I have an amex gold(will downgrade to an amex green at the end of the year) annual fee 130$ (110$ next year). I earn at least one free ticket on southwest a year, which I will use to g from LAX to BNA. This ticket with 2 weeks advance notice on southwest costs roughly 500$ and with 3 months in advance about 308$. Would I be better off using a simple cash back card? I like the fact that I can earna ticket for just using my CC on stuff I would anyways, and I play the bonus miles when I can, and most of my purchases are "everyday" purchases so I only spend about 13-15,000 a year to get that free ticket. I would use the starwood card, BUT I don't like tking risks, and since NO ONE knows if it will change in the future where a stay will NOT BE considered using your Amex I would lose all my points, and don't want 6to bother worrying about that. So, should I just go back to a cash rebate card, like blu cash or am I making it out okay with where I am at? Most of the time I will fly with only 2 weeks advance noitice and will fly this route on southwest. I know I have asked this previously, but believe I am coming out okay still, better than a cash rebate? And would like some recommendations. Thanks!

I personally use only cash rebate cards that have no annual fee.

I cannot imagine paying for a credit card simply to receive frequent flier miles in a particular program. Perhaps other FlyerTalkers have benefitted from those credit cards more than they would from a no-annual-fee cash-back credit card, but I already earn plenty of miles. I would rather have more cash to use as I please.

Some credit cards offer cash back at the end of each year. Some rebate the money back into your account at the end of each billing cycle, reducing your credit card payment each month. Some credit cards offer a 5% rebate on gasoline; other credit cards offer up to 2% cash rebate on other items.

Go to any credit card Internet web site � Visa, MasterCard, American Express or Discover � and you can search for the fee-free cash rebate credit card that best matches your needs.

The bottom line for me is that I would rather have the money in the bank earning interest than mile or points (which can be difficult to redeem in many cases) sitting in a frequent flier account.

I travel extensively on business and therefore rack up some hefty cc bills, around 10k a month. I use a Bank One Card (formerly First USA) which does not charge me a fee and gives me points.

These points can be used on any airline which has been great when I want to fly friends to a city that my primary carrier (United) does not fly to (or does in a limited fashion). You can fly international and domestic and I have had no problems using the points during peak travel times. Its just comforting to know that I have a few hundred thousand miles that I can use on any airline if United can't come through for me. Yeah, I guess cash is nice but unless you spend serious bucks.....

One other nice thing is Bank One allows you to redeem points for cash cards at local stores like Home Depot. $100 gift cards are great ways to make friends!

Compared to a specific airlines credit card, these cards offer much more flexibility IMO.

I generally use miles earning cards (SPG first, then UA), but on gas purchases, I use cash back cards from Shell & Exxon/Mobil. AAA & Chase both have 5% gas cash back cards. All the offers I get for cash back cards only have a 1% cash back, so I'd rather earn the SPG points or miles over the 1%. I spend about a total of 1,000/month on my credit cards, so i'd rather have the 1000 miles/points than the 10 bucks back, not a great valuation, but its an easy way to get miles. That combined with long distance offers & other promos, has helped out a lot. I also don't pay annual fees in general unless the sign-up bonus is amazing. I did that with DL and got 25K for 85.00 and with UA I got 20K for 60.00 and SPG i got my first year free, but I think I'll probably continue with it, but haven't decided as yet. I also keep my BA visa account active so it keeps my BA airline miles account active (same with SPG - I don't stay too often with them, and if a year goes by, my SPG Amex takes care of my points expiring - to which there has been discussion on FT, it's useful for that, in my opinion...)

I find cash rebate a better deal. My buisness travel has slowed to a crawl. I travel more for pleasure, but have a very hard time redeeming FF points for good dive locations. So I prefer cash.

Discover (1% back) is my primary cash-back card, used for everyday. I used to have Fleet VISA for foreign travel (2% back, but they just switched me to a points instead of cash program. Points redeemable for worthless crap from their catalogue. I will cancel the card at the end of the program year when I get my $500.)

Chase MC (3% back redeemable for a Subaru). I maxed the Chase reward on I-series bonds to get the Subaru bucks.

The most cost-effective use of FF points for me is to do a class upgrade. But since my business travel is curtailed, the points just sit. From time to time I donate them to Make-A-Wish.

so if I am using my miles simply for coast to coast (lax to BNA) I would be better going with amex blue cash rebate card? I had someone figure it out for me and I would earn right around 213.74 a year, no annual fee. Whereas I have to pay out of my pocket 130$ a year, to then get a ticket that would cost 300 to 500. I got this card purely with the hopes of calling and attempting to cancel every year when the annual fee came up and hoping they would reduce it every year. What do you think are the odds of amex actually reducing my annual fee every year? Pretty slim? Or is it possible? Thanks:-)

The Southwest Visa card is only $49 a year, earns at essentially the same rate as Amex, and has wider acceptance. If your spending is mostly for travel, get the Diners Club card which earns a full credit per $1000 and has a very nice initial signup bonus. Every fall (October-November) you can redeem 24k points ($12k spending) for 16 credits, which is even better.

