Texas-based BankDirect offers an account where you can earn American AAdvantage miles for keeping your money in a checking account with them. The short version (the long version is here at View from the Wing) is you get a signup bonus approaching 22,000 miles for opening a checking or money market account, and then you’ll earn 100 miles for every $1,000 you keep in the account.
The quick math: $50,000 in the account for a year earns you the signup bonus plus 60,000 miles. Sounds great.
Except this: it pays .05% interest.
Sure, interest rates are terrible everywhere now. But I’ve got a savings account with Zions Bank that pays 1.05%. Taking advantage of this deal would mean I’m giving up the 1% annual interest.
In the example above, I’m giving up $500 in interest (minus taxes) for 82,000 miles (in year one, 60,000 miles in future years). Now, that’s not a bad deal, but it’s not a great deal either, especially if interest rates rise.
Just something to keep in mind as you look around for “free” ways to get frequent flyer miles. There are TONS of great deals out there (especially with the recent batch of credit card signup bonuses); just make sure you’re taking into account what you’re giving up to get those miles for free.