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Should you earn miles or cash rewards in 2014?

by on Wed March 12, 2014 • 2 Comments

cash rewards or miles

Airline miles are in the news a lot this year, and the media has asked us to provide our take on the situation, so we thought it would be good to summarize our recommendations here.

All of the major airlines in the United States have raised the prices of some of their mileage awards this year, and Delta has confused people even further by saying you’ll only earn miles based on the dollars you spend on a ticket rather than the miles you fly starting in 2015.

The good news is the number of miles you earn on the ground isn’t changing. The airlines make billions of dollars from banks who buy miles from them to provide as rewards.

That means credit cards are more important than ever to helping you earn travel rewards. But where you earn them is important because not all miles are equal.

Here are some general guidelines on whether to earn cash rewards or airline miles based on the latest changes and our experience earning millions of miles:

You should earn cash rewards instead of airline miles if…

  • You insist on the shortest possible flights at the best times and aren’t flexible with dates. Cash rewards let you choose any airline you want.
  • You want to keep most of your travel here in the United States, where airfares are low and traditional airline miles from American, Delta, and United aren’t a great deal (Southwest, JetBlue, and Virgin America work like cash rewards and are a better deal for U.S. travel).
  • You don’t care about first class or traveling to international destinations like Asia, Australia, or Europe.
  • You don’t fly often and don’t have many airline miles to build on.

If you spend about $1,500 a month on a credit card you should expect to earn about $300 – $400 a year in travel rewards from the most lucrative cash rewards cards. They have no restrictions on what airline tickets you can book with them.

Two decent cards with cash rewards for travel are The Barclaycard Arrival (it earns 2x points on all spending), and the Bank of America Travel Rewards Card (it earns 1.5x points with no fees). You can see which is better based on your spending habits here.

You should earn airline miles if…

  • You want to go to a place where tickets are normally very expensive ($500+). This is usually international destinations or first / business class travel.
  • You’re okay being flexible and planning your trip around the days the lowest mileage prices are available, because it means you can save $500, $1,000 or more on your trip.
  • Or, you fly often and have a decent amount of airline miles to build on. You’re usually better off building on existing miles than starting from scratch with cash rewards.

Chase Ultimate Rewards cards like the Chase Sapphire Preferred Card are great for airline miles – you can transfer the points they earn into both United and Southwest miles giving you lots of flexibility.

Or, for more personalized results, you can see which rewards are best for your own spending using our CardFinder tool.

Just input your monthly spending, then input where you’d like to travel with your rewards (Hawaii, Europe, Asia, etc), and it will rank cards for you from a constantly updated database of dozens of cards. And it factors in the latest prices for awards announced this year.

bonusmilesgraphicAnd remember the key thing mileage enthusiasts know.

Don’t think you can only earn points in one program. Thanks to big bonus offers and transferable points it’s easy to rack up 50,000 – 100,000 points in a program, then move on and rack up just as many points in another.

You can see the latest list of deals here, with some offering 50,000 or more points. The most active mile earners apply for a couple of cards every few months, earning thousands of miles via bonus offers. There are dozens of cards available, so the offers keep changing and new opportunities to earn miles open up if you’re willing to put some time into it.

Want to know which miles to earn?

If you just want to ‘set it and forget it’ here are some recommendations on which miles to focus on earning based on the latest changes to mile prices and availability. These recommendations are based on the prices you can expect to pay most often, not just the lowest advertised price that can be hard to find.



The following two tabs change content below.

Chase Sapphire Preferred® Card

Miles dont expireas long as card is open
Learn more

Partner Offer

50,000 bonus points

Intro Offer

$0 introductory annual fee the first year, then $95

Annual Fee


Foreign Transaction Fee Waived

Yes - transfer to United MileagePlus, Southwest Rapid Rewards, Marriott Rewards, and more

Points Can Transfer to Airline Miles ?

Still confused? Have a question?

Leave a comment below -- we'll reply shortly -- no need to use your real name. Or, use the email form at the top of the page for private advice.

"These responses are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser's responsibility to ensure all posts and/or questions are answered."

2 thoughts on Should you earn miles or cash rewards in 2014?

  1. Irv Kratka

    I have about 200,000 mimles credits from American Express. Can these be converted into cash or other items easily?


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