Goodbye frequent flyer miles, hello cash back?

Point well taken, I too have given up on accumulating FF miles. The lack of available seats and inconvenient flight times when there are seats makes these programs more trouble than they're worth. I have a couple of no annual fee cash back credit cards (Amazon and PenFed Cash Rewards). I just put the cash back towards the price of an airline ticket.

by booch221 on Thursday, September 15, 2011

I think the Chase Freedom card is pretty good. I pay the balance every month to aviod the usurious rates they charge.
I used USAir points to book 1st class to Japan - 120K miles vs. about $10K. It was a hassle because US does not fly to Japan, so I had to go through the Star Alliance and fly UA. It took me weeks of calling a few times every day to finally get the flights and dates I wanted. And they only hold the rez for 3 days, so you have to make one small change on the 3rd day (or get a sympathetic agent to override) to "reset" the clock. It was well worth it for the long flight.
I have also been successful upgrading UA flights to Japan - 15K miles will upgrade a Y-class coach to business. That is worth it even if you have to buy the miles (still cheaper than upgrading to E-Plus)

by jake on Wednesday, December 24, 2008

I just checked out the Chase Freedom card and they switched from 3% back to 1% back.

by Joanne on Wednesday, March 11, 2009

American Express has changed their benefits since this was written in 2008.

by gat069 on Friday, April 10, 2009

I want to caution people considering a switch to American Exp Blue Cash. On a recent trip to Florida , I found that one third of the businesses refused to accept the Amex card because of the high processing fee that they charge. Just this past week , I tried to use the card in Vail Colorado four times and two of the businesses would not accept it for the same reason. Also, for the first 60 days, Amex limits you to a $3000 credit limit. Just some things to consider before you jump.

Mad Dog

by Mad Dog on Tuesday, March 17, 2009

The Amex Blue Cash card only pays 0.5% to 1% on the first $6,500 spent each year.

by Uncle Joe on Friday, August 01, 2008

Thanks "Uncle Joe". I recalculated based on the 0.5% for all other below $6500 and 1.5% for all other above $6500 and the expected reward rises to $560.24

by Daz on Friday, August 01, 2008

We used 50,000 DL miles each to fly to Budapest and back from Munich this year, with a stopover in Paris. Going in high season-Aug. 2-Sept. 11. Tickets would have been close to $2K each.

by Longhorns on Tuesday, December 23, 2008

We live in a small town and fly out of a small airport, giving us a choice of basically three major carriers, and few deals. A flight to almost anywhere is at least $400 these days, so flying with miles is quite a savings over the cash back. When you only fly one airline (not really by choice) and can pool CC miles with actual miles things add up pretty fast. We don't pay intrest, or an annual fee, so it really is free!

by CB in MT on Friday, September 19, 2008

My family and I are those evil people who find credit cards with no annual fees (MasterCard through our credit union) and we pay off our balance every month. With no fees, no interest, it makes the FF miles a little better. However, I'm still considering using Amtrak in place of some flights. I'm tired of getting dinged just because the upper-level execs have to get their bonuses. Are you listening American Airlines?

by AutumnFire on Wednesday, July 09, 2008

We don't have cash back cards in Canada and so frequent flyer cards are the only show in town.

by Win on Thursday, July 31, 2008

To correct a comment by "Win" on 31 July: we do have cash-back cards in Canada! I've used one for years (CIBC Dividend), it has no fee and pays back 1% cash on all purchases (just before Christmas!). Cash is King! (Good site, BTW)

by akboily on Friday, August 01, 2008

Check out Blue Sky from American Express too... :)

by shh don't tell on Thursday, July 31, 2008

I have a couple of questions with your math. $25,000 divided among $5200 for groceries, $3000 on gas and $1000 at drugstores leaves $15800 not $16800.

The American Express cash card only rewards 5% after spending $6500 in a year. Prior to that, the reward is 1%. $25000 over 12 months is $2083.33 per month and it takes 3.12 months earning 1% to get to the $6500 after which points for groceries, gas and drugstores earn 5%.

By my math and your numbers, I estimate an annual reward of $522.32 which, although still good, is well short of the $712 you calculate.

