Expiration Date – January 29, 2016
American Airlines is offering up to 50,000 bonus miles to buy or gift miles until January 29, 2016!
American AAdvantage bonuses are generally offered based on tiered purchase levels and this bonus sale is no different. The more you buy, the larger the bonus. Miles are available for purchase in increments of 1,000 all the way up to 150,000 miles and members can buy up to 150,000 miles to keep or gift (not including the bonuses) each year.
During this sale you will enjoy:
Without a bonus, to buy or gift American AAdvantage miles cost 2.95 cents for each mile, plus a 7.5% tax, which increases your cost to 3.17 cents. In addition you will pay a $30 processing fee per transaction.
With this offer the purchase price will range from a low of 2.13 cents per mile to buy 100,000 miles plus a 50,000 miles bonus to a whopping 6.17 cents per mile for 1,000 miles.
To determine the cost per mile, just take the whole purchase price divided by the total number of miles including the bonus. For example:
Purchase 5,000 miles, enjoy 1,000 bonus miles at 3.14 cents per mile
Purchase 15,000 miles, enjoy 5,000 bonus miles at 2.53 cents per mile
Purchase 25,000 miles, enjoy 10,000 bonus miles at 2.35 cents per mile
Purchase 50,000 miles, enjoy 22,500 bonus miles at 2.23 cents per mile
Purchase 70,000 miles, enjoy 35,000 bonus miles at 2.14 cents per mile
Purchase 100,000 miles, enjoy 50,000 bonus miles at 2.13 cents per mile
Purchase 150,000 miles, enjoy 50,000 bonus miles at 2.39 cents per mile
As you know from prior TRVLVIP Perks and Tips, we believe the value of an American AAdvantage mile is 2 cents per mile, which is the value we would be willing to pay for AAdvantage miles if we could buy them for cash. It is also the minimum value we feel you should expect before redeeming your miles.
So if you purchase 100,000 miles to enjoy 50,000 bonus miles at the lowest price available of 2.13 cents per mile, you will pay more than what we believe AAdvantage miles are worth at 2 cents per mile.
In order for the miles purchase to make good economic sense, you will need to use your miles to book an award ticket or upgrade where the value of each mile is more than what you paid for it.
Does it ever make good financial sense to buy or gift AAdvantage miles? Maybe – but typically only in these scenarios:
You plan to purchase miles in order to secure a specific award flight during a discounted award promotion
MileSAAver award space is available
You plan to secure a Business or First Class award ticket
Here is a quick calculation you can use to determine deal value:
Find an award ticket.
Determine the full price of that ticket if you were to pay cash, including all taxes and fees.
Add to that amount any taxes and fees you will be required to pay on the award ticket.
Divide that amount by the number of miles required.
If the value per mile exceeds the amount you have to pay to buy the miles then you’ve found a good deal and if not, we don’t suggest you buy the miles.
Remember, purchased miles will not count toward AAdvantage elite qualification.
This is a good holiday sale if you plan to purchase a large amount of miles. Just remember, it rarely makes sense to buy or gift miles speculatively as it is an expensive way to acquire miles even with a bonus. Once you’ve picked a location and your dates and have taken the steps to ensure award availability, make the small effort to crunch the numbers to make sure the mile purchase makes good economic sense - you will be very happy you did! Click here to review award availability and to book award travel.
And a great alternative to purchasing miles to gift to another person is to book them an award ticket using your miles. That is a much more economical choice.
Want to look a bit deeper into the option to purchase, gift or share miles with or without a bonus offer? See our great tip: American - Pros & Cons of Buying and Gifting Miles.