Is Earning American AAdvantage Elite Status With Credit Card Spending Worth It?

Is Earning American AAdvantage Elite Status With Credit Card Spending Worth It?

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This week we’ve learned about how American is radically transforming the AAdvantage program, with the introduction of Loyalty Points. One of the interesting new opportunities here is to earn AAdvantage elite status exclusively through credit card spending. In this post I wanted to do some number crunching on the value proposition of that.

Credit card spending counts towards AAdvantage elite status

Starting in 2022, American AAdvantage will be introducing the concept of Loyalty Points, which will be the sole metric by which you can earn AAdvantage elite status. Specifically:

  • AAdvantage Gold status will require 30,000 Loyalty Points
  • AAdvantage Platinum status will require 75,000 Loyalty Points
  • AAdvantage Platinum Pro status will require 125,000 Loyalty Points
  • AAdvantage Executive Platinum status will require 200,000 Loyalty Points

Long story short, you’ll earn one Loyalty Point per dollar spent on an eligible co-branded Barclays or Citi American Airlines credit card. Welcome bonuses, spending bonuses, and other promotional bonuses, don’t count as Loyalty Points, for these purposes.

This means you could earn Gold status by spending $30,000 on a credit card, or you could earn Executive Platinum status by spending $200,000 on a credit card.

It’s also worth noting that in 2022, there will be some opportunities to earn Loyalty Points at an accelerated rate with credit cards (we don’t know if these opportunities will exist beyond that):

  • For the Citi AAdvantage Executive Mastercard, you can earn 10,000 bonus Loyalty Points when you spend $40,000 in eligible purchases between January 1, 2022, and February 28, 2023
  • For the AAdvantage Aviator Silver Mastercard, you can earn up to 15,000 bonus Loyalty Points based on eligible purchases between January 1, 2022, and February 28, 2023 — earn 5,000 Loyalty Points if you spend $20,000, earn an additional 5,000 Loyalty Points if you spend a total of $40,000, earn an additional 5,000 Loyalty Points if you spend a total of $50,000
Credit card spending will count towards AAdvantage elite status

Which American Airlines credit cards earn Loyalty Points?

The following co-branded Barclays and Citi American Airlines credit cards earn one Loyalty Point per dollar spent:

On top of that, the following card earns one Loyalty Point for every two dollars spent:

  • AAdvantage Aviator Mastercard

Note that cardmembers will start earning Loyalty Points for statements that close as of January 1, 2022 (meaning that spending in late 2021 could qualify, if the timing of the statement closing date works out).

Many AAdvantage credit cards can help you earn status

The opportunity cost of American Airlines credit card spending

Some people are saying “well now a bunch of people are just going to spend $200,000 on their credit card to earn Executive Platinum status.” Perhaps that’s true, but I also don’t think the math checks out on that, at least on an ongoing basis. Based on my valuation of points:

Assuming you’re spending in a non-bonused category (which would generally have the lowest opportunity cost):

  • You could be earning 1x AAdvantage miles per dollar spent, which I value at a 1.5% return
  • You could be earning up to 2x transferable points on some other cards, which I value at a 3.4% return

Specifically, you could earn 2x transferable points with the following cards:

Now, people may have different valuations of points currencies, and that’s fine, as you can adjust the math accordingly. But by my math, the opportunity cost of using a co-branded American Airlines credit card is ~1.9%.

In other words:

  • Spending $200,000 on an American Airlines credit card would “cost” me $3,800
  • Is Executive Platinum status (and 200,000 Loyalty Points) worth $3,800?
  • Keep in mind that you only receive Loyalty Choice Rewards (which include bonus redeemable miles, systemwide upgrades, etc.) if you also fly at least 30 segments on American Airlines
There’s an opportunity cost to AAdvantage credit card spending

A hybrid qualification approach could make sense

Like I said, on an ongoing basis I couldn’t imagine earning Executive Platinum status primarily through credit card spending:

  • For the $3,800 opportunity cost, you could just outright pay the fare difference for first class on so many flights, rather than gambling with upgrades (and upgrades for Executive Platinum members are far from a sure bet)
  • If you’re earning status entirely through credit card spending, one has to wonder how much value you’d actually get out of the status; it’s not worth inefficiently spending $200,000 on a credit card so that you can get better treatment on a few trips per year

That being said, at the margins I think there could be value in spending money on an American Airlines credit card. For example, say you fly 30 segments per year with American Airlines anyway (which is probably the lower limit of where it’s even worth going out of your way to earn top tier status).

If you usually book fairly inexpensive fares, you might otherwise earn 100,000 Loyalty Points. At that point I think it could be worth putting some spending on credit cards to earn (or maintain) Executive Platinum status. If you’d otherwise fly 30 segments, at that point you also want to consider the value of Loyalty Choice Rewards, like getting up to five systemwide upgrades, which could have a significant value.

Status is more valuable if you can earn Loyalty Choice Rewards

My plan with the new Loyalty Points system

I’ve been an Executive Platinum member with American for years, and one way or another I intend to keep my status with the new program, because I actually view the concept behind the changes as being positive.

I’m still deciding on my strategy as of now:

  • We don’t yet know if AAdvantage miles earned with Bask Bank, Hyatt, and Rocketmiles will count towards Loyalty Points, as this is still being worked out
  • If those partners do count, that could be awesome; if you had a lot of cash sitting around, you could park $200K with Bask Bank, and you’d earn 200,000 AAdvantage miles plus 200,000 Loyalty Points annually (I don’t consider there to be any opportunity cost to that for those with the cash who want to keep money liquid, since you’re not going to find a higher return on a flexible savings account)
  • If Bask Bank and some other partners don’t count, then I might have to turn to credit cards to top off my Loyalty Points balance annually

For now I’m taking a “wait and see” approach, since in some ways the announcement of the new program seems a bit premature, as details haven’t fully been ironed out yet.

