DOC Compass — Offers, decoded

We’re reposting this because American Airlines send out an e-mail to a lot of people about this offer and we’ve had a lot of questions.

The Offer

Direct link to offer

Receive 1,000 AAdvantage miles when you open a Mileage Checking with Interest account. Earn additional miles for completing the following:
- 10,000 miles: Receive direct deposits totaling $2,000 or more per month for six consecutive statement cycles
- 5,000 miles: Use BankDirects Bill Pay program and pay three different payees at least $500 a month for six consecutive statement cycles
- 5,000 miles: Use your BankDirect® Visa® CheckCard for a minimum of twelve transactions that total at least $500 per month for six consecutive months
- 1,000 miles: Refer a friend and if they open a Mileage Checking with Interest account you’ll both earn 1,000 miles each (the person you refer will earn 1,000 miles in addition to the 1,000 miles they receive as a sign up bonus). You can refer up to a maximum of 10 people (feel free to share your links in the comments section, you can also ask for a referral in this flyertalk thread)
You’ll also earn miles based on your balance (these accounts also earn a cash APR of 0.01%):
- 100 miles per $1,000 (although miles do not come in chunks so you’d earn 1 mile on $100 in balances) in collected balance on the first $50,000 (5,000 miles) per month. This is an interest rate of 1% if you value your points at 1¢ each.
- 25 miles per $1,000 in collected balances after the first $50,000 per month. This is an interest rate of 0.25% if you value your points at 1¢ each.

The Fine Print

Allow six to eight weeks for your AAdvantage miles to post to your AAdvantage account
Limited to one Mileage Checking account with Interest per household
$500 minimum to open
Online only bank
No expiration date
Because these are miles and not cash, you don’t need to pay taxes on them (although Citi recently out 1099 forms for a similar bonus they did, so this may change)
Miles don’t count towards million mile status
FDIC insured

Avoiding Fees

Mileage Checking with Interest Monthly Fee $12

There is no way to avoid the monthly fee of $12.

Early Account Termination Fee $15

BankDirect charges an early account termination fee of $15 if you cancel your account within 90 days of opening. This shouldn’t be an issue as you need to keep the account open for a minimum of six months to get most of the bonuses.

Our Verdict

We’re going to break down our verdict into two sections; sign up bonus & on going bonuses.

On going bonuses

It’s only worth doing this on amounts less than $50,000 (as after that you only earn at 0.25% compared to 1%). It’s really going to depend on what your combined state & federal taxes are, how much you deposit is and how much you value points to determine if it’s worth it or not.

We created this calculator which you can use to determine if it’s worth signing up for the on going bonuses or not.

You cannot waive the monthly fees and you’d need to keep the account open for an absolute minimum of six months to complete most of the requirements. This means you’ll need to pay $72 out of pocket and at most you’ll get 22,000 points.

The requirements are also very strict and require you to maintain direct deposits for six months. They also verify that you are depositing your full income (even asking for pay stubs to prove this). If you get 1¢ in value then you’ll end up making $141 after fees (probably $129 as you’ll need to pay an additional months fees).

If you regularly use American Airlines and can get decent value out of these points then this offer might be worth it. I personally won’t be taking advantage of this offer because I’d rather have my money invested in the market (with a healthy emergency fund in a high interest checking account).

We’ve added this promotion to our current list of bank account sign up bonuses, it unfortunately didn’t make it to our best bank account bonus list.

Direct link to offer | Screenshot of offer

Hat tip to this flyertalk thread