Bonus mileage programs may not pay off for travelers

By Sam Craine on Aug 24th, 2010

Rewards programs have always been an incentive for consumers to sign up for credit cards, and frequent flier mile deals are especially appealing to travelers. Bonus mileage programs have been the latest fad for travelers with credit cards, but new reports show that not all fliers are getting a good value for signing up.

Bonus mileage programs allow travelers to buy rewards points directly from airlines. However, the Wall Street Journal notes that by doing so, card holders are essentially spending twice or triple the amount on tickets by obtaining these points with lesser value.

"Many folks are just crazy for more miles," president of American's AAdvantage frequent-flier program Derek DeCross told the paper. "Some people just really, truly want to have as many miles as possible."

It's easy for travelers with these cards to rack up debt as well when trying to constantly spend to rack up points. Consumers struggling with credit card debt could consider consolidation to decrease their monthly payments. By combining debt and taking out a smaller loan, card holders can get a grasp on their debt with a lower interest rate.

More General Debt News

12-13-2010

Credit card charge offs fell in October

12-13-2010

Credit card lenders resume practice of preapproved offers

12-12-2010

Fed will soon decide whether to limit debit transaction fees

12-11-2010

Wikileaks battle sees hackers go after processors of credit card debt

12-11-2010

Hackers targeting store-issued accounts to rack up credit card debt

12-10-2010

New Android OS doesn't support mobile credit card payments

12-09-2010

TransUnion expects less delinquent credit card debt in 2011

12-08-2010

October sees consumer credit jump despite less credit card debt

12-08-2010

American Express reports more borrowing, less defaulted credit card debt

10-08-2010

Bankruptcy filings back on the upswing

Related Resources