In addition to Chase and Citi, American Express also offers credit cards with transferable award points, called Membership Rewards. There are a variety of AMEX cards that earn Membership Rewards points, but first I’ll highlight the American Express Premier Rewards Gold (PRG) card.
The AMEX PRG card has comparable perks to the Chase Sapphire Preferred and Citi Premier cards:
- $195 annual fee (thankfully waived for the first year)
- Variable sign-up bonus of 25,000-50,000 Membership Reward points (after $2,000 in spending within three months)
- No foreign transaction fees
- 3x points on airline purchases (must be booked directly from airline) as well as 2x points on U.S. restaurants, gas stations, and supermarkets.
- $100 in airline fee credit; this can be used for checked bags, onboard food/drinks… or potentially redeemable for airline gift cards
- Note: The AMEX PRG card is a charge card rather than a credit card, so you must pay the full balance each month. If you’re playing the points game, you should be doing this regardless, but it’s worth pointing out.
Pretty basic stuff, though the $100 airline fee credit is unique among the other credit cards. These “incidental fees” (baggage fees, onboard food/drinks, ticket change fees, etc.) are charged directly from the airline, and the fees are coded differently from actual airline fares. Once eligible charges clear on your American Express card, the bank gives an automatic credit back to your account for the charges.
Pretty awesome in its own right, though some airlines (including Delta, American, and Southwest) allow the airline fee credit to be applied to gift cards purchased from the airline’s website. So in practice, that can be a free $100 in airfare since the annual fee is waived the first year. You can also see that the AMEX PRG card gives 2x on spending at supermarkets, which is also unique among the Chase and Citi travel credit cards. Since the Citi Premier card gives 3x on all travel spending, the PRG’s 3x points on airfare purchases isn’t quite as appealing.
The sign-up offer ranges from a pitiful 25,000 Membership Rewards points to a more respectable 50,000 points. AMEX will periodically offer the bigger sign-up bonus, so let’s assume that you wait for the 50,000 Membership Rewards offer before applying. After meeting the minimum spending requirements, you’ll have at least 52,000 Membership Rewards points. Another nice addition to a diversified credit card points wallet!
So… what can you do with Membership Rewards points? AMEX has 16 airline transfer partners and 3 hotel transfer partners to choose from.
Like usual, most of the transfer partners have very little value. I’ve subscribed to a variety of points blogs for the past three years, and I can honestly say that I’ve never heard of anyone using credit cards points with the Aeromexico, Alitalia, or El Al (Israel’s national airline) frequent flyer programs.
It’s always difficult to know which transfer partners are worth getting excited about and which ones are totally lame, so I’ll cut to the chase. For infrequent flyers, I’d recommend transfering into the Singapore Airlines, British Airways, or Delta frequent flyer programs with your AMEX Membership Rewards points.
As I mentioned in my last post, the Singapore Airlines KrisFlyer program is a versatile program that allows you to redeem points with a variety of Star Alliance airlines. It’s also the only way to find award space in Singapore Airlines first class, which is arguably among the most luxurious airline products in the world. Since Singapore Airlines is a transfer partner with all four credit card currencies (Chase, Citi, AMEX, and SPG), transferring into your KrisFlyer account allows you to quickly earn enough points for roundtrip business class tickets to almost anywhere. The name of the game is diversifying in credit card points in order to compile those points in frequent flyer programs, so earning Singapore Airlines miles is a natural strategy.
Another good option is transferring AMEX points into the British Airways frequent flyer program. The British Airways award chart is distance based, meaning that the only determination in how much a reward flight costs is the mileage between the two points. So using British Airway miles (called “Avios”) probably won’t be wise when planning a around-the-world trip, but there are a few sweet spots to consider. For example, using British Airways Avios, Taryn and I were able to fly roundtrip in economy class with Aer Lingus (an Irish partner airline with British Airways) from Washington-Dulles to Dublin, Ireland, for 26,000 points each. That’s roughly the same amount for a roundtrip domestic award ticket with American Airlines, Delta Airlines, or United Airlines. We also used Avios to fly in business class to and from Hong Kong during around around-the-world trip. Since we had relatively short flights around SE Asia, Avios made for a great value.
One big caveat with Avios: there can be signifiant taxes and fees associated with the reward ticket. For example, the most natural Avios redemption for most of us in the U.S. is flying on British Airways to London (because, duh). However, the taxes and fees associated with a one-way business class ticket can be over $500. Economy tickets can also be $200+. Each person has his/her or priorities, but those kinds of fees hardly make redeeming credit card points worth it. So as long as your strategy is short, non-stop flights on partner airlines (such as the OneWorld airline alliance), Avios could be a great option.
Lastly, transferring Membership Rewards points to Delta Airlines could be a good option for novice credit card points collectors or infrequent flyers. In general, the Delta SkyMiles frequent flyer program is far inferior to either American Airlines or United Airlines. I wouldn’t recommend anyone start collecting Membership Rewards points with the sole intent to transfer them to their Delta SkyMiles account. There are SO MANY other options that can provide you with a better value!
But I also recognize that many of us already have a stash of SkyMiles in our pockets. And using Membership Rewards points could be a great way to top off your SkyMiles account for a high-value award ticket. Delta is notorious for not publishing award charts and for having variable pricing on their award tickets, but I have found great redemption options on partner airlines, including business class flights from the U.S. to Shanghai on China Eastern Airlines.
“But I see Emirates and Etihad are transfer partners, too, and I saw those awesome first class seats on Facebook. Shouldn’t I try to transfer into one of those frequent flyer programs if I want to fly on Emirates or Etihad?”
You would think, but actually, there are better options. For example, Alaska Airlines miles are a much better redemption option for award flights on Emirates, and American Airlines miles are better way to redeem for award flights on Etihad. It’s a bit counterintuitive, but each frequent flyer program has its own quirks, and the combination of a more favorable award chart as well as cheaper taxes and fees make Alaska/AA more strategic options.
American Express Membership Rewards points are another great credit card currency to consider when developing your strategy. Overall, I value Membership Rewards more than Citi ThankYou points, but less than Chase Ultimate Rewards points. This is why I consider the Chase Sapphire Preferred credit card more advantageous than the AMEX Premier Rewards Gold card.
I’ve discussed the Chase Sapphire, Citi Premier, and AMEX PRG cards. Stay tuned for the next post, where I’ll describe the Starwood Preferred Guest credit card and a few ways to redeem SPG Starpoints for great business class redemptions!