50K + $200 statement credit offer for american airlines card – frequent miler electricity labs high school

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While looking at an upcoming reservation online, I saw a new offer for the Citi AAdvantage Platinum Select World Elite Mastercard: get 50,000 miles after spending $2,500 in purchases in the first 3 months plus get up to $200 in statement credits for eligible American Airlines purchases in the first 12 months. The standard offer you’ll find on our Best Offers page is for 60,000 miles after spending $3,000 on purchases in the first three months. Whether you would value $200 or the additional 10K miles more (or whether you would consider the $500 difference in minimum spending requirement to be a factor in the equation) is a toss-up depending on how you’ll use the miles.

Our Reasonable Redemption Values pegs most airline miles, including American Airlines miles, at 1.4 cents each (For more on why we value miles that way, see: What are airline miles worth?). Strictly based on that value, the additional 10K miles on the 60K offer are worth about $140.

We typically only value airline statement credits at 90% of face value for the purposes of determining the first-year value of new cardmember offers. That means we would value the statement credit at $180 (though if you know that you’ll spend $200 with American Airlines in the next 12 months, you may value it more strongly). The 60K offer requires an additional $500 in spending, so there is a little bit of opportunity cost since you could put that spend on a card that earns 2-3% cash back.

The terms exclude car rentals and hotels (except the taxes & fees if you use AA miles to pay for those things), elite status boost, or AA cargo. Based on those terms, I expect things like ticket purchases and award taxes & fees would trigger the credit.

If you only value American Airlines miles around 1.4 cents each, this offer is a better offer provided you’d normally spend $200 over the next 12 months with AA. Personally, I’d probably choose to get the extra miles of the 60K offer rather than the statement credit with the expectation that I’d use my miles for greater value. That said, I’ve recently questioned whether or not I’m getting value better than that from airline miles considering the low paid airfares available these days (See: A miles vs points dilemma: Redeem an award or “pay” with points?).

There are definitely arguments on either side of this one and it’s close in terms of value. Keep in mind that you are not eligible for the bonus on this card if you have had a Citi AAdvantage personal credit card opened or closed in the past 24 months. Also note the new bonus categories — 2x on restaurants and grocery stores — began for new cardmembers last week. Existing cardholders will have to wait until July 22nd for those bonus categories.

It is no toss-up if you are somewhat seasoned in MS, IMO. Suppose you value those 10K miles at something like $200. There are better ways to go about getting the 10K miles, but let’s assume no promotions in effect and having only the resources that the card recipient is sure to have. Just use the card to buy 10K of Simon Mall gift cards and do 5 bill pays at Walmart. The cost in fees is $3.95 x 20 = $79 for the gift cards, and $1.50 x 5 = $7.50 for the bill pays. The total fees are $86.50 which you could put on a %2 card or whatever. So the true cost is about $85 and an hour or two of your time for those 10K miles. If you know about how long it takes you to buy and process gift cards, then it is just a question of whether or not your time is consistently more valuable than about $50 to $100 per hour?

Personally, I like the opportunity to earn $115 in exchange for a bit of time. I probably wouldn’t be going out to get those miles right away though. I’d wait for a Simon promo, or a specific need for the miles. Let the $200 mingle around in my funds as reserve miles for the airline or hotel of my choice, earn some pennies of interest, or invest in some merchant gift cards to throw up on Raise with no particular hurry to sell. When I need more AA miles, I could easily get the 10k within one statement cycle. With the money left over, I could get another 10K in the next cycle.

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