I’ll admit it…whenever I go to dinner with friends, I judge them on their credit card choice. When it’s time to split the check, it’s not uncommon to see a Delta or Southwest card in the pile. While I commend them on their loyalty, I can’t help but think why??? If you like Delta, getting the Amex Delta card seems like a no-brainer, right? However, you can almost always earn more points by not using a co-branded airline credit card.
Airline Credit Card Earning Structures Suck
Every rewards credit card has a points earning structure, and it’s important to build a strategy that earns the most points on everyday purchases. For example, the Southwest Premier card from Chase, United MileagePlus Explorer card from Chase, and Gold Delta SkyMiles card from American Express all earn two points per dollar for purchases with the airline and only one point on all other purchases. We can do better than that!
Try a Chase, Amex, or Citi Card Instead
This is where the flexible points we all of love so much come into play. Even if you’re brand loyal to Southwest, United, or Delta, you’ll be better off earning Chase Ultimate Rewards points or American Express Membership Rewards points since you can transfer these points to the airline of your choice and you will be able to earn more points on everyday purchases.
Take Chase Sapphire Reserve for example. If you used this card instead of the United card for all purchases, you’d be earning one additional point on United purchases AND you would get 3x points on restaurants and any other sort of travel. Yes, the annual fee is greater, but only marginally so when factoring in the other benefits of this card. You can take this even further by using other cards in the Chase Ultimate Rewards portfolio to earn between 1.5x-5x points on all purchases.
Basically, if your goal is to earn miles for airlines that are also transfer partners of bank rewards programs, you’re better off using card(s) that earn Chase Ultimate Rewards points, Amex Membership Rewards points, or Citi ThankYou points instead.
Co-Branded Airline Cards Have A Few Purposes
For me, the main purpose of co-branded airline credit cards is the sign-up bonus of course! After the minimum spending requirement is met, into the sock drawer it goes. However, I’ll admit sometimes it make sense to hold onto these cards for the following benefits:
- Free checked bag: This is a common benefit on airline credit cards and can save you a lot of money if you’re a frequent flyer.
- Anniversary points: Cards like the Southwest Premier from Chase offer points on your cardmember anniversary which can offset the annual fee.
- Redemption rebate: If you have an American Airlines credit card from Citi or Barclays, you can get 10% back on award redemptions, up to 10,000 per year.
- Save on in-flight purchases: Cards like Gold Delta Amex offer 20% savings on in-flight purchases.
Earning miles for a specific airline is not a bad thing, but using an airline credit card is usually not the best way of doing so. You’ll be much better off earning points that can be transferred to these programs. Not only does this provide you flexibility in how you use the points, but you will most likely be able to earn more points on each purchase. Sometimes it makes sense to have an airline card or two, just don’t use it for everyday spend!