I Signed Up For An Airline Credit Card For The Miles

I didn’t get my first credit card until I was 22 and had already graduated college, and since then I’ve been very protective of my credit. I don’t sign up for credit card offers just for the points because I know there will be a temporary hit to my credit card that I don’t want.

My Current Credit Card Situation

There’s no real reason for me to have a good credit score right now. I’m nowhere near being ready to buy a house, I purchased my car with cash, so having good credit doesn’t do much for me other than give me pride.

So over the past year, I’ve changed my ways and signed up for 2 new credit cards. My existing card is the 3-2-1 Bank of America Cash Rewards VISA, which gives 3% back on gas, 2% on groceries, and 1% on everything else.

New Credit Cards I Signed Up For

The first card I signed up for was the Chase Freedom card, which offers 5% cash back on rotating categories. Getting 5% on gas or 5% on groceries is sweet and crushes what my other card gets. So while I don’t always use the card, it is great when there is a category I use that is offering 5% cash back on each transaction.

Oh yeah, and when I signed up, they gave me enough points to redeem for $500 cash back. $500 to sign up for a card that I’ll use responsibly? I love taking advantage of all the perks credit card companies offer.

The second card I signed up for was the Southwest Airlines credit card. When I signed up, they were offering 50,000 points for spending $2,000 in the first 3 months. So what does 50,000 points get you? Oh, just about $833 in free flights! Since I was planning on a few trips over the next 12 months, I figured this was a no-brainer. If I was willing to sign up for a credit card for $500, all the more so I should be willing to sign up for one for over $800!

The difference is that with the Southwest credit card, there is a $69 annual fee. Since the rewards themselves aren’t so great if you don’t fly Southwest a lot (I don’t), I plan on cancelling the card before the annual fee hits me next time around. Take the $764 ($833-$69) and run.

Do You Sign Up For Credit Cards For The One-Time Rewards?

The hit to my credit is relatively minor and I’m not going to use my credit for the next several years anyway, and by that time, these minor hits will have fallen off my credit report.

Do you sign up for credit cards just for the rewards? Do you know of any other great credit card offers I can take advantage of?

14 Responses to I Signed Up For An Airline Credit Card For The Miles

  1. We’ve actually started doing this a little more ourselves as you can really get some decent rewards. We won’t be buying a new house or car anytime soon so I am fine with the small hit. If I can get someone else to pay for a trip without changing how I really spend money then why not?

  2. David says:

    Why not see if you can downgrade to a southwest card with no annual fee as opposed to cancelling?

  3. Jake Erickson says:

    I’ve heard that you can get some great rewards by doing this, but my wife and I have yet to take advantage of it. We’re contemplating moving soon, so we don’t want our credit to take an unnecessary hit if we’re going to need to be approved for a mortgage. That being said, I think we will probably start doing this once we know we’re settled.

  4. krantcents says:

    I have had an airline card for 20+ years. I use my frequent flier miles to fly overseas business or first class. every other year. I have applied for several cards just for the miles bonus and later cancel the card.

  5. I recently signed up for two cards for the rewards. Nothing special, but since I’m not buying anything major in the next couple of years I might as well take advantage. I even wrote a best sign up bonus credit card post on my blog if you’re interested.

  6. Mike@WeOnlyDoThisOnce says:

    Same here! I’m quite happy with my decision, as long as I’m careful not to spend because of the rewards alone.

  7. I don’t sign up for cards just for the rewards, but that is probably because I don’t want to deal with churning cards and my credit score is excellent and I don’t want to ding it.

  8. Mr. Bonner says:

    I have the same Southwest card and it’s awesome! The 50K point promo comes up a few times a year, so sometimes you need to wait it out. My mother-in-law picked it up a couple months back, but when I checked it out again for my parents it wasn’t offered anymore. Next time it comes up they’ll be all over it. For some reason they advertise the ‘wanna get away’ flights at point redemption rate of 60pts/dollar, but when I’ve booked flights it’s closer to 54pts/dollar, so the points stretch out even further.

  9. Blair@LifeDollarsandSense says:

    I have had the same credit card since I was 16 years old and have been really reluctant to sign up for other ones. However, I am considering the Southwest card and a hotel card. I current stay in a hotel 3 months a year for work, and may soon be flying for business regularly…..I think I will take advantage of the boost to my point for those. Canceling credit cards is not something I am interested in so I have been very picky/slow to open any.

  10. Algy says:

    When you lay it out in the raw light of day with the figures and numbers these credit card deals are very appealing. If one has the discipline to manage these cards it is effectively free money. I’m particularly partial to 0% interest deals. This is free money, that I can invest (all be it at a low rate) in risk free regular saving accounts. This all adds up to extra free cash each month. Plus there is something quite satisfying about extracting free money from the banks. Cheers and great blog!

  11. Chris Mettler says:

    Personally, I am going only for those cards that I know that I am going to use. For some reason, the rewards usually are not the incentive that would get me to sign up on its own, although I will always consider them if I am planning to use the given service in the long term.

  12. Jon says:

    We are looking at signing up for a new credit card for the rewards, just haven’t yet! I am tired of spending all the money that I do on my card (before I pay it off each month), but not having it earn anything for me! We are looking at perhaps a Capital One miles card…

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