American Express: Save 40% with Membership Rewards – A Good Deal?

Feb 16, 2012

This post contains references to products from one or more of our advertisers. We may receive compensation when you click on links to those products. Terms apply to the offers listed on this page. For an explanation of our Advertising Policy, visit this page.

American Express sent an email this week touting “Save 40% with Membership Rewards.” I got excited for a minute thinking there might be a spate of new 40% airline transfer bonuses, alas there were no new transfer bonuses. Instead there were five main “sales”:

– 20% Rebate when you use Pay With Points for travel
– 15% off hotel giftcards
– 20% off car rental certificates
– 40% off Shop Amex merchandise
– 40% off Amex gift cards/ Travellers Checks

So are any of these a good deal? It depends on what you need out of your points. I still only use my points for airline transfers – especially when there are bonuses. I generally value my Amex points at about 2 cents a piece, so let’s take a look at the value you can get from each of these “sales”.

20% rebate on points on Pay With Points for airfare: This is a standard feature of the Platinum card. Each point is essentially worth 1.25 cents a piece and tickets purchased earn airline miles – including elite miles, which I value highly. My thoughts: a decent choice if you are Amex point rich, want to conserve cash and value elite status.

15% off hotel gift cards: You can get $100 in hotel gift cards (including Hyatt, Marriott, Ritz-Carlton, Four Seasons, Mandarin Oriental, Best Western and Fairmont) for 10,200 points, so each point is worth just under a cent a piece. Not a great deal, but not horrible.

15% off car rental gift certificates: You can get a $200 Enterprise or National gift certificate for 16,000 points, so each point is worth 1.25 cents each. Not horrible.

ShopAmex 40% off: I’ll be honest and say that buying merchandise with your Amex points is a royal waste. I remember a senior executive at my last company told me, upon hearing about my passion for points, that he used several hundred thousand Amex points to get a new grill. When he saw me have a minor panic attack he didn’t understand – until I explained nicely that he could have taken his whole family to Hawaii – twice, for the same amount if he played his cards and airline transfer bonuses correctly!

See this example, under normal circumstances you can get $1,499 Macbook Air (what I’m using to type this post coincidentally) for a whopping 319,800 points – just under a half a cent per point. With the 40% discount, you could get it for 191,727 points, which still only gets you almost .8 cents a point. Not really respectable, but I suppose if you were points rich and low on cash, it could make sense – especially if you used that computer to make a ton of money ;-).

Shopamex cringeworthy redemption rates

40% off American Express Gift Cards/ Travelers Cheques: Normally a $100 gift card costs 20,000 points – so a pitiful half cent per point in value per point. With this sale, they cost 12,000 points, so .8 cents per point. Not really great, but not as atrocious as the normal ratio.

So, to sum it up, I’m not really clamoring to take advantage of any of these promotions. However, I could see someone who is up to their ears in airline miles and Amex Points potentially liquidate some points to get airfare via Pay With Points or Amex Gift cards, though I wouldn’t really recommend it. But as always, it doesn’t matter what I recommend, it’s all about getting the most valuable for your needs.

Editorial Disclaimer: Opinions expressed here are the author’s alone, not those of any bank, credit card issuer, airlines or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

Disclaimer: The responses below are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser’s responsibility to ensure all posts and/or questions are answered.