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Last week I got Tweeted the following question from a reader:
Which card is better for everyday (non-bonused) spend for an AAdvantage elite: my Citi Prestige or new SPG Amex?
@OneMileataTime Which card is better for everyday (non-bonused) spend for an AAdvantage elite: my Citi Prestige or new SPG Amex
— John Angle (@johnangle) August 18, 2016
It’s a great question, given that maximizing your return on credit card spend as an American flyer can be a bit more complicated than with other airlines due to their credit card arrangements.
Maximizing American miles through credit card spend
American’s co-branded credit cards are presently issued by Citi (though soon Barclaycard will issue some as well), and include the Citi® / AAdvantage® Executive World Elite™ MasterCard® and Citi® / AAdvantage® Platinum Select® World Elite™ Mastercard®.
Now, both cards come with perks that could be potentially valuable. For example, the Citi AAdvantage Executive Card comes with an Admirals Club membership, and best of all, authorized users get Admirals Club access as well. You can add 10 authorized users at no extra cost.
In the case of the Citi AAdvantage Platinum Card, you get a 10% refund on miles redeemed annually, up to a total refund of 10,000 miles per year. I max out that benefit every year, so to me the 10,000 points are worth more than the card’s $95 annual fee.
But neither of those cards actually maximize everyday spend, even if you want to earn American miles. Instead the best cards for spend if you’re trying to maximize American rewards are the Starwood Preferred Guest® Credit Card from American Express and Starwood Preferred Guest® Business Credit Card from American Express.
Starpoints convert into American miles at a 1:1 ratio, and you get a 5,000 point bonus for every 20,000 points transferred. That means when transferring in the right increments you’re earning 1.25 American miles per dollar spent.
But it gets better than that. At the moment there’s a 20% bonus when you convert Starpoints into American miles, meaning 20,000 Starpoints convert into 30,000 AAdvantage miles. While perhaps you shouldn’t factor that into the valuation of a points currency, at the same time American has offered a similar bonus every year around the same time for the past several years.
So if transferring in the right increments you’ll always be earning at least 1.25 American miles per dollar spent, though you could even be getting 1.5 American miles per dollar spent if you transfer during a promotion.
I value American miles at ~1.4 cents each, so you’re looking at a return between 1.75 and 2.1 cents per dollar spent, give or take.
But is there a better option for an American flyer?
- American flyers no longer get Admirals Club access with the card
- You’ll no longer be able to redeem points for 1.6 cents each towards the cost of a ticket on American, but rather redemptions will be lowered to 1.33 cents per point
So for everyday, non-bonused spend, this won’t be especially compelling for American flyers. However, keep in mind that the card still offers triple points on airfare and hotel, and double points on dining and entertainment, so you can potentially get a significantly better rate of return than that.
As an American flyer the better option would be to just use a Citi® Double Cash Card, which offers 1% cash back when you make a purchase, and then another 1% cash back when you pay for that purchase. Then you can spend that money however you’d like, including towards an American ticket.
If your goal is to earn American Airlines rewards, the SPG Amex is absolutely your best bet for racking up those miles as quickly as possible. If transferring in the right increments you’re earning 1.25 American miles per dollar spent, or during a promotion maybe even 1.5 miles per dollar spent.
The Citi Prestige® Card can be great if you spend in certain bonus categories for earning points towards the cost of a paid ticket on American, though the value of that redemption option goes down as of next year.
Big picture, though, keep in mind that even as an American flyer it could make sense to use a rewards card that doesn’t earn American miles or rewards, as it allows you to diversify. I know that’s the direction I’d go. Even though I have an American co-branded credit card, it’s not one I use for everyday spend, but rather just for the perks.