Travel Cards and Tigers

If there’s only one nation in the sky, shouldn’t all passports be valid for it?”

-Yann Martel, Life of Pi

Richard Parker wasn’t the travel partner Pi would have chosen.  Pi was adrift, both physically and emotionally. Lost at sea in a lifeboat in the middle of the Pacific Ocean; an ocean he had just lost his whole family to.  Richard Parker, Bengali tiger, was stranded in the lifeboat with Pi.  Richard Parker didn’t provide Pi with any food or water.  To the contrary, Pi had to provide everything for Richard Parker while avoiding his claws and jaws, but the tiger did give one thing to Pi.  He gave Pi a reason to live.

Travelling can be tough, even if you are not stranded in a lifeboat.  It helps to have an ace in your sleeve, or a tiger in your back pocket.  A travel credit card can be a huge asset if you know how to use it right.  But just like Pi’s tiger, you have to know how to use it right.  One advantage (alright, there are many advantages, but here is one!) over getting a credit card instead of a real tiger to aid your traveling is that you get choose your metaphorical tiger.  And one big question when it comes to choosing travel credit cards is: should I get an airline specific card, or a general travel card?

I prefer general cards (see my post about Second Tier travel cards here) because I can earn more rewards with them and because I don’t fly one airline primarily so I like the flexibility.  But airline specific cards can be great if you have one specific route, and one (or two) airlines you like to fly all the time. Here is a quick comparison of the main areas where general travel cards and airline specific cards go head to head.  Please keep in mind that not every airline or general travel card has all the perks I refer to.  Each one is a little different, and this discussion is based on overall impressions as well as experiences with some different cards.

Earning Miles: General Travel Cards Edge

General travel cards usually let you earn more miles on more things.  Depending on the card you get, you can often get up to 1.5 miles per dollar on purchases with a free card, up to around 2 miles per dollar on a second-tier card, and up to three or more on a premium card.  You can also earn the miles on broader categories (in some cases, everything!).

Airline specific cards usually only get you more than 1 mile per dollar on things buy with the card if you buy something directly from that airline. For example, the Southwest card gets you 2 miles on Southwest purchases, 1 on everything else. However, some airline are improving this. JetBlue’s card gets you three miles per dollar on JetBlue purchases, and two on restaurants and gas. United just recently added 2 miles on restaurants and hotel stays in addition to the 2 miles on United purchases.

It seem more airlines are expanding their rewards earning potential, so the gap has narrowed here somewhat, but the edge still is overall with general travel cards (here’s a link to my discussion on how to maximize Chase points and earn over 5 miles per dollar on some purchases!).

Redeeming Miles: Airline Cards

When it comes to redeeming miles, this is where airline cards earn their keep. Many (but not all, I’m looking at you United), discount flights if you redeem with miles earned with the airline.  I am most familiar in particular with JetBlue and Southwest–programs I use often–who do this often.

What do I mean by discount?  If you have a general travel card, you generally earn between 1 and 3 miles per dollar.  You then usually redeem them directly for the cost of travel, but because each mile is effectively worth 1 cent, you need lots of them (10,000 miles for a $100 flight).  However, if you are earning miles with the airline, like you do with an airline card, you can often get a much better ratio.  For example, I just looked up a random flight on Southwest from San Diego to Denver.  The dollar price is $89 (they are having a sale!).  The point price is only 5426 miles! This means, if you have a Southwest card earning you Southwest miles, you would only need to earn 5426 Southwest miles with that card, as opposed to earning 8900 (89 * 100) miles with a general card, which is what you would need to pay for that flight with miles on a general card.  Please keep in mind that not all airlines are this generous.  United for example, does not always give such a great discount buying with points, and sometimes it takes more United points to buy a flight than the 100 to 1 standard ratio.

There is one huge caveat. Some general cards are partnering with certain airlines and can beat the airline cards at their own game. Citi Thank You Premier and Chase Sapphire are two examples.  They partner with a number of airlines and allow you to transfer points you earn with them (because remember, you generally earn miles faster with general cards!) at a 1:1 ratio into a frequent flyer airline account.  And you can then buy the flight directly with the airline with your points! Chase currently partners with Southwest, United, Virgin, British Airways, Aer Lingus, Air France, Singapore, Korea, and Iberia.  Citi currently partners with JetBlue, Virgin and Singapore airlines.  I have done this a number of times with my Chase Card and Southwest and each time it makes the flight a lot easier to buy with miles for free!

Travel Insurance/Protection: General Travel Cards Edge

General travel cards definitely have the edge, mostly because, as far as I can tell, airline cards do not really offer this service.  Alaska Airlines, for example, which has an otherwise exemplary credit card offer, suggests on the website that you buy travel insurance.  It’s nice having a general card and knowing that if your luggage is lost, or if you have to cancel your trip because of illness or some other serious reason, your trip is covered and you can get reimbursed.  (Please read the actual outline of the coverage to know exactly what is covered by each card).  It is important to note that if you do the trick I described above and transfer miles to a frequent flyer program, you will not be covered because you are not buying the flight with the card. Just a heads up!

Airline Perks: Airline Cards Edge

Airline cards definitely have the edge here.  They offer things like discounts on drinks and movies if you fly with them.  They offer early boarding.  They offer free checked baggage.  And sometimes, starting at the $95 per year fee level, they offer entrance to their airlines elite lounges. You usually have to get a card with a fee closer to $500 or more per year to get this perk with a general travel card.

Overall Recommendation

Overall, I think you get more bang for your buck with general travel cards than airline cards.  Here would be my three general recommendations.

  1. Find a general travel card that partners with the airline(s) you fly the most with. Make sure the fees, redemptions, partnership agreements, and bonuses they offer work for you.
  2. If you fly one or two airlines regularly and can’t find a general card that partners with those airlines, look for an airline specific card.  Make sure the fees and perks that airline offers works for you.  Most importantly, take a look at the frequent flyer program and make sure you can understand it and that the points system works for you.  Not all frequent flyer plans are created equal.  Southwest is simple.  United is anything but.
  3. If you don’t travel just one or two airline often, but you travel enough that a travel card is worth your while, a general card might be right for you.  Make sure to check out the earnings capabilities, the redemption capabilities, and the extras.
  4. Smile.  This is an exciting time to be looking for a travel cards.  General cards are getting more and more airline specific perks, and airline specific cards are starting to broaden their appeal to compete.  Either way, you should be able to find the card for you!

 

 

 

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