We still don’t know all the partners that will earn Loyalty Points

Is earning elite status with credit card spending unfair?

I’ve seen comments from some along the lines of “not fair, now I’m going to be competing for upgrades with people who never fly American Airlines.” I have to strongly disagree with this logic, and I say that as someone who intends to maintain Executive Platinum status (most likely) without credit card spending:

  • If someone doesn’t actually fly American Airlines often but earns the same elite tier as you, they won’t pose much competition for upgrades
  • For example, say someone earns Executive Platinum status with credit card spending, and flies just 20,000 miles per year on the airline; it would take 10 of these kinds of travelers to pose the same level of competition for upgrades as a single Executive Platinum member who earns the status by flying 200,000 miles per year
  • So even if elite ranks were swelled significantly (which I personally don’t think will happen, especially for the higher tiers), the risk to upgrades clearing should be minimal if people aren’t traveling that much

Bigger picture, while I know there’s some contention between those earning status through flying vs. credit card spending, it’s important to acknowledge that credit card agreements are where major US airlines make much of their profits. Even pre-coronavirus, American largely lost money actually flying planes, and made billions in profits from credit card agreements.

Therefore it’s reasonable, if you ask me, that American would want to further incentivize this profitable behavior. And again, I say this as someone who doesn’t plan on earning airline status through credit card spending.

Upgrade competition from credit card spenders shouldn’t be that big

American Airlines credit card spending FAQs

Since there have been lots of questions about the details of the new system for credit card spending, I figured I’d address some of the most common questions below. In no particular order…

Will American Airlines credit card spending count towards million miler lifetime status? Nope. Lifetime status continues to be calculated based on the distance flown for American marketed flights, or base miles earned for travel on eligible partner marketed flights. Credit card spending doesn’t count towards that.

Won’t you also need 30 flight segments to earn elite status with American? Not quite. You can qualify for any published American Airlines elite tier exclusively through credit card spending. However, if you want to qualify for Loyalty Choice Rewards (offered to Platinum Pro and Executive Platinum members), which includes perks like systemwide upgrades, you’d need to also complete 30 qualifying segments.

Will American Airlines credit card spending help upgrade odds? Yes it will. Not only will you earn AAdvantage elite status with credit card spending, but within each elite tier, upgrades will be prioritized based on your rolling 12 month total of Loyalty Points. You’ll earn one Loyalty Point per dollar spent on an eligible co-brand card, so the more you spend, the higher your upgrade priority will be within your elite tier.

Will you need to use an American Airlines credit card to earn Loyalty Points for a flight? You don’t, and this seems to cause some confusion. Regardless of which credit card you use, you can earn five Loyalty Points per dollar spent on American Airlines flights. If you have elite status, you can earn anywhere from 40-120% bonus Loyalty Points, for a total of up to 11 Loyalty Points per dollar spent on American Airlines flights. If you pay with an eligible American Airlines credit card, you can earn one additional Loyalty Point per dollar spent on American Airlines flights.

Understanding Loyalty Points can be confusing

Bottom line

Starting in 2022, you’ll be able to earn all published AAdvantage elite tiers exclusively through credit card spending. The catch is, if you’re a savvy credit card user, there’s a significant opportunity cost to spending money on American Airlines’ co-branded credit cards.

I calculate the opportunity cost of American Airlines credit card spending as being somewhere around 1.9%, though others may have different valuations. That means spending $200,000 on an American credit card would “cost” me $3,800, compared to the best options out there.

Personally I couldn’t imagine earning AAdvantage status exclusively — or even primarily — through credit card spending, as I just can’t make sense of the math. Status isn’t that valuable, especially if you’re not flying all that much (which would presumably be the case if you’re earning status through spending).

I’m sure my thoughts will evolve on this over time as we learn more about which partners qualify for Loyalty Points earning (in particular Bask Bank). But that’s where I stand as of now…

Do you plan on earning American AAdvantage Loyalty Points through credit card spending? If so, what’s your logic?

Conversations (76)
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  1. Steve Ward Guest

    Hi Ben,

    Do you know if the $15K spend on AA card will still requalify extension of status thru 2023?

    Thanks,

    Steve

    1. TranceXplant New Member

      Yes. That promotion is still being displayed in the AA app.

  2. Ray Guest

    If, and that is a BIG if, I could put that much spend on a credit card I don't think I would choose to fly AA. Let's face it, once you are making that kind of money, and I am not counting those using the cards for business spend, your quality level goes up and who wants to fly with people that punch the FA, etc. It may sound demeaning but I think it is the truth. My income level, I pick the flight with the best times and price.

    1. Eskimo Guest

      You are suggesting people who uses cards for business spend doesn't fly AA, have worse quality, or punches the FA?

      What seems to be missing from all the comments about spending your way to earn status is Delta has been doing that for years. And recently, you can do it all the way to the top tier Diamond Medallion. So there is no difference between AA or DL when it comes to spending your way up top. But look at all the hate AA received.

    2. DCS Guest

      And recently, you can do it all the way to the top tier Diamond Medallion. So there is no difference between AA or DL when it comes to spending your way up top.

