Originally Posted by
MilesGator
I'm also curious about this (and I have investigated a little on Google
). Not counting the initial sign up offer, you get 100 AA miles per $1000 in their checking account.
That means to get 20k AA miles/month someone has to have $200,000 sitting in a checking account. Lets say those are worth 2 cpm, that's a value of $400/month. Now lets say they get redeemed for business class, that's probably closer to 4-5 cpm(? just a guess as I haven't had the luxury of redeeming for biz/1st) so they are getting a value of $800-1000/month. If you were to park 200k in some retirement/investment account that gets 5% return (doesn't seem unreasonable to me),
your value would be $10,000/month.
Why is anyone parking 200k in a checking account? I love to travel, but it just doesn't seem like the smartest way to stash your money.
I only hope you improve your math so you would really know how to calculate a return. Therefore you would understand better how much your nest egg would worth 10, 20 years from now based on the 5% assumption...
On top of that 5% return is quite difficult to achieve in today's 0% interest rate environment - assuming it is almost a guarantee as you think it is not unreasonable ... does that include the risk factor?