonus miles would end up costing me 10 cents/mile.

True I guess it does cost you $0.10 per airmile if you choose the airmiles brand in this case. As a side note I think these examples apply mainly to Safeway where the products are mostly equivalent but not a company like Westjet where they have more to offer then other companies.

Ex 3 - Same as example 1, except that I HATE tomatoes. If I decide to buy the tomatoes anyway, my cost for the miles would be 30 cents/mile: As far as I'm concerned, I'm only spending the money on the miles, the tomatoes have no value to me.

Right. Except for the fact that you have really no point to buying this tomatoes anyway. And like I've said it only makes sense to purchase items with airmiles if you want the item anyway (or will use it eventually). Like the reader stated at the bottom of the email...

Obviously, this is a much more complicated way of doing the computation, and the simpler calculation (total price/total airmiles) is quite useful in general. However, if you want to completely accurate, you really need to compare the differences.

I personally think the total calculation is accurate enough. I've stated numerous times you'll be spending a bit more on each item to collect the airmiles. Be it that you're shopping at Safeway or buying a different brand then the cheapest brand. So be warned that i'm NOT changing the airmiles calculations but thanks for the reader comments. What do you think? Are my calculations way off?


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