      A potentially fair point, but you have to compare apples vs. apples.

      Here are the NORMAL (as opposed to pandemic-time reduced) requirements for earning the various DL Medallion elite levels:
      - Silver Medallion: 25,000 MQM or 30 MQS plus 3,000 MQD

      And recently, you can do it all the way to the top tier Diamond Medallion. So there is no difference between AA or DL when it comes to spending your way up top.

      A potentially fair point, but you have to compare apples vs. apples.

      Here are the NORMAL (as opposed to pandemic-time reduced) requirements for earning the various DL Medallion elite levels:
      - Silver Medallion: 25,000 MQM or 30 MQS plus 3,000 MQD
      - Gold Medallion: 50,000 MQM or 60 MQS plus 6,000 MQD
      - Platinum Medallion: 75,000 MQM or 100 MQS plus 9,000 MQD
      MQD for above three levels waived by spending $25K on DL CCs.

      - Diamond Medallion: 125,000 MQM or 140 MQS plus 15,000 MQD
      MQD waived by spending $250K on DL CCs.

      Spend on DL CCs can lower the MQM requirement: 15,000 bonus MQM sre earned by spending $30K, $60K, $90K, and $120K per calendar year.

      Apples vs. apples question: How many DL flyers earn Diamond by spending $250K on CCs vs. those who earn it through 125,000 MQM or 140 MQS plus 15,000 MQD, and how does that compare with earning the top AA elite status by spending $200K on AA CCs at 1X?

      The comparison could be tighter and I do not know what the answer is, but I suspect that most choose to earn DL Diamond Medallion status through 125,000 MQM or 140 MQS plus 15,000 MQD, which I consider the "saner" option as it is like UA's now-defunct requirement to earn 100K PQM and 15K PQD.

      When UA "simplified" the requirement to reach 1K by dropping the PQM part and requiring only 24K premier qualifying miles (PQP), which is essentially equivalent to requiring a spend of $24K, or some combination PQP and premier qualifying Flights (PQF), it was a bridge too far for me. At that point, I was prepared to dump UA MileagePlus after patronizing the program for 19 years for SQ KriFlyer because I could not justify spending the kind of cash it required just to earn an elite status. That plan is on hold because it got "messed up" by the pandemic. Clearly, however, there is consistency in my dim view toward spending exorbitant sums of money simply to earn airline or hotel elite status.

    3. DCS Diamond

      Clarification:
      PQP = Premier Qualifying Points, and not Miles, where 1 PQP essentially equals $1, based on (base ticket price plus carrier imposed charge minus taxes and other fees).

  3. T Dog New Member

    The discussion of point and mile value is what I find interesting. After 18 months of flying much less, I have an excess of points and miles. Also, when I did fly in the past year and a half, fares were so low that it didn't make sense to use miles. I would argue that miles are less valuable now given the low price of airfares. That is to say, measured in the cost of...

    The discussion of point and mile value is what I find interesting. After 18 months of flying much less, I have an excess of points and miles. Also, when I did fly in the past year and a half, fares were so low that it didn't make sense to use miles. I would argue that miles are less valuable now given the low price of airfares. That is to say, measured in the cost of actual cash fares, the miles are being redeemed for less. In this light, the cash-back return of 2% for Capital One cards or similar is probably the best return available for non-bonus spending.

    Said another way, the low cash cost of airfares and the excess of miles in my accounts means that I'm not going to value points earned for future spending based on how those points can be spent on award flights. The opportunity cost (for me) is lower than Lucky is suggesting here. My estimate is 0.5% since 2% is the maximum you can earn on a cash-back card for non-bonus spending (this assumes the AA points earned are worth $0.015 each).

    I've also been converting many of my Chase UR points into cash for $0.015/point which means spending on the Unlimited cards would translate into a 2.25% return. In this case, the opportunity cost for using the AA credit cards to obtain status would be 0.75%.

    I realize that my situation may be unusual in having excess points and miles in my accounts but it does highlight how spending strategies need to factor in more than a fixed value for those points and miles.

  4. Endre Guest

    AA will end up like Hilton, who throws Diamond status at people for just having a co-branded cc. And don’t tell me the current Diamond perks at Hilton properties have not significantly watered down since they offered status through a cc. You want status with an airline? Then earn it, Karen.

    1. DCS Diamond

      AA will end up like Hilton, who throws Diamond status at people for just having a co-branded cc. And don’t tell me the current Diamond perks at Hilton properties have not significantly watered down since they offered status through a cc.

      -- Endre

      Will folks just quit making such dogmatic pronouncements regarding hotel or airline loyalty programs that they know absolutely nothing about?

      For your edification, @Endre, only someone who is utterly dumb...

      AA will end up like Hilton, who throws Diamond status at people for just having a co-branded cc. And don’t tell me the current Diamond perks at Hilton properties have not significantly watered down since they offered status through a cc.

      -- Endre

      Will folks just quit making such dogmatic pronouncements regarding hotel or airline loyalty programs that they know absolutely nothing about?

