Bask Bank Review — Earn AAdvantage Miles While Saving Money

There are several ways to earn frequent flyer miles. Flying on a purchased flight with an airline and opening (and spending on) an airline-branded credit card are at the top of the list.

However, there may be an easier way to earn frequent flyer miles while never having to leave your sofa.

Bask Bank, an innovative FDIC-insured financial institution, provides a unique opportunity that allows you to earn frequent flyer miles instead of interest.

According to Bankrate.com, the average savings account annual interest rate is sitting at 0.22% nationally (at the time of publishing). For some, the possibility of earning usable frequent flyer miles in lieu of interest may sound like an intriguing opportunity for travelers.

It piqued our interest, too (no pun intended), so we decided to find out how the Bask Bank savings account works. This article will explore how you earn miles with Bask Bank, what those miles might be worth, and any downsides to having an account.

What Is Bask Bank?

It’s possible you haven’t yet heard of Bask Bank, but the institution does have some history. The bank is a division of Dallas-based Texas Capital Bank N.A. Back in 1999, in an innovative move, Texas Capital Bank became the first bank to offer an online savings account.

Texas Capital Bank is also an established member of the FDIC (Federal Deposit Insurance Corporation), meaning your deposits are insured for up to $250,000 in total across Bask Bank and other Texas Capital Bank affiliates.

While Bask Bank’s financial services are limited to high-yield savings accounts, CDs, and miles-earning savings accounts, Texas Capital Bank has an expanded range of financial products and services.

Texas Capital Bank has also had a long-term relationship with American Airlines, so it made perfect sense that Bask Bank would leverage that relationship and create the only savings account that earns American Airlines AAdvantage frequent flyer miles.

Let’s look closer at how this unique Bask Bank savings account works.

Bottom Line: Bask Bank is a legitimate bank owned by an established financial institution and FDIC member. 

How To Earn Miles by Saving With Bask Bank

The Bask Bank savings account has a simple structure, so earning miles is easy. You simply deposit money and receive frequent flyer miles for leaving the funds in the account.

Let’s look at how you’ll earn miles with a Bask Bank savings account.

Earning on Deposits

The number of AAdvantage frequent flyer miles you earn is based on the average daily balance in your account. You’ll receive 2.5 miles for every dollar in your account. For example, if your average daily balance for an entire year is $60,000, you would earn 150,000 miles.

Miles are calculated monthly by the fifth business day of the following month, then deposited into your American Airlines AAdvantage account. It can take 6 to 8 weeks before the miles are credited to your American Airlines AAdvantage frequent flyer account, however.

Bottom Line: Earn American Airlines AAdvantage miles by opening a new Bask Bank savings account, depositing money, and leaving the funds in your account. 

Everything Else You Need To Know

Before you decide to open a Bask Bank savings account, consider this additional information.

• Mile Values Are Taxed — You will receive a 1099 interest statement for the value of the miles (calculated at 0.42 cents per mile) earned in a calendar year. This translates to $42 in taxable value for every 10,000 miles received.
• No Additional Fees or Minimums — Bask Bank does not charge any account fees and there is no minimum deposit required to open an account.
• No Ongoing Interest To Compound — Since you are not receiving interest deposited into your account, there is no compounding as in a typical interest-bearing savings account. Over time, this factor could be significant, especially if interest rates on savings accounts increase.
• Loyalty Program Devaluations — It’s worth considering that the value of airline miles can also decline.
• Opening and Managing an Account Is Simple — Just complete the application, create a login, provide ID, and transfer funds. Continue to manage your account via the Bask Bank app (iOS, Android).

Hot Tip: Watch for special offers to earn more miles or American Airlines AAdvantage Loyalty Points that count toward earning AAdvantage elite status. Past and recent offers have included earning 5,000 Loyalty Points for a $25,000 deposit, bonus miles for referrals, and a 1,000-mile bonus for opening an account. 

Is a Bask Bank Savings Account Worth It?

To determine whether the Bask Bank savings account is worth it, compared to earning interest in a standard savings account, let’s look at some sample math.

With the average annual savings account interest rate of around 0.22%, you would earn $132 on your $60,000 deposit if left for 1 year. Or let’s say you do better and earn .5% on that deposit, or $300.

With Bask Bank, a deposit of $60,000 that remained in your account for 12 months would earn 150,000 AAdvantage frequent flyer miles.

While you would receive 150,000 miles in lieu of an estimated $132 to $300 in interest, you will also receive a 1099-INT tax statement for the value of the 150,000 miles from Bask Bank. At the current stated rate of 0.42 cents per mile, 120,000 miles would generate a taxable interest income of $630. If you are in a 25% tax bracket, you could pay $157 tax on the miles.

Your cost for the 150,000 miles would be the estimated $114 to $300 in interest you gave up in addition to the taxes you would pay on the value of the miles. While valuations fluctuate and are subjective, we value American Airlines AAdvantage miles at around 1.4 cents each. This translates to a value of $2,100 for 150,000 miles.

Bottom Line: Whether a Bask Bank savings account is worth it to you will depend on how much value you receive from utilizing the AAdvantage frequent flyer miles and how much interest you’re giving up to obtain those miles. 

Where Can 150,000 AAdvantage Miles Take You?

Business and first class tickets for flights less than 500 miles throughout the contiguous 48 U.S. states and Canada start at 15,000 miles for MileSAAver flights. One-way business and first-class flights within the contiguous 48 U.S. states, Canada, Mexico, Central America, and Northern South America start at 25,000 miles and can be as much as 90,000 miles depending on timing and availability.

Economy flights start at 7,500 miles for flights less than 500 miles throughout the contiguous 48 U.S. states and Canada to 50,000 miles for peak flights to Hawaii. Flights to the Caribbean, Mexico, Central America, and Northern South America range between 12,500 miles for MileSAAver flights to 50,000 miles for peak pricing.

You’d probably be interested in flying business class to Europe — we can help you with that and more. We’ve done our homework and put together a list of the best ways to redeem AAdvantage miles with American and its partner airlines to receive the maximum possible value.

You don’t need to have a large stash of AAdvantage miles to receive good value either. Check out what you can do with just 10,000 AAdvantage miles.

If you frequently fly American Airlines, you’ll be interested in our breakdown of the best credit cards for American Airlines flyers to earn miles, redeem miles, receive travel perks, and more.

Final Thoughts

Earning miles for saving money sounds fun and productive. If you have a travel goal in mind and you have the funds to deposit in an account, do the math, and go for it if it makes sense to you.

When saving accounts’ interest rates are low, it can make sense to be earning miles in a Bask Bank savings account. Receiving a greater value for those miles than you would receive from the interest you would earn elsewhere would make the account worth it.

When interest rates increase, as they have recently, the dynamics of earning frequent flyer miles instead of interest may not make economic sense.