You can now only earn 2 American miles per $1 with Bask Bank — what to know about the changes

Bask Bank and American Airlines have a partnership that lets AAdvantage members earn interest in the form of miles, meaning members will earn travel rewards instead of interest on their money. This can be advantageous if you value AAdvantage miles highly — especially given the relatively low rates of return on many savings accounts.

Unfortunately, after raising its AAdvantage mile earning rate on its Mileage Savings Account multiple times in recent years, Bask is now lowering it. As of Nov. 1, the rate is decreasing from 2.5 miles to 2 miles per year for every dollar saved. Depending on how much you keep in a Bask Bank account, this could mean missing out on thousands of AAdvantage miles per year.

Let's take a closer look at Bask Bank's new Mileage Savings Account rates and how you can use this account to earn miles on your cash savings.

Related: Best uses of American Airlines AAdvantage miles

Bask Bank's new AAdvantage earning rate

Effective Nov. 1, Bask Bank has lowered the earning 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 a statement by the bank, "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 still, 2 miles per dollar is nothing to sneeze at. Since TPG's October 2024 valuations peg AAdvantage miles at 1.6 cents each, that's a return of 3.2% (though in practice, this can be much higher or lower depending on how you redeem your AA miles). This rate is well above what you'd get with many savings accounts, like Chase's standard savings account, which offers only a 0.01% annual percentage yield on deposited funds. However, at the time of writing, several high-yield savings accounts offer 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 earning cash or miles on your savings makes more sense. Sometimes, it could be worth splitting your savings between Bask's Mileage Savings Account and a traditional savings account to diversify your earnings.

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

What is Bask Bank's Mileage Savings Account?

Bask Bank's Mileage Savings Account is a savings account that earns AAdvantage miles instead of interest on deposited funds. Texas Capital Bank owns and operates the bank, so the Federal Deposit Insurance Corporation insures all funds. There's no monthly account fee to keep your Mileage Savings Account open, regardless of how much you deposit.

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Miles earned with the Mileage Savings Account are accrued daily and then deposited in your AAdvantage account monthly. Your monthly payout is based on your account's average monthly balance. These miles are the interest you earn on your savings, so no cash interest is earned on deposited funds.

For example, if you keep $50,000 in your Mileage Savings Account for one year, you'd earn 100,000 AAdvantage miles based on the new earning rate of 2 miles per $1 saved. This works out to roughly 8,333 AAdvantage miles per month — though the daily accrual process means you'd earn slightly more for months with 31 days and a bit less in other months.

To put this into perspective,100,000 AAdvantage miles is enough to potentially book a business-class seat to Europe or even a first-class flight from Los Angeles to Japan.

It's also worth noting that Bask Bank sometimes offers bonuses for new members. Right now, you can earn 10,000 AAdvantage bonus miles if you open a Bask Mileage Savings Account by Nov. 30, fund your account within 15 business days and maintain a minimum daily account balance of $50,000 for 180 consecutive days out of the first 210 days.

Bask Bank could be a good option if you have cash in a savings account and would rather earn miles. Just note that you don't earn Loyalty Points with Bask Bank unless there's a special offer. So, if you're chasing AAdvantage elite status this year, check out TPG's full guide to earning Loyalty Points for other options.

Finally, it's worth noting that these miles are considered income for tax purposes. Per Bask Bank's FAQ page:

"AAdvantage miles awarded by Bask Bank for maintaining a deposit balance are viewed as interest income. This income will be reportable to the IRS and to you for the year in which the miles were posted to your AAdvantage account."

As a result, you'll receive a 1099 for these earnings.

Related: Why I qualified for American's top-tier status without plans to fly the airline

Bottom line

Bask Bank has lowered the earning 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 could still be a great way to earn miles on your savings. Just be sure to crunch the numbers (and check with a financial adviser) to see if it makes sense to earn miles instead of interest on your savings. Like anything in the points and miles world, AAdvantage miles could be devalued without notice, effectively devaluing 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 by Nov. 30 and meet the offer criteria.