      For your edification, @Endre, only someone who is utterly dumb would spend $200K just to earn an elite status, any elite status, hotel or airline. It is simply nonsensical to compare earning the AA top elite status by spending $200K on a co-branded AA credit card with earning HH Diamond through the HH AMEX Aspire card, a co-branded rewards card that is "too good to be true", by 'spending' just $450 or whatever the AF is currently, and, with that, earn a status in a program with the following long list of features and perks that easily pay for and exceed the card's AF:
      — a huge footprint
      — elite rollover nights
      — guaranteed premium wifi
      — guaranteed free full free breakfast almost everywhere, except in the U.S., optionally in the restaurant or Executive lounge
      — guaranteed upgrade to the Executive floor at properties with one
      — unlimited complimentary suite upgrades based on availability.
      — late checkout with no time limit, based on availability [hint: request late checkout at check-in!]
      — one-time ability of put Diamond status on hold when one is not able to re-qualify for whatever reason
      — C+P awards ‘on steroids’, i.e., unlimited
      — $250 resort credit
      — $250 airline credit
      — no resort fee on award stays
      — “Diamond Force” when the chips are down
      5th award night free for outsized redemption values
      — a free night certificate for use at any category hotel
      — one additional free night certificate for use at any category hotel after spending $60K
      — 10K bonus points after reaching 40 nights, and…award nights count!
      — 10K bonus points every 10 nights after reaching 40 nights with no cap
      — 30K additional bonus points when one reaches 60 nights
      — ability to gift Gold status at 60 nights and to gift Diamond at 100 nights
      — ability to pool points with up to ten (10!) people; obviates need to transfer points.
      — Priority Pass lounge access.
      — industry-leading 14X earn rate for on-property spend paid with the Aspire card
      — 100% elite bonus points on base points
      — and much, much more.

      I have been a Hilton Diamond, continuously, for 11 years and am on track to hit lifetime HH Diamond in about two and half years (or sooner). I can, therefore, tell you authoritatively and without hesitation that

      the current Diamond perks at Hilton properties have not significantly watered down since they offered status through a cc.

      If you have evidence to contrary, put it up; otherwise, just have the decency to shut it up once and for fall.

    2. Endre Guest

      You speak authoritatively? Nope, you just have a big ass triggered ego. I’m a Diamond myself, I’ve been staying at various Hilton properties mainly in Asia and in some properties in Europe in 2021 and the experiences varied significantly. True, some might be due to the pandemic, others seem to be more of a permanent cut, especially upgrades! And please, don’t tell me to ‘shut up once and for all’ — just because you disagree....

      You speak authoritatively? Nope, you just have a big ass triggered ego. I’m a Diamond myself, I’ve been staying at various Hilton properties mainly in Asia and in some properties in Europe in 2021 and the experiences varied significantly. True, some might be due to the pandemic, others seem to be more of a permanent cut, especially upgrades! And please, don’t tell me to ‘shut up once and for all’ — just because you disagree. How else could you display your toxic sense of superiority?

    3. DCS Diamond

      This was your claim:

      And don’t tell me the current Diamond perks at Hilton properties have not significantly watered down since they offered status through a cc.

      The challenge was for you to provide evidence to support that claim and not to huff and puff hot air. I provided the list of features and perks of the 'Aspire' Diamond status. You just need to point to those that have watered down Diamond status...

      This was your claim:

      And don’t tell me the current Diamond perks at Hilton properties have not significantly watered down since they offered status through a cc.

      The challenge was for you to provide evidence to support that claim and not to huff and puff hot air. I provided the list of features and perks of the 'Aspire' Diamond status. You just need to point to those that have watered down Diamond status overall. What I see are several features (free night certs, resort/airline credits) of the Aspire card that, instead, enhance the Diamond status. Claiming that upgrades have been "cut", when there are 'Diamonds' that claim on these boards to have had the status for 'years' without ever getting a single suite upgrade, is evidence of nothing, because if true, it simply reflects their inability to take full advantage of status. So, put up or shut it up.

      G'day.

  5. at Guest

    AA is far from my favorite airline, but AAdvantage miles have somme of the best redemption possibilities on other airlines (I've flown Q-suites three times now with AA miles, 70K each way, with reasonable availability).

    What I am really curious about is how the Bask Bank will fit into this revised structure.
    @LUCKY- do we know when they will announce?
    With interest rates so low, it could make sense to park some funds there.

  6. D3kingg Guest

    What about Aadvantage dining ? Do you earn a loyalty point for each dollar spent ? And then another loyalty point for using a co branded American Airlines credit card ?

  7. fatty380 New Member

    Lol, love to hear all justifications to stay on hamster wheel. Far easier to buy premium fares and go somewhere that fit your schedule than waste time to think about how you can hit the status.

    Airlines don’t give a crap about you and you should feel same about your status. Your wallet and health will thank you when you do that.

  8. Fathiss Guest

    Appreciate the information on loyalty points and upgrade priority within a status level. That was the one I couldn’t find anything on. But I assume there are other qualifiers here? Award vs paid ticket to determine priority?

  9. Chris Guest

    Anyone spending $200K to earn Executive Platinum status is probably already buying First class tickets, so what's the point of earning status? It just doesn't make economic sense.

  10. Lipkin Leonard Guest

    What about bonus miles accrued thru American Airlines vacations and cruises?

  11. Sosie Guest

    I value American airlines points a lot,
    For they great partner redemptions.
    Since you can't really transfer points to them, I just need the 200K point a year anyways which is my best way of getting them.

  12. Russ Guest

    I think this works to my "advantage" (see what I did there). I'm flying less now that my business travel has been curtailed, but my AA-Citicard spending continues. My question is will spending earn me million miler balance miles? I'm 180,000 miles away from 2 million miles and that would be a nice boost to reach that threshold.

    1. Ben Schlappig OMAAT

      @ Russ -- Nope, credit card spending doesn't count towards million miler lifetime status, unfortunately. It's still based on miles flown.

