Aviator Taxies to the Hangar
"Well, folks," airline pilots tend to say when they're about to share bad news over the intercom. Well, this aviator has flown its last flight (for now) and has landed in the great hangar in the sky. The aviator I'm talking about is the American Airlines AAdvantage Aviator card from Barclays Bank. I closed the card recently because I don't see it being worth keeping for another year. Let's run the numbers.
I opened this card account 13 months ago with a lucrative sign-up bonus. All I had to do was pay the $99 annual fee and make one charge in the first 3 months to earn a whopping 70,000 American Airlines miles. Nevermind that I already had three-quarters of a bazillion miles on AA; here was a cheap way to get MOAR! So I signed up, was awarded a ridiculously generous credit limit of $30,000, bought myself one lunch and paid the annual fee, and tossed the card in my desk drawer for what I thought would be the next 11.5 months. Oh, and I did reduce the credit limit from $30k to a more modest $5k. There's no value in having a huge limit on a card I don't use.
The card didn't exactly sit in a drawer for the next 11.5 months. It did see one spurt of activity last winter when AA and Barclays offered a brief, small spending multiplier. I charged about $1k on the card to earn 3k miles with that offer.
All told, I earned 73,000 miles in just over a year from the Aviator card. Valuing AA miles at 1.1 cents per point, those miles are worth $800. Subtracting out the annual fee of $99 I paid up front leaves a net of $700. And subtracting out an opportunity cost of 2% for the $1,100 in charges I put on the card (2% is what I could have earned from my no-annual-fee, cash-back cards) leaves me still with a net of $675. That's a pretty decent haul for a card I barely used all year.
And then I canceled it. Why? Because as good as the $675 net win was, that was mostly from the signup bonus. For the next year the card only pays 1 mile/dollar on most charges. At $.011 value per mile that doesn't out-earn a 2% cash-back card, and it charges a $99 annual fee. Pay money upfront and get less in return than a free card? Haha, no. Canceled.
I opened this card account 13 months ago with a lucrative sign-up bonus. All I had to do was pay the $99 annual fee and make one charge in the first 3 months to earn a whopping 70,000 American Airlines miles. Nevermind that I already had three-quarters of a bazillion miles on AA; here was a cheap way to get MOAR! So I signed up, was awarded a ridiculously generous credit limit of $30,000, bought myself one lunch and paid the annual fee, and tossed the card in my desk drawer for what I thought would be the next 11.5 months. Oh, and I did reduce the credit limit from $30k to a more modest $5k. There's no value in having a huge limit on a card I don't use.
The card didn't exactly sit in a drawer for the next 11.5 months. It did see one spurt of activity last winter when AA and Barclays offered a brief, small spending multiplier. I charged about $1k on the card to earn 3k miles with that offer.
All told, I earned 73,000 miles in just over a year from the Aviator card. Valuing AA miles at 1.1 cents per point, those miles are worth $800. Subtracting out the annual fee of $99 I paid up front leaves a net of $700. And subtracting out an opportunity cost of 2% for the $1,100 in charges I put on the card (2% is what I could have earned from my no-annual-fee, cash-back cards) leaves me still with a net of $675. That's a pretty decent haul for a card I barely used all year.
And then I canceled it. Why? Because as good as the $675 net win was, that was mostly from the signup bonus. For the next year the card only pays 1 mile/dollar on most charges. At $.011 value per mile that doesn't out-earn a 2% cash-back card, and it charges a $99 annual fee. Pay money upfront and get less in return than a free card? Haha, no. Canceled.