Who benefits the most from your airline affinity card? (That’s not a trick question)

Hey buddy, wanna sign up for a credit card?

OK, that wasn’t Citi’s come-on when it asked Jerry Mandel if he was interested in an affinity card that would help him collect American Airlines miles. But it probably should have been.

Mandel, a frequent American customer and engineer based in Dallas, found the offer enticing: It promised significant discounts and perks in exchange for “qualifying” purchases. But Mandel, being the meticulous type — after all, he’s an engineer — looked for the fine print.

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He didn’t find it. So he phoned Citi.

Turns out that in order to take advantage of some of the card’s guaranteed benefits, he would have to buy a full-fare ticket. “Of course, like many others, I would never buy a full-fare ticket,” says Mandel.

That’s because a refundable ticket can cost up to four times as much as one that’s nonrefundable. Granted, some large corporations will shell out that kind of money. But not mere mortals traveling sans expense account.

Mandel is unhappy. If he hadn’t called, he would have assumed that any American Airlines ticket would be good enough. This drama plays itself out all the time, in front of computer screens and often, at those little tables at the airport where airline employees hawk affinity cards. Those are almost as annoying as the flight attendants who try to persuade you to sign up for the airline’s frequent flier program at the end of a long flight. But I digress.

I deal with the fallout from these offers on an almost daily basis. Passengers who made assumptions about their cards that they shouldn’t have, and are complaining to me mostly because they want someone to hear them. They know there’s little I can do; rules are rules, after all.

Ah, but there is. I can write about this scam.

Did I just call it a scam? Absolutely.

One of the worst credit card offers was made by a European carrier, although I haven’t seen it in a while. It pitched a “free” companion ticket, but declined to prominently say that the original ticket had to be of the dreaded full-fare variety. And interestingly, you could probably buy four regular tickets for that amount and take the whole family to London for the games. Oh well.

It helps to take a big-picture view of affinity card offers made through airlines. What do I mean?

• There’s no such thing as “free.” Either you’re paying an annual fee or you’re dealing with confiscatory interest rates.

• There’s always fine print. Always! Among the worst gotchas: The miles you accrue don’t actually belong to you. If you don’t believe me, read the terms and conditions of your airline loyalty program.

• There are hidden expenses. The one no one talks about is the cost of giving your loyalty to the card or the airline, when a cheaper card or airline ticket is available. Over time, that can cost you tens of thousands of dollars.

What about the loyalty? Doesn’t that mean something? Not really. Travel companies — and particularly airlines — take your loyalty for granted unless you’re a quadruple-platinum business traveler. Even for those elite-level fliers, the goalposts of their loyalty program are constantly moving, requiring more miles for an upgrade or a perk.

I hear from many die-hard mileage collectors who say my view of loyalty programs is dead wrong, that airlines are loyal to them. As proof they tell me about their last “free” flight to Hawaii. But what they fail to take into account were all of the purchases they had to make, all the overpriced flights they had to take, to get to that point. Truth is, they didn’t get anything for “free.”

Fortunately, Mandel didn’t take advantage of the affinity card from American Airlines. But I hear from many victims who do. They sign up and move their purchases to the new card, only to find out that the card wasn’t what they thought it would be. I wish I could have helped them before they made the purchase.

It’s shocking that affinity cards can continue to operate like this after more than two decades, making vague and hopeful promises with virtually no accountability. But the folks creating these pitches aren’t dummies and they have expensive lawyers. They know how to circumvent state and federal laws — and they do.

You have to be smarter. Affinity cards are a booming business — why else would airlines be hawking it on the plane and in the airport? They know they can get away with their nebulous and seductive pitches. The government is powerless to stop them, despite the recent legislative credit card reforms.

The only person who can protect you from their clever pitches is you. Remember that the next time someone offers you a credit card.

75 thoughts on “Who benefits the most from your airline affinity card? (That’s not a trick question)

  1. While I agree with you about reading the fine print, I don’t think you should paint all affinity cards with the same brush.  Most cards that I’m aware of simply credit your airline frequent flyer account with miles – a set amount for every dollar you spend.  Many people use cards without annual fees and pay off the balance monthly, so they don’t pay interest or anything else to the credit card company.  Certainly, the miles that are credited to the account have to be used in line with the terms and conditions that apply to the frequent flyer program in general, with extensive blackout dates and low availability of qualifying fare classes.  But this is a general issue with frequent flier points, not specific to the affinity cards themselves.