    2. Russ Guest

      Thanks for the update. That figures!

  13. Joey Diamond

    I normally get my stash of AAdvantage miles through the AAdvantage shopping portal so this new system works for me. I have no plans nor any desire to qualify for exec plat but if I can qualify for gold or maybe platinum, then I'd be happy. I barely fly AA and doubt that will change in 2022 but if I can get gold, then at least I'd get main cabin extra for free at check-in if I do fly AA.

  14. AaronP Guest

    I'm very close to 2 million miles so I paid my estimated taxes on my Aadvantage card, qualified
    for Platinum Pro status now through 3.31.23 and I'll fly out the balance to 2 million by then...

    1. Ben Schlappig OMAAT

      @ AaronP -- Just to be clear, the Loyalty Points system isn't live until next year, so currently you can't earn status as easily through credit card spending. Or do you have a card that offers 10K EQMs for reaching a certain spending threshold, and that got you to the next elite tier?

    2. AaronP Guest

      I received a 2021 EQD waiver by spending $30k on my MileUp card, mainly done by paying estimated taxes. My PP status will be good until 3.31.23 with the extension and I'll have 2 million miles by then...

  15. Tim Guest

    If they want to encourage spending on the branded AA card, why exclude overseas spending? One big advantage of the card is no surcharge on overseas spending. They say all spending is included but then exclude certain items from gathering points - so which is it?

    1. Ben Schlappig OMAAT

      @ Tim -- International spending on US-issued co-branded credit cards does qualify. Or am I misunderstanding what you're saying?

  16. Ang Guest

    Someone doesn't seem to happy! There is already a spoof disaadvantagestatus.com

  17. Donna Diamond

    The new status system doesn’t change much for my personal flying situation with AA. I’m still a bit confused as to what they’re trying to achieve with this change. The cynic in me believes this will hurt lots of road warriors and the optimist in me says they’re attempting to enable more to achieve higher status and remain with them, hopefully it’s the latter. It’s hard to trust AA given all the negative “enhancements” over...

    The new status system doesn’t change much for my personal flying situation with AA. I’m still a bit confused as to what they’re trying to achieve with this change. The cynic in me believes this will hurt lots of road warriors and the optimist in me says they’re attempting to enable more to achieve higher status and remain with them, hopefully it’s the latter. It’s hard to trust AA given all the negative “enhancements” over the past five years. Hard at this point in time to figure this one out.

  18. D3kingg Guest

    @Mike Reed

    No idea what you’re talking about.
    I don’t think American Airlines would partner with a shady bank. Bask is FDIC insured.

  19. john Guest

    To Ben
    Isn't this a little discriminatory with the credit card they will not give me a credit card I have applied for it and they will not give it to me it doesn't seem fair if you can't get the credit card they should give the credit card to anyone that applies

    Perhaps a class action lawsuit would work do you have any suggestions thank you

    1. Ben Schlappig OMAAT

      @ john -- I'm no lawyer, but I don't think that's grounds for a lawsuit. There are many pathways to earning status, from flying, to dining out, to shopping online, to using credit cards. Not every avenue will be open to every person.

  20. Neil Guest

    I think they announced that you will need 30 flight segments annually to qualify for the top two tiers (platinum pro and executive platinum) so it cannot be solely the card to qualify for those. That was in their announcement of the plan….

    1. Ben Schlappig OMAAT

      @ Neil -- You need 30 segments in order to receive Loyalty Choice Benefits (like systemwide upgrades), but not to earn the status as such. So you could earn Platinum Pro or Executive Platinum status exclusively through spending, you just wouldn't get Loyalty Choice Benefits.

  21. cjares New Member

    @Lucky

    Hi Ben - I have a question on the credit card angle here. Ironically, I just cancelled my AA Citi card I wasn't using about 2 hrs before I learned about these changes. I was going to apply for a Barclays Red card, but the terms seem to suggest you can't earn the bonus if you've ever had the card (I had and cancelled >24 months ago). Is that true? If so, then seems...

    @Lucky

    Hi Ben - I have a question on the credit card angle here. Ironically, I just cancelled my AA Citi card I wasn't using about 2 hrs before I learned about these changes. I was going to apply for a Barclays Red card, but the terms seem to suggest you can't earn the bonus if you've ever had the card (I had and cancelled >24 months ago). Is that true? If so, then seems like Barclays Silver is the better play since you can earn Loyalty points for spend >$20K. Any thoughts on Red Vs. Silver?

    1. Ben Schlappig OMAAT

      @ cjares -- I've gotta be honest, Barclays is a bit of a mystery to me. I believe you can't actually apply for the Aviator Silver, but rather it's just an upgrade option from the Aviator Red. Someone correct me if I'm wrong?

      Barclays has changed rules many times over the years when it comes to card eligibility for those who have previously had a card. Hopefully someone can chime in with what the current policy is.

    2. Matt Guest

      Have a friend sign up for a new AAdvantage account. They will get an email inviting them to apply for the Citi AA card. The terms and conditions of the email do not say that you cannot get the bonus if you have had one within X months. You can then use their offer code/email to get a new card w/ the sign-up bonus.

  22. Alon Guest

    I’m one of those who have been using the AA Exec MC as our primary CC anyway. The rationale was that we get AA lounge membership (including spouse access) for domestic travel as a benefit at a reduced cost (included with the card annual fee). We then put most of our spending on that card out of convenience rather than taking out another card with perhaps superior travel rewards. Now that spending will help me...

