American AAdvantage 30% Bonus on Transferred Miles Not a Good Deal

American is offering a bonus of up to 30% when you pay to transfer miles from one AAdvantage account to another. The offer lasts through July 1.

Limited time offer: Earn up to a 30% bonus for friends and family, when you share miles 
Know someone who needs American Airlines AAdvantage® miles or could you use some extra miles to reach a travel award faster? You can share miles between family, friends or colleagues and the recipient will earn up to 30% in bonus miles. Sharing miles just became more valuable, so make the most of this limited time offer, now through July 1, 2013.

The bonus gets progressively larger the more miles you transfer:

Let’s take the biggest possible bonus as an example. If you transfer 50,000 points there’s a bonus of 15,000 — at a cost of $550 plus $30 processing fee, or $580.

Your first reaction might be — wow — I can get 65,000 points for $580? That’s just under a penny a mile. Certainly American miles are worth that. And they are.

Remember that you are only generating a net increase of 15,000 miles. $580 for 15,000 miles is over 3 cents a mile. That isn’t a good deal.

If you have usable miles in one account there’s little reason to transfer them to a second account — American offers one-way awards, and those awards can be issued in anyone’s name.

If you need to transfer points between accounts in order to top off towards a specific award, and are willing to pay to do so, it’s better that there is a bonus in play than no bonus at all.

For instance, if one account has 10,000 miles in it and a second has 45,000 miles, it can make sense to move the 10,000 miles over — that gets a combined 55,000 miles which is enough for a business class ticket to South Asia (“Asia 2”).

But I wouldn’t jump on the deal just because of the bonus. And I would view this as a good way to buy miles, the way that the US Airways 100% bonus on shared miles that comes along sometimes is.

In fact the current 50% bonus on shared miles from US Airways is a better deal than this as it allows creation of ‘new’ miles at ~ 2.15 cents apiece — and US Airways miles should eventually become American miles with the merger between the two airlines pending.

Side note: I find it interesting that US Airways charges 7.5% federal excise tax on miles gained through their sharing feature (the 2.15 cents price quoted above includes that tax) while American does not. Apparently they have different interpretations of the rules…

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About Gary Leff

Gary Leff is one of the foremost experts in the field of miles, points, and frequent business travel - a topic he has covered since 2002. Co-founder of frequent flyer community, emcee of the Freddie Awards, and named one of the "World's Top Travel Experts" by Conde' Nast Traveler (2010-Present) Gary has been a guest on most major news media, profiled in several top print publications, and published broadly on the topic of consumer loyalty. More About Gary »

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  1. Sorry to be a pedant but minor correction.

    “Your first reaction might be — wow — I can get 55,000 points for $580?”

    50,000 + 15,000 = 65,000

    Thanks for the warning though. Shame

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