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TPG reader Kyle tweeted me with this question:
@thepointsguy– “Is it worth paying $499 to boost up to American Airlines Gold Status? I just received a targeted offer but I’m not sure if I should use it.”
Elite status is getting pretty watered down these days, especially at the lower tiers. Instead of giving lower-tier elite members free upgrades and prime coach seats, airlines are taking those benefits away and selling them to whoever will pay for them. 2014 was the biggest year ever for airline fees, and I don’t see that trend subsiding anytime soon. Plus, a lot of the benefits you get from lower-tier elite status you can gain by just having a co-branded credit card.
Gold status is the middle elite tier on most major airlines, but with AAdvantage, Gold status is at the very bottom. AAdvantage Gold status normally requires 25,000 miles/points or 30 segments a year, and includes these key benefits:
- 25% Mileage Earning Bonus
- One Checked Bag Fee Waiver
- Complimentary same-day standby
- Complimentary Main Cabin Extra seats (within 24 hours of departure)
- Unlimited, auto-requested complimentary upgrades on flights 500 miles or less
- Use earned or purchased 500-mile upgrades on American Airlines flights over 500 miles (upgrades confirmed as early as 24 hours in advance)
- Flights 500 miles or less: Unlimited, auto-requested complimentary upgrades
- Flights over 500 miles: Use earned or purchased 500-mile upgrades (upgrades confirmed as early as 24 hours in advance) on American
- Unlimited, auto-requested complimentary upgrades on US Airways
I assume you’re not flying enough to earn Gold status through elite miles/segments/points, but let’s say you’re flying 20,000 miles a year. I value AAdvantage miles at 1.7 cents apiece, so that 25% mileage bonus will would then get you 5,000 extra miles — about $85 in value. Subtracting that from the $499 cost, you’re at $414. Even if you include the fee for a checked bag on each flight you take — which would be waived with either Gold status or a co-branded credit card like Citi AAdvantage Platinum Select Mastercard — and the cost of an upgrade or two, it’s still probably not worth the value.
Plus, if you aren’t flying enough to get the status in the first place, it may not be worthwhile to pay that $499. Whereas the lowest tier elites will be re-accommodated before the non-elite masses, in your case, I don’t think it’s worth it to pay that much cash for the lowest-tier Gold status. The money you’re spending is probably more than the benefits you’ll gain, unless you plan on flying quite a bit this year. I would carefully consider your travel habits before you shell out the money.
Citi® / AAdvantage® Platinum Select® MasterCard®
|Intro APR||Regular APR||Annual Fee||Foreign Transaction Fee||Credit Rating|
|N/A||14.24% - 22.24%* (Variable)||$95, waived for first 12 months*||0%||Excellent/Good|