Overview
Miles per dollar, commonly written as mpd, measures how many airline miles you earn for every dollar charged to a credit card.
For example, a card earning 1.2 mpd would give you approximately 1.2 miles for every $1 of eligible spending.
Understanding mpd is important because different credit cards may reward different types of spending at different rates.
Base Miles vs Bonus Miles
Most miles credit cards have a base earn rate that applies to general spending.
Some cards also provide higher earn rates for selected categories such as:
- Online spending
- Dining
- Travel
- Contactless payments
- Foreign currency spending
These higher earn rates are often referred to as bonus miles or bonus categories.
Why Higher mpd Is Not Always Better
A card advertising a high mpd rate does not automatically mean it is the best card.
There may be additional conditions such as:
- Monthly spending caps
- Minimum spending requirements
- Specific eligible merchants
- Selected payment methods
- Excluded transactions
For this reason, it is important to understand the conditions behind the advertised earn rate.
Spending Caps
Some cards only award their higher miles rate up to a particular amount of spending each month.
For example, a card might provide a higher earn rate on the first portion of eligible monthly spending before reverting to its normal base rate.
This means the effective miles earned depends on both the earn rate and how much of your spending qualifies for it.
Choosing a Miles Card
When comparing miles cards, I generally consider:
- Miles per dollar
- Eligible spending categories
- Monthly bonus caps
- Annual fees
- Minimum spending requirements
- Airline transfer partners
- Miles transfer fees
- Expiry of rewards points
The best card therefore depends on your personal spending pattern rather than simply choosing the card with the highest advertised mpd.
Simple Example
Suppose you spend:
- $500 on dining
- $300 online
- $700 on general spending
If one card rewards online and dining spending more generously while another mainly rewards general spending, the first card may generate considerably more miles despite both being marketed as miles credit cards.
This is why understanding where you spend your money is important when building a credit card strategy.
What I’m Looking For
When evaluating miles cards for BAM, I will generally focus on:
- Strong earn rates
- Realistic spending requirements
- Useful bonus categories
- Reasonable spending caps
- Flexibility of miles
- Annual fee value
- Ease of earning and redeeming rewards
Conclusion
Miles per dollar provides a useful starting point when comparing miles credit cards, but it should not be considered in isolation.
A good miles strategy involves matching the right card to the right type of spending while understanding the conditions required to earn the advertised rate.