Bank Deal: Earn 1.00% APY on an FDIC-insured savings account at Barclays.
A comment on my recent post on Emigrant Direct’s new and improved reward credit card got me to thinking about credit card rewards and frequent flyer miles. In general terms, I’ve always valued frequent flyer miles at around a penny apiece — I typically pay around $250 for a roundtrip domestic ticket (give or take), and they usually require 25k miles. Since most cards give you a mile for each dollar charged, that works out to a 1% reward, which is pretty standard stuff as far as credit card rewards go.
However, a number of mileage cards charge an annual fee, and you can’t always get the flights that you want (due to both blackouts and limited availability). Thus, mileage rewards really aren’t all they’re cracked up to be… As another commenter said, cash is king. That being said, I’ve recently had fleeting thoughts of switching to a mileage card, but for kind of a weird reason…
We live quite a distance (over 900 miles) from family and we pretty much always end up driving to visit them. The main reason for this is that we have four kids, and it just costs too much to fly. Sure, I could put the money we earn from our credit card rewards toward plane tickets, but even with ‘found’ money of this sort, I have a hard time bringing myself to part with such a large amount of cash when we could reasonably (albeit somewhat uncomfortably) drive. On the other hand, if we had airline miles instead of additional cash, I wouldn’t have a problem putting them toward free plane tickets — after all, that would be our only option. I know, I know… This doesn’t make all that much sense, but sometimes that’s how my head works.