    Over the years I have used affinity cards to great benefit without costing me a cent extra, because I have shopped carefully and have the discipline to pay off the card each month.  So while like many things the buyer should be ware, I don’t think this industry is a scam

    (The card of choice for me actually gets my points on Amtrak Guest Rewards, the frequent traveler program for US rail travel.  Amtrak’s fare policies are much less restrictive than the airlines so the points are easy to redeem.)

    1. Agree.  It depends on the person and on the card; finding the right match is the key.  Personally, the Amex Platinum card, even at $450.00/year, works great if you use the benefits.

      1. True – it really is great for the more frequesnt traveller – the cruise benefits – hotel benefits – club entrance – fab!

  2. Agree with Jeremy here. I think the affinity cards in general make money off of the people who carry balances and in other ways are less careful with their spending. The others of us who use the cards as a tool to do a job we were going to do anyway, stand to benefit. I have multiple Citi cards and they’re great. They used to turn a blind eye towards churning cards, but in past years, it’s been harder to open / close multiple accounts. So now you just have to wait for the great offers to come around…

    1. The key really is the sign-up bonuses. They are often so good you can ignore everything else the card offers and take nice trips just from those.

  3. Actually, I think it’s the credit card companies that benefit most, not the airline or the passenger.
    Most airline credit cards are cards that just give you frequent flyer miles when you use the card – the goal is to just get you to spend money, which benefits the credit card company (either through fees from merchants, or from fees from customers who don’t pay on time or annual fees or the like). Otherwise they are just like regular credit cards, maybe with slightly different conditions and costs. What the airline gets is just some small amount of money per mile it ‘sells’ to the credit card company to give to the consumer. Not insignificant, but my guess would be not nearly as much as the credit card company gets as fees from customers who wouldn’t otherwise use their credit card.

  4. Anyone who thinks the loyalty is part of the equation is sadly misinformed.   You must understand these programs for what they are.  They are marketing tools to convince you to spend your travel dollars with them and not their competitor.

    It must be analyzed like any other financial transaction.  How much does it cost to obtain the benefit.  Its a basic return on investment (ROI) in terms of money and time.

    The premise is painfully simple.  The more money you spend the more important a customer you are and the harder the travel provider tries to keep your business.  Of course that sounds somewhat crass and classist, so its couched in terms of loyalty. Number of flights, number of  miles flown, number of butts in seats, butts in beds, etc.

    It all translates to making a rough estimate of your profitability as a customer.

  5. I know you get anecdotes from all over, so take this for what it’s worth. I’ve not ever paid a penny of interest nor an annual fee on the card(s), nor have I racked up purchases for anything I don’t normally buy.  When I fly, I pick the flight based on connections, type of plane, and cost, and wind up flying my “loyalty” airline about half the time.  In return, I’ve flown to Europe four times and first class to Asia twice.  I agree that the loyalty cards CAN benefit the issuer, but they don’t have to.

    1.  backprop, may I ask what affinity card you use?  I pay an annual fee for my Continental (now United) branded card but I certainly make it back in baggage fees and miles but I’m curious about a no-fee card.  I haven’t seen any but I admit I haven’t researched them in a while. 

      1. Sure, I didn’t mean to imply it’s no-fee.  But, perhaps like many, Citi AAdvantage is no fee for one year, after whichI have it downgraded (“Bronze” or some nonsense) to a lower-level for six months (at no fee), after which I re-apply for the Platinum level to start the process over.

        Not to muck the waters, but they used to allow multiple cards with effectively unlimited churn.  There are many million milers who got that way without a lot of seat time, and without paying any fees or interest.

        1. Gotcha.  I had never heard of that bronze level.  I’ll check to see if the OnePass Plus (or whatever name it is now) has that.  Probably not as it’s the lower level card.  It was free for the first year. I have looked at churning discussions on FlyerTalk but never did it.  Too concerned with my credit score maybe.  

          1. I called Chase when my United card was up for renewal to cancel it.  When I explained I did not want to pay an anual fee, they changed the platinum card to a gold one.  Only difference was no concierge.  Big whoop.

          2. That is my experience too.  You can’t apply for the lower level card, but they have it in their back pocket to offer someone who wants to cancel. 

  6. What would happen if airline loyalty programs disappeared altogether? (Not just affinity credit cards.) How would I be able to choose what airline to fly?

    Well, I guess I would be forced to look for the airline with the best combination of price, schedule, and service. 

