Can't decide between an airline credit card or travel rewards card? Ask yourself these 3 questions (2024)

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With the right type of credit card, you could save serious money on your next trip. The tricky part is choosing the right one: a standard travel rewards credit card or an airline credit card.

There are some key differences between the two types of credit cards, and personal considerations that may affect your decision. To help you hone in on the right card for you, CNBC Select outlines three questions to ask yourself before applying.

These two types of credit cards are similar in some ways, but have key differences.

An airline credit card is a co-branded credit card for a specific airline, and its rewards can only be redeemed with that airline and its airline alliance partners. For instance, the miles you earn with the Delta SkyMiles® Gold American Express Card can only be redeemed with Delta or its SkyTeam alliance partners, such as Air France or Aeroméxico.

Though airline credit cards are less flexible in terms of award-redemption opportunities, they offer benefits catered to those who are loyal to a particular airline. These perks include airline lounge access, complimentary checked bags, priority boarding, in-flight food and beverage discounts and benefits designed to help you earn elite status faster.

For example, if you hold the Delta SkyMiles® Reserve American Express Card, you receive access to DeltaSky Club® lounges and free checked bags when you fly Delta. Reserve Card Members will receive four Delta Sky Club One-Time Guest Passes each year.

After that, you may bring up to two guests at a per-visit rate of $50 per person, per location. Effective 2/1/25, Reserve Card Members will receive 15 Visits per year to the Delta Sky Club; to earn an unlimited number of Visits each year starting on 2/1/25, the total eligible purchases on the Card must equal $75,000 or more between 1/1/24 and 12/31/24, and each calendar year thereafter. Once all 15 Visits have been used, Eligible Card Members may purchase additional Delta Sky Club Visits at a per-Visit rate of $50 per person using the Card.

A travel rewards credit card, earns points that can be redeemed for a variety of travel. You can typically use travel rewards to book directly through the bank's travel portal or by transferring points to hotel or airline partners.

For example, the Capital One Venture X Rewards Credit Card lets you earn Capital One miles, which can be redeemed through the Capital One travel portal for different travel purchases including flights, rental cars and hotels. You could also transfer your Capital One miles to one of its many airline and hotel partners.

When you're choosing between an airline card and a general travel card, it's important to dig into the specifics of the exact cards you're comparing. Credit card benefits and features vary not just by card type but also from one card to the next.

This is true even within a family of cards. For example, there are seven different co-branded Delta SkyMiles cards issued in the U.S., and while there is some overlap in benefits, each is designed with a different person in mind. The same goes for travel cards, many cards earn American Express Membership Rewards points, some have no annual fee and others charge hundreds of dollars a year.

Use rewards for flights

Airline cards earn miles or points tied to that airline's frequent flyer program, and travel cards earn rewards that are part of that card issuer's rewards program. You can use both types of rewards to book flights.

You can redeem airline miles for award flights with that airline or airlines it partners with. Sometimes, it's easier to use airline miles, but many airlines have dynamic award prices. This means your rewards can be devalued more easily with price increases.

Credit card travel rewards programs, typically allow you to use points to pay for flights or transfer points to airline loyalty programs. If you have transferrable rewards, you can move points to whichever airline program offers the best deal for the specific flight you want to book. The option to transfer points to multiple airlines protects you when one airline raises its award prices.

Flexible rewards and redemptions

You can use airline miles for more than just flights. You can use miles to book vacation packages, hotels, rental cars and activities. You may even be able to use your miles to pay for lounge passes or checked baggage fees. Some airlines allow you to transfer airline miles to hotel programs, but it's rarely a good deal. The transfer ratios for these conversions tend to be poor and hotel points are usually much less valuable than airline miles. Redeeming miles for flights will usually get you the most value, so other redemption options aren't ideal.

