Good Deal: Buy American Miles For ~1.8 Cents Each

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Update: This offer for the Citi Prestige® Card is expired. Learn more about the current offer here.

Through April 13, 2017, American is offering up to 115,000 bonus miles when you purchase AAdvantage miles. This is the best offer we’ve seen on purchased miles so far this year.

The bonus miles are tiered, and based on how many you purchase, as follows:

  • Buy 6,000-9,000 miles, get 1,500 bonus miles
  • Buy 10,000-19,000 miles, get 3,500 bonus miles
  • Buy 20,000-29,000 miles, get 7,500 bonus miles
  • Buy 30,000-39,000 miles, get 15,000 bonus miles
  • Buy 40,000-54,000 miles, get 22,500 bonus miles
  • Buy 55,000-69,000 miles, get 30,000 bonus miles
  • Buy 70,000-84,000 miles, get 40,000 bonus miles
  • Buy 85,000-99,000 miles, get 50,000 bonus miles
  • Buy 100,000-124,000 miles, get 60,000 bonus miles
  • Buy 125,000-149,000 miles, get 75,000 bonus miles
  • Buy 150,000 miles, get 115,000 bonus miles

To achieve the lowest cost on a per mile basis you’ll want to purchase exactly 150,000 miles. If you did that, you’d receive a total of 265,000 miles at a cost of $4,786.88, which is a cost of ~1.8 cents per mile. This is a significantly better deal on a cent per mile basis than any of the other thresholds.

Buy-AA-Miles-1

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 (pre-bonus).

This is the second major promotion on the purchase of AAdvantage miles that American has launched this year. Through the previous promotion, the best cost you could achieve on a cent per mile basis was ~2.02 cents per mile, so this is quite a bit better, assuming you’re willing to buy the maximum number of miles.

Big picture, ~1.8 cents per mile is definitely among the better promotions we’ve seen on the purchase of AAdvantage miles. In December it was possible to buy miles for as little as ~1.74 cents each, which was otherwise the best offer we’ve seen. Ultimately the differences in cost are typically relatively minimal, so I’d choose when to buy miles based on when you need them, and not based on the specifics of the promotion.

Is buying American miles a good deal?

With American’s devaluation early last year, my valuation of AAdvantage miles has decreased from ~1.8 cents to ~1.5 cents each. It’s international first class award redemptions which went up in price most, with awards increasing in price by up to ~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 new program:

Contiguous 48 U.S. To:Business ClassFirst Class
Contiguous 48 U.S. States 25,00050,000
Canada & Alaska30,00055,000
Hawaii40,00065,000
Caribbean27,50052,500
Mexico27,50052,500
Central America27,50052,500
South America Zone 130,00055,000
South America Zone 257,50085,000
Europe57,50085,000
Middle East / India70,000115,000
Africa75,000120,000
Asia Zone 160,00080,000
Asia Zone 270,000110,000
South Pacific80,000110,000

Qatar-Airways-A350-Business-Class-30
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 certainly instances where it could make sense to pick up miles for ~1.8 cents each with a short term use in mind. While we might see a slightly better deal on the purchase of miles in the future, I don’t think it will get much better than this.

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:

Japan-Airlines-Business-Class-777 - 1
Redeem American miles for JAL business class

Bottom line

While American miles were more valuable a bit over a year ago, ~1.8 cents per mile is about as good as it gets when it comes to promotions on the purchase of miles. You can do quite well with this promotion if you’re looking to redeem a premium cabin ticket on a partner airline, especially in business class, which is the sweet spot nowadays.

If you are looking to buy miles, keep in mind that American allows five day award holds (meaning you can hold an award ticket, purchase miles, and then ticket the reservation).

Do you plan on buying American miles through this promotion?

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Comments

  1. I think there are a lot of people who have a lot of AA miles, but cannot use them due to the pathetic AAward availability.

  2. This is a very poor advice. Your valuation of 1.5 cents per AA mile is also too generous. I’d argue that an AA mile is worth less than a SkyPeso. There’re already way too many AA miles in circulation, and there aren’t many worthwhile redemption opportunities. What good is the AAdvantage currency if one can’t cash it in?

  3. Lucky

    Do you have a record of the previous 5-10 promos? Nice to compare these over time I seem to remember a 1.6 cent per mile sale but was well over a year ago. Always good to compare as it helps those of us who have plans next year or the year after plan ahead.

  4. Thanks for the heads up, Ben! I always manage to blow through my miles with award redemptions for trips to Australia 🙂

  5. I had 2 PHN-BNA tickets on AA’s 5 day courtesy hold, have been waiting for this promo for 2 months now, tickets would have expired today at noon (midnight ICT), late last night I bought the points, paid for the tickets, and this morning there was the much sought after promotion………Oh well,…..

  6. AA miles is worthless now, after devaluation and tight award availability, and non-stop bonus on purchase miles, AA is worse than Delta now, actually Delta is getting better. Feel like US air used to sale miles a lot, not AA copy that!

  7. Your generous valuation of AA miles at 1.5 is the problem. They’re worthless unless you can find availability, which is extremely rare now. Even if you can get lucky and find availability, I’d judge the value closer to 1.0 cent since that only occurs on extremely cheap tickets.

    Confederate money is worth more.

  8. Gotta agree with many of the sentiments above. All of this is based on availability of saver awards which has become virtually impossible. As an exec plat I have not been able to secure anything the past year either long term or with a few days notice using saver awards so I will be damned if I am gonna speculate on buying any miles. I’m increasingly convinced that saver awards to anywhere but Des Moines do not even exist in the system. It’s why I am flipping a lot of my trips over to Delta now…Skymiles may equally suck but at least the service is better on Delta and they show some semblance of actually trying from a service perspective.

