American has just announced their latest promotion on purchased miles. Through August 31, 2017, American is offering up to 85,000 bonus miles plus a 10% discount when you purchase AAdvantage miles.
While you get 10% off as long as you purchase at least 15,000 miles, the bonuses are tiered, and you earn more bonus the miles the more you buy, as follows:
- Buy 15,000-29,000 miles, get 3,500 bonus miles plus a 10% discount
- Buy 30,000-49,000 miles, get 10,000 bonus miles plus a 10% discount
- Buy 50,000-74,000 miles, get 22,500 bonus miles plus a 10% discount
- Buy 75,000-99,000 miles, get 40,500 bonus miles plus a 10% discount
- Buy 100,000-149,000 miles, get 55,000 bonus miles plus a 10% discount
- Buy 150,000 miles, get 85,000 bonus miles plus a 10% discount
To achieve the lowest cost on a per mile basis you’ll want to purchase exactly 150,000 miles. If you did that, you’d receive a total of 235,000 miles at a cost of $4,311.19, which is a cost of ~1.83 cents per mile.
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).
For the past two months American has been offering better promotions on purchased miles. Both months they’ve been offering miles for as little as ~1.72 cents each. Essentially you’d get 250,000 miles rather than 235,000 miles for $4,311.19. For bigger picture context, I’d say this is about average as far as American promotions go, as the cost can vary significantly.
Is buying American miles a good deal?
When American devalued their award chart early last year, my valuation of AAdvantage miles has 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 in the past few months, as I recently explained. With American’s big devaluation it’s international first class award redemptions which went up in price most, with awards increasing in price by up to ~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 new program:
|Contiguous 48 U.S. To:||Business Class||First Class|
|Contiguous 48 U.S. States||25,000||50,000|
|Canada & Alaska||30,000||55,000|
|South America Zone 1||30,000||55,000|
|South America Zone 2||57,500||85,000|
|Middle East / India||70,000||115,000|
|Asia Zone 1||60,000||80,000|
|Asia Zone 2||70,000||110,000|
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 certainly instances where it could make sense to pick up miles for ~1.83 cents each with a short term use in mind.
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:
|Card||Points earned on airfare spend|
|The Platinum Card® from American Express||5x Membership Rewards points per dollar spent|
|American Express® Gold Card||3x Membership Rewards points per dollar spent|
|Chase Sapphire Reserve®||3x Ultimate Rewards points per dollar spent|
|Chase Sapphire Preferred® Card||2x Ultimate Rewards points per dollar spent|
|Citi® / AAdvantage® Executive 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® Platinum Select® World Elite™ Mastercard®||2 AAdvantage® miles per $1 spent on eligible American Airlines purchases|
|American Airlines AAdvantage MileUp℠ Card||2 AAdvantage® miles per $1 spent on eligible American Airlines purchases|
Redeem American miles for JAL business class
While American miles were more valuable a bit over a year ago, there are still circumstances under which it can make sense to buy miles. You can do quite well with this promotion if you’re looking to redeem a premium cabin ticket on a partner airline, especially in business class, which is the sweet spot nowadays. Just be aware that saver award availability on American metal is virtually non-existent, so don’t buy these with the intention of actually redeeming on American.
If you are looking to buy miles, keep in mind that American allows five day award holds (meaning you can hold an award ticket, purchase miles, and then ticket the reservation).
Do you plan on buying American miles through this promotion?