An important step toward getting the most out of your travel is to not only maximize your points and miles, but also to minimize your expenses. Today TPG Contributor Jason Steele explains how you can lower your cash outlay for both paid and award tickets by taking advantage of some very useful credit card benefits.
Call it unbundling, a la carte pricing, or just nickel-and-diming; by any name, air travelers are being pummeled by an array of new fees for services that were once free. Sensing an opportunity, the credit card industry has seized on passengers’ misfortune and started offering benefits to help cardholders offset or eliminate these incidental airline expenses.
In this post I’ll provide a rundown of top cards that offer airline travel credits, explain how each one works, and discuss some strategies to maximize these benefits in general.
The cards below can reimburse you for airline incidentals, or even airfare. (Image courtesy of Shutterstock)
American Express Platinum and Business Platinum Cards
Amex was one of the early adopters of the airline fee credit, and both the personal and business platinum cards offer primary cardholders a $200 fee credit for airline incidentals. This credit is one of the more nuanced ones out there, in that customers must jump through a few hoops and understand which fees are eligible for reimbursement and which are not. Here’s what you need to know:
- Cardholders must first choose an eligible carrier. Cardholders can only choose from 10 different domestic carriers: Alaska, American, Delta, Frontier, Hawaiian, JetBlue, Spirit, Southwest/Airtran, United, and US Airways. Once chosen, the selected carrier cannot be changed except during January of the following year. Use this link to select a carrier.
- Understand which fees are eligible, and which are not. In my experience, airline fees that you can expect to be credited automatically are those that appear on your statement as being charged to the airline, and are not associated with a ticket. Examples of eligible fees include those for baggage, reservation fees, lounge admission and membership, and in-flight food and beverage. Seat assignments within the same class of service are eligible, but upgrades to a higher class of service are not. For the purpose of this fee, United Economy Plus, Delta Economy Comfort, and American Main Cabin Extra are all considered to be seat assignments within the same class of service. I’ve had good luck with receiving credit for purchasing gift cards directly from the airline, although this is not a published benefit, so there are no guarantees. Payments toward ticket purchases or taxes and fees on award tickets are ineligible, along with those billed to third parties, such as in-flight WiFi, partner airline charges, and mileage purchases. For more information, check out TPG’s post on how to maximize this benefit.
- If the fee isn’t credited properly, call American Express. In my experience, and that of others I know, American Express will give customers the benefit of the doubt when they call to see why a charge hasn’t been credited, so it often helps to ask.
- Don’t forget Global Entry. Although not technically an airline fee credit, the American Express Platinum cards also offer a $100 credit toward the application fee for the Global Entry program operated by the U.S. Customs and Border Patrol, which includes enrollment in the TSA’s Pre-Check program. This credit can only be used once every 5 years per cardholder (including authorized users), and the fee is not refunded if an application is denied for any reason.
The Ritz-Carlton Rewards card offers a fee credit of $300 annually for certain airline expenses.
Ritz-Carlton Rewards Card from Chase
This card offers an annual $300 fee credit per calendar year, so most new applicants can effectively utilize it twice within their first year of card membership. The credit is not automatic, and cardholders must call Chase within four billing cycles to request the credit, which can be used toward charges to any airline. Eligible fees include airline lounge day passes and yearly lounge memberships, seat upgrades, baggage fees, in-flight Internet and entertainment, in-flight meals, and the Global Entry application fee.
Citi Prestige
Earlier this year, Citi announced sweeping changes to the benefits on the Citi Prestige. Beginning on October 19, 2014, this card will offer a $250 air travel credit, which Citi defines as “purchases made with airlines”, including airfare, baggage fees, lounge access, and some in-flight purchases. In the past, only charges of $100 or less qualified for fee credits, but that limit has been removed from the updated benefit, so the entire $250 credit can be reimbursed for a single eligible expense. Like the credit on the Ritz Carlton Rewards card, this fee credit is offered per calendar year.
Citi Expedia+ Voyager
This recently launched card offers a $100 annual statement credit (again based on the calendar year, which is defined in this case as January through December billing statements). Eligible fees include those incurred with one of the nine qualifying airlines, two wireless hotspot providers, or on the Global Entry application fee. Eligible airlines include Alaska, American, Delta, Frontier, JetBlue, Southwest/Airtran, United, US Airways, and Virgin America Airlines. The qualifying wireless hotspot providers are Boingo and Gogo. Qualifying incidental fees include those for checked bags, in-flight entertainment, food, and beverages. Citi also states that airline incidental fees must be separate from airline ticket charges in order to be eligible.
The FlexPerks Travel Rewards card gives you a fee credit for each flight purchased with an award redemption.
US Bank FlexPerks Travel Rewards Visa Signature Card
This card offers a $25 airline allowance for each award ticket redeemed using FlexPerks points. Cardmembers must call US Bank at 877-978-7446 to request a statement credit within 90 days of making a qualified purchase.
Capital One Venture Rewards Credit Card and Capital One VentureOne Rewards Credit Card
Cardholders earn miles that can be redeemed for statement credits toward nearly any travel expense. Eligible expenses include any airline charges, including those for seat upgrades as well as taxes and fees for award travel.
Barclaycard Arrival and Arrival Plus
Like the Capital One cards, both versions of the Barclaycard Arrival offer miles that can be redeemed for statement credits toward travel expenses, including any airline charges.
Some cards let you apply your airline credit to the purchase of gift cards, but check the fine print to be sure.
Tips for maximizing airline fee credits:
1. Know your card’s fee credit benefit well. While it’s not a real page-turner, it pays to read the fine print in the benefits guide that comes with your card. This document provide crucial details that may be missing from the terms and conditions available to applicants. It can also serve as a valuable backup if the eligibility of a fee you paid is ever in dispute.
2. Make sure to utilize the full benefit each calendar year. Most of the cards offer above offer fee credits on an annual basis (with the exception of the Capital One and Barclaycard products). This means that if you receive one of these cards before the end of this year, you can use the fee credit now, and then again in 2015. That can make or break the value proposition of paying the high annual fees that come with these cards during the first year of card membership.
3. Consider purchasing airline gift cards. This is a grey area, but for anyone who plans to purchase airfare in the future, there’s little harm in trying. Gift cards seem to be implicitly eligible under the new benefit terms of the Citi Prestige card, while it’s less clear how the new Citi Expedia+ Voyager card will treat such purchases. Unless the card issuer demands a receipt, there’s no way to tell what comprised a non-airfare purchase with a given airline. Note that gift cards can be used for infant fares, and can usually be used toward the payment of award taxes and fees, such as the recently increased TSA fee.