Beyond miles: comparing airline credit cards and travel credit cards

While airline credit cards offer rewards and perks with a specific carrier, travel credit cards cast a broader net, providing benefits and bonuses that can be applied across multiple airlines and travel-related expenses. 

Deciphering which card suits your travel needs might be overwhelming. There’s a sea of reward options, annual fees, benefits, and other considerations. To help you navigate the complicated world of rewards cards, we’ve created this comprehensive guide to help you choose the best one. Here’s everything you need to know about airline credit cards vs. travel credit cards:

Airline credit cards vs. travel credit cards 

While they have much in common, there are key differences between airline and travel credit cards. Airline cards earn airline miles specific to a single airline, while travel card rewards can be transferred to numerous airlines and hotel loyalty programs. Airline cards also provide perks to improve your travel experience with a single airline, like free checked bags, in-flight discounts, priority boarding, companion passes, and more. 

With a travel credit card, you often receive annual statement credits for general travel expenses. These credits are more versatile since you can apply them to multiple airlines (though there are some exceptions). While some airline cards provide elite status perks, travel cards generally offer hotel elite status. Both cards offer value to different types of travelers.

What are airline credit cards? 

Banks or credit card companies issue airline credit cards in partnership with specific airlines. These cards are tailored to travelers, providing various benefits and rewards associated with air travel. Nearly every major airline offers a co-branded credit card that earns miles for various purchases, often providing bonus rewards on travel and other spending.  

Airline credit cards earn miles or points that can be redeemed for free or discounted flights, seat upgrades, access to airport lounges, or other travel-related perks. They’re relevant to frequent travelers and those who don’t fly enough to earn elite status but want the associated perks. 

How airline credit cards work

Airline credit cards work by rewarding cardholders with points or miles for everyday spending, particularly on air travel purchases. Every time cardholders use the card for a purchase, they’ll earn at least 1 mile per dollar spent. Some airline credit cards offer bonus miles on categories like travel, dining, gas and grocery spending. You can also expect bonus miles on purchases made with the airline, along with perks like in-flight discounts when you use your card.

The miles are deposited into your account after your monthly statement closing date. 

Another airline card benefit that often flies under the radar is that they keep your airline miles from expiring. If your airline of choice still enforces an expiration policy for miles (usually 12-24 months of inactivity), earning rewards with your airline card counts as a qualifying “activity” that keeps your account active.

Additionally, these cards may include supplementary benefits such as free checked bags, priority boarding, travel insurance, companion passes or statement credits for travel-related expenses. Some airline cards even earn credit towards elite status, allowing you to fast-track your status goals. Despite carrying annual fees ranging from $95-$550, these perks can offset this cost entirely.

Once you’ve accumulated airline miles or points, you can then redeem them for flights, vacation packages, upgrades, airport lounge memberships and more. Despite these vast options, flights are usually the highest value for your airline miles – especially business or first-class flights. These otherwise cost thousands of dollars, making miles and points a cost-effective alternative.

Pros and cons of airline credit cards 

Airline credit cards offer several advantages tailored specifically to frequent flyers. One of the primary benefits is the ability to earn miles directly with a particular airline, often at an accelerated rate for purchases made with that airline or its partners. These miles can then be redeemed for flights, upgrades, or other travel-related expenses. Additionally, airline credit cards often have perks like priority boarding, free checked bags, discounts on in-flight purchases, and access to airport lounges, enhancing the overall travel experience. For loyal customers of a particular airline, these cards can provide significant value through exclusive benefits and rewards.

However, these cards also have their downsides. They might tie you down to a specific airline, limiting flexibility in choosing the best flights or routes based on price or convenience. Some airline credit cards come with annual fees, and while the benefits outweigh the costs for frequent travelers, occasional flyers might find it challenging to justify these fees. 

Additionally, the miles accrued with these cards can sometimes have blackout dates or limited availability, making them harder to redeem for desired flights during peak seasons or for specific destinations. Most airline credit cards also carry annual fees, which may not be worth paying if you don’t fully use their benefits. 

