Your Amex Points Are Worth Exactly 2 Cents for Airfare, Not More

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The American Express Business Platinum card is awesome because it currently offers a 100,000 points sign up bonus and those points have two very high value uses:

  • transfer them to Membership Rewards partner airlines
  • use them like cash to book flights at a value of 2 cents per point

Plus the card has all the standard Amex Platinum benefits like lounge access, hotel status, and much more.

Credit card links have been removed from posts and added to the menu bar at the top of every page of MileValue under the heading Top Travel Credit Cards.

That’s good enough without having to invent some fuzzy logic that the points are worth more than 2 cents each when booking airfare.

The Airfare Benefit Explained

Business Platinum Card Members can redeem Membership Rewards at a rate of 2 cents per point toward toward fares in economy on one airline and 2 cents per point toward any First or Business Class fare. You have to call in and select one airline to get 2 cents per point of value for its coach flights. The Business/First benefit is automatic.

Then you have to have enough points to cover a booking at 1 cent per point and book through American Express Travel inside your Amex account. You will quickly be rebated half the points back.

Getting 2 cents per point on redemptions is very good, and many people will prefer it to transferring Membership Rewards to a partner airline either in order to earn status or in order to book cheap flights.

Any flight you book with Membership Rewards through American Express Travel is considered a cash flight by the airline selling the ticket because they get cash from AMEX. So if you want to earn status with, say, Delta, you could select Delta as your airline for the 50% rebate on redemptions for coach tickets. Then when it’s time to book yourself a ticket, book Delta flights through American Express Travel and get 2 cents of value per Membership Reward. In the process, earn Delta miles and status when you fly the flights.

Imagine you find a $300 cross-country roundtrip. That would be 15,000 Membership Rewards, which is far less than the 25,000 traditional airline miles you’d need to redeem for such a flight. You’d also earn miles and status for your trip.

Or imagine you find a $2,000 roundtrip Business Class fare to Europe. That would be 100,000 Membership Rewards, which is far less than the 125,000 to 140,000 traditional airlines miles for such a flight. Plus the 100,000 Membership Rewards is all you’d pay. With traditional miles, you’d pay taxes of $100 to $300 on the award. Plus with the 100,000 Membership Rewards, you’d earn miles and status on the trip. You wouldn’t earn either with the traditional miles.

But That’s It: 2 Cents

A recent email I got from a reader and a recent The Points Guy post try to argue that Membership Rewards are actually worth more than 2 cents per point when redeemed like this because of the airline miles you earn from flying the paid tickets.

Simply put, that’s bollocks unless you also mentally subtract the value of miles earned from the cash price of cash tickets.

When you see a $300 ticket on United, do you say, “This ticket costs $277.50 because it is $300 upfront but I earn 1,500 United miles worth $22.50 when I fly it.”?

  • If so, then yes Membership Rewards are worth more than 2 cents per point when redeemed for flights because you also earn miles on those flights. They’re worth around 2.1 cents if you don’t have airline status and more if you do.
  • If not, then Membership Rewards are worth exactly 2 cents toward redemptions. I’m in this camp. When I see a $300 ticket, I think it costs $300. I don’t mentally subtract the value of miles I’ll earn.

This distinction might seem small, but this blog is called “MileValue,” and I do think understanding the value you’re getting per point/mile on your redemptions is crucial to using your points and miles correctly.

If You Really Want to Make the Perk Sound Better

While I don’t agree with the logic presented above that attempts to make the Amex Business Platinum’s perk sound better, there is one legitimate ways to make it sound better:

If you have an Amex Business Platinum and other cards that earn Membership Rewards, all the Membership Rewards earned by all the cards can be redeemed at this 2 cents per point rate. Many other Membership Rewards-earning cards have higher earning rates than the 1-point-per-dollar-spent Business Platinum–up to 4.5x in fact. That means this benefit can mean getting 2 to 9 cents back per dollar of spending toward airfare.

Bottom Line

I’m all for creative, but consistent, ways of valuing miles and points. Membership Rewards earned on the American Express Business Platinum card are worth 2 cents each toward flights if you–like me–see a $300 ticket and think, “This ticket costs $300.”

