An airline mileage credit card is a specific type of mileage credit card provided by, you guessed it, the airline. Compare this to a bank issued mileage credit card, which has points that can be redeemed for many different airlines. So what are the differences between an airline mileage credit card over the bank issued mileage credit card and which is right for you?
Like the bank issued mileage credit card, the airline mileage credit card gives you more bang for your buck when purchasing airfare. You earn frequent flier miles both from the dollars that you spent on the credit card for the airfare as well as for the miles traveled. Thus, for those who travel often for work or leisure, an airline mileage credit card can be very attractive. As mentioned earlier, the non-airline specific mileage credit card tends to give you greater flexibility over a specific airline mileage credit card. Thus when considering airline cards, it is important to research which airlines fly into your nearby airport.
Generally speaking, the most important attributes for any credit card, including an airline mileage credit card, are those relating to what it costs you. When researching the cards, be sure to record and compare the yearly fees, interest rates, redemption fees/percentages, and other charges. A shrewd shopper will probably opt for an airline mileage credit card that has no annual fee (it can be hard to make up for this via better rewards) and the best opportunity for earning reward miles. Many airline mileage credit cards will also offer a large amount of initial miles for signing up, although read the fine print as sometimes it takes time to redeem these miles.
In summary, an airline mileage credit card can be a worthwhile option for frequent travelers. Generally speaking, a bank issued mileage credit card will be more versatile than an airline specific card. However, whether one is better than the other will vary based on the specific offers of the mileage credit cards.
Showing posts with label Mileage Credit Card. Show all posts
Showing posts with label Mileage Credit Card. Show all posts
Thursday
Mileage Credit Card - Know Before You Buy
A very useful type of credit card is the airline mileage credit card. In summary, these type of credit cards offer you rewards in the form of frequent flier miles for the money you spend with the card. As with any type of financial product, there are different types of a mileage credit card with each having specific advantages and drawbacks. One benefit of a mileage credit card is that you get points for both the dollars you spend and the miles you fly (when a flight is purchased with the card). So essentially, you are getting a double benefit when you purchase a flight with your mileage credit card. The goal of this post is to educate you on what you need to look for when shopping for a mileage credit card.
For starters, do not open a mileage credit card (or any new credit card) if you carry a month-over-month balance. Unless perhaps you are consolidating to a lower interest credit card as part of you reducing credit card debt efforts. If you do not carry a balance, then a mileage credit card may be worthwhile for you.
Airline mileage credit cards are offered both by the airline companies themselves as well as by banks. One benefit to using a bank card over a specific airline's mileage credit card is that usually the miles earned on the bank card can be used on a number of airlines. Depending on what airlines fly into your local airport, you need to be careful when considering a specific airline mileage credit card. There are also other factors when choosing a mileage credit card which may offset this limitation, which we'll discuss next.
Other things to consider when looking into a mileage credit card include the annual fee, the interest rate (again, won't matter if you don't intend to carry a balance which you shouldn't), minimum miles to redeem for a flight, how miles are earned and cashed, processing fees, and when miles expire (if ever). For most airlines, a minimum of 25,000 miles is required with a mileage credit card before you can redeem a flight. Some mileage credit cards will offer you up to 25,000 (occasionally more) miles just for signing up if you qualify. Even if there is an annual fee, in this case it would be offset by the free ticket. It is important to read the fine print as sometimes these miles accrue at a rate of 1,000 miles per month for the first 25 months or something similar.
If you have a specific time frame in mind for when you'd like to use your mileage credit card miles to redeem a trip, the expiration date/life of the airline miles is important. The last thing you want is to save mileage rewards for 3 years for a trip only to have them expire and get no rewards whatsoever for your mileage credit card purchases. Hopefully this understanding of the mileage credit card will be useful as you research which card is best for you.
For starters, do not open a mileage credit card (or any new credit card) if you carry a month-over-month balance. Unless perhaps you are consolidating to a lower interest credit card as part of you reducing credit card debt efforts. If you do not carry a balance, then a mileage credit card may be worthwhile for you.
Airline mileage credit cards are offered both by the airline companies themselves as well as by banks. One benefit to using a bank card over a specific airline's mileage credit card is that usually the miles earned on the bank card can be used on a number of airlines. Depending on what airlines fly into your local airport, you need to be careful when considering a specific airline mileage credit card. There are also other factors when choosing a mileage credit card which may offset this limitation, which we'll discuss next.
Other things to consider when looking into a mileage credit card include the annual fee, the interest rate (again, won't matter if you don't intend to carry a balance which you shouldn't), minimum miles to redeem for a flight, how miles are earned and cashed, processing fees, and when miles expire (if ever). For most airlines, a minimum of 25,000 miles is required with a mileage credit card before you can redeem a flight. Some mileage credit cards will offer you up to 25,000 (occasionally more) miles just for signing up if you qualify. Even if there is an annual fee, in this case it would be offset by the free ticket. It is important to read the fine print as sometimes these miles accrue at a rate of 1,000 miles per month for the first 25 months or something similar.
If you have a specific time frame in mind for when you'd like to use your mileage credit card miles to redeem a trip, the expiration date/life of the airline miles is important. The last thing you want is to save mileage rewards for 3 years for a trip only to have them expire and get no rewards whatsoever for your mileage credit card purchases. Hopefully this understanding of the mileage credit card will be useful as you research which card is best for you.
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