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Update: This offer for the Citi ThankYou® Premier Card is expired. Learn more about the current offer here.
On Friday I wrote about some minor changes coming to the Citi® / AAdvantage® Platinum Select® World Elite™ Mastercard® as of November 15, 2015. Specifically:
- Foreign transaction fees will be eliminated on the card
- The $100 flight discount after spending $30,000 on the card in a membership year will be eliminated
The elimination of foreign transaction fees is obviously a good thing, while the elimination of the $100 flight discount is obviously a bad thing… at least on the surface.
What amazed me were the number of emails I received from savvy readers who spend $30,000+ per year on the card. When I asked them “why?” some responded with “well it’s the best way to earn American miles, isn’t it?”
The SPG Amex is the best card for earning American miles
Starpoints are the single most valuable points currency out there, in my opinion, as I value each Starpoint at ~2.2 cents. What makes Starpoints so valuable is that they can be redeemed efficiently for hotel stays, and can also also be converted into miles in over two dozen airline programs. Among those transfer partners is American AAdvantage.
You can convert Starpoints into airline miles at a 1:1 ratio, and for every 20,000 points you transfer you get a 5,000 point bonus. That means when transferring in the right increments, you’re actually earning 1.25 AAdvantage miles per dollar spent on the Starwood Preferred Guest® Credit Card from American Express and Starwood Preferred Guest® Business Credit Card from American Express.
Keep in mind that on top of that we see promotions every so often for a bonus when converting Starpoints into American miles. We recently saw a 20% bonus for points conversions, which meant 20,000 Starpoints converted into 30,000 AAdvantage miles. That meant you were earning up to 1.5 AAdvantage miles per dollar spent on the SPG Amex and SPG Business AmEx. If you can make points transfers at the right time, that can greatly increase your earnings potential.
But the other great thing about earning American miles this way is that you’re hedging against a devaluation. If American devalues their award chart, the value of your miles could decrease significantly. Meanwhile SPG has dozens of airline transfer partners, meaning if American miles go down in value, you can always transfer points elsewhere.
If you want credit towards travel on American
AAdvantage miles are extremely valuable, so wanting to earn them through credit card spend isn’t a half bad idea.
But a lot of people want to earn rewards that help them fly American, and assume earning AAdvantage miles is the best way to do that. And that’s not necessarily true. Two of the hottest cards are the Citi Prestige Card and the Citi ThankYou® Premier Card.
What makes these cars so compelling?
The Citi ThankYou® Premier Card was refreshed back in April, and is now a really rewarding card for everyday spend. It has a $95 annual fee, which is waived the first year. The card also has an extremely lucrative points earning structure, arguably the best of any flexible points currency card. It offers:
- 3x points on travel
- 3x points on gas
- 2x points on dining out and entertainment
- 1x point on all other purchases
So that’s a fantastic way to maximize your points earning potential on everyday spend.
Meanwhile the Citi Prestige Card has a $450 annual fee, though comes with many benefits which more than justify it, in my opinion.
The card has the following points earning structure:
- 3x points on air travel and hotels
- 2x points on dining at restaurants and entertainment
- 1x point for all other purchases
And on top of that it offers the following perks:
- A $250 annual airline credit (with your first year’s annual fee you actually get two of those — that’s $500 of airline credits with your first year’s $450 annual fee)
- A fourth night free hotel benefit
- The most comprehensive Priority Pass membership offered by any card
- A $100 Global Entry fee credit
The ThankYou points earned through this card can be redeemed towards the cost of a paid ticket on American. When you factor in that you’re earning 3x points per dollar spent in some categories, that’s a huge return.
Also keep in mind that since these points are redeemed towards the cost of a paid ticket on American, you’ll still earn miles for those flights, and can upgrade, etc.
There are lots of ways to get credit card rewards which will be useful for travel on American. However, in general I’d shy away from American’s own co-branded credit card as a way of earning miles towards travel on American.
Instead, the SPG Amex and SPG Business AmEx are probably the best ways to earn AAdvantage miles, given that you’ll do much better than earning one mile per dollar spent. Keep in mind that both of those cards have increased sign-up bonuses through tomorrow only.
But if you’re interested in earning points which can be redeemed towards the cost of paid travel on American, it’s tough to beat the Citi ThankYou® Premier Card and Citi Prestige Card, given the great bonus categories.