    I’m one of those who have been using the AA Exec MC as our primary CC anyway. The rationale was that we get AA lounge membership (including spouse access) for domestic travel as a benefit at a reduced cost (included with the card annual fee). We then put most of our spending on that card out of convenience rather than taking out another card with perhaps superior travel rewards. Now that spending will help me maintain EP status through spending I’m already doing anyway, so I see it as a definite plus. I’m guessing AA is targeting individuals like me with this… and there may be quite a few of us.

  23. Super Guest

    Lucky can you please block this spammer?

  24. OfTheWorld Guest

    Using card spend as a top-up? Sure! But as a primary method for EXP, almost insane - especially if charging flight tix with cards like Ch.Sapphire or Citi.Prestige or Ax.Platinum, where we get 5pts/$ on air spend! Who would go any other way? But nothing will ever beat BIS (Buns-in-Seat) travel to truly "earn" Elite levels, and the deserved bonus offers. The only issue with the new program's required 30-segments is that if we normally...

    Using card spend as a top-up? Sure! But as a primary method for EXP, almost insane - especially if charging flight tix with cards like Ch.Sapphire or Citi.Prestige or Ax.Platinum, where we get 5pts/$ on air spend! Who would go any other way? But nothing will ever beat BIS (Buns-in-Seat) travel to truly "earn" Elite levels, and the deserved bonus offers. The only issue with the new program's required 30-segments is that if we normally win most of our status with J/longhaul (often fortunately nonstop), it means that we will not-very-happily need to purposely start choosing longer flights with a time-consuming added stop along the way. Not fun… but probably necessary despite the longhaul loyalty already there. Anyone agree?

    1. Ben Schlappig OMAAT

      @ OfTheWorld -- I agree that the 30 segments is a lot. You could fly every month roundtrip across the Atlantic nonstop and still not have enough segments to earn Loyalty Choice Rewards.

    2. GregsDC Guest

      I don't understand AA's decision to establish a segments threshold for Loyalty Choice Rewards without a "miles flown" alternate path. The notion that taking 15 return trips between DFW and AUS make me more worthy of perks, or more valuable to the airline, than if I were to take, say, 5 trips to Asia in business class is confusing (to say the least).

  25. D3kingg Guest

    Hitting the minimums for an elite level then putting spend on other cards to maximize value as a hybrid approach may leave you frustrated .

    If I hit 109K loyalty points despite falling short of Platinum Pro I will still have higher seniority for upgrades over other Platinums who just hit the 75K range .
    No one wants to fall just short of higher status but it might actually put you in an advantageous position for upgrades.

    1. Stephen Guest

      They are using rolling 12 months points for this calc.

    2. D3kingg Guest

      @Stephen

      Good. There will be a lot of Gold and Platinums looking for same day upgrades so priority lists will be competitive. I think once you’re on top at CK or EP there is less competition.

  26. PresRDC Gold

    Lucky, d fees such as fuel surcharges count toward the Loyalty Points total? For example, an award ticket on BA in J or F can have over $700 of fees (more if round trip). Some of this is taxes and those clearly (and fairly) don't count for Loyalty Points, but if I am paying fuel surcharges, etc., that is $ that goes to the bottom line and, I think, should count.

    1. Chris K Guest

      I thought the new calculation is based on base miles for partners, not the fare. You then get your elite status bumps which is 120% for EP.

    2. Ben Schlappig OMAAT

      @ PresRDC -- Fuel surcharges count on revenue tickets, but not on award tickets.

  27. Keemao Guest

    What about the AA Citi Premium Select card? What kind of bonus will that get after what spend by 2-28-23?

    1. Ben Schlappig OMAAT

      @ Keemao -- Are you talking about the Platinum Select? To the best of my knowledge there won't be any bonuses on spending, so you'd earn one Loyalty Point per dollar spent.

  28. Steve Gold

    I laugh every time i see people talking about earning 5, 6, 8% interest and say the words "no-risk" haha.

  29. GetToThePoints Guest

    Holding a AA card provides most of the benefit of status without the 30 segments. And that would be free bags. This was a stupid move by people who don't worry status or how to get it.

  30. Phil Guest

    How does this new scheme weigh up for non-US based members, where credit cards are not available?

    Please do an example (eg Lucky lives in Paris and flies to [US City]), lets see how difficult it now is to earn status.

    1. Ben Schlappig OMAAT

      @ Phil -- The new program sucks for those outside the United States, plain and simple, given the lack of partner earning opportunities.

    2. jfhscott Guest

      Ben,

      Might it sucking for people outside the US be part of the point?

      Were I based in HKG or MEL, EXP would be far, far more valuable, with access to the swankiest OW lounges. Surely this comes at some cost to AA. Making Emerald a tougher slog for such people is surely an added benefit, but purhaps not a purpose, of the new system.

  31. DaninMCI Guest

    I agree but you need to keep this mind set with future posts regarding putting most any spend on even less valuable cards like for Hilton Points etc.

    1. Ben Schlappig OMAAT

      @ DaninMCI -- I don't think I ever recommend putting spending on Hilton Honors cards, unless it's for a welcome bonus, or for an extra free night certificate (in situations where the math checks out)?

    2. Stephen Guest

      This all keeps leading me to the BofA Premium Rewards. For travel spend that is paying me 3.5% cashback on travel.

      I'm also getting that on groceries and 2.625% on everything else.

      Cash is the ultimate transferable currency. If it's too complicated to think about what card to swipe. I swipe this one.

