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Reader Email Sunday: American Express Membership Reward Dilemma

by on June 26, 2011 · 19 comments

in American Express, Continental, Sunday Reader Questions

This morning I am introducing a new feature to my blog; Reader Email Sunday. Basically, about every week or so I will select a couple questions from my inbox and answer them online so that everyone can view my response and offer their own comments. As always, feel free to contact me here if you have your own question and you may end up on the front page of www.thepointsguy.com!
“Hi, I have had an  an Amex card for many years and have never used the
points. I have now accumulated over 1 million points and am planning to
use them for travel. I notice Continental Airlines is dropping out of
the Amex redemption program and presumably all of their Star Alliance
partners[?]. I am considering moving 400,000 or 500,000 points into my
Continental account before end September as Continental goes to a lot
of the places I wish to visit. If I do so will I be able to transfer
points from Continental to other Star Alliance partners after Sep.30?
Does it make sense to put all these points into my existing
Continental account [where presumably they will continue to not
expire?]. Any thoughts are welcome. Thanks, Steve H.”
TPG: First off, congratulations on accruing over a million points to one of
the best programs out there. I’m a big fan of Membership Rewards
points and they can be extremely valuable if used correctly.

As far as Star Alliance transfer partners are concerned, they are not
all leaving the program. In fact, you’ll still be able to instantly
transfer points to Air Canada Aeroplan. You can also transfer to ANA
(All Nippon Airways) and Singapore Airlines – both of those transfers
take about 48 hours. Each of the three have different award charts,
which means there is no one best program for all awards. Check out
this post on the Star Alliance transfer partners and expect more posts
on the topic leading up to Continental’s departure from Membership
Rewards.

As far as moving points to Continental, that’s not a bad idea
necessarily, but I’d wait as long as possible unless you need to book
awards before September 30. I do not believe Amex will run a transfer
bonus to Continental, but crazier things have happened and there’s no
reason to jump the gun and transfer before you have to. And since Continental
probably won’t have a transfer bonus you should consider taking advantage
of one of Amex’s current 50% transfer bonuses to Delta (registration required)
or British Airways. At 50% there is a huge value to be had if you use those miles
appropriately.

Overall though, I do think Continental/United has a solid frequent
flyer program so transferring isn’t a bad idea. Continental.com has a
pretty good award engine (which they will use once merged) and they
allow one-way awards – even on Star Alliance partners, at relatively
low rates. So to sum it up, I think transferring is a decent choice
(though you should leave a good amount in Membership Rewards so you can
redeem in Skyteam and Oneworld as well).

Disclaimer: This content is not provided or commissioned by the credit card issuer. Opinions expressed here are author.s alone, not those of the credit card issuer, and have not been reviewed, approved or otherwise endorsed by the credit card issuer. This site may be compensated through the credit card issuer Affiliate Program.

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  • Bryan C.

    He should think about transferring into AA. Don’t all their miles count toward their Million Miler Status? If transfer miles count, If so, he could get gold status for life with 1,000,000 Miles. If they don’t count, then he could find a hotel program that transfers 1:1 from Amex and to AA. Just a thought for free gold status on AA.

  • emily

    He should also consider transferring to Delta because of their current 50% bonus promotion on first-time transfers.

  • The Points Guy

    @Bryan- American is not a transfer partner of American Express Membership Rewards

    @Emily- good advice- I’ll add links to remind people of those bonuses

  • gpapadop

    BA miles also get 50% bonus these days

  • Shari

    I attempted to transfer Membership Rewards to my Continental Acct. yesterday and up popped a notice from Amex that they planned to charge me an AIRLINE EXCISE TAX OFFSET FEE stating that “We charge this fee to offset the excise tax we must pay on transfers. For each point that you transfer into a frequent flyer program of a U.S. airline, a fee of $0.0006 per point will be charged to your Card account, with a maximum fee of $99.” I hadn’t heard of this before. Is this just another sneaky fee? Also I wonder if it is per airline frequent flyer program. Thoughts?

