How to Earn Rewards Miles by Dining Out
By Eva Norlyk Smith Ph.D.
November 5, 2012
I was wondering how those dining rewards programs that are often attached to airline credit cards work. When I fly, I keep seeing ads in the plane and on the jetway saying stuff like “Earn miles by dining out!” Are these programs you need to sign up for? Does it work at all restaurants? Is it a hassle? — Nora
Indeed, for foodies eating out frequently, what’s not to like about a card that can get you free miles or a free lunch at your favorite restaurant?
There are two ways to earn rewards on restaurant visits. You can either go with a generic rewards card that lets you earn cash back on your restaurant spending. Or, as you noted, most airline frequent flier programs let you earn extra rewards when dining at some of their partner restaurants. Each option works slightly differently, so let’s take a look at each.
The no-hassle approach: generic rewards cards
While standard rewards cards earnings run at 1 percent per dollar spent, some rewards cards let you earn a premium on restaurant purchases, in some cases up to 5 percent. Don’t expect a free lunch, however. With those kind of cash-back earnings, to earn $100 in free dining, you’d have to spend $5,000 eating out on a card earning 2 percent cash back, and $2,000 for a card earning 5 percent. That’s a lot of restaurant visits.
The good news is that using a generic rewards card to earn cash back on restaurant purchases doesn’t have to involve any extra hassle. Once you find the best rewards card for your needs, all you have to do is use it to pay each time you eat out. And of course, when looking for the best rewards card for restaurants, your best bet is to choose a card that lets you earn above-average rewards on your other purchases.
When comparing rewards cards that pay a premium for restaurant charges, the Citi Forward card stands out from the crowd: The card offers 5 points for every dollar spent at restaurants (roughly equivalent to 5 percent cash back), as well as on movies, books and music. You get 1 point for all other purchases. New cardholders also earn 10,000 bonus points after the first $650 in purchases (and after you sign up for paperless statements), good for $100 in gift cards.
There are cons, however. To get the full 5 percent cash value on your points, you have to redeem earnings for $100 gift cards in increments of 10,000 points. If you redeem less, say 6,000 points, you get only a $50 gift card. In addition, earnings are capped at 75,000 points per year, but most people won’t even get near that limit.
Other generic rewards card to check out include the Discover Open Road card, which lets you earn 2 percent cash back on the first $250 in restaurant and gas purchases each billing period, and gives you an extra 20 percent cash back-bonus when shopping with popular online retailers through Discover.com. In addition, for Costco fans, the American Express Costco card will let you earn 2 percent back on restaurant purchases and 3 percent on gas purchases, with no limit on the amount of rewards you can earn each year.
More hassle, higher rewards: airline dining rewards programs
You can also earn dining rewards through airline frequent flier programs by dining with their partner restaurants. This involves more hassle than just using a generic rewards card, but it also has the potential for higher rewards, particularly if you are looking to boost your frequent flier miles balance.
Here is how it works: You first sign up with the airline, and then you have to make sure you eat at the right partner restaurants. In many cases, you can use any credit card to sign up for the rewards program. The American Airlines AAdvantage Dining program, for example, lets you enroll any credit or debit card to earn 5 miles for every dollar spent on participating restaurants. The website makes it easy for you to find qualifying restaurants in your area.
Similarly, the Delta Airlines SkyMiles Dining program lets you earn up to 5 miles per dollar spent at participating restaurants. To earn the full rewards, you have to both sign up to receive emails from Delta and have at least 12 purchases at qualified restaurants per year. If you just sign up for the email notifications, but don’t eat out enough, rewards earnings drop to 3 miles per dollar spent.
In short, you can choose for yourself how complicated or how easy you want this to be. If you prefer a no-hassle approach, going with a generic rewards card and getting cash back is your best bet. On the other hand, if you are looking to put more miles into your frequent flier account and frequently eat out, enrolling in the airline’s dining rewards program and checking out its partner airlines will likely be worth your while. Bon appétit!
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