Bask Bank reduces payouts on its AAdvantage savings account: Now earn 2 miles for every $1

Bask Bank and American Airlines has a partnership that allows AAdvantage members to earn interest in the form of miles, meaning members will earn travel rewards instead of interest on their money. This can be beneficial if you take it seriously A Advantage miles very high – especially given the relatively low rates of return on many savings accounts.

Unfortunately, after increasing the AAdvantage mileage accrual rate above Mileage savings account repeatedly in recent years, Bask is now downplaying it. As of November 1, the rate drops from 2.5 miles to 2 miles per year per dollar saved. Depending on how much money you keep in your Bask Bank account, this could mean you’re missing out on thousands of AAdvantage miles each year.

Let’s take a closer look at Bask Bank’s new Mileage Savings Account rates and how you can use it to earn miles with your savings.

Related: The best uses of American Airlines AAdvantage miles

Bask Bank’s new AAdvantage earnings ratio

Effective November 1, Bask Bank lowered the earnings rate on its Mileage Savings Account from 2.5 miles to 2 miles per dollar saved per year. This new earning rate applies to new and existing Bask Bank accounts. According to the bank’s statement, “The adjustment is based on a range of economic factors and current market conditions.”

Mileage Savings Account members won’t be thrilled by this news, but 2 miles per dollar is nothing to scoff at. As of October 2024 by TPG valuation AAdvantage miles peg at 1.6 cents per mile, which is a 3.2% profit (though in reality, this could be much higher or lower depending on how you redeem your AA miles). This rate is much higher than what you get with many savings accounts, such as Chase’s standard savings account, which only offer a 0.01% annual percentage yield on deposits. However, at the time of writing, some high interest savings account offers 4.00% APY or more.

Ultimately, the value you’ll get from a Bask Mileage Savings Account — and whether it’s the right choice for you — will depend on how you redeem your miles. Do the math and see if it makes more sense to earn cash or miles from your savings. Sometimes it may be worth splitting your savings between a Bask Mileage Savings Account and a traditional savings account to diversify your income.

Related: How to earn miles in the American Airlines AAdvantage program

What is Bask Bank’s mileage savings account?

Bask Bank Mileage savings account is a savings account that earns AAdvantage miles instead of interest on deposits. Texas Capital Bank owns and operates the bank, so the Federal Deposit Insurance Corporation insures all funds. There are no monthly account fees to maintain your Mileage Savings Account, no matter how much you deposit.

Miles earned with a Mileage Savings Account are accumulated daily and then deposited into your AAdvantage account monthly. Your monthly payments are based on the average monthly balance in your account. These miles are interest you earn on your savings, so you won’t earn interest on your deposits.

For example, if you keep $50,000 in your Mileage Savings Account for a year, you will earn 100,000 AAdvantage miles based on a new earn rate of 2 miles per $1 saved. That works out to about 8,333 AAdvantage miles per month — although daily accrual means you’ll earn a little more in 31-day months and a little less in others.

To put this in perspective, 100,000 AAdvantage miles is enough to book a ticket business class seats to Europe or even a first class flight from Los Angeles to Japan.

It is worth noting that Bask Bank sometimes offers bonuses to new members. Right now, you can earn 10,000 AAdvantage bonus miles if you open a Bask Mileage Savings Account before November 30, fund your account within 15 business days, and maintain an account balance daily minimum of 50,000 USD for 180 consecutive days within the first 210 days.

Bask Bank could be a good choice if you have cash in your savings account and want to earn airline miles. Just note that you do not earn Loyalty Points with Bask Bank unless there is a special offer. So if you’re after AAdvantage elite status this year, take a look TPG’s complete guide to earning Loyalty Points for other options.

Finally, it’s important to note that these miles are considered income for tax purposes. According to Bask bank Frequently asked questions page:

“AAdvantage miles awarded by Bask Bank to maintain deposit balances are considered interest income. This income will be reported to the IRS and to you in the year in which the miles are credited to your AAdvantage account. “

As a result, you will receive a 1099 for these earnings.

Related: Why did I qualify for American’s top status without an airline flight plan?

Bottom line

Bask Bank has lowered the earnings rate on its Mileage Savings Account from 2.5 miles to 2 miles per dollar saved annually. Depending on how much you value AAdvantage miles, this can still be a great way to earn miles from your savings. Just be sure to crunch the numbers (and check with a financial advisor) to see if earning miles instead of interest on your savings makes sense. Like anything in the points and miles world, AAdvantage miles may be devalued without notice, effectively reducing the value of the mileage interest you’ve earned on your savings.

If you’re considering opening a Bask Mileage Savings Account, you can earn a new customer bonus of 10,000 AAdvantage miles when you do so before November 30 and meet the offer criteria.