What are travel credit cards?

Travel credit cards earn points that can be transferred to numerous airline and hotel loyalty programs, making them more flexible than airline miles. Similar to airline cards, travel credit cards offer substantial welcome bonuses to new card members. They also earn continuous rewards on various spending, with elevated rewards on travel purchases and categories like dining, gas, and groceries. 

While travel credit cards lack airline-specific perks like free checked bags, they sometimes include annual travel credits that can be applied towards these expenses. Premium travel credit cards also include perks like airport lounge memberships, TSA Precheck or Global Entry application fee credits, elite status perks via card spending, and more. 

How travel credit cards work 

Beyond the general (yet practical) travel perks, travel cards are most valuable for their versatility since the rewards can be converted to both airline miles and hotel points. Airlines are known to devalue their frequent flyer programs from time to time by substantially increasing the miles needed for a free flight. Some airlines even impose dynamic pricing, which means the number of miles for an award flight can vary greatly depending on demand. 

With transferable rewards, you won’t be stuck with thousands of miles that are suddenly worth less. You can hold on to your points and transfer them only when you’ve confirmed the redemption rates and are ready to book a flight. Unless you plan to utilize the airline-specific perks from an airline card frequently, you might find more value in a travel credit card.

Pros and cons of travel credit cards

Travel credit cards can be an excellent tool for travelers looking to capitalize on flexible rewards and valuable travel perks. One of the most significant perks is the ability to earn rewards for every dollar spent, which can be redeemed for flights, hotel stays, car rentals or even cashback. Some cards also provide enticing welcome bonuses, often consisting of tens of thousands of points, after spending a certain amount within a specified time frame. 

Additionally, travel credit cards frequently come with benefits such as travel insurance, airport lounge access, waived foreign transaction fees and various discounts on travel-related expenses, enhancing the overall travel experience.

Holly Johnson, a credit card expert and founder of Club Thrifty, recommends travel cards for those seeking more flexibility. “They work better for people who want general benefits and rewards that can be redeemed in more than one way.”

However, these cards have their drawbacks. Many travel credit cards come with high annual fees, which might outweigh the benefits if you don’t spend enough to meet reward requirements or take advantage of the perks.  Some cards have complex reward structures or redemption processes, making it overwhelming for consumers who aren’t experts on loyalty programs. It can be especially challenging to parse through a list of transfer partners and determine which presents the best value. Sometimes transfers aren’t instant, creating frustration for consumers trying to book award travel in a hurry.

How to choose an airline or travel credit card 

Choosing between airline and travel credit cards largely depends on your travel habits, preferences, and needs. Airline cards are ideal for travelers who are loyal to a single airline and want extra perks when flying. Premium credit cards can offer frequent travelers a fast track to elite status or other luxury travel perks like lounge access. However, consider the limitations of being tied to one airline, such as restricted flight options and potentially limited redemption opportunities.

On the other hand, general travel credit cards provide more flexibility. They typically offer rewards that can be used across various airlines, hotels and for cash back. These cards often come with versatile redemption options, allowing you to choose from a broader range of travel partners. They also offer benefits like annual travel statement credits to offset airline fees. If you prioritize flexibility and enjoy exploring different airlines and travel options, a general travel credit card might suit your needs better.

For a well-diversified points strategy, consider both types of cards. Senitra Horbrook is a travel expert and freelance credit card rewards writer who opts for this strategy. While she prefers travel rewards cards, she finds value in having an American Airlines card as well: “[American Airlines] is the airline I fly most of the time. Since American Airlines has limited transfer partners from the flexible travel programs, having their credit card makes it easier to earn more miles for travel.”

When deciding between airline and travel cards, consider your travel habits, spending patterns and the value of the card’s benefits against any annual fees. An airline-specific card is advantageous if you stick with a specific airline and value its perks. Conversely, a general travel credit card might be the better choice if you prefer flexibility and want to maximize rewards across various travel expenses. Evaluating the rewards structure, redemption options, annual fees, and additional perks will help you determine which card type best aligns with your travel preferences and financial goals.