By Carl Dombek
Now that Southwest (NYSE:LUV) Airlines has abandoned its long-standing “Bags Fly Free” policy, fees for checked bags have become very much the norm, at least among American airlines flying domestic routes. But there are ways to avoid those fees. What works for you will depend on where, which carrier, and how much you fly.
When Southwest announced that it was going to start charging $35 for the first checked bag, it didn’t take advanced calculus to figure out that the $69 annual fee for the lowest-tier Southwest Rapid Rewards credit card would offset fees for two checked bags (though only one in each direction). Travelers who take more than one round-trip per year with a checked bag quickly come out ahead.
Savings on checked bag fees can extend to others traveling on the same itinerary. “Cardmembers and up to 8 additional passengers in the same reservation can check their first bag at no additional cost,” according to the Southwest web site.
The Southwest card, issued by Chase Bank (NYSE:JPM), offers other benefits as well, including “No foreign transaction fees” which can save three percent when purchasing travel, goods or services outside the U.S. (and, in some instances, Canada).
To access these benefits, travel must be paid for with the Southwest credit card. However, that is not a universal requirement across all travel credit cards.
Now that Southwest (NYSE:LUV) Airlines has abandoned its long-standing “Bags Fly Free” policy, fees for checked bags have become very much the norm, at least among American airlines flying domestic routes. But there are ways to avoid those fees. What works for you will depend on where, which carrier, and how much you fly.
When Southwest announced that it was going to start charging $35 for the first checked bag, it didn’t take advanced calculus to figure out that the $69 annual fee for the lowest-tier Southwest Rapid Rewards credit card would offset fees for two checked bags (though only one in each direction). Travelers who take more than one round-trip per year with a checked bag quickly come out ahead.
Savings on checked bag fees can extend to others traveling on the same itinerary. “Cardmembers and up to 8 additional passengers in the same reservation can check their first bag at no additional cost,” according to the Southwest web site.
The Southwest card, issued by Chase Bank (NYSE:JPM), offers other benefits as well, including “No foreign transaction fees” which can save three percent when purchasing travel, goods or services outside the U.S. (and, in some instances, Canada).
To access these benefits, travel must be paid for with the Southwest credit card. However, that is not a universal requirement across all travel credit cards.
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| Affinity credit cards |
American Airlines’ (NASDAQ:AAL) most basic AAdvantage credit card covers checked baggage charges for the cardholder(s), even if the trip is paid for using a different card. That may be a factor for those who travel on business and whose travel is paid either by their company or with a different travel card. And, as with other cards, whether the annual fee offsets checked bag charges (currently $40 per bag on American), depends on the frequency of your travel as well as your travel style.
American Airlines’ AAdvantage credit cards are issued by Citibank (NYSE:C).
Many airlines offer affinity travel cards and some include additional benefits. The United Airlines (NASDAQ:UAL) Mileage Plus Explorer Card, issued by Chase Bank, includes two passes to United Clubs each year, though the actual value of those has been steadily declining.
Far too often, I’ve tried to use mine during layovers (usually at a major airport), only to find signs at the clubs stating that they “…are not honoring day passes due to capacity constraints” or some other excuse. I’m not the only traveler who has made the case that they need to honor what they issue, but the only response I’ve received from United is a basic, “We’re sorry you’re disappointed.”
Other airlines offering affinity cards with bag fee benefits include Delta Air Lines (NYSE:DAL) SkyMiles Credit Cards issued by American Express (NYSE:EXP), Alaska/Hawaiian Airlines (NASDAQ:ALK) Atmos Cards issued by Bank of America (NYSE:BAC), and jetBlue (NASDAQ:JBLU) Jet Blue Cards issued by Barclays Bank.
American Airlines’ AAdvantage credit cards are issued by Citibank (NYSE:C).
Many airlines offer affinity travel cards and some include additional benefits. The United Airlines (NASDAQ:UAL) Mileage Plus Explorer Card, issued by Chase Bank, includes two passes to United Clubs each year, though the actual value of those has been steadily declining.
Far too often, I’ve tried to use mine during layovers (usually at a major airport), only to find signs at the clubs stating that they “…are not honoring day passes due to capacity constraints” or some other excuse. I’m not the only traveler who has made the case that they need to honor what they issue, but the only response I’ve received from United is a basic, “We’re sorry you’re disappointed.”
Other airlines offering affinity cards with bag fee benefits include Delta Air Lines (NYSE:DAL) SkyMiles Credit Cards issued by American Express (NYSE:EXP), Alaska/Hawaiian Airlines (NASDAQ:ALK) Atmos Cards issued by Bank of America (NYSE:BAC), and jetBlue (NASDAQ:JBLU) Jet Blue Cards issued by Barclays Bank.
There are other ways to score free bags. Frequent flyer clubs often provide free bag benefits but this is usually a perk for achieving elite status.
THE DOWN SIDES
Not all airline affinity cards offer free checked bags. The basic Jet Blue Card has no annual fee but does not offer a free checked bag. Travelers will need to choose at least the Jet Blue Plus Card with a $99 annual fee to get the first bag checked free.
Another downside is higher interest rates. For example, Alaska’s Atmos card, issued by Bank of America (BofA) carries an Annual Percentage Rate (APR) of between 19.99% and 27.99% based on the applicant’s “creditworthiness, when you open your account.” By comparison, BofA’s newest non-affiliated card carries a 0% interest rate for the first 15 statement closing dates, then a base rate of 17.99% that can go as high as 27.99%.
In addition, merchants are typically charged more when they accept affinity cards. Merchant fees typically run from 1.5% to 3.5% of the amount charged. With affinity cards on the higher end of that scale, it’s not surprising that they’re merchants’ least favorite, though I have yet to encounter a merchant that won’t accept them because of that.
Finally, the cards I’ve compared are the most basic that each airline offers. Annual fees can increase significantly depending on the benefits you want so do the math, consider your travel plans and style, and choose carefully.
Bon voyage!
Visit my main page at TheTravelPro.us for more news, reviews, and personal observations on the world of upmarket travel.
Photo by Carl Dombek
Click on photo to view larger image
THE DOWN SIDES
Not all airline affinity cards offer free checked bags. The basic Jet Blue Card has no annual fee but does not offer a free checked bag. Travelers will need to choose at least the Jet Blue Plus Card with a $99 annual fee to get the first bag checked free.
Another downside is higher interest rates. For example, Alaska’s Atmos card, issued by Bank of America (BofA) carries an Annual Percentage Rate (APR) of between 19.99% and 27.99% based on the applicant’s “creditworthiness, when you open your account.” By comparison, BofA’s newest non-affiliated card carries a 0% interest rate for the first 15 statement closing dates, then a base rate of 17.99% that can go as high as 27.99%.
In addition, merchants are typically charged more when they accept affinity cards. Merchant fees typically run from 1.5% to 3.5% of the amount charged. With affinity cards on the higher end of that scale, it’s not surprising that they’re merchants’ least favorite, though I have yet to encounter a merchant that won’t accept them because of that.
Finally, the cards I’ve compared are the most basic that each airline offers. Annual fees can increase significantly depending on the benefits you want so do the math, consider your travel plans and style, and choose carefully.
Bon voyage!
Visit my main page at TheTravelPro.us for more news, reviews, and personal observations on the world of upmarket travel.
Photo by Carl Dombek
Click on photo to view larger image
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