Best Credit Card For Airline Miles 2021
Jin - March 12, 2021
This post will take a look at the best credit cards solely for redeeming airline miles. The cards examined are frequently reviewed from popular websites like NerdWallet, The Points Guy, and CompareCards.com. Read along to understand, in detail, which card to choose.
I’ve always wondered: Is the value of the sign up bonus for different credit cards the same between cards? Not necessarily and this is what makes an apples-to-apples comparison difficult. To be able to compare between them, one way is to look at a dollar amount value that the sign up bonuses are worth. That’s what this post aims to do.
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Metrics and Assumptions
The metric used to compare each card is the potential dollar amount you can accumulate based on the points accrued on the credit card and then subsequently spend on airline tickets. The conversion process is, first, from credit card points to airline miles to dollars. For the most part, a single point is equal to a single mile. Some important assumptions made in this analysis:
- You aren’t spending on travel with the credit card so that you can use your points on the airline tickets. You’re just spending on other stuff to accrue the points.
- You cancel the card before the annual fee kicks in.
- The conversion rates used in this post are based on this post from The Points Guy. The conversion rates are NOT defined by the credit card companies or the airlines. They are estimated by ThePointsGuy.com.
- All information is current as of March 2021.
The confusion with rewards points/miles for each credit card is that they aren’t converted to a dollar value at a constant rate and are even dependent on the credit card company and the airline. For example, 1 American Express card reward point can equal 1.2 cents for Delta Airlines. At the same time, Chase’s card reward point can equal 0.9 cents for Avianca Airlines. The point is, it’s not obvious what the conversion is from points/miles to dollars. Check the conversion rates here.
Card Reward Summary
Let’s take a look at the following cards (not sponsored) and summarize what their reward structure looks like.
- American Express Gold Card
- Chase Sapphire Preferred Card
- Citi Premier Card
- Chase Sapphire Reserve Card
- Citi AAdvantage Platinum Select Card
- Chase Southwest Rapids Rewards Plus Card
Comparison and Results
Now that you’ve got an idea of what the rewards look like, let’s apply the points-to-dollar conversion rates along with information about what credit cards partner with what airlines to see what the best credit card for airline miles can potentially be.
Keep in mind that specific cards are partnered with specific airlines. For example, Chase is mainly partnered with JetBlue, Singapore, Southwest, United, and Virgin Atlantic airlines whereas American Express is partnered with Delta, Avianca but not Southwest and United. You get the idea. Here is a table showing the dollar valued amounts for the 6 credit cards above and the dollar value amount calculated using the conversion rates from The Points Guy.
From this analysis, the Chase Sapphire Preferred card has the best dollar amount value mainly since it offers 60,000 sign up points and the conversion from points to dollars for the airlines it partners with is relatively high at roughly 1.5 cents per point/mile.
Accounting for Extra Point Restaurant Spending
Now let’s factor in the spending bonuses that pay out points based on some multiple for restaurant spending. It’s true that different cards also reward you for spending on other things like travel or gas stations or supermarkets. However, the common denominator between all the cards here is the spending on restaurants so we can use that to do an apples-to-apples comparison. If you tend to spend a lot on some of the other categories, it may make sense for you to choose another card.
From the table above, the Chase Sapphire Preferred Card seems like the winner at a dollar value of $900 when used with Southwest airlines. But… the American Express Gold Card does have a 4X multiple on restaurant compared the Chase Sapphire Preferred Card’s 2X multiple.
Let’s assume you spend $5,500 on restaurants for all the cards. What would the total dollar value including the sign up bonus be for each of the cards?
The takeaway here is that only when you spend about $5,500 does it make sense to choose the American Express Gold Card over the Chase Sapphire Preferred Card.
Final Thoughts
Based on pure dollar amount value and the assumptions made, the Chase Sapphire Preferred Card is the best card for airline miles at face value. Depending on your spending habits, the American Express Gold Card may be the better option.
However, you can also see these conclusions are airline dependent. If you have a preferred airline to travel with, your decision may change. If you want rewards for American Airlines, there’s only one choose here which is the Citi AAdvantage Platinum Select card. Similarly, if you’re a fan of Delta, you should pick the AmEx Gold Card. If you’re looking to travel with Southwest, you shouldn’t pick the Chase Rapid Rewards Card as the Sapphire Preferred is better.
So it seems the answer isn’t that clear. The “best card” is dependent on your spending habits and what airline you preferred. But if it were my recommendation, the Chase Sapphire Preferred card would be the way to go. I hope this post helped you become a little more informed. Safe travels!
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