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chgeeb Feb 2nd, 2009 11:30 AM

Credit Card Help
 
Hello,
I'm interested in getting a credit card that earns up points for flights/hotels...any suggestions?
I'm 24 years old, zero debt, work full time and attend graduate school at nights. I love to travel when I have free time, and I have to make big purchases (for school), and I attend many concerts/sporting events...Are there any good credit cards someone can recommend to earn flights?
There's a new one I just received, Jet Blue through American Express to earn free flights...there's a $40 annual fee.
If there are any suggestions, I'd love them. I'm on my own here and am new to this credit card business and earning rewards...thank you so much!

RoamsAround Feb 2nd, 2009 12:53 PM

There are basically two types of "rewards" cards; 1) Those that are affiliated with a specific airline (such as the CitiBanck American AAdvantage Card) which earns your Frequent Flyer Miles (1 mile for each dollar charged) on that particular airline and 2) those cards (like the Capital One Card) that give you "travel points" (one point for each dollar charged) that can be used to purchase airline tickets on any airline.

You have to figure out which type works best for your situation. Most airline afinity cards (Frequent Flyer points) charge an annual fee as do some "Travel Rewards". I believe the capital One card does not charge an annual fee.

If you do a lot of flying you should sign up for the Frequent Flyer programs on the airline or airlines of your choice. This will help you accumulate more points that can be redeemed for free airline tickets. If you do fly alot a credit card that give you FF miles may be the right choice for you. On the other hand if you don't fly often you will be better off getting a "travel Rewards" card rather than a Frequent Flyer Card.

You should know that you need quite a lot of points to get a free ticket - rewards start at 30,000 points or miles and go up to as much as 100,000 points or miles - it varies with the airline, destination and class of ticket you expect to claim.

Lastly, from a purely economical side FF/Travel cards only "work" if you pay ypour balance in full every month. If you carry a balance or only make minimum pmonthly payments the extra finance charges you pay will exceed the cost of any "free" airline ticket you require.

this is somewhat of a complex topic and difficult to answer in a brief reply on a travel forum so I hope this explanation helps.

You might want to go to www.flyertalk.com - (click on "Miles & Points" - there's an entire fporum devoted to "travel Rewards Cards".

chgeeb Feb 2nd, 2009 01:36 PM

Thank you RoamsAround!

I'm on the "not so frequent" flyer...about 2 trips a year.
You mentioned Capital One...is that the best "travel reward" program? Or how would I go about looking into travel reward cards?

beachdreams3 Feb 2nd, 2009 02:22 PM

There are so many different types of credit cards and associated benefits, it can be really hard to figure out what is best. I am attaching a link to a site (I have no affiliation with them, but found it useful the last time I was considering different credit cards) with information about different options:

http://www.bankrate.com/brm/rate/cc_home.asp

You really have to figure out your spending and payment habits to make sure that a card is right for you. For several years, I had a credit card that I was using to earn airline frequent flyer miles, and I realized that I wasn't really charging enough on it, and the benefits were not really worth the annual fee I was paying each year for the card. I decided then not to pay annual fees for credit cards, and I got a no annual fee "rewards" type card that offers cash back on purchases. You could always go with a card like this and just earmark your cash back rewards (you determine when to get the cash back on most cards) as your travel fund.

Since then, I have taken advantage of offers for travel cards that offer airline points (or Amex rewards points that can be transferred to certain airline programs), when the card issuers offered favorable terms (i.e., first year with no annual fee and bonus points). If you don't have an established credit history (because of your age and still being in school, you may not be able to get offers like these now).

If you are going to travel outside the US on a regular basis, another feature to look for in a credit card is one that charges low (or no) currency conversion/transaction fees for international transactions (many MC and Visas charge a 3% fee for purchases outside the US and/or in a foreign currency). I believe that Capitol One does not charge these fees on many of their credit cards, but this situation can be pretty dynamic.

JeanH Feb 3rd, 2009 03:37 AM

I mostly use CitiBank's American Airlines card. I charge everything I possibly can. All my groceries, even doctor bills. I also pay the balance every month. In a couple of weeks, I'll fly 'free' to Belize. We also used miles for St. Kitts, Nevis, Panama, and other trips to Belize. Since most of our travel is on routes that AA flies, it's a good card for us.

I also got a Delta American Express card a couple years ago, since they were offering almost 30,000 miles to get the card. I have found it extremely difficult to use those miles. Availability is extremely limited it seems.

doug_stallings Feb 3rd, 2009 05:03 AM

Frequent Flier credit cards are not a very good deal unless you plan to use them constantly and pay off your bill in full each month. They all carry fees and have high interest rates. In general, I don't find affinity cards to be of much use. Better is a card with a low interest rate and no annual fee.

If you fly JetBlue mostly, then definitely get a card that is affiliated with JetBlue, but the card you get depends on where you live and where you go. If you lived in Atlanta, then it's Delta by all means. If you travel mostly to Florida from the NYC area, then JetBlue is probably your best bet.

But if you aren't really a frequently flier, you probably choose an airline solely on the basis of the cheapest fare, so there's no real advantage for you with any specific card.


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