    1.  Well, you still can, and many people do just ignore the frequent-flyer programs and not collect miles. Such programs are just an added bonus that costs nothing, unless you choose to give it a value when buying flights.
      (I ignore FFPs for the most part, but if the price is within $10 or so with similar times, I’ll choose the airline that I collect miles with)

      1. My MIL fly’s 12-20 times a year for work, and refuses to use FF programs.  She fly’s almost exclusively on United and AA because of her location.  I have urged her many times to sign up for the frequent flyer programs and she always refuses saying she doesn’t want the airlines to have her information and track her. I have even tallied up her flights showing her how many miles she could earn and the free flights she can get with them.  She still refuses saying she won’t play that game.  Then when she comes to visit us, she always calls asking to use my frequent flyer miles to fly her to us.  It annoys me.  At least sign up, you won’t lose anything, the worst that can happen, is you get free trips.

        1. There is another benefit to having a ff number with the carrier you are flying as it moves you up in priority in certain situations.

          1. I sympathize.  I have a mother who gets her minds set in a way that she won’t listen to reason, too.

  7. I go for option C: The Bank.  As a rule, the sponsor of affinity cards gets about 1% of the purchase amount.  (Though an annual-fee card probably also remits some of that amount or a slightly greater percentage to the airline.)  If the bank is only making 1% of the purchase amount in profit, the bank’s portfolio manager needs to be fired.

    What are these “significant benefits” that were getting missed out on because the AA ticket isn’t full fare?

    On another note, FF miles have a wholesale cost of about a penny.  That being the case, why does AA think I want to buy some for ten cents or so each when I buy a ticket?

    As another side-note: My primary credit card is Pentagon FCU Platinum Rewards. 1.25% back on everything, 5% on gas and groceries. Can’t be beat.

      1. Yep, those great interchange fees that the Durbin rule was supposed to lower have only encouraged merchants to prefer cash payments even more over card payments.  That’s how the cards can afford to pay you anything back — by hurting the merchants.

    1. I’m not sure that the credit card company is the beneficiary.  Its main benefit is that it may get  a new customer, but it has to purchase those miles, points, whatever, from the sponsor. This is a debit item that it doesn’t have with unbranded cards.

      1. The pricing all comes out in the wash… while the bank does have to spend 1%-ish on the affinity branding, the affinity partner handles all the marketing, relieving the bank of that burden.  In any case, the net costs of the program is already baked into the fee and interest structure.

  8. I like my affinity cards; however I pay them off each month, so I don’t pay any interest.  I have a Hilton card which has no fee, I earn 5 extra Hilton points per dollar and when I use it at a Hilton, and when I am not at a Hilton, I don’t use it.  I also have a Marriott Card that gets me 5 extra Marriott points per dollar at Marriott.  It has an annual fee of $65, which gets me 1 free night in a Marriott category 5 every year, which I use, and is worth much more than $65.  I then have a United card (the old one) that gets me 3 miles per dollar spent on United, 2 miles per dollar spent on gas and partner airlines, and 1 point per dollar on anything else including competing airlines.  It has a fee which they have waived for every year I have had the card.  I use it for most of my business expenses to keep the separate.  Then for personal expenses I use a bank card which gives me 5% cash back on groceries and gas and 1% cash back on everything else.  I have yet to pay a credit card fee on anything except the Marriott card which gives me great value, and the moment I am charged one, I will cancel the card.
    I do recall getting an offer for an AirTran card a few years ago that said companions will always fly free, I read the fine print and it said only on “Full Fare” tickets, I said no thanks!

    1. Do you realize how many nights you have to stay with Hilton before you “earn” a free night? Figure it out sometime, like I have, and you will be appalled! When we got transferred, we spent 179 nights at an embassy suites in one year and used those “earnings” for a 6-night free stay in tWashington, DC. And, had to pay $45 per night for parking. Granted, DC is not cheap but neither is embassy suites!

      1. Currently it’s taking me 4 nights to get enough points for 1 night in a Homewood Suites/Hampton Inn. 11 nights to get a free night in a full service Hilton and 15 nights to earn a free night in a Waldorf Astoria. It’s a bit more stays without the credit card, and like I said, not credit card fee.

        1. I’d like to know how you did that? We earned 1180 points for a hampton in Athens Ga, 1790 points in puerto rico and 1130 in San Francisco, all one nights’ stay. It takes 30000 to book a free room at that same Hampton in Athens. Best I can tell, it will take approximately 25-28 nights to get that free room. And, yes, we are applying for the affinity card so that we can earn more points so it should take even less stays.

