$12/Month Fee Imposed for American Airlines BankDirect Checking Account

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Last year I posted about the BankDirect checking account which earns you American Airline miles. I personally use it now as my primary checking account, however, wanted to let all existing and interested account holders know that: “Beginning January 1, 2012 there will be a $12 monthly fee for all Mileage Checking Accounts regardless of balances.”

Many of you have emailed me interested in opening an account and I wanted to ensure you know of this change. Even with the $12/month fee, it MIGHT still be worth it as your primary bank account. I am pretty bummed about this new fee they are tacking on, but am still going to keep my account open. I am able to earn a pretty decent number of AA miles from this and do not have to report earnings (yet) as I would with another checking account where I earn interest.

If you are interested in this online checking account, you can read a detailed prior post here. However, I will quickly recap the bonus potential for you all:

New Account Bonus:

  • Earn 1,000 miles for each new Mileage Checking Account or Mileage Money Market Account opened.
  • Earn an additional 1,000 miles for every $100,000 in initial deposit, up to $500,000, per household.
  • Earn 10,000 miles for establishing full payroll direct deposit from your employer into a Mileage Checking Account. Needs to be the full amount for three consecutive months.
  • Earn 5,000 miles for using BankDirect’s bill pay service. Need to have 3 bill pay merchants for 12 consecutive months.
  • Earn 5,000 miles for using your BankDirect Visa® CheckCard. Need 12 transactions per statement for three  consecutive months.
  • Earn 1,000 miles for referring a friend when they open a Mileage Checking account.

Ongoing Earning Potential:

  • Earn 100 miles per month for every $1,000 of the monthly average collected balance in your Mileage Checking Account up to the first $200,000 on deposit.
  • For monthly average collected balances over $200,000, earn 25 miles per $1,000 for all balances over the first $200,000 on deposit.

For example, if you have $50,000 in your checking account, you will earn 5,000 American Airline miles per month. This will result in 60,000 miles per year (enough for a round-trip ticket to Europe)! I am not going to go through the numbers and do an entire analysis of whether of not this account is worth it due to the sole fact that there are a variety of other checking accounts out there all with different interest amounts and fees tacked on. However, with a conservative 2 cents per mile, these 60,000 miles can be valued at about $1,200.

I also like how you get reimbursed for AMT withdrawals (4 per statement cycle), but I am not a fan of the site’s interface.

Just be aware of this new $12/month fee and if you are looking for a referral, feel free to contact me, or find a friend to refer you for that 1,000 point bonus. Every little bit helps, right?!

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Comments

    • @Sheils – You will only get 10,000 miles per account for direct deposit. If you want to get the 20,000 miles you will need to open two accounts, one under each name.

    • @Caveman – As of right now I do not know of any other bank accounts that give out AA miles, but I will definitely look into it more.

  1. It sounds like if you have 50K in deposits, AND you move essentially all your banking to BankDirect (3 bills for 12 months, full direct deposit for 3 months) then you *might* have close to 100K miles and one business class ticket to Europe. That just sounds like a rotten idea. Maybe right now while the stock market isn’t going anywhere, but there are probably better returns on $50K and better service at another bank.

    • @Scottrick – The decision really depends on what you can earn elsewhere. Cannot really compare this to the stock market, as they are totally different types of account. When I was earning 5% at ING this absolutely would not have been worth it. However, now with interest rates so low it is something to consider, and in my opinion a great return on your money. Also, need to take into consideration the tax benefit. You will not pay any tax on your AA earnings .where as with a regular interest bearing account, you will. Need to take that into consideration with your analysis as well. I know there are a few other travel bloggers who use the BankDirect as their primary checking account as well, so definitely cannot be too rotten of an idea!

  2. I went with BankDirect in October for the points, but the fee is chasing me away at the end of the month. They shouldn’t be grabbing a fee on top of a $2500 balance. People went nuts over an avoidable $5 ATM fee with BOA…it’s funny this hasn’t seemed to have cause a blip.

  3. If you have a large enough balance it is still worthwhile. I have just over $200k in the account (I added $144 to cover a year of fees. This will net me 240,000 AA miles this year. I have money earning .009% at ALLY and Amex Personal Savings so I am forgoing $1800 of taxable interest by keeping my money at BankDirect. Post-tax let’s say I am giving up $1200 and paying $144 for a net cost of $1344 for 240,000 AA miles. That is a cost of just over a half a cent per mile. Of course if/when interest rates rise I will reevaluate this account but in the current interest rate environment it is still a good deal for larger balances. [With $20,000 in the account you would earn 24,000 miles in a year at a cost of about 1.1 cents per mile. This calculation only considers the monthly miles earned.]

    • @drbench – I couldn’t agree with you more! With my personal situation as well, earning the AA miles 100% outweighs having my money in a regular checking account (Ever Bank).

  4. @drbench Or, you could take a little risk, and lend $17K at LendingClub on good risk loans (you do have to pick wisely) and make 8% interest, netting you $1360 without the $144 fee

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