How Airline Miles Work: A Beginner’s Guide 2020
If you’ve ever paid the full price of an airline ticket out-of-pocket, then you know just how expensive it can be to fly. If you’re tired of shelling out your hard-earned money for expensive flights, why not put your spending to work for you by taking advantage of airline miles through loyalty programs and travel credit cards? Accumulating enough airline miles to redeem for a “free” flight is easier than you might think, and can help free up money to make the most of your travels—even on a limited budget!
By having a better idea of what airline miles are and how they work, you can create your own game plan for earning and redeeming miles for your upcoming travels. Whether you end up opening a travel credit card to earn points or decide to use airline loyalty programs instead, there are plenty of tips and tricks to keep in mind along the way.
What Are Airline Miles and How Can You Earn Them?
A lot of travelers are at least a little intimidated by the concept of airline miles, and for good reason. Different airlines have very different policies for earning and redeeming these points, which can make things confusing even for a seasoned traveler.
In general, airline miles programs allow you to accumulate airline miles based on purchases (or other actions). You can save these miles up and redeem them for free flights and other perks down the road. For example, once you accumulate 20,000 airline miles, this could be enough miles to afford a round-trip flight to any number of domestic destinations. These are also commonly referred to as “frequent flyer miles,” so if you see this term use, don’t be confused; they’re interchangeable.
Airline Miles Models: What You Need to Know
One of the most complex aspects of airline miles programs is that airlines can differ greatly in how their programs work. In general, there are three main types of airline miles models:
- Zone-based Models – this is the most common model, and it works by requiring a specific number of miles to get from one region on the map to another. Regions are most often defined by continent, so you’ll need a certain number of airline miles to travel from North America to Asia, for example.
- Distance-based Models – another model used by some airlines is the distance-based model, where miles requirements depend on the exact distance (in miles) from your departure location to your destination.
- Cost-based Models – this model essentially translates airline miles to the cost of an actual ticket, meaning you’ll need to redeem more miles for a more expensive fare. This means you’ll need more miles to fly during peak days and seasons (such as the holiday season) than other times of year, regardless of distance or region.
Now that you have a better understanding of how airline miles programs can work, it’s time to explore some of the many ways in which airline miles can be earned!
Earning Airline Miles Through a Loyalty Program
Almost all airlines offer their own loyalty programs, where you can earn points for the money you’d already be spending on your plane tickets. These programs are completely free, so if there’s an airline you fly with frequently, there’s really no reason not to join their loyalty program.
Specific miles earned will vary from one airline to the next. At the very least, you should expect to earn one mile per actual mile flown, though some airlines allocate points based on dollars spent. In this case, you might earn anywhere fom 3-6 miles for every dollar you spend on airfare or other qualifying expenses.
Earning Airline Miles Through a Credit Card
Another popular option for earning airline miles is to do so using a travel credit card. This is generally a faster way to accumulate a large enough number of miles for free flights. With most travel credit cards, you’ll earn miles for every dollar you spend. If you use your credit card regularly, you can see how these may add up quickly.
Many travel credit cards also offer substantial sign-on bonuses if you make a certain amount of purchases within the first few months of opening your account. For example, you may earn 50,000 bonus miles if you spend $3,000 on your card within the first three months. These sign-on bonuses can often be enough to redeem for a free round-trip flight.
Other Ways to Earn Airline Miles
You don’t necessarily have to open a credit card or even fly to earn airline miles. There are plenty of other methods for earning “bonus miles” using purchases you’d be making anyway. For example, many airlines have online shopping portals, dining programs, and other options for earning additional miles to your loyalty account. This is a great way to boost your miles in between trips.
What You Need to Know About Redeeming Miles
Now that you have a better idea of how earning and accumulating airline miles works, you may be wondering how you’ll go about booking a flight using airline miles once you’ve saved up enough. The specific process can vary depending on whether you’re using credit card miles or loyalty program miles to make your booking.
Redeeming Miles With a Credit Card
When you’re using airline miles earned through a travel credit card to book a free flight, it’s important to understand that you’ll actually be booking your flight directly through your credit card company. In essence, your credit card company will be making your flight reservation on your behalf.
Most credit card companies make this easy to do through your online account, though the specific steps can vary a bit from one credit card company to the next. In general, you can find a “rewards” tab somewhere on your account page once you’ve logged in. From there, you should be able to search for airfare and book directly through the same browser.
Redeeming Miles Directly Through an Airline
When you’re redeeming airline miles accumulated through a loyalty program, things work a little differently. In most cases, you will need to book directly through the airline. You should begin by logging into your loyalty account on the airline’s website. From there, you can search for airfare, and most airlines will give you the option to search based on total fare cost or airline miles.
Once you select airline miles, you can shop and see which flights you can afford based on the number of miles you have accumulated. When it comes time to check-out, you will be given the option to pay with credit card or to redeem a certain number of miles for your flight.
Tips and Considerations for Redeeming Airline Miles
When redeeming airline miles for free flights, there are some considerations to keep in mind. For starters, understand that you may run into more restrictions when you’re trying to book a flight using loyalty program miles alone. That’s because for most flights, airlines will set aside a pre-determined number of seats that are made available to loyalty program members. The remainder of the seats are available for purchase by the general public.
As a result, you may have a harder time finding flights available through a loyalty program than you would with credit card miles. This is especially true during blackout travel dates, which your airline might set forth on busy holidays. When you redeem airline miles through your credit card, you generally don’t have to worry about these restrictions because your credit card is essentially buying your fare on your behalf.
Is a Loyalty Program or Credit Card Best For You?
If you’re ready to start earning airline miles towards free flights, you may be wondering whether an airline loyalty program or travel credit card is best for your needs. There are some potential benefits and drawbacks to consider with each option that will ultimately help you decide which is best for you.
