There's something very wrong with mileage programs. I have always been somewhat skeptical of their value and am constantly surprised at the backward bending some of my friends practice in order to get a few more miles into their accounts.
Let's begin with the airlines. It is a fact of life that where you live determines, in most cases, which airlines you fly on the most. This is especially true for frequent travelers to many different destinations, less so for the leisure traveler with one or two fixed destinations. If you live in Atlanta or Detroit you are more likely to fly Delta than another airline. If you live in Chicago or San Francisco, Dallas or Los Angeles you are most likely to fly United or American and if you live in Houston or if Newark Liberty is your preferred airport Continental is your most likely choice. There are many other airports where your choices are limited to one or two airlines.
This is because, at the airports mentioned, the preponderance of flights are with the dominant airline which will have the most flights to the most destinations and you are most likely to use them more frequently than others. This leads you to a situation where you have a lot of miles on the dominant airline and bits and pieces on other airlines serving your city. While I have no hard data on any of this, it's reasonable to believe that most business travelers pay for their business travel and accumulate the mileage for their personal travel.
So when you want to take a vacation to an exotic destination you find that your most convenient airline doesn't happen to have the best or cheapest route to your dream vacation spot. In order to correct this flaw, each major airline offers a credit card and purchases on said card will accrue mileage plus the signing bonus. Why pay 9.3% interest and no annual fee to some non affiliated card when you can pay 13% plus an annual fee and get mileage towards your dream vacation. Also, as you collect cards, your credit rating goes down because the credit agencies see a multiplicity of credit cards as a high need for credit rather than a high need for miles.
And then there is the granddaddy of all credit cards, American Express which not only charges an annual fee but charges another $40.00 a year for the mileage program and additional charges to link your business cards with your personal card.
Now it comes time to use the mileage you have painstakingly and doggedly collected for many years. You find that your miles are worth between .75% and 1.5% of your expenditures. Don't forget, there are some cards that offer almost 5% in certain types of benefits. Not only aren't your miles worth much, if you want to augment missing miles you can buy them from the airlines for more than they are worth or, in certain situations where transfers from one account to another are permitted, the fees are equal to or exceed the points' value.
The only miles that are worthwhile accumulating are flown miles because you don't fly in order to gain points.
Making financial decisions based on the chimera of free vacations just doesn't make sense.
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we have found that not all miles programs are the same. Amex is particularly difficult to use and be flexible with but we have had wonderful experiences with using worldperks (originally northwest, now called flexperks miles) the earlier you book the most you will get out of your miles. KLM miles are also harder (more expensive) to use as they charge all sorts of fees to actually use the miles and flights and seats are very limited(much like amex/delta)
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