  • tassojunior

    There is no transfer fee to international carriers. Unless something better comes along before 7/30 I’ll probably throw my 200K MR into the British Air 50% bonus to get 300K to use on AA, LAN and CX. Wish Aeroplan would do a big bonus or wish US would replace CO with a big bonus.

  • Jax

    As Continental will soon be the New United, another reason you might want to transfer Amex MMR to Continental is that you can link to your United account and transfer between the two airline programs until they are merged into one: http://www.continental.com/web/en-US/apps/onepass/transferMiles/betweenPrograms/signInHome.aspx

    This can be helpful for anyone who has points in either program and needs to supplement. It also allows you to find where the award seat is (I have noticed different inventory on each) and move your points where you need them. You will need to check on mileage program rules for the expiration part.

  • Shari

    I thought about transferring my MR to British Airways but I have read on-line that they charge a hefty fuel surcharge for reward travel tickets….

  • Roy

    I’m in the same dilemma as well. I primarily travel to Asia (HKG, SIN, HND) and was wondering if anyone has had experience using BA points on CX or JAL (i.e. how much does BA usually charge in taxes and availability). I’m sitting on 250K MR points and am tempted to transfer to BA with their 50% bonus

  • Carl

    The BA and Delta 50% transfer bonuses are the way to go right now, especially for LAN to Easter Island, V Australia, and Air Tahiti awards. And get the Chase Sapphire for another 53k BA miles after $3k in initial spend. And hope Chase offers another 100k bonus for their BA Card.

    Plus Aeroplan to S.Asia via Europe before they inflate their award chart on 15 July, plus ANA for the Virgin Atlantic award which is great for SFO-LHR-JFK for 68k miles in Upper Class.

    And SQ is an option, as they have better premium availability for their own members.

  • Carl

    @Roy – Lucky has a good discussion of that here: http://boardingarea.com/blogs/onemileatatime/2011/06/02/50-membership-rewards-transfer-bonus-to-british-airways-executive-club/

    For Business Class to Asia on CX with a HK stopover would run you $400 or so.

  • The Points Guy

    @Roy check out this post for a sampling of BA surcharges and fees http://thepointsguy.com/2011/04/how-to-use-british-airways-miles-post-4-spotlight-on-taxes-and-fees/

  • The Points Guy

    @Jax- great reminder. FYI I wrote a post about this process here if anyone needs more info http://thepointsguy.com/2011/03/major-enhancement-united-and-continental-miles-and-status-now-combineable/

  • gavinmac

    What about advising him to actually start using the points, not just transferring them to an airline program and having them sit there? Don’t points tend to devalue over time? If he’s got a million, I think he should start using them.

  • Jay

    Since both BA and Delta are offing a 50% bonus to transfer MR points, is there a better value in transferring to one vs the other? Dose Delta charge you taxes on international travel?

  • Roy

    @TPG — I was wondering how you got the BA flight search to show available flights/mileage+taxes req’d for Cathay flights? I keep getting a message saying that there are no current BA flights available to HKG from SFO.

  • Pianist718

    hey a though … so why not keep accumulating points with AMEX and when he needs to use Continental he can just transfer points into Air Canada and then call Air Canada and book a flight on CO or Lufthansa??? or does he lose on the miles?

  • Mitch

    @Jay I think all carriers will collect TAXES on award travel. It’s fuel surcharges that get nasty and variable. I just redeemed LHR-ICN-MEL//SYD-KUL-LHR for 150K SkyMiles in December (peak time for Oz, more or less) and paid about $750 in taxes and fees and fuel surcharges. The fuel surcharge was around $325 and all came from MH on the return. There was no fuel surcharge applied for the KE outbound segments. The rest is “legitimate” taxes, including the dreaded United Kingdom Air Passenger Duty and several Australian immigration/customs fees. For US origination, it appears you can avoid fuel surcharges if using Delta, AirFrance, KLM, and Korean. I know Malaysia, VAustralia, and China Southern will all involve fuel surcharges. Not sure about other carriers.

  • Anonymous

    ** The contact me here link above is broken.