  32. Matt B Guest

    Agree with just about everything you've said here. I don't see many people rationally and intentionally shifting significant amounts of spend from one card over to AA in order to achieve elite status based only on card spend. What I do see though are many less rational people who are lazy, signed up for the AA card 5 years ago for some 50k bonus marketed to them in-flight, who have since then put every dollar...

    Agree with just about everything you've said here. I don't see many people rationally and intentionally shifting significant amounts of spend from one card over to AA in order to achieve elite status based only on card spend. What I do see though are many less rational people who are lazy, signed up for the AA card 5 years ago for some 50k bonus marketed to them in-flight, who have since then put every dollar of spend on the card.

    Based on my interactions with friends and such about this hobby, I think those of us more rational credit card consumers that maximize the returns on every dollar of spend are in the minority. So how many people out there already put $30k or $75k a year on an AA card? I bet that number is substantial. But I'd imagine a $125k or $200k level would be the rarity.

    1. Ben Schlappig OMAAT

      @ Matt B -- I agree 100%. There are a bunch of people irrationally using airline co-brand credit cards, and they'll easily earn status. But for those trying to be rational about maximizing credit card rewards, it's a different story.

  33. Esquiar Guest

    $200k is way too much cash in the bank unless you’re imminently buying a house. I-Series Bonds are a much better emergency fund, yielding ~4% over the next year. Yes you can’t redeem for twelve months, and yes there’s a $10k/yr limit ($20k with grantor trust) but you can ladder purchases over consecutive years. There’s no interest rate risk because you can cash out all bonds held for a year if inflation goes below HYSA rates

    1. Ben Schlappig OMAAT

      @ Esquiar -- Fair, and I wasn't intending to suggest that everyone with $200K keep that amount liquid and put it entirely in a Bask Bank account. My point was that you can supplement your Loyalty Points earning with Bask Bank, whether that's $10K, $50K, $100K, or whatever.

    2. Mike Guest

      $200k cash in the bank is nothing for a large enough business making quarterly tax payments and needed to secure that cash in the interim.

    3. MurrayF Guest

      As someone living outside the US, having 200k in Bask if it also earned 200k loyalty points would be worthwhile. It would give me oneworld emerald which is great as my travel is mostly Asia -Pacific so assess to qantas/JAL/Cathy first class lounges, plus 200k AA miles to use each year. Also given I am spending more on Hyatt going forward I would expect another 10-20k AA miles through linking the two programmes. The interest...

      As someone living outside the US, having 200k in Bask if it also earned 200k loyalty points would be worthwhile. It would give me oneworld emerald which is great as my travel is mostly Asia -Pacific so assess to qantas/JAL/Cathy first class lounges, plus 200k AA miles to use each year. Also given I am spending more on Hyatt going forward I would expect another 10-20k AA miles through linking the two programmes. The interest lost compared to deposits in my home country is trivial. I assume there is no USA tax consequences of earning AA miles in the Bask a/c

    4. D3kingg Guest

      Depends on your net worth. If 200K is less than 10% of your net worth then why not Bask up for American status ? Also for corporations. You need cash on hand for two reasons an emergency or another stock market crash to buy the dip. The rest should be tied into securities and assets. With 200K that I didn’t need for at least 5 yrs I’d go 2/3rds bitcoin and 1\3rd gold.

  34. Brian H Guest

    I feel like I see this analysis of opportunity cost a lot and would say it is slightly incorrect when comparing two the two paths, spend on AA CC or spend on bank/higher earning card. To say it is 200k on AA or 200k on bank I believe is easy to weigh and compare the two. But these aren't your only two options. For me it would be 200k on AA CC or well... none...

    I feel like I see this analysis of opportunity cost a lot and would say it is slightly incorrect when comparing two the two paths, spend on AA CC or spend on bank/higher earning card. To say it is 200k on AA or 200k on bank I believe is easy to weigh and compare the two. But these aren't your only two options. For me it would be 200k on AA CC or well... none at all/chase sign on bonuses. I wouldn't just go spend 200k on a bank card for just points/miles, just like you wouldn't do for AA CC if there wasn't some other end goal like status. Just saying the opportunity cost isn't as large as depicted here...for a different point of view.

    1. Ben Schlappig OMAAT

      @ Brian H -- In general my analysis is intended for people who would otherwise spend a certain amount on credit cards every year. After all, you usually shouldn't spend money on credit cards just to earn rewards.

      I'm curious about what you mention, though. It sounds like you're referring to manufactured spending (which I personally don't do or find to be worthwhile). You're saying you'd only spend $200K if it could earn you Executive...

      @ Brian H -- In general my analysis is intended for people who would otherwise spend a certain amount on credit cards every year. After all, you usually shouldn't spend money on credit cards just to earn rewards.

      I'm curious about what you mention, though. It sounds like you're referring to manufactured spending (which I personally don't do or find to be worthwhile). You're saying you'd only spend $200K if it could earn you Executive Platinum status, and not if it could earn you 400,000 transferable points?

      I get you might only be encouraged to do that with a specific goal in mind, but you should still consider the opportunity cost of that, in my opinion. After all, if you've gone through the effort of spending $200K on an American Airlines credit card, you should consider what you could have earned otherwise.

      Or am I misunderstanding what you're saying?

  35. eponymous coward Guest

    Unless I do manufactured spend trickery (and there’s a time and effort cost to dragging myself to Walmart for money orders or whatever the current play is), there’s no ****ing way I could get close to 100k in base credit card spend for Loyalty Points, and the opportunity cost of maxing out that is not just passing up 2x on base spend but a bunch of 3x/4x/5x or 3%-4%-5% and signup/retention bonuses. AA Dining and...

