I explained it above (the biggest part of your math that you are missing is no miles for using miles on most airlines and much less ability to shop around for better deals/switch airlines to one that you have no miles for). But keep going on your miles; I'm glad they work for you. They simply cannot work for me since I do not have a reliable airline to use them on. A bunch of miles with nothing to use them on is no good. That is how I started this discussion.
I’m not challenging whether they work for you or not. I'm challenging your statement to others as it's based on inaccurate information and I don’t think you redid your math based on the clarification. But for fun we can go through the math together.
First - one time bonuses aren’t really a thing. Maybe there are a few very unique offers out there but 90+% of offers can be gotten more than once. The closest we come on a normal basis is Amex’s once every 5-7 years unless they’re running one of their frequent (typically multiple times a year) promos where they waive that language. Heck - there are a number of cards from banks you can get multiple times a year. I mean if you only stick with one airline card forever then its probably not going to work out in your favor but we don’t tell people to not invest just because a bad way to do it using AUM advisors exists. We tell them to do it the smart way using index funds instead.
But onto the math. For simplicity lets take Southwest. Yes not the best carrier for every situation but their points are fixed value so we don’t have to worry about decoupled mile value compared to revenue tickets, debate business class value over economy, consider lounge access value, debate award availability etc etc. In most situations a SW point is worth $0.0128. Southwest credit card signup bonuses range from 50,000-120,000. Let’s pick a middle-ish 80,000 points. Usually you get that after $3,000 in spend so tack on another 3,000 points for the lowest point generation category. 83,000 points = $1,062 towards Southwest flights
Let’s compare that to 5% cash back even though most cash back cards are 2% for travel. So you would get $150 in cash back from that $3,000 in spending compared to $1,062 towards flights. You claimed my math didn’t take into account that you don’t get airline miles when buying a ticket. Buying $1,062 worth of Southwest tickets gets you 6,372 miles or $83. So the cash back card is now up to $233 in value compared to the Southwest card and bonus. Of course we need to add in the card annual fee. So lets assume a middle of the road $100. So we ended with the Southwest card at $962 vs $233 taking the best case cash back card against a middle-ish Southwest bonus. And by Chase’s rules you can do this specific example every 2 years with plenty of ways to do it much more often.
For an actual data point I’ll share my math from 2022:
2 Southwest credit cards netting 136,500 points and a companion pass after $10,000 in spending combined. With a BOGO airline ticket thats a value of $3,200 after subtracting card annual fees. I’ll completely ignore the ancillary benefits like free earlybird and business class upgrade credits. A 5% cash back card would have gotten me $500. I have basically done the above every 2 years for the past 10 years.
Let’s move on to this statement of yours:
much less ability to shop around for better deals/switch airlines to one that you have no miles for
I mean having a miles or points card doesn’t prevent you from paying another way so you can still shop around for better deals. And, if flexibility is a concern, it is an artificial and ill advised limitation to select and stay with a specific airlines miles card. There are a number of major travel ‘currencies’ out there. These let you transfer points to a broad array of carriers unconstrained by airline alliance boundaries. For example Chase lets you use points with all the major domestic partners: United, American (Via BA or Aer Lingus), Southwest, and Delta (via Virgin or AF\KLM). Capital One is similar albeit missing Southwest. Most transfers are instant so you can find a flight on a carrier and then transfer the points to book the ticket within ~2min.
Now there are plenty of valid reasons for not doing this. You carry a credit card balance, you don’t travel much or at all, you don’t want the added complexity, your local airport really sucks or is a fortress hub (and you don't want to take a positioning flight) etc etc. Sounds like the last one is your situation so you've picked what works for you. But the travel value is absolutely there long term over a cash back card for those who can and want to use it.
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