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American has just launched their latest promotion on purchased miles. Through September 30, 2018, American is offering up to 35% off when you purchase AAdvantage miles.
With this promotion you get a tiered discounted based on the number of miles you buy, as follows:
- Buy 10,000-19,000 miles, get 10% off
- Buy 20,000-29,000 miles, get 15% off
- Buy 30,000-49,000 miles, get 20% off
- Buy 50,000-99,000 miles, get 30% off
- Buy 100,000-150,000 miles, get 35% off
In this case you’ll receive the lowest cost per mile by purchasing anywhere between 100,000 and 150,000 miles. For example, if you purchased 150,000 miles it would cost you $3,126.97, which is a cost of ~2.08 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.
As far as American’s bonuses and discounts on purchased miles go, this is one of the worst we’ve seen. For example, here are the ones we’ve otherwise seen lately:
- In August, American offered miles for as little as 1.82 cents each
- 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 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 instances where it could make sense to pick up miles during a promotion with a short term use in mind.
However, if I were to buy miles, I’d much rather do so during a better promotion than this. Paying over two cents per American mile is quite steep, especially when they sometimes sell them for just 1.72 cents each, which is a much better price.
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|
|Chase Sapphire Reserve®||3x Ultimate Rewards points per dollar spent|
|Premier Rewards Gold Card from American Express||3x Membership Rewards points per dollar spent|
|Citi ThankYou® Premier Card||3x ThankYou points per dollar spent|
|Chase Sapphire Preferred® Card||2x 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.
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:
- The Citi® / AAdvantage® Executive World Elite™ Mastercard® is offering a welcome bonus of 75,000 AAdvantage miles after making $7,500 of purchases within the first three months; the card has a $450 annual fee
- The CitiBusiness® / AAdvantage® Platinum Select® World Mastercard® is offering a welcome bonus of 70,000 AAdvantage miles after making $4,000 of purchases within the first four months; $99 annual fee, waived for the first 12 months
- The Citi® / AAdvantage® Platinum Select® World Elite™ Mastercard® is offering a welcome bonus of 50,000 AAdvantage miles after making $3,000 of purchases within the first three months; $99 annual fee, waived for the first 12 months
- The AAdvantage Aviator Business Mastercard is offering a welcome bonus of 60,000 AAdvantage miles after making a purchase and paying the $95 annual fee
- The AAdvantage Aviator Red World Elite Mastercard is offering a welcome bonus of 60,000 AAdvantage miles after making a purchase and paying the $95 annual fee
While there are circumstances under which it can make sense to buy American miles, this is one of the worse promotions we’ve seen on purchased miles in a while, so personally I would try to avoid taking advantage of this offer.
Paying over two cents per American mile is quite steep, and I’d much rather take advantage of some of the great welcome bonuses available on American’s co-branded credit cards.
If you are going to buy miles this month, I think Avianca LifeMiles’ promotion for up to a 140% bonus, and Alaska Mileage Plan’s promotion for up to a 50% bonus, both represent a much better deal.