    Unless I do manufactured spend trickery (and there’s a time and effort cost to dragging myself to Walmart for money orders or whatever the current play is), there’s no ****ing way I could get close to 100k in base credit card spend for Loyalty Points, and the opportunity cost of maxing out that is not just passing up 2x on base spend but a bunch of 3x/4x/5x or 3%-4%-5% and signup/retention bonuses. AA Dining and SimplyMiles on top + flying wouldn’t cut it either. I see my top being Platinum in this system, similar to where I max out on Alaska (MVPG) without having to worry about spending money (I also am pretty unafraid to take Southwest or Delta flights if they meet my bar, since the advent of Basic Economy/Saver fares I’ve been more willing to buy cheaper fares on other airlines).

    Basically Loyalty Points don’t work for me the same way putting 25k a year on a Delta AMEX Plat or Reserve doesn’t work for me (and arguably the Delta AMEX spend route is EASIER, at least in that 25k wouldn’t require a bunch of MS, just suboptimal spend vs. other card choices, and living in a Delta hub, I could probably net Gold on a semi-consistent basis as long as I used them pretty exclusively, Platinum maybe in a good year, Silver in a not so good year).

    I think AA is pretty smart at doing this, and it will make sense for someone like you who is very much in an AA hub and has good reasons not to leave them (as you’ve discussed at length, Ben), but for someone who wants to optimize spend without manufacturing spend and isn’t generating six digits of credit card spend with either lifestyle or their business, free agency with an eye towards optimizing spend makes sense (a lot of my Alaska flying is just that the miles are actually not goddamned SkyPesos, and while AA has issues, they haven’t debased the program to that level yet, so there is that too).

    1. DCS Diamond

      ....and the opportunity cost of maxing out that is not just passing up 2x on base spend but a bunch of 3x/4x/5x or 3%-4%-5% and signup/retention bonuses

      You just nicely articulated the first thought that entered my mind when I saw at @Lucky's math, which figured the opportunity cost for CCs that earn 2x. In practice, the opportunity cost would be much higher because the rule of thumb is to put one's spend on CCs...

      ....and the opportunity cost of maxing out that is not just passing up 2x on base spend but a bunch of 3x/4x/5x or 3%-4%-5% and signup/retention bonuses

      You just nicely articulated the first thought that entered my mind when I saw at @Lucky's math, which figured the opportunity cost for CCs that earn 2x. In practice, the opportunity cost would be much higher because the rule of thumb is to put one's spend on CCs that would earn the most transferable points for a given purchase, and earn rates for such CCs these days are generally higher than 2x.

    2. Ben Schlappig OMAAT

      @ eponymous coward @ DCS -- You're both totally right, I was trying to illustrate the absolute lowest potential opportunity cost, and it can potentially be much higher than that.

  36. jfhscott Guest

    You are correct - its all about the opportunity cost.

    I might move spend from my Citi double cash card to an American card to nose over a threshold.

    But if my miles flown merely gets me gold, that signals to me that my usage of the program, and its benefits on American, are low. Such signals to me that I get little juice for the squeeze of the opportunity cost. Indeed, I am plat...

    You are correct - its all about the opportunity cost.

    I might move spend from my Citi double cash card to an American card to nose over a threshold.

    But if my miles flown merely gets me gold, that signals to me that my usage of the program, and its benefits on American, are low. Such signals to me that I get little juice for the squeeze of the opportunity cost. Indeed, I am plat for life. I buy up to the front of the plane on cheaper premium fares (like to Belize). But with my travel patterns, I am better off getting more miles on Citi double cash or bonus categories on other cards, redeeming those miles for the class of service I want.

    To take this to absurdity, there will, no doubt, be some dolt who accrues $200,000 in spend, qualifying for executive platinum . . . . but never steps into an airport to enjoy the benefits

  37. Vlad Guest

    Great assessment, agreed with all that. There's no way in hell they will allow Bask to earn Loyalty Points. Not gonna happen, that would make their program meaningless, would be way too easy to earn status. And I think a large part of AA's strategy here is to fix the problem of people not spending enough on their cobranded cards, which is what it would make sense for them to incentivize.

    1. Ben Schlappig OMAAT

      @ Vlad -- We'll see, I'm not sure I see it the same way. Not everyone has $200K+ just sitting around that they're happy to keep in a liquid savings account.

    2. Omar Guest

      That's not the way to think about it. How much revenue does AA get from $200k sitting in a Bask acct versus spend through their cards? Answer: A lot more with the latter. That's why it will not be allowed.

    3. Ian Guest

      I think it's likely they will count Bask Bank. I can see them doing 1 loyalty point/$2. If you max the FDIC limit (not that you should...) you would end up with Platinum Pro.

Featured Comments Most helpful comments ( as chosen by the OMAAT community ).

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Super Guest

Lucky can you please block this spammer?

2
Stephen Guest

This all keeps leading me to the BofA Premium Rewards. For travel spend that is paying me 3.5% cashback on travel. I'm also getting that on groceries and 2.625% on everything else. Cash is the ultimate transferable currency. If it's too complicated to think about what card to swipe. I swipe this one.

1
Phil Guest

How does this new scheme weigh up for non-US based members, where credit cards are not available? Please do an example (eg Lucky lives in Paris and flies to [US City]), lets see how difficult it now is to earn status.

1
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