I believe the Chase Freedom Card rewards are also capped at $300 a year.

by Daz on Friday, August 01, 2008

We had all better brush up on our math as the FF and CC wars begin!
For me, I've done the math recently but am certainly ready to try again when some of the smoke and chaff clear. As a long time American FF member, I can only report success. I charge everything I can to the Citi card which usually tops out at 60,000 miles a year sometime in November. The current card fee is $85, I think. So that's pretty good as I figure it. I never use miles for any flight under $300. When I want to redeem, I must live a charmed life as I have been able to successfully connect most of the time. OK, some of the itinerary options are pretty awful and in those cases I dont use the miles but look to the competition.
There are many flights available at 25K and some at 20K. That's when I use the miles. And have seen decent intineraries.
So, $85 for 2-3 flights a year is pretty good according to my abbacus.
Now, when the AAFF redemption fees kick in, I'm going shopping...for a new card!
Thanks for all the good feedback...
John

by John Dale Kennedy on Tuesday, July 08, 2008

I am a newbie in the Frequent Flyer market. I've been saving them up for years but today I redeemed for the first time. I wanted to fly non-stop from PHX to PHL next month with USAir. I've done this trip many many times, paid $372 for the trip just last month. Well, today it was $624 so I turned to my miles. I had to use Premier (25,000 miles each way) as no Saver flights were available, but I did get first class both ways. 2 things: I have been reading about all the fees. My tickets cost $5 each. Am I missing something? Secondly, I was shocked to find out a one-way ticket with miles was ALSO 50,000 miles! We are moving our daughter to Philly and just needed one way for her, plus her cat. And she only had 45,000 miles available so the fee to transfer from my account plus 1 center per mile came to $75, plus the cat for $100, plus the 50,000 miles to redeem didn't make too much sense, so I bought her one-way ticket for $312 and the cat is flying First Class with me for the $100!.

by Jami on Tuesday, July 08, 2008

Last week I used my miles from Citi bank master card to purchase a round trip ticket on American Airlines from St. Louis to San Pedro Sula, Honduras. I used 60,000 miles and am flying 1st class on all 4 legs of the flight. The total cost of the ticket was $32 AND since I am flying 1st class, there is no charge for the 1st two suitcases. I pay no annual fee on my card.

Although I am not always as lucky, I have used miles for 5 tickets on American Airlines.

by Ginnie on Tuesday, July 08, 2008

You didn't calculate how much interest you pay on the card over the course of the year. If I owed 25,000 in credit wouldn't my interest be about the same as a plane ticket to Europe?

So best case scenario is that people pay off the card before it's due and they're only out the yearly fee and the fees when it comes time to cash in on the miles.

I have a better idea, stop using the cards and just buy the tickets. Banks won't give you more money than you gave them forever or they'd go bankrupt. I collect miles from traveling and pay cash for everything. I think if I calculated it I'm getting more than any card by not using one at all. Airlines don't give away tickets without out someone paying for them and banks don't give away free money. Although I run into people all the time that think they do.

by grant on Tuesday, July 08, 2008

Agree completely. One additional aspect of the Chase Freedom card is the ability change cash-back to points, and to transfer points to United or Continental at a pretty good rate. Thus, you can go either way with your rewards. We did a comparison similar to yours at http://howtotravelamerica.blogspot.com/2008/04/chase-freedom-visa-points-to-airline.html
Always enjoy your posts.

by Ken on Tuesday, July 08, 2008

Thanks for the chart. Unfortunately, it disregards the miles you're not earning when flying on an award ticket. For plebes, that's about 5000 roundtrip cross-country, 8000 roundtrip to Europe, etc. For elites, add whatever bonuses and add that to the "miles cost" of the award ticket to get the true cost. When we were United 1K, we almost *never* redeemed miles: we earned 10000 every time we flew cross-country. We earned 40000 every time we went to SE Asia. Now that we're nobodies, we're redeeming like crazy (3X 3 tix Newark-Hawaii various islands over the past two years!), and getting good value, at least 2 cents/mile.

Best credit card program out there, sadly isn't accepting new members. USAA Eagle Points: 1 point per dollar, redeemable as cash (1 cent per point) or airline tix (up to 2 cents' purchase price per point, and if the actual ticket price is higher, you can pay the overage.) The good part about these "award tickets" is that you actually earn miles, and can upgrade.

I think the Capitol One rewards card offers something similar (your points actually purchase a revenue ticket), but they have increments that effectively rip you off, yielding less than 1% dividend rate.

My advice? Sign up for whatever credit card offers come in the mail! Get 20000, 25000 miles on a variety of airlines, redeem them, then close the cards! This strategy only for people with teflon credit, natch.

by David Horne on Tuesday, July 08, 2008

Frequent flyer miles are both a blessing and a curse depending on how you earn and how you use them.

For myself, I buy the cheapest seat I can get and then use miles to upgrade to business or first class. It doesn't always work, because there are fewer seats set aside for upgrades, but when it does, I am certainly a happier flier. For me, it is worth the hassle and the hoops the airlines make you jump through. That may change, of course.

I have only used miles to book a free seat once. Everything came together and the process was a breeze. Of course, that was three years ago.

I will continue to look at all the changes the airlines are imposing on us. When using miles (whether earned by flying or buying) is no longer to my advantage, I will certainly take the cash.

by ladygarnett on Monday, July 07, 2008

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Goodbye frequent flyer miles, hello cash back?

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