We all love the idea of getting miles for flights we've flown. However, a few of us have a clear understanding of how airline miles work when they apply for a frequent flyer program and even for a credit card to accumulate frequent flyer miles or travel points.
Frequent Flyer Miles
Frequent flyer miles, or simply airline miles, are part of a loyalty program offered by airlines. Typically, you accumulate a set amount of airline miles when buy a ticket and take a flight. The number of miles you earn depends on the ticket price and your status in the loyalty program. However, there are airlines that still give miles based on how far you fly (the miles flown). So, the further you fly, the more miles you earn. Frequent flyer miles are earned when you are member of a loyalty program of a specific airline (say it is AAdvantage from American Airlines) and have the airline's credit card, for example, the Citi® / AAdvantage® Platinum Select® World Elite™ Mastercard® credit card.
Now, you've accumulated some miles and ready to redeem them for an award travel. But don't think the miles you've accumulated are equal to the actual number of miles you can fly. The miles you accumulate are more like points in a rewards program. For example, with the AAdvantage program, you will need about 20,000 on average for a domestic one-way travel. With the earning potential of two miles per dollar, you will need to fly quite a lot domestically and internationally to get a roundtrip award travel with American Airlines. Here another thing comes out – frequent flyer miles a usually earned with the airline that provides the loyalty program, American Airlines in our example. Sometimes you are allowed to earn miles with partners (including alliance partners), and if you have an airline credit card, you can earn miles on everyday purchases. Redemption works the same way.
Basically, frequent flyer miles are like any other rewards program: you earn miles buying stuff, and then redeem them to get something for free.
Credit Card Rewards and Airline Rewards
Today many banks offer credit cards that are not tied to any airline but allow earning miles towards free flights. Those are travel rewards credit cards, and the miles they give work in a slightly different way. First of all, you don't have to be a member of a frequent flyer program to accumulate miles. You will earn miles for every dollar you spend on travel or anything else having just one travel rewards card. And secondly, you don't have to fly to earn miles towards an award travel. You can shop at your favorite stores and earn miles without losing earning potential. For example, with the Discover it® Miles you will earn a set number of miles for every dollar you spend. And if you want to use accumulated miles towards an air travel, just buy a ticket with your Discover card and then apply miles to this purchase. No need to buy a ticket with a specific airline, you can buy any ticket with any airline and then use miles to redeem for that ticket.