If you're like most people, you want to get as much value out of any purchase as possible. Therefore, you'd probably never buy a First Class or Business Class airline ticket. You might use miles to upgrade. But you certainly wouldn't pony up your hard-earned dollars to sit in a wider seat.
However, money is meant to be spent. And if you've been successful in your career and/or had tremendous investment gains, maybe you should treat yourself to flying first class.
This post will set up parameters for when paying for a first class ticket is OK. OK is defined as feeling comfortable enough paying the premium where you don't feel buyer's remorse.
As a frugal person who has taken hundreds of flights from Economy Class, Business Class, and First Class, I'm trying to figure out the answer myself.
When It's OK To Pay For A First Class Airline Ticket
You can always buy a First Class ticket as soon as you have the money. However, let's go through the various guidelines in order to minimize regret and maximize the value we receive.
1) When A First Class Ticket Costs 2X The Price Of An Economy Class Ticket Or Less
A first class ticket generally costs 2-10 times more than an Economy Class ticket. The highest multiple comes during long international flights. For example, it might only cost you $1,000 to fly to Shanghai from San Francisco roundtrip. However, it could easily cost you $10,000 if you fly first class.
When you find First Class tickets less than two times the cost of an Economy class ticket, you have yourself a relative bargain. It's like finding something you want for 40% – 60% off. The product may still be overpriced, but at least you'll feel like you got a deal.
2) When You Earn A Top 5% – 10% Income
On an Airbus 321, there are usually 16 First Class seats. Then there are around 180 Economy and Economy plus seats. Therefore, about 8% of all seats consist of First-Class seats. For every commercial airplane, less than 10% of the seats are First-Class seats.
To stay consistent with the percentage of First-Class seats, one should strive to earn at least a top 10% income before paying for a first class ticket. An individual top 5% income is roughly $310,000. An individual top 10% income is roughly $160,000 as of 2018 according to the Economic Policy Institute. Today, the numbers are about 10% higher.
Now that we know what the income levels are, I think you've got to earn at least $300,000 a year. Earning only $160,000 feels like too little. Go for Economy Plus or Business Class instead.
3) When You Have A Top 5% – 10% Net Worth
Based on the same logic above, you should have a top 5% – 10% net worth before being OK to pay for a First Class airline ticket.
Therefore, to comfortably buy a First Class ticket, you should probably have a household net worth of at least $1 million. $1 million is a top 10% household net worth. However, based on experience, the $1 million threshold likely won't be enough for you to spend up without discomfort.
Thanks to inflation, $3+ million is the new $1 million. And given we should think in real terms, having a minimum $3 million net worth is the more appropriate minimum threshold.
4) If You Fly Less Than Once Every Two Years
If you fly a lot, the cost to fly racks up quickly if you don't have a business that pays for your ticket. Therefore, if you're paying out of pocket, you probably want to save some money and only purchase Economy Class tickets.
However, if you are an infrequent flyer, the value of each trip goes up. Therefore, the value of paying for a First Class airline ticket also goes up.
Think about a scenario where you only take a vacation once every 10 years. You'd be more willing to go all out on the best accommodations, the highest rated activities, and the yummiest food. But if you go on vacation every three months, vacations aren't as special.
Flying only once every two years or less is the threshold partly based on the logic of point #1 – when a First Class ticket costs 2X an Economy Class ticket or less. The idea is to manage your overall plane ticket expenditure.
The one caveat to this guide is that you also make at least a top 10% income.
5) When You Need A Bigger Seat
In general, domestic Economy Class seats are around 17 inches wide and domestic First Class seats are around 21 inches wide. A 4-inch difference is pretty massive as seat widths have been shrinking over the decades. Meanwhile, First Class seats offer between 8-39 inches of extra legroom.
If your body flows over the Economy Class armrest into the other passenger's seat or if your legs can't comfortably fit, then buying a First Class seat may be more appropriate. After all, your neighbor deserves the entire space of their seat.
Instead of paying for a First Class seat, you might be able to save by buying two Economy Class seats, which may be cheaper.
You might also need a more comfortable seat if you have some type of physical ailment, like chronic lower back pain or sciatica. If a First Class seat can help alleviate pain, then paying up may be worth it.
