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Beginning in May, American Express started offering a new “Upgrade with Points” feature to US customer holding a Membership Rewards earning card. The new process allows you to essentially use i) Membership Rewards points or ii) a combination of points and cash to bid for seat upgrades to Premium Economy, Business Class and First Class with 21 different airline partners.

Who Are The Airline Partners?

Who Are The Eligible Card Members for The New “Upgrade with Points” Feature?

This new feature is currently only available to eligible US card members holding: consumer, business or corporate cards and that are enrolled in the Membership Rewards program.

How Does “Upgrade with Points” Work?

  1. Click on this link and select the airline that you have booked your tickets with.
  2. Enter your reservation details. At this stage, you will find out whether your ticketed itinerary is eligible to upgrade using Membership Rewards points. You can also place an upgrade offer for other travellers.
  3. If it is eligible, you have the option to i) use your Membership Rewards points or ii) a combination of points and cash to bid for an upgrade. Depending on the amount that you have placed for bidding, there is an indicator to tell you what is the minimum bid, fair bid and good bid. Do note that you can solely use cash to bid for upgrade.
  4. Typically within 5 days of your flight, you will find out via email whether the airline has accepted or rejected your offer for upgrade. If your bid is successful, the airline will re-issue your ticket.

Should You Use The “Upgrade with Points” Feature to Bid For Upgrades?

Most Amex Membership Rewards cards offers $10 of value for 10000 points towards an upgrade with the following exceptions which only offer 1000 points to $5 of value:

  • American Express Platinum Credit Card
  • Blue for Business Credit Card
  • Blue for Students
  • Some Blue from American Express Cards
  • Business Management Account
  • Gold Optima Card
  • Optima Credit Card
  • Optima Platinum Card
  • Platinum Business Credit Card
  • ZYNC Card

Under those terms Amex is valuing each “Upgrade with Points”, point at 0.5 – 1 cent of value.

We typically value American Express Membership rewards point at around 1.6 – 1.8 cents per point. Significantly higher than what Amex is valuing them at. In order to receive values that high, you should consider direct Amex points transfer to frequent flyer programs instead of using the “Upgrade with Points” feature. Almost all of the Amex transfer partners conversion rates are set at 1000 Amex points to 1000 miles with occasional bonus transfer up to 30% or more.

To illustrate, one of the best use of Amex point is to transfer them to the Virgin Alantic Flying Club program. Suppose that you travel frequently between New York JFK and London LHR, a typical revenue ticket is priced at $3600. If you take 1000 Amex points which transfers 1000 miles in the
Virgin Atlantic Flying Club program, you can redeem the round trip ticket at 95,000 miles during standard season. This represents 3 cents of value per Amex point (1 Amex point: 3 cent), which offers a higher value than if you intend to save your points and use it for the Amex “Upgrade with Points” feature.

What Credit Card Should I Use For The “Pay with Points” Feature?

While we don’t think upgrading with points is a great idea. I recommend using the American Express® Gold Card or The Business Gold Rewards Card from American Express OPEN. For some reason the Amex Platinum and the Business Platinum card only receive .5 cents of value per point instead of 1 cent per point.

You can learn more about the great benefits of the
American Express® Gold Card here

Including 4x Points at Restaurants and on Groceries!

You can learn more about the great benefits of
The Business Gold Rewards Card from American Express OPEN here

Including 4x points on 2 categories you spend the most on per month!

Conclusion

You can achieve higher value for Amex points by doing a direct transfer to a frequent flyer program. While everyone has their own valuation for their Amex points, the general rule of thumb is to consider a direct Amex points transfer to frequent flyer program instead of using the new Amex “Upgrade with Points” feature. It’s great to see Amex being innovative, but at the end of the day your better off saving your points for other opportunities.

Editorial Note: 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.

Comment Disclaimer: The responses in each article 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.

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