Comparing The Two New No Annual Fee Airline Credit Cards

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Update: These offers for the Delta SkyMiles® Credit Cards from American Express are expired. Learn more about the current offer here.

Historically airline credit cards have been considered to be “premium” cards, as they have annual fees and come with valuable perks for those who fly an airline with any frequency. However, last week we saw the introduction of no annual fee cards from both Delta and United. While the cards were announced around the same time, they’re structured differently.

In this post I thought it would be fun to do a comparison of The UnitedSM TravelBank Card and the Blue Delta SkyMiles® Credit Card from American Express, to look at how the sign-up bonuses, return on spend, etc., compare.

The fundamental difference between the two cards

While the cards are similar in the sense that they both have no annual fees, their structure is different. The United TravelBank Card is essentially a cashback card, where the rewards structure gets you “cash” in your United account that you can use towards flights, while the Blue Delta SkyMiles Card is a traditional mileage earning card.

However, the Delta SkyMiles program is increasingly becoming more revenue based, meaning that even though you’re earning miles, it’s getting tougher to get outsized value from your SkyMiles.

Comparing the sign-up bonuses

The United TravelBank Card is offering a sign-up bonus of $150 in TravelBank credit after spending $1,000 within three months.

The Blue Delta SkyMiles Card is offering a sign-up bonus of 10,000 bonus miles after spending $500 within three months.

In this case I’d say United’s card offers a marginally better return. I value SkyMiles at ~1.2 cents each, meaning that the 10,000 miles are worth ~$120 to me. However, the minimum spend on the Delta card is only half of the minimum spend on the United card. So I’d say the United sign-up bonus is marginally better.

Comparing eligibility

The terms of the United TravelBank Card say the following:

This product is not available to either (i) current cardmembers of this credit card, or (ii) previous cardmembers of this credit card who received a new cardmember bonus for this credit card within the last 24 months.

Furthermore, it’s my understanding that the card is subjected to Chase’s 5/24 rule, meaning you won’t typically be approved if you’ve opened more than five new accounts in the past 24 months. If you’re anywhere close to that limit, personally I’d much rather apply for the Chase Sapphire Preferred® CardInk Business Preferred℠ Credit Card, Chase Freedom® CardChase Freedom Unlimited®, etc.

Meanwhile the terms of the Blue Delta SkyMiles Card say the following:

Welcome bonus offer not available to applicants who:

  • Have or have had this product or the Delta SkyMiles® Options Credit Card, or
  • Currently have or have had one of the following products in the last 90 days: Delta SkyMiles Credit Card, Gold Delta SkyMiles Credit Card, Platinum Delta SkyMiles Credit Card, or Delta Reserve® Credit Card.

That’s surprisingly restrictive — that means this card has the strictest approval requirements of any Delta Amex product. You won’t earn the welcome bonus if you’ve had cards like the Gold Delta SkyMiles® Credit Card from American Express in the past 90 days. Meanwhile the welcome bonuses on all of Delta’s other co-branded cards are available as long as you haven’t had that specific card before. So it’s interesting that their most basic card also has the strictest requirements for earning the bonus.

So both of these cards are surprisingly restrictive when it comes to getting approved and earning the welcome bonus.

Comparing the return on spend

The United TravelBank Card offers the following return on spend:

  • 2% in TravelBank cash on airfare purchases with United
  • 1.5% in TravelBank cash on all other purchases

Meanwhile the Blue Delta SkyMiles Card offers the following return on spend:

  • 2 SkyMiles per dollar spent at restaurants and on purchases made directly with Delta
  • 1 SkyMile per dollar spent on everything else

So I’d say for everyday, non-bonused spend, United’s card is better here, as I value 1.5 cents at more than one Delta SkyMiles. However, the Delta card does have the benefit of offering double miles at restaurants, so that card wins for restaurant and airfare purchases.

Still, neither of these cards offers an especially compelling return.

If you’re considering putting spend on the United Card, I’d instead consider using the no annual fee Citi® Double Cash Card, which offers unlimited 1% cash back when you buy, plus an additional 1% as you pay for those purchases. I’d generally rather get a return of two cents after paying for a purchase than 1.5 cents.

If you’re considering the Delta Card, I’d instead use the no annual fee Amex EveryDay® Credit Card from American Express, which offers points that can be converted into Delta SkyMiles, except you can earn points at a faster rate.

Comparing perks

The United TravelBank Card offers 25% back as a statement credit for eligible inflight purchases. It doesn’t come with many of the same benefits as the $95 annual fee United MileagePlus® Explorer Card, like a free first checked bag, priority boarding, two United Club passes every account anniversary, additional saver and standard level award availability, a potential waiver of the elite status revenue requirement, etc.

