Last updated 7/2/2015
(Update: These offers have expired.)
I previously wrote an analysis of the Delta Reserve credit card. In that post I pointed out that the Reserve card has an excellent rate of return for daily spend (about 3 cents per dollar) if you are a very big spender and can hit the $30K or $60K bonus levels. That card also has a very steep annual fee ($450) which is offset by various perks. If you don’t want to go all out with a $450 annual fee, another option is the Platinum Delta SkyMiles credit card which has a $195 annual fee. (Update: This offer has temporarily expired.)
What you get for the annual fee (just the highlights):
MQMs, bonus miles, and statement credit: The current signup offer (which has since expired) is 5,000 MQMs (Delta Medallion Qualifying Miles) and 35,000 redeemable miles after you make $1000 in purchases within three months. Additionally, you will receive a $100 statement credit after you make a Delta purchase with your card within your first 3 months. If we conservatively value the bonus miles at 1 penny each and since I’ve argued that the fair trading price for MQMs is about 3 cents each (see How much should you pay for elite qualifying miles) this signup bonus is worth approximately $600
NOTE: the specific offers referenced here have expired. Check for new offers.
Since the annual fee is not waved the first year, this amounts to over $400 in first year value. Note that if you are not seeking Delta elite status then the $5K MQM bonus will not have any value to you, and the total signup bonus value will reduce to $450 (or >$250 once you subtract out the annual fee).
Companion Certificate: After the first year, when you renew the card, you will receive a a free companion certificate. This will allow you to essentially buy two tickets to and from anywhere in the continental US for the price of one. Unlike the companion certificate that comes with the Delta Reserve card, this one only allows economy tickets, not first class. Note two big downsides: the companion does not earn miles or MQMs and you and your companion will not be eligible for upgrades. Also, there are some fare class restrictions to these certificates but I have yet to have any problems redeeming them. Personally, I value this benefit at about $150.
Priority Boarding and Free Checked Bag If you have elite status with Delta, these benefits won’t matter to you. Otherwise, this is a pretty good perk. Priority boarding will allow you to get on the plane and find overhead bin space for your carry-ons before the bins fill up. The value of a free checked bag should be obvious. If you don’t have elite status, I would estimate the value of this perk to be about $75 per year. Total cost each year (including year 1): $195 Total estimated benefits first year: $600 for elites $675 for non-elites who will reach elite status $525 for non-elites who will not reach elite status
NOTE: the specific offers referenced here have expired. Check for new offers. Total estimated benefits ongoing years: $150 for elites $225 for non-elites So, as you can see, the card pretty much pays for itself with its benefits as long as you make full use of them. If you value the particular benefits listed above, you might want to seriously consider this card.
Benefits from Daily Spend If you don’t spend a lot on this card, the return rate for using this card is not very good in my opinion. You will earn one Delta SkyMile per dollar on most purchases, and two Delta SkyMiles per dollar on Delta purchases. Compared to several other cards, this is pretty lame. Where the card shines, though, is if you manage to put exactly $25K or $50K of spend on the card in a year:
Big Spend Benefits Once you reach $25K in spend in a calendar year, you will be awarded with 10,000 bonus miles and 10,000 Medallion Qualifying Miles (MQMs) which will help you get to the next level of elite status at Delta. The same benefits kick in again at $50K of spend. So, if you manage to put exactly $25K or $50K of spending on your card each year, you will earn 1.4 SkyMiles and .4 MQMs per dollar spent. Let’s estimate the value of redeemable SkyMiles at 1 cent each and MQMs at 3 cents each. This means that you would earn 1 * 1.4 + 3 * .4 = 2.6 cents of value per dollar spent on the card. This is a very good rate of return for non-category spend (some cards offer better rates of return for spend within categories such as gas stations, grocery stores, etc.). The more highly you value redeemable miles and elite qualifying miles (MQMs), the more attractive this option is likely to be to you.
My take If you are a frequent Delta flyer and you value annual companion passes, this card is a good one to keep in your wallet or in a drawer. If you are also a big spender, this card is a strong contender. The rate of return for big spend is not as good as the Delta Reserve, but it is close. I’ve used both cards in the past few years to rack up Medallion Qualifying Miles to earn high level Delta elite status. For details, see: Mileage running, from home. Note: If you’re interested in signing up for this card, you can find the best current offers here.