The most valuable travel rewards programs, such as Chase Ultimate Rewards®, Bilt Rewards or Citi ThankYou® Rewards, offer a wider range of ways to use your points and miles. You usually can convert points to cash back (typically at one cent per mile/point or better). With cash in hand, you can book any travel or pay for any expense. You'll also have the opportunity to increase the value you receive from these rewards by taking advantage of transfer partners (if they're available). The best transfer partners unlock the ability to book business-class flights or luxury hotels that would cost hundreds or thousands of dollars.

Earn airline elite status

You can earn airline elite status without flying with many co-branded airline credit cards (but not all). How useful this benefit is, depends on the airline and the specific card. Some airline cards offer status just for having the card, but generally earning airline status with a co-branded card requires a hefty amount of spending.

Travel cards may offer credits that can cover airline fees or may earn rewards you could use to pay for a seat upgrade, but they won't help you qualify for airline status.

Travel and purchase protections

Airline and travel cards both may offer insurance protections, such as trip delay coverage, trip cancellation/interruption insurance or purchase protection. The best travel insurance benefits are attached to premium airline or travel cards, which have the highest annual fees. While both types of credit cards may offer these perks, you're more likely to find meaningful protections with a general travel card.

Intro bonus offers

The vast majority of airline and travel cards offer some sort of a welcome offer. Many of the best intro bonuses are attached to these types of cards. When comparing these offers, consider not just the number of points or miles, but also the value of those rewards. Flexible travel rewards are generally regarded as more valuable than airline miles.

Airline specific-benefits

If you want priority boarding, free checked bags, in-flight discounts and companion pass offers, you'll want an airline card. Getting free checked bags or annual companion passes can easily make an airline card worth paying for. Keep in mind, the best airline perks typically aren't available with no-annual-fee airline cards.

Travel cards don't typically offer benefits tied to a specific airline. However, if a card offers travel credits, you may be able to use those credits to offset airfare or airline fees (checked bags, lounge passes, etc.).

Airport lounge access

You can get access to airport lounges with airline cards and travel cards. However, the benefit is typically only available with premium credit cards that have higher annual fees. If this is an important perk for you, be sure to consider what lounges you might frequent the most because travel cards usually grant access to Priority Pass lounges, while airline cards can get you into that airline's lounge network.

Some cards offer access to both, such as The Platinum Card® from American Express. With it, you can visit Delta Sky Club lounges, Priority Pass lounges and many more.

Travel benefits

When it comes to travel benefits, travel cards outshine the majority of airline cards. The best travel cards offer statements that apply to hotels, rental cars, airfare and more. Some even offer elite status perks with hotel chains and rental car agencies. Travel cards also tend to be more rewarding for all sorts of travel purchases.

Some airline cards provide benefits that apply when you're not flying with that airline, but it's much less common. The perks also tend to be more difficult to earn or have restrictions.

Both types of credit cards present great opportunities to save money on travel, and one is not inherently better than the other. Everyone has different needs, travel habits and preferences, so it's best to analyze your travel style and find the card that works best for you.

For starters, ask yourself the following three questions:

1. How do you typically travel?

If you tend to fly more than three times per year, an airline credit card may be a solid fit, especially if you live in a city that serves as a hub for a particular airline. For example, Atlanta is a hub for Delta, so a co-branded credit card such as the Delta SkyMiles Reserve American Express Card could make sense if you live near Atlanta.

If your travel style varies — a mix of cruises, road trips, train rides, etc. — a travel rewards credit card may better suit you since you'll be able to accrue and redeem points for more than just airfare on one airline.

2. Where do you want to go?

Once you have a destination in mind, it's easier to know which credit card to get.

If you'd like to travel around Europe, you'll probably fly with more than one airline, use other modes of transport and stay at different hotels. In that scenario, earning transferable points such as Amex Membership Rewards® points or Chase Ultimate Rewards® points makes more sense than earning airline miles as they offer greater flexibility.

Some of the best cards for earning these points are the Chase Sapphire Preferred® Card and the American Express® Gold Card.

On the other hand, if United Airlines flies everywhere you want to go and you're staying with friends, the United Club℠ Infinite Card is a great choice. It earns United miles, comes with United Club lounge access and gets you free checked bags.