Pros and Cons of Airline Loyalty Programs
Airline loyalty programs are a great option for those who are looking for a free way to earn miles on the money they’d already be spending with an airline. These programs don’t cost a thing to join, so you really have nothing to lose. On the other hand, the number of points you’ll earn per dollar spent or mile flown is generally quite limited (especially when compared to what you’d earn with a travel credit card), and points may also expire if you don’t use them.
Another major drawback to be aware of with airline loyalty programs is that redemption can be more challenging; you may be subject to blackout dates and other restrictions, which could limit you in how you actually redeem your points.
Pros and Cons of Travel Credit Cards
With a travel credit card, you’ll typically earn more miles per dollar spent than you would with a loyalty program. And rather than being limited to earning miles on money you spend directly with the airline (as is the case with a loyalty program), a travel credit card rewards you for every dollar spent—regardless of category. As a result, you can earn airline miles for everything from groceries, carry-ons and restaurant purchases to entertainment and every expense in between.
Many credit card companies also offer special bonuses for spending in certain categories. For example, you might earn three times the miles on all your travel-related spending. And for many travel credit cards, you’ll earn a large sign-on bonus when you spend a certain amount of money on your card within a few months of opening it.
With travel credit cards, you also won’t be subject to as many restrictions when it comes time to redeem your miles for a free flight. You generally won’t have to worry about blackout dates, which frees up your travel options more.
Of course, credit cards can come with potential drawbacks, such as high annual fees and interest rates. And if you have a less-than-ideal credit score, you may have a hard time getting approved to open a travel credit card account in the first place.
Which is Best For Your Needs?
Deciding between an airline loyalty program and a travel credit card for earning and redeeming airline miles can be a challenge. Generally, if you fly with the same airline on a regular basis and don’t want to deal with the hassle of annual fees, a loyalty program can be a great option. On the other hand, if you’re a serious traveler who wants to get rewarded for all the purchases you’d be making on a credit card anyway, a travel credit card may be better suited for your needs.
Keep in mind that you aren’t necessarily limited in choosing one or the other; many travel credit cards actually come with 1:1 earning ratios for airline loyalty programs, so you can take advantage of the perks that both have to offer.
Tips For Making the Most of Your Airline Miles
Once you’ve accumulated a fair number of airline miles, you may be looking to book your first free flight. Before you get started, however, there are some tips you’ll want to keep in mind to help you make the most of your booking and avoid wasting miles.
Be Flexible With Your Travel Dates
The single best way to make the most of your airline miles is to be flexible with your travel dates, especially if you’re redeeming through an airline that uses a cost-based model. Since fares will be higher during weekends and other peak times of the year, you’ll have to use up more of your miles if you fly during an in-demand season or day of the week.
If you can be flexible with your travel dates (for example, by flying out on a Wednesday instead of a Friday), you can make your miles go further.
Don’t Be Afraid of Stopovers
If you’ll be embarking on a longer trip, look into booking flights with stopovers. These often cost significantly less airline miles than flights without stopovers. Specifically, a stopover refers to any flight where there is a delay of 24 hours or more in a connecting city. However, a stopover flight can cost you very few airline miles and give you the opportunity to add another city to your itinerary.
Budget for Taxes and Other Fees
Keep in mind that even if you have more than enough miles saved up for a “free” flight, you’ll most likely still end up paying at least a little bit of money out-of-pocket, so budget accordingly. Taxes and other fees typically cannot be covered by airline miles, and you may also need to pay for checked baggage. Be sure to carefully research the airline’s policies here so you don’t get stuck with any surprises at the time of your booking.
Considerations For Choosing A Credit Card
If you’ve decided to open a travel credit card as a means of earning airline miles, check out our guide to travel credit cards, where we have some specific recommendations on the top five travel credit cards available today. You’ll also want to keep a few key considerations in mind as you decide on the travel credit card that’s right for you.
Restrictions, Blackout Dates, and Availability
Unlike airline loyalty programs, most travel credit cards won’t have restrictions on when you can redeem your points or the type of seating you can book using your accumulated miles. Still, it’s a good idea to verify the credit card’s specific policies before you open an account.
Point Values and Expiration Dates
Be sure to find out exactly how many airline miles you’ll be earning for each dollar spent, especially if earnings can vary based on spending category. You’ll also want to make sure that your airline miles won’t expire. With most credit cards, your miles won’t expire so long as you make at least one qualifying purchase every one to two years, but this can vary—so be aware of your credit card company’s policies.
Annual Fees and Other Costs
Almost all travel credit cards will charge an annual fee, and these fees can vary greatly from under $100 to well over $500 per year. Some credit card companies will also waive your fee for the first year you carry the card, but this is not always the case.
In addition to annual fees, you’ll also want to be aware of your credit card’s interest rate/APR. Many will offer an introductory rate of 0% for the first year, but what about after that?
Additional Perks or Benefits
Many travel credit cards offer additional rewards and perks beyond the ability to earn and redeem airline miles. For example, you might gain access to airport lounges just by carrying your card, or you might enjoy free travel insurance or rental car insurance coverage. Others may include perks like free luggage fees, a monthly Uber credit or an annual airline credit to offset your travel expenses. Be sure to ask for a list of perks before you sign up for a travel credit card to make sure you’ll get use out of them.
The Bottom Line on Airline Miles
As you can see, there are many ways to earn airline miles, including enrollment in an airline loyalty program and opening up a travel credit card. Ultimately, the option that’s best for you will vary based on how often you travel and whether you’re truly loyal to a single airline. Regardless, there are plenty of ways to maximize your earnings and redeem your airline miles wisely so you can save money and optimize your travel!