          1. I start with the base points of 10 points per dollar.

            Then I get 5 additional points per dollar by opting out of receiving airline miles. (You have to sign up for this; it’s called “Double Dipping”).
            Then 5 additional points per dollar for being an elite member.

            Then 5 additional points per dollar for the credit card.

            Then a 500 point bonus for booking with the credit card.

            My rates lately have been around $190 a night, so I am getting about 5,250 points a night. The lower end hotels my wife and I usually go to run from 15,000 (category 3) to 20,000 (category 4) a night. So 4 nights will get me one night at either of those categories. 11 nights gets me above the 50,000 I need for a full service Hilton (Category 7 which is the highest they have before Waldorf Astorias).

            Hilton also offers a ton of promotions. I just started staying at Hilton last year and so far two quarter per year they have offered “Double base points” so that bumps the base points up to 20 per dollar which I didn’t include in my math.

            I used to always stay at Marriott, but their prices have been too high to justify lately. So I made the switch and am surprised how many points I earn. I still think Starwood is the best value for points, but for the past few years they have been even more pricy than Marriott’s when I look, so I have had to nix them too.

          2.  I Priceline at stay at the same $190 hotel for $70 I get cash back on the credit card I use.  

          3. You have been watching too many hotwire commercial.

            And very funny, I just tried priceline out of curiosity. The hotel that is $190 through Hilton is $199 through priceline. It did return 1 hotel for $70 and a few around $120ish, but they all look really shady and are all about an hour away from where I am working in various directions. So not worth it! Besides, after all of the problems people have with the OTA vending machines, I will not complete a transaction with them.

            Chris, this could be a good warning to other travelers. If someone is going to a specific location for business or pleasure, and wants a hotel where they can walk or have a quick drive to their destination, Priceline shows them hotels that are extremely far away and makes it look like there are right by where they want to go. Only a real personal travel agent could help you find hotels that are actually nearby where you want to go.

            Another MIL example. She went to a conference and booked her hotel through Expedia (Against my advice). Her conference was at the Denver convention center (Downtown). She entered Downtown Denver, and picked the cheapest hotel. She was about 20 miles away with no car.

          4. Thus, you just made my point for me. According to your calculations, you spent $760 to receive one free night at a 15000 to 20000 required point stay hotel (4 nights x $190) and $2090 to stay at a 50000 required point stay hotel (11 nights $190). Do you not think that is a heck of a lot of money? Granted, if you are staying there anyway, then, by all means, take the points. I think you can find a less expensive hotel than $190 if you are going by price instead of staying “loyal” to a particular hotel.

          5. I am actually going by location first and foremost, then price, then by loyalty (Which can be trumped by services such as fee breakfast). I have worked in some places where I stay at a non-point hotel because of location and price. So I would stay at this Hilton anyway, but as long as I have to, I am going to take advantage of the points. As I mentioned, I did not want to stay at this Hilton, but the other hotels are more expensive and further away. In fact there is only one other hotel nearby for less, there is a Best Western that is about 1 mile further, it is $180 a night and it was so disgusting I actually left early. As much as I would love to stay there and save money, it was not worth it. So I really get the free nights just because, not for loyalty. Unfortunately anything under $180 is going to give me a 1 hour drive each way to and from the client, and after already commuting on a plane for 4-5 hours each way, it is not worth it to me to then spend 2 hours a day in the car on top of that. I am price sensitive as I get an all-inclusive rate and my expenses come out of that, so the more money I save, the more money I keep.

  9. Chris – Another situation where we agree to disagree. About three years ago, my business shifted it major purchases to an affinity card that earns both FF miles and status miles. As a result, I now have the top status in the airlines FF program without buying a single ticket in the last two years. The purchases through the card have built up enough miles that we haven’t needed to purchase any tickets for business travel in the last two years. Those savings alone have made up for the annual card fee.

    Affinity CC are like any other credit. You need ignore the marketing pitch and weigh the costs vs benefits. In our case, we needed a non-Amex for purchases anyway and we’re now receiving a benefit we didn’t in the past which far outweighs the cost of the benefit.

  10. Some times the credit card offers are so good that they are making an offer you can’t refuse.
    Recently, I received a bank card that offered 1000,000 miles to join. My wife got the same offer. So now we have two credit cards (first year free) and 100,000 miles on a major airline…  So we now have two business class tickets to Asia.  That’s as good as it gets!

