American Express Membership Rewards Program, How to Earn Points & Use Them

American Express Membership Rewards

American Express Membership Rewards Program

American Express is one of the major credit card issuers in the United States. They have a wide variety of credit cards, some of them issued by American Express alone and others issued in collaboration with airlines, hotels or other institutions. These credit cards will either earn cashback, hotel points, airlines miles or Membership Rewards points. The latter, American Express Membership Rewards points, is what we will go over in this article.

Cards That Earn Membership Rewards Points

Before getting deeper into the American Express Membership Rewards program, let’s first look at what credit cards give you the ability to earn these points. Not all American Express card earn Membership Rewards points, not even all those issued by American Express alone. So if you want to earn Membership Rewards points, you need to have one of these cards:

American Express allows only one sign-up bonus per card per lifetime. Lifetime usually means 7 years and there’s also some offers that get around this lifetime restriction.

What Are Membership Rewards

Membership Rewards are points that you earn through spending with the American Express credit cards listed above. One great thing about these points is that if you have multiple eligible cards, all the points are pooled together in a common account. So you can use them from any account that you are logged in.

There’s many options for using Membership Rewards and that’s what makes them a versatile currency for travel enthusiasts. You can see all these option here. Membership Rewards don’t expire, and there is no cap on the amount of points you can earn.

How to Earn Membership Rewards

The primary option to earn Membership Rewards points is with one of the American Express credit cards listed above. You can earn some huge signup bonuses of 100,000 or more points with some cards such as Business Platinum for example. Then there’s the points that you earn from ongoing spending with these credit cards. By using each card on categories where they earn the highest rate, you can really add lots of points to your Membership Rewards account.

Here is the earning rates for each eligible card:

There’s some limitations and annual caps for some of these rates, so check the details for each specific card if you want to find out more. But these earning rates will give you a good idea of where you can accumulate points with American Express credit cards.

You can also earn points by referring friend and family members to sign up for an American Express credit card. You can usually earn a bonus of 10,000 or 15,000 points for every person that you refer. There’s a limit of 55,000 points that you can earn annually through referrals. Just keep in mind that you should not refer yourself, and that referral bonuses are taxed as income, unlike signup bonuses.

But credit cards are not the only option to earn points. The second best source is Rakuten, a shopping portal. They have two different accounts, one that earns cashback and the other that earn Membership Rewards. You need an eligible American Express card first in order to earn points.

How to Redeem Membership Rewards

This is the fun part. Once you have accumulated your Membership Rewards points, you wonder what you can do with them. There’s a few options. You can redeem for:

  • Transfer to Travel Partners such as Hotels and Airlines
  • Book Travel Directly
  • Statement Credit
  • Cash out with Schwab brokerage account (need Amex Platinum Card for Schwab)
  • Gift Cards
  • Pay with Points at Checkout
  • Donations

To get the best value for your points, you should transfer Membership Rewards to travel partners. You can easily get a value of 1.5 cents per points or double and triple that in some instances. Here’s a list of options and the transfer ratio for each one of them:

Aer Lingus1:1
Air Canada1:1
Cathay Pacific (Asia Miles)1:1
British Airways1:1
Choice Hotels 1:1
El Al1000:20
Flying Blue (Air France / KLM)1:1
Hilton Honors1:2
Hawaiian Airlines1:1
Marriott Bonvoy1:1
Singapore Airlines1:1
Virgin Atlantic1:1

While this is the best option, it also requires some knowledge of the program you’re transferring into. If you have no idea how to use your Etihad miles for example, then you won’t be able to get the value that you expect for the Membership Rewards that you just transferred. So always make sure you read up and familiarize yourself with a travel partner before transferring any points. Once you transfer out, you can can not transfer back to Membership Rewards. If you know that you need miles or points for a certain program, keep an eye out for transfer bonuses as well. Keep in mind that when you transfer points to U.S. airlines, such as Delta and JetBlue, you’ll have to pay a fee of $0.0006 cent per point (up to a maximum of $99).

American Express Platinum Card for Schwab

If you have the American Express Platinum Card® for Schwab you can cash out your points with a value of 1.10¢. That’s not as good as transferring to travel partners, but it is still a great option for those who have more points than they need, or don’t travel much. The American Express Platinum Card® for Schwab is just a different flavor of the Amex Platinum Card and you can get the welcome bonus even if you have other Platinum cards in the past.

Once you have the American Express Platinum Card® for Schwab, you can transfer your points into your Schwab brokerage account at 1.10¢ each. Then you can transfer to your checking account and to make it even better, you won’t receive tax forms for cashing out MR in this way. 

Other Options

The American Express Business Checking Account and Morgan Stanley Amex Platinum card also offers a similar option. But, you only get a value of 1 cent per point.

It’s also a good idea to always keep a few points in your account so you can use them for discounts on Amazon.

Guru’s Wrap-up

The American Express Membership Rewards program is one of the best available. With the wide variety of cards makes it easy to earn lots of points through signup bonuses and great earning rates on many categories. You can earn points through personal and business cards and everything is pooled together into one Membership rewards account. Then there’s referral bonuses and Rakuten if you want to earn more points.

If you want to get the most value for your points, transferring to travel partners is the best option. Once you learn the tricks and sweet spots for each partner you can extract lots of value from your points. But don’t forget about those other redemption options either. Just know that they’re there, because if all you have is 2,500 points for example, maybe you should go ahead and just get a gift card.

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