American’s August 2018 Bonus On Purchased AAdvantage Miles

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American has just launched their latest promotion on purchased miles. Through August 31, 2018, American is offering up to 85,000 bonus miles plus 10% off when you purchase AAdvantage miles. This promotion comes just a day after American’s previous promotion on purchased miles ended, which was their best of the year.

With this promotion you get a tiered bonus based on the number of miles you buy, plus a 10% discount:

  • Buy 15,000-29,000 miles, get 3,500 bonus miles plus 10% off
  • Buy 30,000-49,000 miles, get 10,000 bonus miles plus 10% off
  • Buy 50,000-74,000 miles, get 22,500 bonus miles plus 10% off
  • Buy 75,000-99,000 miles, get 40,000 bonus miles plus 10% off
  • Buy 100,000-149,000 miles, get 55,000 bonus miles plus 10% off
  • Buy 150,000 miles, get 85,000 bonus miles plus 10% off

In this case you’ll receive the lowest cost per mile by purchasing exactly 150,000 miles pre-bonus. This would earn you a total of 235,000 miles for $4,316.19, which is a cost of ~1.84 cents per mile. By the way, it’s interesting to note that American recently increased the “processing charge” for these transactions from $30 to $35. Sad!

As usual, AAdvantage accounts less than 30 days old aren’t eligible to purchase miles. Furthermore, there’s a cap of purchasing 150,000 AAdvantage miles per account per calendar year (pre-bonus).

As far as American’s bonuses and discounts on purchased miles go, this ons is better than average, though not as good as the one we’ve seen for the past couple of months

  • In June & July American offered miles for as little as 1.72 cents each
  • In May American offered miles for as little as 2.08 cents each
  • In April American offered miles for as little as 1.81 cents each
  • In February American offered miles for as little as 2.02 cents each
  • In January American sold miles for as little as 2.13 cents each

Is buying American miles a good deal?

When American devalued their award chart in early 2016, my valuation of AAdvantage miles decreased from ~1.8 cents to ~1.5 cents each. My valuation of American miles has further dropped from ~1.5 cents to ~1.3 cents earlier last year. Ever since the big devaluation, the cost of international first class awards went up in price by the most, by as much as 70% in some instances.

Meanwhile the cost of most business class awards increased as well, though not nearly as drastically. As a reminder, here’s the cost of first and business class awards originating in the U.S. under the current program:

Contiguous 48 U.S. To:Business ClassFirst Class
Contiguous 48 U.S. States 25,00050,000
Canada & Alaska30,00055,000
Hawaii40,00065,000
Caribbean27,50052,500
Mexico27,50052,500
Central America27,50052,500
South America Zone 130,00055,000
South America Zone 257,50085,000
Europe57,50085,000
Middle East / India70,000115,000
Africa75,000120,000
Asia Zone 160,00080,000
Asia Zone 270,000110,000
South Pacific80,000110,000


Qatar Airways business class continues to be a great use of American miles

I find the cost of business class redemptions to still be reasonable in most cases. There are instances where it could make sense to pick up miles during a promotion with a short term use in mind. In this case it might even be worth buying miles somewhat speculatively, given that this is the lowest cost per purchased mile of the year.

Which credit card should you buy miles with?

American processes mileage purchases directly, which means the purchase of miles does qualify as airfare spend. Therefore you’ll want to consider using one of the following cards for your purchase, since they offer the following bonus miles for airfare spend:

CardPoints earned on airfare spend
The Platinum Card® from American Express5x Membership Rewards points per dollar spent
Chase Sapphire Reserve®3x Ultimate Rewards points per dollar spent
Citi ThankYou® Premier Card3x ThankYou points per dollar spent
Chase Sapphire Preferred® Card2x Ultimate Rewards points per dollar spent
Citi® / AAdvantage® Platinum Select® World Elite™ Mastercard®2 AAdvantage® miles per $1 spent on eligible American Airlines purchases
CitiBusiness® / AAdvantage® Platinum Select® World Mastercard®2 AAdvantage® miles per $1 spent on eligible American Airlines purchases
Citi® / AAdvantage® Executive World Elite™ Mastercard®2 AAdvantage® miles per $1 spent on eligible American Airlines purchases
American Airlines AAdvantage MileUp℠ Card
(no annual fee)
2 AAdvantage® miles per $1 spent on eligible American Airlines purchases


Redeem American miles for JAL business class

For example, I value Membership Rewards points at 1.7 cents each, so I view that as an 8.5% return on this spend if you use The Platinum Card® from American Express. So if you used that card and paid ~1.84 cents per mile and valued the 5x points at 8.5%, that would lower your real cost of acquiring these miles to ~1.68 cents each, which is even better.

Other great ways to earn American miles

There are lots of great ways to earn American miles aside from outright buying them. At the moment there are excellent welcome bonuses on co-branded Citi AAdvantage Cards, as follows:

Earn American AAdvantage Miles

Bottom line

For the past two months American has offered their best promotion of the year on purchased miles, which was certainly the time to buy, given the option. While this promotion isn’t as good, it is still better than most of the other promotions we’ve seen from American.

This can still potentially be a good deal for business class redemptions, and it gets even better if you’re earning 5x points for the purchase, with a card like The Platinum Card® from American Express.

Of course also remember the great welcome bonuses available on some co-branded American cards, which are a much cheaper way to rack up the miles while also earning some useful benefits.

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Comments

  1. If only OMAAT devoted as much time to covering AAdvantage *redemptions* as they do to disguising their credit card pitches inside these regurgitated posts about how to accumulate AAdvantage miles, then they might actually generate content that turns heads.

    Every month, the same story gets posted. They only seem to swap out a few paragraphs, but even the photos stay the same.

    At this point, I’d even settle for Lucky or someone else sitting down and blasting out a solid commentary piece on the decline (and coming end) of frequent flyer programs altogether. Write something that moves your AvGeek readership, or at least gets them talking about something that matters. Instead of this bland and cheap sales pitch for cards nobody needs, someone here should get back to what they used to be good at: Sharing their passion for air travel.

  2. A few issues:
    1. While one can question the availability of reward redemptions on AA we used miles for trips to Rome and Sao Paulo this year (Rome in business class), along with multiple reduced mileage awards for domestic travel. Flying out of hubs is more challenging, but from smaller cities served by AA availability is better.
    2. You should amend post to say that you will get 235,000 miles for $4316.19, not 250,000 miles.
    3. If one uses the Aviator Silver card (3x AA miles) you would receive 247,949 miles with the 150k purchase, which comes out to 1.74 cpm. Not bad, but still not as good as last promotion. If the goal is to maximize AA miles, then this card is the way to go.

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