In the world of rewards credit cards, there are literally hundreds of offers to choose from. While such a privilege used to be reserved for cardholders with the highest credit limits, such is not the case today. Today, rewards cards are available to most everyone, with the types of rewards varied enough to meet most every preference. Since the late 1980s, one such preference has been airline miles, a.k.a. free travel. Is this the right type of card for you?
Redeeming Points
The idea behind a rewards card is that for every dollar spent, points are earned in return which can then be redeemed at a later time. Depending on the card, the reward can be most anything: for the household or the office, purchased in-person or online. Popular rewards today include music, computer products, electronics, cash back - you name it.
When signing up for any credit card, a good deal of research should be done first. Ask yourself some questions. What’s the overall cost of this card (both in the short and long run)? Is the reward worth the investment? Will I ever get to use the reward?
To this last question, every cardholder will of course want to answer in the affirmative. However first you need to get there; and when it comes to free travel, that statement is literal. Once you begin working towards a vacation, the hope of a fun getaway can’t arrive soon enough.
Free Miles
With airline miles, the goal is to book a trip or getaway at a discount. Whether it’s an airline-specific card (like the Alaska Airlines Visa Signature) or a generic air-miles card (like the Capital One No Hassle Miles Rewards), the reward is the same: free miles to get you to where you want to go. With such cards, the miles work like points, with each mile adding to how far you can travel.
Like with any rewards card, a travel card honors spending, so if you use your credit card responsibly, you should be able to reap all the benefits. One important thing to remember is to try and avoid keeping a balance on the card, as interest rates can cancel out any savings you would have accrued.
Airline credit cards tend to have higher interest rates, as well as a membership fee, but they also work with frequent-flier accounts and reward bonus miles from the start. With generic cards, flexibility is key as the airline miles can be used on most any airline, but the catch is that the offer is likely subject to blackout dates and minimum points before use.
Pros vs. Cons
As with any rewards card though, pros and cons should be assessed beforehand. If a person lives in the city for instance and thus, doesn’t drive very often, a gasoline card would seem less useful. The same with an iTunes Visa card if the cardholder prefers records. For air-miles cards, they’re designed for the traveler - both frequent and occasional. To accommodate both, offers are varied and with research, you can find a card tailored to your spending patterns and travel needs.
In addition to the speed at which airline miles can be accrued, cardholders should also look at the interest rate, APR, grace period, rollover, and any hidden fees. Also, take a look at the card’s partners as many airline cards give bonus points (miles) on purchases made with certain businesses, such as hotels, rental car companies, and gas stations. As you near one free trip, you can already start building towards the next.
Bottom Line
Now that rewards cards are available to everyone, the key is to make them work for you. Remember to spend responsibly first and foremost. With rewards cards, people sometimes have the tendency to spend more simply to gain the points. This is never a good idea. Be patient. The reward - whether it’s store credit, cash back, or airline miles - will come in time. In order to enjoy a card’s full benefits, you shouldn’t feel like you’re paying for the perks.