What about the MBNA Amtrak card? No fee, 1:1 conversion to your choice of United, CO, or Midwest, and no extra foreign transaction fees. In my mind, you can't beat it. Plus it's a Mastercard; I use it for everything. The 25K cap doesn't bother a low-income FF like myself.

I've been using the UA card. The annual rate essentially purchases the signup bonus. Cancel after one year. Then immediately reapply and get a new bonus. Thats 10-20K miles/year for $60. Works for me. Have heard of some folks with a second card.

Well, first of all, many of the replies came from people who don't earn toward Southwest, and in other programs miles are worth a lot less than the equivalent in credits on Southwest. In other programs, you don't get awards that are equivalent to "walk-up" fares (ie, good for the "last seat" left on the plane) the way you do with Southwest. In other programs, you need 50000 miles to get even CLOSE to the equivalent in few restrictions.

But OTOH hand: It's interesting that you say you fly only about once a year on such a free ticket. Because Southwest credits EXPIRE after a year. Now, if you're not earning Southwest credits directly, but rather earning them through an Amex or Diners Club, then this doesn't matter, as long as you transfer whatever number of points you need for 16.0 credits all at once. But if you were to switch to the $49 annual fee Bank One (fka First Usa) card that earns you Southwest Airlines RR credits directly, you'd lose any credits that were more than 12 months old if you didn't earn 16.0 credits at least every 12 months. And with the Bank One card, you earn 1 credit for every $1250 spent but with pretty much no bonuses, so you'd need to spend $20000 every 12 months or less (or else be earning SOME of your RR credits through flights or hotel stays or rental cars), or else you'd NEVER get to a free flight (ie, if you only earn 15.5 credits every 12 months, they're totally useless). So while you can reduce your annual fee a lot by switching to the Bank One card, make sure you'll always be earning enough credits a year, or else your annual fee savings will actually cost you tickets.

In general (unless you have very high credit card spending, like because you buy $$$$$ of stuff a year you're reimbursed for or for your own business), I'd say credit cards work better as a way to TOP OFF credits for Southwest, when you're also earning some credits (but not quite enough) through shorthop flights or hotel stays or car rentals. But unless you spend enough to earn well over one flight every year, yes, the math of paying a high annual fee just to earn one free flight may work out to not much better than a wash.

As for the odds of reducing the annual fee: I have no idea about Amex, but at Diners Club (where the annual fee is $95, and you only need $12000 of spending to earn a Southwest award ticket, but you'll find acceptance limited except at "travel & entertainment" type of businesses) they don't ever let you reduce your annual fee, but you can often talk them into a "renewal bonus" of 5000 to 10000 points (32000 points normally, 24000 points in an annual "sale", transfer to 16.0 RR credits), and they'll also let you pay for the annual fee with points (tho the exchange rate for that is NOT good unless you have points you don't know what to do with!). At Visa and MC companies, half the time (even with the same company!) you threated to cancel they take you up on it, even tho sometimes they do lower your annual fee (but just for that one year).

Here's an alternative idea: Learn to love Vegas. Southwest often sells LAX-LAS flights for $30ish one way, and hotels are CHEAP in Vegas, and you can do anything from shows to hiking (Red Rock Canyon a half hour west of the city is great hiking of a type you'll not find in LA). (Just don't gamble your money away!) Buy those tickets online, and 6 of those round trips will get you a free flight. (Only 4 of those trips needed if you rent a car and stay one hotel night on each of those 4 trips.) But more imporantly, each one will get you 3.0 credits (4.0 credits only until the end of this year), and so one or two of those a year (or LAX-OAK, or LAX-PHX) will greatly reduce the amount of credits you need to earn from a credit card, and thus will make the $49 annual fee Bank One RR Visa way more practical.

As noted above, Southwest's double credit for booking online ends Dec. 31, being replaced with point-and-a-half. That may change the calculus on mile v. points v. cashback cards for some flyers.

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[This message has been edited by Middle_Seat (edited 10-31-2003).]

And you have to fly Southwest, which I avoid whenever possible. It is not a product for most people who are flying several times each week.

alright, so it still takes 16 credits or 20,000 MR pts to fly on shouthwest though, correct? Also, how much tax should I usually expect to pay on a FF ticket? Like 50$? Cause if I add that into the mix, I am not doing as well as I thought I was. I am new to this so bear with me;-) However, as long as I redeem my pts for emergency "walk up" tickets or ticets like 2 weeks in advance I am still coming out very good, right?

I agree with Stefan's comments above, with one addition--with the BankOne SW Visa card, you must spend $1200 to equal 1 SW credit, opposed to $1,250 on Amex. You mention using your cc on everyday purchases--I have both cards, using Amex Green Rewards to purchase groceries, postage, drugstore items (double MR points) and the Visa at supermarkets that don't take Amex. I then top off my Southwest account as necessary with MR before the end of the 12-month cycle.

the double pts pays off big time for me, since probably 1/2 of my purchases are everyday. I think I will kepp my amex, BUT downgrade it to preferred rewards green when renewal comes up. Because as long as I use it for walk up or 2 week in advance notice tickets, then I am still making WAY more than using a cashback card, even with the annual fee. (I think :-)