How to Choose the Best Airline Miles Credit Cards

Posted by on Feb 17, 2014 in Airline Miles Credit Cards | 0 comments

Since their introduction in the late 1970’s, airline miles credit cards have gained the appeal to travelers worldwide. This is because you earn rewards or points using them. You can redeem your points for free flights to your preferred destinations. You can also get upgrades and other travel related perks. So, how do you choose the best airline credit cards for your travel needs? In today’s post, we explore some of the key factors you should consider before you open your travel credit card account.

Strategize

With any undertaking, the first thing to do is plan. Consider your travel and spending habits and use that to determine your strategy. Do you want to enjoy the travel perks? Do you want to receive upgrades on your flights? Earn loyalty points for purchases at particular outlets or how about free flights to your vacation destinations. With a plan, you can tailor your choice of cards and avoid damaging your credit score or running into excessive debt.

Airline Vs. Bank Branded Cards

Each has their pros and cons. While choosing, consider your location. Do you live in a major airline hub serviced by one dominant airline? Do you travel frequently on that airline? If so, you might be best suited to get an airline miles credit cards with that airline. This way you enjoy all the travel perks offered by that particular airline such as choice of seats, upgrades, lounge facilities.

Bank branded travel credit cards are best suited if you live away from major travel hubs and prefer a variety in choice of the airlines you do business with. These cards also come with other benefits attached such as discounts at particular stores and outlets that lets you increase your points.

Huge Sign Up Bonus

Look for airline miles credit cards offerings with huge sign up bonuses. The higher the sign-up bonus the faster you will accumulate points and hasten your redemption. Ordinarily I look for offers with at least 30,000 sign up bonuses. Some cards offer up to 50,000 sign up bonus points. These are worth at least a domestic flight.

Bonus Points Per Dollar Spent

Most airline miles credit cards program employ a one dollar one point policy. Spend one dollar on your purchases and you receive one airline mile or points. When choosing, look for offerings that give you more for every dollar spent. This could be in form of extra points earned for shopping at particular outlets, occasional bonus points promotions to clients, loyalty programs that let you acquire more points for being a long time customer. This strategy quickens the pace you accumulate points.

Low Minimum Spending

Unfortunately with airline miles credit cards, the minimum spending requirements for most cards are insanely high. Who wants that? Most people just want choice, and cards that compliment their normal spending behaviors. Look for cards with at most $1000 in minimum spending requirements. That is a threshold you can easily cross with your domestic spending needs.

Annual Fees

Fees on airline miles credit cards are inevitable. In my experience, fee based credit cards tend to have better managed point schemes. In the long run, you will end up saving more than the annual fees you pay through better travel protection, perks and special offers. That doesn’t mean you splurge on the fees, on the contrary, research and settle for cards with fair annual fees.

Consider the APR

The Annual Percentage Rate is the rate at which you repay your credit card monthly balances. Airline miles credit cards tend to have higher APR’s than ordinary credit cards. Weigh this while choosing your card and factor in your monthly expenditures. The last thing you want is being stuck with high credit card bills for the points you collect.

Foreign Conversion Fees

Most cards charge a 3% fee on foreign usage. If you travel frequently to foreign destinations, weigh the rates while choosing your card. Ordinarily you want a credit card thats hassle free to use internationally and that has a fair rate.

Teaming Up

Does your preferred airline miles credit cards allow teaming up to earn more points? You can team up with your spouse by adding them as an authorized user on your card and any purchases they make earn you points on the card. This also helps when you travel as a couple or family.

Airline Miles Credit Cards Vs. Credit Scores

It’s a recognized fact that rapidly opening and closing credit card accounts (aka, churning & burning) will affect your credit score. A lot of checks on your credit history and outstanding loans/balances will lower your credit score somewhat.

So how do you avoid this eventuality?

  • Space your credit card acquisitions.
  • Only get airline miles credit cards that fit your strategy.
  • Maintain a great credit scores by timely servicing your loans
  • Clear your credit card balances at the end of each month.
  • Follow your budget when using the card. Do not go overboard for the points.
  • Get creative with your credit card usage. Look for inexpensive ways to earn points.

Conclusion

Airline miles credit cards offer the opportunity to travel for free to the most exotic destinations for just using the card for your normal purchases. Your choice of card ultimately depends on your needs. With responsible usage and an excellent choice of credit cards, you stand to benefit immensely and travel the globe on a shoestring budget. It just takes a bit of planning and strategy to achieve it.

So, what do you consider while choosing an airline miles credit card? Let me know in the comments!

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