You may have often heard the term “traveling on points.” Have you ever wondered how people manage to travel at such discounted rates? Well, the answer is simple — AIR MILES®.

Accessing funds whenever and wherever needed, discounted rates, exclusive rewards, bonuses, and perks, are some advantages that you can avail every time you swipe an AIR MILES® credit card.

So, if you are confused about how AIR MILES® works and which option you must choose, understanding a few factors may help.

How does AIR MILES® work?
Every airline has its own reward system. However, the names may differ; some call it the “frequent flyer” program.

There are specific credit cards that are co-branded with an airline. This way, every time you pay for goods from retail stores or food at the local diner, points are added to your card. These points are often referred to as miles. The more you use that card, the more points are added. Once you have earned enough miles you can use them to book flights with the particular airline that has partnered with the credit card company. The discount completely depends on the number of miles (points), distance, and fare class.

The miles used for a return trip in an economy domestic flight can range anywhere between 40,000 to 50,000. Most credit cards let you earn one mile per dollar on all purchases in addition to the introductory bonus. For example, Gold Delta SkyMiles® Credit Card by American Express offers 30,000 miles when one spends $1000 in the first 3 months. However, you might have to use the same credit card for every purchase to collect enough points. Also, although the miles are non-transferrable, you can use one airline’s miles with one of its partners. For instance, you can use the miles earned from American Airlines to book a British Airways flight since they are partners.

Occasionally, you are not allowed to use the miles earned to book air tickets. These are usually common around holidays, also known as blackout dates; so, it is advisable to book the flight at least 2 months prior.

Types of AIR MILES® credit card
The two basic types of air miles cards are: Co-branded airlines cards and general travel cards. As mentioned earlier, most credit card companies partner with airlines and offer co-branded cards. Gold Delta SkyMiles® credit card and Southwest Rapid Rewards ^® Credit Cards are some examples of co-branded air miles cards. These cards not only let you book flight tickets at discounted rates but often offer other perks, like priority boarding, airport lounge access, free checked bags, and discounts on in-flight purchases.

General travel cards are not associated with any airlines. Instead, you earn points based on your purchases through credit cards. General travel credit cards don’t have airline-specific perks, but they let you use miles on a variety of airlines instead of just one.

Travel cards, whether co-branded or general, come with a high annual fee and interest rate. AIR MILES® credit cards are good for you if you are a frequent flyer, have a good credit score, and pay off balance in full each month. It is important to learn which airlines you can use before you choose to invest in a card.

Some of the top AIR MILES® credit cards are:

• Capital One® Venture® Rewards credit cards
  With an annual fee of $95, this credit card by Capital One® offers 50,000 miles as a bonus for spending $3000 in the first three months of its purchase. It rewards 10X miles on bookings from Hotels.com and 2X miles on other purchases.
  The Capital One® Venture® has a variable APR ranging between 17.99% to 25.24%. The credit card also offers you $0.01 for every mile. Additionally, it does not charge you an annual fee in the first year of purchasing the credit card.
• Gold Delta SkyMiles® Credit Card by American Express
  Being one of the best air miles credit card by Amex, Gold Delta SkyMiles® offers an introductory bonus of 60,000 miles after you swipe it for $2000 in the first three months of its purchase. It also credits $50 in your card after you book a Delta Airlines flight in the first three months. The card offers 2X miles per dollar on Delta purchases and 1X miles per dollar on other purchases.
  The credit card also offers other perks, such as free first checked baggage, a 20% percent discount on in-flight purchases, and access to the lounges for $29. They have a variable APR ranging between 17.99% – 26.99% and have an annual fee of $95. It doesn’t charge you for the first year after purchase.
• Southwest Rapid Rewards® Priority Card
  Although this credit card has a high annual fee of $149, they have an introductory bonus of 40,000 miles that you can redeem after spending $1000 in the first three months of its purchase. These credit cards also provide $75 and 7500 bonus points. It upgrades your boarding passes four times annually, offers 20% discount on in-flight purchases and 1500 tier qualifying points for each $10,000. They have an interest rate varying between 18.24% and 25.24%. Additionally, you can check-in bags for free through this card.
• United ^SM Explorer Card
  This is another popular air miles credit card. The United Airlines offers this with no annual fee for the first year and $95 for the consecutive years. They offer priority boarding, 25% discount on in-flight purchases, 2X miles for hotels booked on the website, and 1X on other purchases.
  With a variable APR of 18.24 to 25.24%, they offer an introductory bonus of 40,000 miles on $2000 in the first three months and an extra 20,000 miles if you swipe $8000 on your credit card in the first six months.
• Citi® AAdvantage® Platinum Select® Mastercard®
  This card is certainly worth the try if you live near an American Airlines’ hub. One of the unique features about this card is that it offers miles even at gas stations. The card has an annual fee of $99, which is waived off in the first year. Citi® AAdvantage® offers an introductory bonus of 50,000 miles after you spend $2500 in the first four months of its purchase. As perks, the credit card offers 25% on in-flight purchases and $100 after you spend $20,000 on flight bookings. They have a variable interest rate ranging between 18.24% and 26.24%.

Your location of residence is the most important factor before choosing any of the above mentioned AIR MILES® cards. Prefer choosing cards of those airlines that dominate your local airport.

Sometimes, even the best of AIR MILES® credit cards change their introductory bonuses after a certain period of time. It is advisable to check the official website before signing up for these credit cards. AIR MILES® credit cards help you gain travel rewards on your purchases; this makes life so much easier.

Another good thing about using credit cards with Air Miles® is that it does not affect your credit score much when you apply for it. However, it might be difficult to get one due to the intense inquiry. This inquiry takes place when the lender checks your credit score before making a lending decision. It is just like banks that inquire about information before lending a loan or cellphone company before giving you a cellphone contract. Even if you have an impressive credit score, opening a new account resets time after your recent account is opened.

So, many financial experts suggest avoiding applying for new cards in a short period of time. If you are planning to apply for a new Air Miles® card, make sure that you know the dynamics of credit scores. Make sure you keep a track of your active cards, their statement dates, and renewal dates. Consider canceling the card if you do not use it and only pay the annual fee.