Discount On Purchased American AAdvantage Miles Through August 31, 2014

Through August 31, 2014, American is offering tiered discounts on the purchase of AAdvantage miles, up to 25%.

Bonus-American-Miles-1

The tiered discounts are as follows:

Bonus-American-Miles-2

You can purchase a maximum of 80,000 AAdvantage miles per calendar year (not including promotional bonus miles), though if you purchase anywhere between 65,000 and 80,000 miles you’d be achieving the cheapest cent per mile cost, given that you’d be eligible for the 25% discount.

The ordinary cost to purchase American miles is 2.95 cents each, plus the 7.5% federal excise tax, plus a $35 transaction fee. In this case if you were to purchase 80,000 miles you’d pay a total of $1,808.75, which comes out to ~2.26 cents per mile.

Bonus-American-Miles-3

Unless you’re in a bind or have a specific use in mind, this definitely isn’t a rate at which I’d speculatively buy American miles. Just to put this into perspective compared to a few recent promotions:

With a specific short term use in mind it could still make sense to take advantage of this promotion, like if you can snag Cathay Pacific or Qantas first class award seats. For example, American charges 67,500 miles for a one-way ticket between the US and Asia in first class, so at that rate you could pick up enough miles for a one-way Cathay Pacific first class ticket for just ~$1,500. That’s pretty darn good.

CX-F
Sweet dreams in Cathay Pacific first class!

Do keep in mind that American allows five day holds on AAdvantage award tickets, so you can always hold the award tickets, then purchase the miles, and then complete the purchase. Purchased AAdvantage miles don’t post instantly, so expect for it to take 2-3 days for purchased miles to post.

Also keep in mind that accounts have to be least 14 days old to take advantage of this promotion, and points purchases are processed by points.com, meaning they don’t qualify as airfare spend for the purposes of your credit card.

Ultimately I’d rather take advantage of a US Airways 100% bonus on purchased or shared miles, which would put the cost of miles more in the 1.67-1.88 cents per mile range. Unfortunately US Airways isn’t (yet) offering such a promotion this month. And even then I wouldn’t speculatively purchase miles. Keep in mind, though, that there are still some pretty substantial differences between American AAdvantage and US Airways Dividend Miles, so the miles really aren’t “created equal” (though one isn’t necessarily better than the other — it all depends on your individual needs).

Bottom line

Unless you have a very specific use in mind, this isn’t a promotion I would be taking advantage of.

Comments

  1. @Lucky – Do US Airways also charge 67,500 miles for a one-way ticket between the US and Asia in first class? If they do, is it easier or harder to book award seats on US, AA or AS? If not, which airline is easiest? Or perhaps, what is your best advice?

  2. @Lucky – Since US/AA charges 67,500 miles for a one-way ticket between the US and Asia in first class, shouldn’t a round-trip ticket be 135k miles instead of 120k?

    With a max. limit of 80k miles one can buy per year, does mean, I can buy 80k miles in Dec 2014 and another 80k miles in Jan 2015?

  3. @ Silver — No, American and US Airways have different award charts and redemption rates. American charges 67,500 miles one-way (135,000 miles roundtrip) for first class between the US and Asia 2. Meanwhile US Airways charges 120,000 miles roundtrip (same cost one-way) for first class between the US and North Asia.

    Yes, you could buy 80K miles in December and then 80K miles in January. It’s a per calendar year limit.

  4. Hi, I’m new at this and I was wondering if it is possible and if so how to book a flight from Miami to Asia in Cathay Pacific instead of American. When I tried doing so it only offered me American flights.

Leave a Reply

Your email address will not be published. Required fields are marked *