  11. I voted for “The Airline” but only because the Credit Card Company (Visa, MasterCard, etc), the banks that issue affinity cards (everyone from Bank of America to Wells Fargo…just because I couldn’t think of banks starting with ‘A’ and ‘Z’), the payment processing people (the folks who own the point-of-purchase machines where you swipe your cards, and who send the payment information to the bank), and all the other financial people involved with the Credit Card industry weren’t on the voting options. 

    The Airlines really get very little out of the affinity programs. They get a little money for licensing their name/logo to the credit card issuer. Perhaps they get a little more loyalty from the customer who takes the card. And maybe they get a small payment for each mile accrued (I don’t know how that side of it works). But that’s really not much. 

    The customer gets very little out of it except for miles. And like Chris said, unless you’re the super-duper double-secret ultimate-platinum level traveler, it’s unlikely you’ll be able to turn those ‘deals’ into anything of value for yourself.

    1. The Airlines really get very little out of the affinity programs

      It might be argued that the airlines get quite a lot out of the credit card programs – the name, address, etc. of someone that identifies with the airline at some level for some reason.  There is little better definition of a good targeted marketing prospect.

      1. Besides, if it works like hotel programs, the credit card company actually had to buy the miles from the affinity program.  The sponsor made money by selling a virtual good that it gets to effectively set the value through blackout dates, limited redemption, etc.

    2. Josh, just a few weeks ago I traveled to Asia for free with miles earned just from credit card signup bonuses. I’m not a super-duper anything. Just a person who’s willing to take free trips if the credit card companies want to give them to me.

  12. I agree there are some affinity credit cards out there that have overly restrictive redemption terms for whatever program the cardholder belongs to. I also agree that anyone who chases the points/miles and spends on a specific card solely to collect them is probably not getting the best price for many things purchased.  But that is about all I agree with you on for these types of cards.  And Chris, your disdain for affinity programs, for whatever reason, is well known.

    The specific card mentioned is not the traditional airline card where you simply have miles credited to your airline FF account which can in turn be used however you want.  This sounds like more of the “travel rewards” cards where you actually have to buy your ticket using accumulated points from a travel provider which is not the airline.  I avoid those at all cost no matter which Baldwin is pitching them.

    ANY credit card can be a bad deal.  If you run balances that are not paid off every month the interest rate will kill you.  I get a kick out of the new disclosure on the card statements that tell you how long it will be till you pay off your balance if you make only the minimum payment requested.  My latest airline card statement says it will take me 22 years to pay it off if I make only the minimum monthly payment and pay something like $9000 in interest.  Ha.  I will pay it off by the due date and pay zero interest.  Also, the annual fees are ridiculous for most because you are paying simply to carry the card.  My airline card fee covers access to the airline club and is about $100 less than club membership alone.  Since I fly way too much, having access to the club is something I would pay for anyway so in this specific case paying the card fee saves me $100 a year.  I have no other cards with annual fees and will not have any no matter how good the deal sounds.  Credit card companies hate me because of this.  

    I fly whatever airline gives me the most for what I pay.  I have a choice between three to get where I go most of the time (WN UA & F9).  I fly whichever will get me there at the most convenient time, with the fewest stops, and at the best price.  (Note I didn’t say LOWEST price, but also note I won’t pay the highest price if it is way out of line with the others.)  I also am a member of all three FF programs.  I get at least 1 free flight every year on two of the three and several more on the third.  I don’t do anything I would not normally do in order to get those flights.  So why not.

  13. Not to add fuel to the fire (though this probably will) but a few of you have contacted me by email this morning, saying this story is biased and oversimplifies the issue. 

    Yes, it sure does. My agenda is to look after you, the consumer. And in my judgment, a vast majority of loyalty programs are bad for consumers I consider it my mission in life to discourage as many consumers as possible from making purchases based solely on a loyalty program. The only winners are the companies that offer these programs.

    I think I’ve been very open about my agenda. If there’s any doubt left — well, there’s my disclosure.

    That said, I’m willing to hear your arguments for giving all of your loyalty to one company or affinity card — something beyond the, “I got a free flight to Hawaii” argument, which as I mention, doesn’t take into account the true cost of the “free” ticket.

    1. Not really a criticism, but after reading the comments I think the poll really should have 3 options: consumers, airlines, and credit card companies.

    2. Chris … here’s my argument…
      I have an affinity card that gives me and anyone with me free bags (different than the one below). On the first trip, I saved the annual fee in baggage fees.  As long as I continue to spend less on the annual fee than I would on baggage fees, it will stay in my pocket. After that, it goes away.

