Monday, April 20, 2015

Worst Use of Amex Points

I love where my miles and points have taken me and will take me. Others love to use their miles for less than optimal value. I have a co-worker who boasted of his 200K Amex Membership Rewards points. That’s a nice enough balance of Amex points. Where this becomes a horror story is how he chose to use his points.

Be sure that women and children are not present when you read the next sentence. He redeemed 115,800 MR points for an iPad Air….

Result: $369 value/ 115,800 MR points = $0.003 per point value.

Now that those words have had a minute to sink in, let’s review how egregious a redemption this really is. Doing some quick searching on the Amex Rewards site, I see that you can redeem MR points for a variety of retail gift cards, including Staples. Doing some further searching, I found the same iPad Air on sale at Staples for $369. You can redeem for gift cards in $25 increments, or in this case, $375 of Staples gift cards. The redemption rate is a penny per point, so for $375, it would cost 37,500 Amex points. One further advantage is that you can purchase the iPad Air online through a shopping portal and earn extra bonus points, even when using a store gift card for your purchase. 


Summary: save 78,300 Amex points, and earn 740 Chase UR points through the shopping portal.
Net Result: $369 value/36,900 MR points = $0.01 per point value (PPV).

Under the right circumstances, Amex points can be transferred to travel partner programs and be redeemed at a rate greater than 2 PPV. An easy example would be to transfer 25K MR points to Air Canada’s Aeroplan program and redeem for a coach class flight from any point in the US or Canada to any other point in US or Canada, such as New York to Vancouver. For the below flight, you would be redeeming at a 3 PPV rate, 10x better redemption rate than the iPad Air. 


Try as I might, my co-worker was not to be dissuaded from his prize. He proved the biggest point about this hobby, that points and miles are only as valuable as the user wants them to be.

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