American Wants to Test Your Math Skills With Good New Buy Miles Bonus

American is offering two stackable promotions for the purchase of miles.

First, up to a 30% bonus on purchased miles through May 17.

There are specific bonuses at various threshold levels of mileage purchases, it isn’t a straight percentage. To get the best deal you want to buy the minimum number of miles necessary for the tier level you’re interested in.

To get a 30% bonus you need to buy exactly 40,000 miles — anything less and the bonus is lower, buying more miles and you still only receive 12,000 bonus miles so your percentage bump is lower as well.

This offer on its own isn’t that attractive. But through noon central time on April 5 you also get a 15% discount on the price of the miles you’re buying (as long as your purchase is at least for 20,000 miles).

That makes a 40,000 mile purchase yield 52,000 miles — at a cost of:

  • $935 for the miles
  • $70.13 for the 7.5% tax
  • $35 transaction fee

Or $1040.13 total, a cost of 2.0 cents per mile. I haven’t ever seen American miles sold less expensively than that in a direct-to-consumer purchase. However I have seen similar pricing twice over the past year.

And of course US Airways soemtimes sells their miles cheaper with a 100% bonus, at 1.87 cents apiece. Some that are looking to stock up on miles will want to wait for a 100% bonus from US Airways to get a bit of a better price (and their price will apply to a larger mileage purchase as well).

But for now, if you aren’t stocking up but need a chunk of miles for imminent redemption, a mileage purchase can come at a pretty good price. 50,000 miles is enough for business class to Europe or South American one-way. North Asia (“Asia 1”) is 55,000 miles one-way. For capacity controlled awards, of course.

Given my seven figure American balance I am not a buyer at 2 cents. But this will be useful to some.

About Gary Leff

Gary Leff is one of the foremost experts in the field of miles, points, and frequent business travel - a topic he has covered since 2002. Co-founder of frequent flyer community InsideFlyer.com, emcee of the Freddie Awards, and named one of the "World's Top Travel Experts" by Conde' Nast Traveler (2010-Present) Gary has been a guest on most major news media, profiled in several top print publications, and published broadly on the topic of consumer loyalty. More About Gary »

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  1. All of these “buy miles at a discounted price” promos that AA has been running for a little more than a year make the hairs on the back of my neck tingle. They tell me two things: 1) They are experimenting with incentive pricing to see what yields a greater return (not inherently a bad thing), and 2)That after the merger is finalized, while the new AA will not want to make waves that alienate its most profitable customers, that we should expect a significant devaluation that will affect -ahem- more marginal customers.

  2. Was glad to see someone else come in with exactly what I was thinking. Makes me feel like I’m not crazy.

  3. And to maximize the bonus while purchasing the maximum number of miles, one can make two transactions, instead of one:
    40,000 + 12,000 bonus @ US$1,040.13
    and
    20,000 + 5,000 bonus @ US$537.56
    That gives a total of 77,000 miles for US$1,577.69 (US$0.0205/mile)

    As opposed to purchasing 60,000 +12,000 bonus @ US$1,542.69, that results in 72,000 miles at US$0.0214/mile.

  4. So at 2 cpm the BD acct. yields 2.4% tax free. Not bad in this rate environment. What do you suppose they pay for em ?

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