If, instead, you look at a $300 ticket and mentally subtract the value of miles you’ll earn from flying it, then Membership Rewards are worth a little more to you.

Credit card links have been removed from posts and added to the menu bar at the top of every page of MileValue under the heading Top Travel Credit Cards.


Editorial Disclaimer: The editorial content is not provided or commissioned by the credit card issuers. Opinions expressed here are author’s alone, not those of the credit card issuers, and have not been reviewed, approved or otherwise endorsed by the credit card issuers.

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9 COMMENTS

  1. BUt doesn’t this card now give you 1.5 points for single charges over 8000.00. If that is the case those pints end up being with 3 cents each toward airfare? I do t have this one yet but was thinking about getting this card

    • Actually, any purchase over $5000 automatically generates 1.5 miles. I think the preferred math analysis is to separate the how-many-points-earned-per-dollar equation from the how-much-is-each-point-worth-when-you-spend-it question. Once you earn the points–in whatever fashion–all Amex points will spend the same if used on the airfare deal. Of course, you need to consider both formulas when deciding which credit card to use in the first place! FWIW, I’m loving my new BPlat (and recently charged tuition to meet min spend)–nice to get the extra few thousand points with the big spend bonus!

  2. Muddying the waters. There is no set exchange rate for these things. It’s all down to how they’re used, whether you stumble into a good way or deliberately seek good ways. And that makes false outrage over an invented crisis not much fun to read.

  3. With all due respect, I believe your analysis isn’t accurate and it’s because you are focusing only on redeption. When we evaluate our credit card spend options, we compare the value generated by different cards and then decide which points are worth more relative to others. We are going to use a credit card, we just need to decide which one. We are not comparing points with cash – that is a decision we make when spending the points.

    For instance, I can use my AmEx platinum card or my Freedom Unlimited card and generate either 1 point worth 2 cents or 1.5 points worth 2.25 cents for booking a flight. Now, you can choose to say that’s the end of the story and rely on that simple math. I would suggest, however, that the second tier value generated by the AmEx point should be factored in because the Chase points are _not_ generating that value. That second tier value comes in the miles generated from the cash ticket for the flight and, depending on your status, can be as much as 17%.

    You suggest that a $300 ticket is just a $300 ticket. Really? I factoring in the value of points generates by paying cash for airfare when making decisions about airfare. Am I unusual? Maybe but Lucky’s post yesterday on Alaska Air tells me that the downstream value generated by cash fares is a consideration for many of us.

  4. You missed the point. If you compare using MR by transferring to an airline vs booking with amex using the 50% rebate on points then it makes sense to book using points since its essentially a cash ticket which earns you points back vs an award which does not. according to your logic may as well book the award ticket because you ignore the 1500 miles earned…not as good a milevalue as it could be.

  5. Question: if I have the non-Business Plat Amex, can I book through Amex Travel for F/Bus fares at a points rate of 2 cpp?

    Or is the 2 cpp rate only for Business Plat Amex cardholders?

    Sorry for the dumb question.

  6. For cheaper fares or short flights, I don’t consider the miles generated by flying, because they’re negligible. For expensive or TATL/TPAC flights, you bet I do. I’d definitely compare an “adjusted” revenue cost (revenue booking less mileage rebate) to the equivalent award price (ala your old mileage calculator).

    But there’s also another, more important dimension of scarcity to balance that’s not often considered here — opportunity cost of time. For travelers that like earning status, there’s a scarce 52 weekends a year in which to earn ~100k miles (and whatever dollar spend). Even if the valuation of the award is pretty good compared to the adjusted revenue cost, there’s also some threat imposed of not achieving status.

    To make matters worse, it’s a little bit difficult to bake in to the valuation of my favorite airline’s points because I could always use the points for other people still, and the loyalty penalty disappears completely whenever I achieve status again (or can project that I will).

    The goal, of course, would be to clarify how to make an optimal decision without wasting much time.

    One way to simplify the decision process would be to adopt a strategy of only using points whenever achieving a good redemption value. That strategy works much better for international travelers. If one flies domestically a lot, the ability to be upgraded on cheap fares is a bigger deal. Also, status conveys greater flexibility in general, so it permits insurance bookings (one of my primary uses for awards).

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