      Ultimately for my business and situation, I save more annually using the affinity cards that I do than I would using a cash back card but I also evaluate that annually.

    3. My Mom taught me to never take candy from strangers.

      The same adage applies to neatly dressed people in airports trying to get me to sign up for their credit cards.

    4. That’s the flaw in your argument Chris.  First it buys into the marketing hype that these programs are about loyalty.  But more importantly, who said anything about giving your business to just one program?

      It about doing what makes the best sense.

      For example, I stayed in downtown LA because its near the three major freeways, great for meeting clients, and has been revitalized recently.  The LA Marriott was $109 per weekend night.  As a platinum member I had a second weekend night free coupon. I also received free buffet breakfast for two at the restaurant and free internet.  And I would always get upgraded to a suite.

      To deconstruct the price.  $54.50 per night
                                           -9.95 for no wi-fi charge
                                           -21.00 for included breakfast for me
                                           -21.00 for my client’s breakfast

      Effective room cost for a suite in downtown Los Angeles at a four star hotel  $2.55/day

      Cost for non-elite member $109.00 per weekend day.

      I stayed at the hotel so many times, I was on a first name basis with every manager, every front desk clerk, valets, bellman, etc.

      The hotel has since raised its price to $179, no longer gives breakfast buffets on the weekend, and suspended the second night free coupon.

      I bolted next door to the Westin which is now cheaper, renovated, and equally central.  It would have been imprudent to stay there just because I’m a Marriott platinum.

      Same with my rental car company.  I like driving large SUVs.  As a top level elite (terrible term), I can rent a full size car, get a guaranteed free upgrade to a premium car, then for $75/day get an Escalade.  But wait, because of my loyalty status, the front desk folks are empowered to reduce that upgrade fee to about $25-$35.

      That’s a savings of $40-50 daily.  I rent cars about 75 days yearly.  That’s a savings of $3000 – 3750 annually

      Then, on the rare occasion where I can’t get a weekend rate, or must do a one way rental. I’ll use the accumulated points. 

      So that’s my long winded calculations of how the loyalty program saves me real dollars and cents, not even considering the miles/points aspect of it

      1. Your hotel room still cost you $54.50 per night, not $2.55.  You just didn’t have to pay those extras that the non-elite customers did.

    5. If you are not stupid in using your credit card, like having a balance that you are paying high interest on, these cards are excellent to have.  We just got approved for a new one that will give us money back, no foreign transaction fee, which works for our overseas travel, and no yearly fee.  How is that bad?  We have had the AA Citi card and flew first class on an international trip with the miles we got from just opening the account, then canceled the card just before the yearly fee kicked in.  We have flown the entire family for free for a vacation from our UA points that we pay zero dollasr to have. Our company card gives us points on any carrier and we have taken two free trips with those points.  Just like anything else, you have to research and read BEFORE signing up. 

    6. I don’t give all of my loyalty to any one company or credit card.  I use the ones that make sense for the particular situation.  However, it is nice to receive a bonus when I do choose a specific one over another. 

      Sure, I get free trips, hotel rooms and car rentals. And they are free because I am not doing anything I wouldn’t be anyway, not spending any extra, or making bad choices when I purchase the travel options that give me those free items.

      I will rent with a specific rental car company, which happens to be the one I use most, because I like the way they treat me, their policies make more sense that others, they have the type of car I want inthe location I am visiting and many other reasons. Am I choosing them because I get a couple free days of rentals a year? Absolutely not. I would choose them anyway.

      I primarily fly 3 airlines I mentioned in another post. I also belong to all of their FF programs. I could fly other airlines, but that would mean more connections, longer travel time, and dealing with airlines that have received multiple bad reviews on this very website. Why would I not choose the airlines I do and not be a member of their FF programs? I fly at least once a week. If I have the oportunity to accumulate enough miles/points to get a free flight when I would be flying anyway, then where is the cost you complain about?

      Same with my hotel card. What I spend on the card gives me credit toward their Elite status just like staying in their hotels. I also stay in their hotels often enough that I can get a couple free nights. Once again, not spending any extra dollars than I would anyway.

  14. We have a delta affinity card only because delta, until only recently, was about the only option out of Atlanta. My husband is a muckity muck with delta because he has flown over 2 million miles on business. Thankfully, we use his miles for the rare occasion that I get to go somewhere with him but I have been extremely FRUSTRATED the last couple of years when trying to book those flights. The bogus “award calendar” always says I’m choosing “low” mileage days but not once has the award ticket been the 25000 miles that supposedly entails.