3. What is your budget for an annual fee?

Many airline credit cards and travel rewards cards come with an annual fee. Some cards offer solid benefits for a fee that's under $100. But cards that allow you to earn more points and miles and come with a wide variety of benefits can have a much higher annual fee.

While paying an annual fee isn't necessarily a bad thing, it's important to remember to stay within your budget and not pay for a new card when you won't be able to maximize all its benefits.

Here are some CNBC Select's picks for the top airline credit cards:

• Best for American Airlines: Citi® / AAdvantage® Platinum Select® World Elite Mastercard®
• Best for JetBlue: JetBlue Plus Card
• Best for Delta: Delta SkyMiles® Platinum American Express Card
• Best for Southwest Airlines: Southwest Rapid Rewards® Priority Credit Card
• Best for United Airlines: United℠ Explorer Card
• Best for Alaska Airlines: Alaska Airlines Visa® credit card
• Best airline card with no annual fee: American Airlines AAdvantage® MileUp®

Here are some of CNBC Select's picks for the top travel rewards credit cards:

• Best for dining:American Express® Gold Card
• Best for welcome bonus:Capital One Venture Rewards Credit Card
• Best for authorized user perks:Capital One Venture X Rewards Credit Card
• Best welcome bonus:Chase Sapphire Preferred® Card
• Best for luxury travel:Chase Sapphire Reserve®
• Best for lounge access:The Platinum Card® from American Express
• Best for no annual fee:Discover it® Miles
• Best for paying rent:Bilt Mastercard®
• Best for low interest:Choice Rewards World Mastercard®
• Best for students:Bank of America® Travel Rewards for Students

When you're deciding whether to apply for an airline card or a travel rewards card, you need to consider the advantages and drawbacks of each choice.

Airline cards are helpful if you're loyal to a specific airline because you'll earn miles with that program. In addition, many airline cards can help you earn elite status more easily or may grant you elite-like perks like free checked bags, priority boarding and access to the airline's airport lounges. But there are downsides to earning miles with a single airline because it may not fly where you want to go or may not be the best deal for that particular route.

Travel rewards cards offer the most flexibility. Many travel cards allow you to transfer the rewards you earn to various airlines and hotels, allowing you to pick the best deals. This type of card also typically offers a variety of general travel benefits, such as travel insurance and access to larger networks of airport lounges. On the flip side, with a travel rewards card, the best redemptions can be harder to find or complicated to book and you usually won't get airline-specific benefits.

Keep in mind, if you've assessed your situation and feel you can benefit from both types of cards, you can have one (or more) of each card type.

Airline credit card: Pros and cons

Pros

• Earn miles with your favorite airline
• Fast-track your way to elite status
• Unlock valuable benefits with a specific airline (priority boarding, free checked bags, airline lounge access, etc.)

Cons

• Locked into a single loyalty program
• Limited options for using rewards for other types of travel
• Fewer general travel perks, like travel insurance

Travel rewards card: Pros and cons

Pros

• Flexibility to use rewards for hotels, rental cars, flights and more
• Exceptional travel protections
• Versatile airport lounge access benefits

Cons

• Few, if any, airline-specific perks
• Certain redemptions are more complicated
• May not be able to transfer rewards directly to your favorite airline

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When deciding between an airline credit card or a travel rewards credit card, ask yourself the above three questions to narrow down the best choice for your travel needs.

As long as you earn the welcome bonus, make the most of your card's travel benefits and stay within your budget, either type of credit card can enhance your travels while simultaneously saving you money on flights and other expenses.

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For rates and fees of the American Express® Gold Card, click here.

For rates and fees of The Platinum Card® from American Express, click here.

For rates and fees of Discover it® Miles, click here.

Information about the American Airlines AAdvantage® MileUp®, Alaska Airlines Visa® credit card, Bank of America® Travel Rewards for Students, Citi® / AAdvantage® Platinum Select® World Elite Mastercard® has been collected independently by Select and has not been reviewed or provided by the issuer of the card prior to publication.