Changing Airline Rewards Credit Cards Shouldn't Cost You Your Miles

Dear Cashing In,

I'm considering transferring the balance from my American Airlines credit card to my Delta AmEx. The rate went up on the American card, and I can get a deal from Delta, so I think I'll do it. But will I lose my American miles if I make this move? I really don't want to do that.

- Harrison

Dear Harrison,

Don't worry, the miles you've earned so far are safely stored with the airline itself -- in this case, American Airlines' AAdvantage program. So even if you cancel that card altogether, you won't lose miles earned up to the point of cancellation. This is true for all credit cards associated with American Airlines AAdvantage. (And by the way, this is true even in the wake of American's recent filing for Chapter 11 bankruptcy.The airline has said members' AAdvantage miles remain safe and intact despite the company's struggles.)

In fact, it's true for most credit cards that earn frequent flier miles. You may be earning them thanks to the spending you're doing with the credit card, but you're banking them with the airline's loyalty programs.

If you were to transfer your balance in the other direction -- from your Delta American Express card to the Citi AAdvantage card -- you wouldn't lose your Delta miles either, because they're in your Skymiles account.

If you do close your account with the American Airlines card, though, be careful not to let those AAdvantage miles sit fallow too long. When you use a credit card that earns miles, you ensure that the miles in that account don't expire. You're keeping your membership in the airline's frequent flier program active by charging on the card.

Once you stop using the card, you have 18 months to do something with those AAdvantage miles before they start to expire. Having done this myself, I can tell you that 18 months goes by amazingly fast when you're not using an affiliated credit card.

I just received a reminder that my US Airways miles -- earned partly with a credit card I no longer carry -- are due to expire soon unless I do something with them. If I were you, I wouldn't depend on an official reminder. Set your own alert for a year from now. You worked hard for those miles, make sure you get your reward.

Any activity on your mileage account will keep your miles from expiring once you stop using the card. The most obvious way would be to book a flight with them, and you can do that not just on American, but also with British Airways, Cathay Pacific, Quantas or any member of the One World Alliance. As few as 12,500 AAdvantage miles will qualify you for a one-way flight to more than 250 destinations.

But there are many options for keeping miles active as long as you put some activity on the account within 18 months. A few ways to keep your AAdvantage account active:

Use your AAdvantage miles to purchase gift cards or magazine subscriptions on Points.com.
Register with the AAdvantage dining program where you earn points for using any credit or debit card at participating restaurants.
Donate a few miles to Operation Hero Miles, to help members of the U.S. armed forces who have been injured or wounded in Iraq or Afghanistan. Your miles will help provide travel to people visiting injured family members and close friends at military hospitals around the world. (For more information, visit the Fisher House Foundation.)
Donate miles to Kids in Need, a program that helps children (and their families) who are in need of medical care, all over the world.
Pay to reactivate. This offer may not be around when you need it, but up until Dec. 31, 2011, American Airlines is offering to reactivate any miles expired since Dec. 31, 2002, for a $200 minimum. That'll buy you back 50,000.