    Quite frankly the miles game is closing in my mind. I am more interested in paid discounted promotional business class and using Amex points towards it.

  9. I actually dont think it is that bad of a promo. Totally agree that it is hard to redeem the miles, but if you have an option to do so, you can get a lot of value. I was checking out cathay flights and there is a bunch of availability next month, so its a no brainer if you are getting a 2x $6K flight for 2x 120K miles or whatever.

  10. @Lucky —> My critique of this offer differs somewhat from the above . . . and as I rarely fly AA, I don’t really have a dog in this fight, so to speak.

    Many airlines, when offering a sale on buying miles, have a tier system that is different than AA. (Whether this is because most transactions go through points.com, rather than AA.com directly, I do not know.) Usually the bonus is a percentage of the purchase, regardless of the number of (pre-bonus) miles purchased, up to a max of ___________. So rather than, say, a 40% bonus on any number, here I would get 15,000 bonus miles whether I buy 30K or 39k or anything in between. In effect, therefore, 30k represents the max. bonus I would get, until I reach the next level of 40k, or 55k, etc., etc., and there is no benefit to buying (e.g.) 35,000 miles — indeed, it costs me more to do so with less of a return. And since the 1.8¢ redemption doesn’t take place for less than a 150k buy (plus bonus) for $4,788.86, I have to ask how many of us have an extra $4,788.86 lying around? (Even though, w/5x MR points using the Amex Platinum, one would net out w/265,000 AA miles and another 26,517 MR points.)

    Secondly — and I have to rely on others here, as I’ve already said I don’t fly much on AA — if there is little award availability on AA flights, I have to ask what’s the point? Wven if the best redemption is for “a premium cabin ticket on a partner airline, especially in business class, which is the sweet spot nowadays,” if there’s no availability on partner airlines either, then why bother?

    And finally, @Lucky, perhaps it’s me, but I find your AA reward chart above rather misleading. All of your numbers rely on getting an MileSAAver Award and are for ONE-WAY travel. Since the availability of Saver awards is virtually non-existent (see above), it’s far more likely that one would have to book an Anytime Level 1 or even Level 2 award. That makes a Business fare to Europe sky-rocket from 57,500 to 110,000 or even 135,000 miles. Make it a round trip, and you’re looking at 220k or 270k, meaning you might not even have the miles to fly roundtrip from the States to Europe for $4,788 even with the bonus miles . . . .

  11. +1 on the availability issue with AA. I have tons of miles now I haven’t been able to use. Even on the off chance that I managed to “hack” a trip say business class to Europe it will be leaving at 5:35am and connecting is some random out of the way hub to a random 3rd choice city in Europe. I’m going to pass on this one.
    Sorry to sound bitter, this post is actually well done btw.
    I assume since this isn’t through Points.com that there is no affiliate payout on this? Is that why not every blogger on the planet isn’t pimping this?

  12. I think all depends in where in the world you want to go.

    Last month I booked 4 RT tix from PHL to Rome, then Venice to PHL. 30K x 8 = 240 in July. Half were booked from my account, half from my wife, so we each got 10K miles back, net miles spent 220K, total out of pocket cost $220! Sweet deal.

    Last summer we did the same thing, except the destination was Paris. This past December we used some miles to save $1K in ticket prices. Presently I am working on spend with SPG to transfer to AA with the hopes of booking Germany next summer.

    I book nice AirBnb places for about $100 bucks a night so I dont target hotel cards unless I can flip them to an airline.

    If you like traveling to Europe its 30K miles each way and I find many direct flights. Granted I live near Philly, so I am near PHL, JFK, LGA, EWR, BWI. All within 1.5hrs so maybe I have more options. So far my value has been over 2 cents so 1.8 seems good to me. But I dont buy miles, I just earn them through sign up bonus.

    Lots of options for new folks.

    AA Citi Card 50K
    Barclay 40K
    SPG Pers
    SPG Business (they offer mid summer bonus – every 20K SPG to AA equals 30K miles, wait for this)
    Marriott Pers, just got a 100K offer which I will transfer to SPG, then AA
    Marriot Bus

    If you are going to take a summer vacation, look around, see what areas of the world are open and try something new. Next summer Germany may not have the flights I want, so I will check out some other European option.

    Dont get angry, just change your strategy! Good luck to all! Happy Travels!

  13. What discount/premium do you apply to your “valuations” to account for availability? The recent TATL seats available only underscore the lousy award travel options AA miles offer. Anyone paying these prices for AA miles other than to top off an account is likely buying fool’s gold.

    I suggest a lot more posts on AA’s lack of availbility, and fewer with a buffet of affiliate links on a bad deal.

  14. Valuation of airline mileage currencies is complex. It’s really a financial option with all sorts of exercise restrictions. The intrinsic value is realized when you exercise the option to buy an award ticket. If a $1000 ticket (and you would earn 10000 miles if you pay cash for it) which you redeem using 90000 miles, the intrinsic value is $1000/(90000-10000) or 1.25 cents per mile. The value of the option is the sum of its intrinsic value and its time value, and time value is where things get tricky. When an airline puts more restrictions on redemption, it reduces the time value of the option. In the case of AAdvantage, by making fewer desirable award seats available, it reduces both the intrinsic value (you have to settle for less value if you redeem) and the time value (you have fewer options to redeem).

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