Home > American Express, Credit Cards > Pointers on American Express Membership Rewards

Pointers on American Express Membership Rewards

This used to be THE POWERHOUSE when it came to credit card rewards. They have recently faced a lot of competition from Chase and Citibank, and have had some of their partners even stolen by Chase. However, it is still a great program if you like American Express. Their transfer partners include Air Canada/Aeroplan, Delta Air Lines, British Airways, Cathay Pacific/Asia Miles, Singapore Airlines, and Air France/KLM. They also run various bonus offers, such as 50% bonuses for Delta and British Airways (i.e., transfer 1,000 points, get 1,500 miles).

What you can do with these points:

Air Canada, Singapore Airlines, and ANA are amongst their Star Alliance partners. Each has their own redeeming (hah!) qualities, but each also charges major fuel surcharges.

British Airways is a member of the OneWorld Alliance, and whose miles are powerful for domestic awards on American Airlines and intra-South America awards on LAN. British Airways charges fuel surcharges for flights to Europe, but not for flights in the Americas. This program is now distance-based, which means that it offers spectacular value for short flights. If you’re on the west coast, you can get to Hawaii on AA for 25K miles round-trip, cheaper than what AA charges. If you’re in NYC, you can head down to South Florida for just 15K miles round-trip, again cheaper than what AA charges. In February, 2012, I used 9000 Avios points to book a roundtrip on LAN between Lima and Cuzco in Peru; although only a few hundred miles, the flight would have otherwise cost me $357 roundtrip. That mean my points were worth 25 cents per mile. You can check the prices for various routes by using this calculator, built by the Wandering Aramean.

Cathay Pacific can be useful for distance-based awards on OneWorld, especially on Cathay Pacific flights (where you’ll get more availability than by using British Airways miles).

Delta can be incredibly frustrating to use, but they can be quite valuable for awards to Europe and Australia (on partners Air France/KLM/Alitalia and Virgin Australia). Since transfers are instantaneous, you can keep your AmEx points in that account, look for award availability, and transfer only when you know the award is available. Flexibility is key here.

Air France/KLM often have reduced awards to Europe during the off-season; even with fuel surcharges, it can be a great use of AmEx points.

How to get these points:

There are many different types of AmEx cards, but the only ones that participate in the full Membership Rewards program are the Platinum (personal and business), Premier Rewards Gold (personal), and Business Gold Card. The Platinum cards are great for their travel benefits, but if you’re looking to earn a lot of points for spending, the Gold cards are the way to go.

Premier Rewards Gold ($175/year, first year free):

  • 3x earning on airfare
  • 2x earning on gas and grocery
  • 15,000 bonus points for $30,000 of spending each calendar year
  • 2.7% foreign transaction fee 😦

Business Gold Card ($175/year, first year free):

  • 3x earning on airfare
  • 2x earning on gas, advertising, and shipping
  • 25,000 bonus points for $50,000 of spending each calendar year
  • 2.7% foreign transaction fee 😦

Personally, I find better value in Chase’s program, as the annual fee for the cards are $95 instead of $175; there is no foreign transaction fee; and they transfer to United, one of my favorite mileage programs. In addition, AmEx charges a fee for transferring point to domestic airlines, such as Delta, something that Chase does not. However, if you are a big spender and want more flexibility in where you can transfer, AmEx has a great program. I recommend these cards if you get a great signup bonus (like 75,000 points) and a free year.

Before you apply for any credit cards, it’s important to take stock of your credit situation and credit report. See my pointers for beginners (step 3) for more information.

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