Maximizing American Express Membership Rewards Points

by Credit Card Wisdom on May 22, 2013

Long before Chase offered its innovative Ultimate Rewards program, American Express cards featured its Membership Rewards program. And while these points are incredibly flexible, it is up to cardholders to extract the most possible value from their hard earned points. Here is how I do it:

First, I avoid the “Pay With Points” option. This allows customers to use their points to offset existing charges but unfortunately, it only returns .6 cents in value per point redeemed. The next best option is merchandise rewards. These redemptions can be worth nearly 1 cent per point in value. Likewise, point redemptions for travel reservations also return one cent in value per point redeemed. Yet, customers can do even better with gift card options which can return a full one cent per point in value. In fact, cardmembers can often find some gift cards specials that offer more than one cent in value per point, especially for restaurants.

But the best way I know to extract the most value from Membership Rewards points is through transfer to airline miles. American Express allows cardholders to transfer points at a rate of 1:1 to over a dozen different carriers. For example, cardholders can transfer their points to miles with Air Canada’s Aeroplan program. For 100,000 miles, cardholders can book flights to Europe in Business class on Air Canada or any one of their Star Alliance Partners. Transfer points to British Airway’s Avios program and cardmembers can use them on One World partners including American Airlines. And since the BA program is distance based, 9,000 points can be redeemed for round trip flights between cities that are under 650 miles apart. Other transfer partners include Frontier, Hawaiian, jetBlue, Delta, and Air France/KLM.

The key with airline point transfer options is to identify the reward you want before the transfer. For example, I am looking forward to going to Europe some time next summer using Membership Rewards points. I discovered that Air Canada will allow me to redeem a flight on United or US Airways without out imposing a fuel surcharge. Furthermore, Air Canada is one of the few airlines that will not charge 10% of a full priced ticket to carry my infant daughter as a lap child. By redeeming 100,000 points for a business class ticket worth thousands of dollars, I might realize as much as 5 cents per point in value, or even more.

By carefully considering all of the available point redemption options, American Express cardmembers can earn phenomenal value from the Membership Rewards program.

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