    And, as for those “free” companion tickets? Ha, what a joke! I’ve kept ours and have a stack of at least 15 that we have NEVER used because they do require a full fare ticket purchase which only happens when my husband has to fly last minute and those aren’t the trips I want to go on (they are usually in and out trips).

    One of these days I am going to pull the strategy of signing up for every delta frequent flier award card, collect the bonus 25000 or so miles, and cancel right before the fee comes due. Why haven’t I yet? Because I’m too honest unlike delta has been!

  15. I have no loyalty to any one airline, though I may prefer one over the other.  When I travel, I look for the best deal at the time (ticket price, stops, the other fees I know I may have to pay).  Life is much simpler that way.  So, no affinity programs, no mileage clubs, or anything of that sort.

    1. Do you collect free frequent flyer miles though? You don’t have to fly exclusively with one carrier or even give preferences to any carrier. If not, worst case you lose the 2 minutes it takes to sign up, and best case you get free airline tickets.

  16. First, please itemize the “some of the card’s guaranteed benefits” which require a full-fare refundable air ticket purchase.

    On the recent re-iteration of my citicard Aadvantage benefits, I found none which required a full-fare refundable ticket purchase.  Here are what I found which are not mentioned in this  article:

    1.  Free first bag checked for passenger and up to 4 more on same reservation for domestic flights.  (Family of 5 savings each way, $125)
    2.  Priority boarding, enabling you to avoid the long line on the jetway and to get overhead space above your seat.  
    3.  25% discount for on-board food and beverage charged to the card.
    4.  A 10% rebate of Aadvantage miles redeemed each year (max–10K).  So if you get tickets for 60,000 miles, then it really costs you 54,000.

    There are several more benefits of less monetary value which reward bonus points.  Just looking at these, the card provides savings which are in excess of the annual fee if you take just a couple r/t’s with checked bags.  

    Further, to get these benefits you do not have to buy the air tickets with the card.  All you have to do is to be a valid cardholder.  You do not have to pay the “confiscatory” interest rates the article claims.  

    The article claims the card holder will be paying for “overpriced” flights.  How so and why?  A great majority of city-pair airfares are at parity, especially during large “sales” when most buy leisure tickets.  Many LCC fares are higher, when you add in advanced seat selection (of any seat), luggage, carry-on, on-line or in-person booking, breathing-on-board fee, etc.  

    What is so “shocking” about this affinity credit card “scam” article is that you simply make no comparisons between having a card and not having one.  If I am traveling transcontinental with one bag, I value the waiver of baggage fee, priority boarding “to beat the rush” and discounts on food.  My comparable fare is equivalent to other airlines, even less with luggage discount.  You took none of this into account.  

  17. No need to go to Europe for the “free” accompanying fare scam.  For years American Express Platinum card (and possibly now but I wouldn’t know since I went back to Gold)  touted the same really really BIG bargain.  And you’re right:  the primary ticket did cost about four times what the consumer would normally pay.

    1. Their promotion was for a business class ticket and it actually was a good deal.  If you are someone who flys in coach, yes, it was more expensive than an APEX fare.

      1. AMEN!  My clients got quite a few of these over the years, and we’ve always compared the options for them to make sure they got the best rates.

    2. I inadvertantly left out Business Class but my comments still hold. It was a full fare Business Class for which I could have gotten about 4 normally priced BC tix…..therefore costing me about twice the price I needed to pay.  It was a good deal if your employer was paying!  And only on that basis.

      1. I have ticketed these several times and they were always a good deal, so without knowing exactly your situation, hard to say what happened.  Now that the carriers have added discounted business class fares, this could be the issue in that you had to purchase the full biz fare, which could make the deal less appealing based on price.

  18. The airline cards benefit both the airlines and the credit card companies. The make you a regular customer to that airline. Dumb move unless you are traveling 10+ times a year to really accumulate miles. If you are spending tons of money on your credit card, $100000.00’s of thousands to get points, then try to redeem the miles easily.It will not happen!  I was just gifted 90,000 miles by my son, who is Delta platinum and it still took 20 tries, 5 months in advnance to get seats to Seattle. I do charge a ton on a credit card and get 2% cash back, so I am addicted to using that card. I can buy the tickets easier than fighting using miles. There are travelers that will travel Pittsburgh to Atlanta via Charlotte to use Usair credit cards and get Usair miles instead of paying far less for the non-stop Air Tran. Fools and their miles are soon parted. Airline cards are stupid, but obviously, so are thier users.

