eyc

I've been really confused about credit cards with "miles" rewards. I recently obtained the Capital One Venture Card because of their rewards program. As I'm sure most of you know, the benefits can be summed up as follows:

1. For every dollar you spend, you get 2 "miles."
2. The "miles" can be used for any travel-related expense.

My problem is that these aren't really miles in the conventional sense -- i.e., frequent flyer miles. In particular, the "miles" that you get from Capital One are redeemed by doing the following: You first purchase a travel-related item with your Capital One card (e.g., $100 airline ticket), and then you go into your online account, and use your "miles" to "erase" the cost.

To "erase" the $100 airline ticket, you need to use 10,000 of your "miles." In order to have accumulated 10,000 miles, you would have had to to spend $5,000 dollars (i.e., two miles per dollar). Thus, you are saving $100 for every $5,000 you spent, or, in other words, 2%.

Despite that this is still a pretty good deal (on most cards, you only get 1 point per dollar), I think it is disingenuous to call these "miles." These are just points; you cannot redeem these miles with any airlines for actual flights. For example, if you go on AA.com and look at the price of round-trip tickets from Chicago to Rome, you'll see that it will cost you over $1,600. But, if you search by miles, you can get the exact same flight for 60,000 AA frequent flyer miles. But, of course, 60,000 Capital One "miles" would only get you $600 in value, not $1,600.

Anyway, I'm just surprised that this is not more frequently discussed. I think it's borderline false advertising to call these "miles." With that all said, what are the best cards for actual miles?

I tried looking into the Mileage Plus Explorer card by Chase because I fly United a lot, but, to my extreme annoyance, I was unable to determine from their website whether you are getting real miles or fake miles.

AlohaDaveKennedy

And then there are cards that earn kilometers.... Figure 2% is a good figure. The Chase card is good for actual miles and does magic card tricks. Get the card and you can do those magic card tricks!

skizz

You are correct regarding "fake miles" that's why no (sane) person here would recommend applying for Capital One cards :P
Airline-branded credit cards will (almost?) always earn actual frequent flyer miles for that specific airline.

deant

But even specific airline FF miles do not get you one FREE mile per banked mile (which is what I believe the OP is complaining about).

You just need to know how to work the system.

amolkold

C1 uses the "miles" term because many of the consumers they're chasing are the same types of consumers who don't understand airline miles and feel they've been burned by the system (no low level availability, only one airline to use them on, etc). That's why they call their points "miles" with no blackout dates (though there's a cap to their value).

Airline-branded credit cards will earn the same types of miles as you do when you fly, so the MileagePlus Explorer Card would earn "real" United miles.

wastedwords

I remember being confused by the same "miles" language with Capital One when I first got their Venture card years ago.

I also recently heard a friend of mine complaining about how he signed up for a credit card for miles rewards and was surprised when they weren't actual distance miles. I guess its actually a pretty common misconception when starting out.

mia

Welcome to FlyerTalk. I have transferred your question to the Credit Card Programs forum where CapitalOne cards are discussed.

highops

I view Capital One's card as a 2% cash back card as I would either use their pruchase eraser or their gift card choices to redeem my rewards. I wouldn't use their travel agent.

Right now I'm enjoying trying to gather points that are worth more than 2% of what I spend. If this quits being fun then Capital One cards are a relatively simple way to earn a pretty good rewards rate.

eyc

Yea. I suppose, in the end, this card is still better than the other cards that I have, which only give me 1% cash back. So, as long as I'm buying travel-related items, I get 2% cash back and if I have any "miles" left, I can cash them out at 1%.

I also probably wont get an airline-specific card because, after more research, it looks like you're only really getting 2 cents on the mile (at most) for domestic flights and I don't really fly international very frequently (where you can get the biggest miles-to-dollar benefits).

KennyBSAT

Depending on where you live, transferring AMEX or Chase points to British Airways and booking AA can get some great value, especially on short domestic flights. Southwest points are worth 3.2 cents with a companion pass if you travel with someone and SW works for you. And everyone who can should get a a Barclays USAir card for free post merger AA miles bonus with no minimum spend.

mia

I think there is a misunderstanding. You earn two points per dollar, and the points are worth $0.01 each maximum, hence "2%" return on your spending. If you redeem, for example, 2,500 points for a $25.00 giftcard you have not diminished the return because you spent $1,250.00 to generate those 2,500 points.

eyc

Although the information is nowhere to be found on CapOne's website, it is my understanding that if you redeem for anything other than travel-related items, you can only do so at a 2-to-1 miles-to-dollar ratio. In other words, if you have 5,000 miles (i.e., spend $2,500), you can get $25.00 in cold cash. The only source I have for that is: http://www.nerdwallet.com/blog/2011/...risingly-easy/ ("Note that redeeming for travel is the only way you’ll get the full 2% benefit, but if you don’t travel much, you can still redeem for cash, gift cards, and the such at a 1% rate.")

mia

I no longer have this card, but I believe that if you login to your account and click Explore Rewards (or similar) you will be taken to an award catalog where you can see the number of points required for various options. I was able to redeem for giftcards at $0.01 per point at the time that blog entry was written.

eyc

Good idea to check there. For cash, it is half a cent per point, and for certain gift cards, it is one cent per point.

jbvideo

For my C1 Platinum Mastercard, I get the following

2% for travel related redemptions ( for 10,000 miles/points i would get $100 in redemptions)
1.5% for cash back (if i want them to cut me a check or apply it to my balance. (10,000 miles/points i would get $75.00)