American Express has been doing a large marketing push with increased welcome bonuses for new cardholders. Cards like The Platinum Card from American Express and the American Express Gold Card earn Membership Rewards (MR) points.

The value of Membership Rewards points can vary based on how you plan to redeem them. In this post, we’ll go over the best and worst ways to redeem Amex points.

The data points in this post are pulled from the American Express Rewards calculator site: https://global.americanexpress.com/rewards/calculator

The Worst Amex Membership Rewards Redemption Methods

1. Merchandise

The worst way to use MR points is to buy merchandise from American Express. 99% of the time, you can find a better value on Amazon or another retailer.

This method values points at .5 cents points per point (CPP), which is worse than redeeming for a statement credit.

2. Redeeming for Statement Credit

The second worst way to redeem Membership Reward points is for statement credits. A common misconception from people who rush into opening Amex cards is that points are worth 1.0 cents when you redeem for credits.

When you redeem points for statement credit, points are valued at .6 CPP.

For example, if you redeem 10,000 points, it’s only worth $60.

If you want cash, there are some other setups we'll talk about later in the post.

3. Pay with Points at Checkout

When you link your Amex account with merchants to Pay with Points, the typical redemption rate is 0.7 CPP.

Redemption rates may vary based on the retailer, so be sure to check that it’s a good point value rate before redeeming. Be careful here because some platforms like Amazon can auto-fill that you’re using MR points at check out.

4. Gift Cards

The value of gift card redemption depends on the type of gift card you get. In the screenshot below, redemption values vary.

If you redeem points for an Amex cash equivalent gift card, you're probably getting 0.5 CPP.

For stores like Walmart or Best Buy, you can get 0.7 CPP. Other retailers like Home Depot, REI, New Navy, Banana Republic, and most stores are 1 CPP.

Gift cards are not ideal since there are "cash out" paths that get you 1 CPP to 1.25 CPP.

You can then use that money to buy gift cards at a discount or put it on another card and get points back.

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The Best Ways to Use Amex Points

1. Booking Travel

When you book travel via the American Express travel portal, flights are generally worth 1 CPP. Other travel like cruises, prepaid hotels, or vacations are usually 0.7 CPP.

Note: using the Amex Travel Portal is NOT the same as using transfer partners.

2. Morgan Stanley Cash Out

If you have the Platinum Card from American Express Morgan Stanley edition, there’s the ability to cash out at 1.0 cents per point to your brokerage account.

Once the points hit the brokerage account, you can cash it out anywhere. In the past, there were not any tax consequences since you already earned the points. It should be considered rebates vs. income.

A few things to consider:

1. You need a Morgan Stanley account to get a the Morgan Stanley Platinum Card, typically with an account balance of $5,000-$25,000.
2. You need to be approved for the Morgan Stanley Platinum Card
3. The Morgan Stanley Platinum Card annual fee is $550.

Learn more about the Morgan Stanley Platinum Card here, and how to waive the annual fee.

3. Charles Schwab Cash Out

If you have the Platinum Card from American Express Charles Schwab edition, you can transfer MR points out at 1.25 cents per point into your brokerage account.

The benefit is you’re cashing out points for cash via your brokerage account. A few things to consider:

1. You need a Schwab account to get a Schwab Platinum Card
2. You need to be approved for the Schwab Platinum Card
3. The Schwab Platinum Card annual fee is $550.

4. Amex Platinum Business Card

Platinum Business cardholders can redeem MR points for travel and get a 35% rebate when you pay for either first class, business class, or flights with the airline you picked for the travel incidental credit.

Due to the 35% points rebate, the effective value is 1.5 CPP.

For example, let's say you have a $1,540 flight, so you’ll need to redeem 154,000 MR.

• After this, you get 35% of 154k back = 53,900
• This means you got $1,540 in value for 100,100 MR
• = ~ 1.54 CPP

For normal people who want a simple travel redemption, this is your best bet.

5. Amex Centurion Business Card

One of the benefits of the Business Centurion Card is that you can get a 50% rebate on all flights. With the rebate, you can effectively get 2.0 CPP.

Same idea as the Business Platinum Card, but you get a 50% rebate on all flights.

A $2,000 flight would cost 200,000 points, but you get 100,000 points back. It’s effectively spending 100,000 points for a $2,000 flight = 2 CPP.

The flight rebate benefit is not available on the personal Centurion card.

6. Transfer Partners

Finally, the best way to use MR points is to redeem through transfer partners. The main consideration here is you need to do a lot of research for optimal redemption rates.

Points are valued at 1.5–3.0 cents per point. Most partners transfer at a 1:1 rate, but some are at 0.8:1. Occasionally, American Express runs promotions for transfer partners where you can get a higher rate.

See a full list of transfer partners here: https://rewards.americanexpress.com/myca/loyalty/us/catalog/view/ptlanding/?tier=PR

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FAQ

Can I transfer points from the Amex Blue Cash Preferred or Cash Magnet card to the Platinum or Gold cards?

• No, the Blue Cash Preferred and Cash Magnet cards earn cash back, and not Membership Rewards. Likewise, you cannot transfer Membership Rewards to cash back cards.

Do Membership Rewards expire?

• No, as long as you have at least one card open that earns Membership Rewards.

Best travel transfer partners for Amex Membership Rewards points?

• Singapore, Virgin Atlantic, ANA, and Aeroplan are all interesting. Some of the other airlines have sweet spots as well.  This is assuming they stay at the current rates and don't see a devaluation.

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