Meanwhile the Blue Delta SkyMiles Card offers 20% back as a statement credit for eligible inflight purchases. It doesn’t come with many of the same benefits as the $95 annual fee (though it’s waived the first year) Gold Delta SkyMiles® Credit Card from American Express, like a free first checked bag, discounted SkyClub access, the ability to use “Pay With Miles” towards the cost of a ticket, etc. However, this year the card will come with a Medallion Qualifying Dollar Waiver if you spend $25,000 on it. However, as of January 1, 2018, it won’t, unless you have another American Express Delta card.

Bottom line

For the savvy, frequent traveler, neither of these cards is going to be your best bet. There’s potentially a lot of value in having a premium airline card for the perks it offers, or having a card earning flexible points for the return on spend it offers (like the Chase Sapphire Preferred® Card). However, I suspect a lot of brand loyal casual travelers will still find these cards to be interesting, because they want a card with an airline they like, but don’t want to pay an annual fee.

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Comments

  1. @Lucky- I have the Skymiles Gold Amex. I’ve had it two years and now it’s up for the annual fee again by the end of the month.

    I no longer see the value in the card now that I have the bonus and have moved most of my travel to Alaska.

    Question: do I a) migrate to Blue Delta (and receive no sign up) b) just cancel the Gold, or c) migrate to some other card?

    I already have personal Plat, spg, both hiltons and blue for biz.

  2. @ Ben — For this savy traveler, who has a binder with 300 credit cards, these are exactly what I need (something I can earn a sign up bonus on)! 🙂

  3. It seems to me that the United card is basically a joke. You don’t even get miles, you get 1.5-2% “cash” back which can only be redeemed for United purchases. The Citi Double Cash card easily blows that away on all categories of purchases since its 2% back on everything that you can spend anywhere). The Delta card could conceivably be interesting because of the double miles on dining if you were all about flying Delta and earning Skymiles (and were either elite status and/or also had one of the other Delta cards to get perks like priority boarding and free checked bags). Though even then, for a lot of people 3x chase points on dining with the Sapphire Reserve is still going to be better.

  4. ” I’d generally rather get a return of two cents after paying for a purchase than 1.5 cents.”

    Yeah me too 😀

  5. I agree that the citi double cash card renders the United one largely pointless. Interesting question though: since you don’t earn miles, when you redeem your “united cash back,” does the flight you redeeend it for count as a paid flight or a reward flight? If it counts as a paid flight it might be intriguing since you’d earn miles, elite credit, and million miler credit.

  6. @Grant if you have moved most of your travel to Alaska, why wouldn’t you get an Alaska card? It has an annual companion ticket for taxes and fees, decent miles earnings, no foreign transaction fees, free checked first bag, etc.

  7. It seems to me that for the younger, more casual traveller, the Delta Blue card is gonna make sense. It hits two things my 21 year old son cares about …. well, 3 things really. 1. Travel 2. Dining out 3. Frugal

    He’s not interested in having a travel and professional credit card portfolio like most of us miles and points type folks are. But he is going to like the idea of no annual fee, getting 2x miles on dining out, and 2x miles on travel (when he does travel).

    He won’t care about the things we view as a downside. No MQD waiver won’t bother him, because he doesn’t care about airline status. No free first checked bag also won’t bother my son, because he never checks a bag. No 21 year old boy does. He won’t care about most of the other benefits, like Amex MR points, or Chase points, or whatever. Tracking spending categories and transferring points, and such, is a complexity he will not be interested in.

    But, between the initial spend bonus and the dining 2x earnings, he can probably rack up the 25K miles he needs for a cheap economy RT somewhere. And that my son is going to like.

    I think Delta/Amex were really smart here in constructing a simple, easy to use, frugal card that will appeal to folks 20-25 years old.

  8. I know we all know about fantastic cards that, if you leverage the benefits right, end up being more cost effective than the Delta Blue card. But college students and kids in their first job either 1. Don’t care about that and just want to hit the easy button or 2. Don’t have the upfront resources to make that work.

  9. I completely agree with Eric on that one – for some of us who are younger and still building our career, and therefore don’t have a particularly large income, paying $90/year in order to be able to earn more rewarding points (like with the Chase Preferred card) just isn’t in the cards (pun intended, I suppose). I fly 90% Delta anyway, as they tend to be the cheapest way for me to get where I need to go, so earning on Delta with a great dining category bonus is exactly what we need. And I never make the MQMs waiver either, again because of my income at this stage in my life.

  10. @Eric I already have he Alaska card which is a no brainer and my wife has one too (and not as an AU).

    Just looking for advice in what to do with the Amex Gold Skymiles card.

    Might just ditch it, but I don’t wish to get labeled as a churner.

  11. @Grant for what my thinking is worth, since you have a broad mix of Amex cards, you don’t fly Delta, and you have the airline card for your airline of choice …. I’d just close down the Delta Gold. The only way it would be worth keeping is if you anticipate flying Delta and checking a bag 4 times.

    As to the concern of being considered a churner by Amex, I don’t see it with the mix of cards you have and the value that Amex is getting from you. But I’m not a banker nor an expert. Other than being a fairly heavy credit card user.

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