Not All First Class Seats Are Created Equal
There are different styles of First Class. Some First Class seats just recline. Although these seats are wider, the premium you should pay should be the lowest.
While other First Class seats go flat and have much longer leg room. These seats are the most desirable and are generally priced higher. If a First Class seat doesn't lie flat, I'd rather just pay for Economy Plus with longer leg room.
Below is my favorite first class cabin arrangement by United from SFO to Honolulu. It is the Boeing 777-300ER plane with a 1-2-1 seating arrangement so you don't have to sit next to someone.
The Problem With Frugal Spenders Who Are Analytical
The main reason why I have never paid for a Business Class or First Class airplane ticket is due to math. I take the difference between the cost of a First Class ticket and an Economy Class ticket. Then I divide the difference by the number of hours of the flight. Then I tell myself just sitting in the seat is making me that hourly rate!
Here's an example. Around Christmas, it costs about $1,700 to fly first class from San Francisco to Honolulu. It costs about $680 to fly economy class on the same flight. $1,700 – $680 = $1,020. $1,020 divided by 5.5 hours = $185.
Is it really worth paying $1,700 for a first class ticket when I can just pay $680 and earn $185 an hour sleeping, listening to music, watching a movie, and writing a new post on my laptop? Perhaps not.
Average Airline Ticket Price
Due to inflation, the average airline ticket price has gone way up. Compared to inflation, air fare prices have increased at a much faster pace.
You Probably Won't Regret Spending Up For A First Class Airline Ticket
I hope my guidelines better help you decide on paying for a First Class ticket. I've discovered during my financial spending history that I seldom regret spending up for something nicer. Instead, I more often regret not spending up during the moment.
For example, during our early retirement phase, my wife and I went to Naples, Italy when it was around 92 degrees. Yet, I didn't want to pay 50 Euros for the both of us for a Hop On Hop Off bus to see the city. I felt like it was a ripoff. Further, I thought it would be better to see the city on foot and get some exercise.
We ended up finding a gelato place and not seeing a couple of the main sites because it was too damn far and hot. Until this day, I regret not spending the money to see the entire city. I wouldn't have missed the 50 Euros. Maybe when our children are older we'll try again.
At least we got to see the ruins of Pompei the next day. That was amazing.
Another great dilemma is how much to spend on a car. Since buying my Tata Motors SUV in December 2016 for big bucks, I've had zero remorse. I use my vehicle daily to safely transport my son to and from school. The SUV was a relatively big upgrade from my $20,000 Honda Fit.
A final common dilemma is how much to spend on a house. You don't want to buy too much of a house and put your finances under strain. However, a house is a little different than buying a car or paying for a First Class ticket. A house has a good chance of appreciating over time. Therefore, when it comes to buying a house, stretching to your upper limits of affordability may be best for your finances.
Flying First Class May Help Reduce Friction
There's one final reason why you may want to fly First Class. You hate flying so much that you don't fly, even though you probably should. Unless you're flying private, the general experience of flying isn't great due to long security lines, delayed flights, and packed airplanes.
The best reason to fly is to see loved ones who live far away. The drive might take too long. Or driving might simply be impossible due to an ocean. What a shame not to see your loved ones more often because you can't stand flying.
If flying First Class during a pandemic can help reduce friction and encourage you to see your parents, relatives, or friends more, then paying a premium might be well worth it.
Random Flight Booking Tips
- Make sure you surf for deals using incognito mode so the travel websites don't track your moves.
- If you end up choosing a seat and changing the date to see what else you can get, you must wait until the website caches out. Go back too quickly and the system will think the seat you picked was already sold. If so, the price of the ticket tends to go up. Since there are so few seats in first class, the pricing algorithm will automatically increase if fewer seats are available.
- If you have the flexibility, you can wait last minute for potential deals. Or you can search for economy seating where the seat next to you is empty.
- Not all first class cabins are created equal. Research the various plane types before booking. Even the seat number can make a difference. For example, odd-row seats in First class on the 777-300ER face straight and have more windows.
- Flying First or Business may not be the best when flying with young children. Instead, consider Economy Plus where you can get four seats together.
Readers, what are your metrics for deciding on whether to pay for a First Class ticket? How do you overcome the guilt of spending more than you need to?
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