  19. I fly Alaska almost exclusively and what ticks me off is the flight attendants pushing their airline cards.  Saying – oh so nicely – “we’d like to share a special offer with you today”.  It’s like verbal spam – except the kind you can’t delete or escape.  Quite possibly the WORST thing about Alaska Air….ever……  Seems inexcusable to force people – already trapped in a flying tube and who have dealt with all the other hassles of flying to then listen to what – essentially – is a form of  infomercial.  Could even be considered pay-per-view except the kind you didn’t mean to purchase but you did. 

  20. Skip the airline cards and go for the best deal in the business, as far as I’m concerned: the Amtrak Guest Rewards Mastercard.  There’s no annual fee, and Amtrak points are redeemable at a much more favorable rate than airline points with almost no restrictions aside from a handful of blackout dates per year.   Plus, you don’t have to let the TSA sexually assault you as a condition of using your Amtrak points!  Everybody wins, except the blue-shirts who have to feel each other up to fill the time while you ride the train unmolested.

  21. I’d just look for the best deals whether or not they are related to cards.  But no deal that fails to disclose all the fees and restrictions, card or not, could be considered the “best” deal.

  22. I have a couple of cards like this, but I really only use my Delta Skymiles Platinum Amex. The platinum card costs $150 a year, I think, and you get a $99 companion fare each year and you don’t have to buy a full fare ticket to use it, so you basically get your $150 back that way, plus you get free baggage check on domestic flights with the Amex card
    (you already get free bags on the international flights) and that’s saved me money, too, so the annual fee is covered.  Also, Amex has been REALLY good to me.  They have a lot of good customer service in terms of chargebacks and stuff (I had to do one once on a scam from Amazon of all places… a private seller… and I had my money back with a week).  So I don’t mind paying the annual fee for those reasons.

    I buy everything on the Amex card and I pay it off every month and I’ve accrued a LOT of miles that way.  Enough for several roundtrips on the Japan/US route. To be fair, I’ve had to search for the 60k roundtrip fares to get the most of my miles and make more stops than I’d like, but I’ve still been able to get the tickets.   So, in any event, if I’m buying stuff I would have bought anyway, I might as well use my card and get miles.  I’ve never had a problem using them or accruing them, and I like flying Delta.  So I don’t think ALL the cards are bad, but I don’t think they should be misrepresenting things like having to buy a full fare ticket to use a companion ticket.

  23. We use the United Milage Plus card, and we do our normal spending on it, accruing miles, and paying the bill in full every month. We have had no problems ever, redeeming miles for airline tickets, which we do every couple of years to take a family vacation. i also use a Starwood Preferred Guest card for business travel, and I’ve never had a problem using SPG points to redeem a room. Even for New Years Eve.

  24. Clearly the cardholder benefits more than the airline. Now if you had said “cardholder vs bank” then my answer might have been different.

  25. I get a lot of benefits from my MileagePlus Explorer card – bags free, priority boarding, Club passes.  I don’t even know what the interest rate is, but since I pay in full monthly, I don’t care.  I’ve taken quite a few trips with the miles obtained, and they say that another perk of the card is the ability to book any flight where seats are available at the standard miles rate (though I’ve yet to test this).

    I put most all of my expenses on the card:  car & homeowners’ insurance, medical bills, groceries, cell, satellite TV, health club, and so on.  It’s a couple thousand a month.  I don’t think I spend more than I would with another card or no card.

    There is an annual fee of $85.  I’ve always gotten it waived or credited.  In fact, I just hung up from that call a few minutes ago, and they’re giving me a $100 retention credit.  Bottom line is they are paying me $15 to keep the card!

    My wife and I have over the years cancelled one card and gotten another, gaining another 25,000 mile signup bonus (and often another 5,000 for adding another cardholder, that being the other spouse).

    I’ve looked at the cards with their own “mileage” programs, but the trouble is that the ONLY way to earn miles with them is to spend on their cards, whereas with MileagePlus, I get miles from spending on the card, dining out, shopping online, renting cars, and even flying of all things!

    I don’t know who benefits most, but it seems to me that we may all be benefiting – the bank, the airline, and I.  The merchants who have to pay the credit card fee are the ones losing, but they pass it on to all customers, so maybe the ultimate victim is the cash customer who has to pay a slightly higher cost than he would otherwise pay.

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