Update: This offer for the Barclaycard Arrival Plus® World Elite MasterCard® has expired. Learn more about the current offers here.
We spend a lot of time here talking about international first and business class award redemptions. While that’s great and will often get you outsized value for your points, that’s not how most people are looking to redeem their points. So I figured the following question by reader Paul G in the Ask Lucky forum is worth addressing here:
I am very new to airline credit card traveling, and I was wondering what is the best offer right now for just domestic traveling via economy but also for business class?
Based of the alliance information, the miles accrued cannot be used for low-cost carriers, am I right?
Don’t earn airline miles if the goal is domestic travel
As a general rule of thumb, if your goal is to earn credit card rewards for domestic travel, you don’t want to be earning airline miles. Why?
- Specific airline miles greatly limit your flexibility in terms of which airlines you can fly, as you’ll want the flexibility to fly the “big three,” the ultra low cost carriers, Southwest, and more
- For the most part, domestic saver level award availability is very limited, so it’s unlikely you’ll be able to snag the flights you want with miles
- If you’re earning miles with American or United, you’ll be subjected to a close-in ticketing fee of as much as $75 if booking last minute, which takes away a lot of the value
- With the way the Delta SkyMiles program has changed, the value you can get per SkyMile is getting closer and closer to one cent per mile, which isn’t great
Spirit’s “Big Front Seat” is a great way to travel domestically
Don’t get me wrong, there are situations where you can get value out of redeeming miles for domestic flights. But in terms of general strategies for earning credit card rewards for domestic travel, I’d highly recommend against earning a specific airline mileage currency.
Earn cash back or flexible points instead
If your goal is to be rewarded with domestic travel, I tend to think you’re best off using a credit card that earns cash back or flexible points:
- Cash back is money that you can use to just outright purchase a ticket, including anything ranging from a $9 ticket on Spirit, to a $600 JetBlue Mint ticket
- Flexible points give you the flexibility to either redeem points as cash towards the cost of an airline ticket, or transfer the points to an airline partner for the ideal redemption
JetBlue Mint is the most comfortable way to fly domestically, and is often a good value
Either of these options gives you flexibility, which is exactly what you want when booking domestic travel, since you want to be able to book just about any airline.
The best cash back cards for domestic travel
Nowadays if you’re using a card that earns cash back (or the equivalent of cash back), you’ll want to earn at least 2% back. You have a few different options, depending on whether you want to pay an annual fee, whether you want a card with a big welcome bonus, and whether you want a card with additional perks, like no foreign transaction fees, and potentially more.
So let’s look at a few of the best options:
I consider the Citi® Double Cash Card to be the gold standard of no annual fee cash back cards. The card offers 1% cash back on every purchase, and then an additional 1% cash back when you pay for those purchases. That’s cash back that you can then spend however you’d like, including for domestic airfare.
It could make sense to instead get a card like the Capital One® Venture® Rewards Credit Card. This card has a $95 annual fee that’s waived for the first year, and offers a welcome bonus of 50,000 miles after spending $3,000 within three months. Each mile can then be redeemed for one cent towards the cost of a travel purchase. The card offers 2x miles per dollar spent, meaning that for each dollar you spend you’ll earn two cents towards travel.
Yes, you pay a $95 annual fee starting the second year, but you also earn a welcome bonus that’s worth $500.
Some might also find the Barclaycard Arrival® Plus World Elite Mastercard® (see terms) to be worthwhile. This card has an $89 annual fee, and offers a welcome bonus of 60,000 miles after spending $5,000 within 90 days.
Each mile can then be redeemed for one cent towards the cost of a travel purchase, and you get 5% of your miles back whenever you redeem them. The card offers 2x miles per dollar spent, meaning that for each dollar you spend you’ll earn two cents towards travel, not factoring in the 5% refund.
As you can see, all of these cards more or less offer a return of 2%. It just comes down to whether you prefer having a no annual fee card, or having a card with an annual fee that offers a big welcome bonus, which will potentially more than cover the annual fee for several years.
The best flexible points cards for domestic travel
As you can see above, you should be earning a minimum return of about 2% on your everyday spend. That’s the absolute minimum, though you can potentially do even better than that. One of the ways you can do so is by getting a card that earns you transferable points, which can give you a lot of flexibility. These are points you can redeem as cash towards the cost of an airline ticket, or even transfer to an airline partner for redemptions that way.
So let’s look at a couple of the best options:
One of the hottest welcome bonuses right now is on the Citi Premier℠ Card. This card has a $95 annual fee, and offers a welcome bonus of 60,000 ThankYou points after spending $4,000 within three months.
The card earns triple points on travel and gas, and double points on dining and entertainment. Each point can be redeemed for 1.25 cents towards an airfare purchase, meaning you’re earning 3.75 cents towards an airfare purchase for every dollar spent on travel and gas, 2.5 cents towards an airfare purchase for every dollar spent on dining and entertainment, and 1.25 cents towards an airfare purchase for all other purchases.
But you also have a lot of flexibility, because you could transfer those points to one of the Citi ThankYou transfer partners, where you could also get significant value for redemptions.
The Chase Sapphire Reserve® is one of the other best options out there. This card has a $450 annual fee, and is offering a welcome bonus of 50,000 Ultimate Rewards points after spending $4,000 within three months.
While the card’s $450 annual fee sounds high, in reality the card shouldn’t cost you nearly that much. That’s because it has a $300 annual travel credit, and also offers a Priority Pass membership. The card offers triple points on dining and travel, which covers a lot of the purchases that many of us would make while abroad.
The great thing is that points earned on this card can be redeemed for 1.5 cents each towards a travel purchase, meaning you’re earning a return of 4.5 cents per dollar on dining and travel, and 1.5 cents per dollar on all other purchases.
If you complement this with the Chase Freedom Unlimited, you could be earning a return of 2.25 cents per dollar on non-bonused spend.
Then you could still transfer these points to airline partners, if that’s a better value for your particular redemption.
As a general rule of thumb, you don’t want to collect a specific airline mileage currency if your goal is to redeem points for domestic flights. It’s just not a good option due to the lack of saver award availability and the lack of flexibility. For that matter, in general I don’t recommend using an airline credit card for your everyday spend.
With that in mind, you’ll want to use a card that earns you rewards that can be redeemed as cash towards the cost of a travel purchase.
On the most basic level you could get something like the Citi® Double Cash Card, offering 1% back when you make a purchase, and 1% back when you pay for that purchase.
Personally I think there could be value in going for a premium card, like the Capital One® Venture® Rewards Credit Card. While it has a $95 annual fee (waived the first year), the card offers a big welcome bonus, no foreign transaction fees, and lots of other great benefits.
But I think the best option of all is to get a transferable points currency card like the Citi Premier℠ Card or Chase Sapphire Reserve®. These cards have big welcome bonuses, great bonus categories, and give you the flexibility to redeem points as cash towards a travel purchase, or they can be transferred to an airline partner.
If you’re brand new to credit cards, I think the Citi Premier℠ Card is a great place to start, given the waived annual fee for the first year, the big welcome bonus (worth $750+ of airfare), and the bonus categories.