One of my most popular blog posts ever (thanks to the Google) was nearly four years ago and about the best uses of American Express Membership Rewards points. Obviously that information is utterly out-of-date at this point, not to mention my post wasn’t very detailed.
So I figured I’d revisit the topic in much more detail, and share my suggestions for the best uses of Membership Rewards points based on the region you want to travel to. But first I’ll start with a bit of background.
I value Membership Rewards points at around 1.6 cents each. Early last year I would have valued them much higher, though we’ve seen lots of negative changes on the redemption side, including Continental OnePass being removed as a transfer partner, Aeroplan slaughtering their award chart and imposing fuel surcharges for most partner redemptions, British Airways starting the third world war with their “enhanced” Avios program, and ANA imposing fuel surcharges for redemptions on Virgin Atlantic. While individually the changes weren’t the end of the world, together they eliminated virtually every one of my favorite award redemption opportunities.
Obviously there are lots of uses of Membership Rewards points. You can redeem them for merchandise (anything from toaster ovens to vacuums), gift cards, or even use them towards the cost of a revenue flight (which typically gets you one cent per point of value).
Though please, for my sake, don’t use your points that way. Transfer them to one of the Membership Rewards airline transfer partners, which include:
- Air Canada Aeroplan
- Air France/KLM Flying Blue
- Alitalia MileMiglia Club
- ANA Mileage Club
- British Airways Executive Club
- Cathay Pacific AsiaMiles
- Delta SkyMiles
- EL AL Matmid Club
- Emirates Skywards
- Etihad Guest
- Iberia Plus
- JetBlue TrueBlue
- Singapore Airlines KrisFlyer
- Virgin America Elevate
- Virgin Atlantic Flying Club
Given that transfers are instant for the most part (there are a couple of exceptions, like ANA), I typically suggest only transferring points to a partner program once you have a specific trip/itinerary in mind. This is because Membership Rewards points are especially valuable largely thanks to the fact that they’re so flexible. By keeping them in the Membership Rewards program you avoid any program specific devaluations that could occur. I’m all for “earning and burning,” and that’s for two reasons — you’re not earning any interest on points, and at the same time your points are subject to direct devaluation. While you can’t earn interest on points, you can protect yourself somewhat from the devaluation of points by parking them in a program like Membership Rewards, Ultimate Rewards, or Starwood Preferred Guest.
Also keep in mind that sometimes American Express offers transfer bonuses for points transfers to their partner programs, so if that’s the case it could make sense to transfer some points to that program. These bonuses can often be up to 50%, so can greatly increase the value of Membership Rewards points.
While on the whole Chase seems to have better welcome bonuses nowadays, there are some decent American Express cards worth considering:
- American Express® Gold Card — One of the most lucrative cards available, this card offers 4X Membership Rewards® points at US restaurants (on up to $25,000 per year in purchases, then 1X) and 3X 3X Membership Rewards® points on flights booked directly with airlines or on amextravel.com, plus a $100 Airline Fee credit per year. The card does come with a $250 annual fee.
- The Platinum Card® from American Express — Not great return for everyday spend (except on airfare at 5X per $1 spent when purchased directly with the airlines), but gets you lounge access with Delta, Priority Pass, and others, plus a $200 annual airline fee credit, which helps offset the $550 annual fee (if played right that can translate to a $400 airline fee credit in the first year, since the annual $200 benefit is based on calendar years while the annual fee is based on membership years — that means you’re really only paying $150 out of pocket for lounge access and all the other benefits).
- American Express® Business Gold Card — The best business card for earning Membership Rewards points for everyday spend, earns 4X on the two categories with which you spent the most, on the first $150,000 in combined purchases from the two categories each year. The bonus categories are as follows:
- Airfare purchased directly from airlines
- U.S. purchases for advertising in select media
- U.S. purchases at gas stations
- U.S. purchases at restaurants
- U.S. purchases for shipping
- U.S. computer hardware, software, and cloud computing purchases made directly from select providers
- The Business Platinum® Card from American Express — Not great return for everyday spend, but gets you access to American, Delta, US Airways, and Priority Pass lounges, plus a $200 annual airline fee credit, which helps offset the $450 annual fee (if played right that can translate to a $400 airline fee credit in the first year, since the annual $200 benefit is based on calendar years while the annual fee is based on membership years — that means you’re really only paying $50 out of pocket for lounge access and all the other benefits).