For John Kovacs, there is little question whether he will be paying by credit card. It's just a matter of which one he will pull from his pocket.
One provides double frequent-flier miles at grocery stores, gas stations, pharmacies and post offices. Another offers double miles while staying at his favorite hotel chain. A third yields bonus miles when he purchases airline tickets.
"I don't pay cash for anything," said Kovacs, a sales representative from Palatine, Ill., who was in Chicago on June 6 for a meeting. "We want the miles."
Kovacs estimates he and his wife earn about 35,000 miles a year - enough to fly to Hawaii on some airlines - by using credit cards.
Earning miles or points for free plane tickets, hotel nights and gifts is becoming something of a national obsession for Americans who have found ways to use plastic to pay for groceries, tuition, cars, rental payments, bail bonds and even funerals.
"People don't think they can," said Terry Hemeyer, a spokesman for Service Corporation International, the nation's largest funeral home chain. "But when they find out that they can, they want to do it because they want the miles."
But experts say using all those miles is becoming more difficult, as the number of free seats available on the major carriers has dwindled because of reduced flights and cost-cutting.
At United, the nation's second-largest airline, 1.7 million award flights were provided in 2004, down from 2 million the previous year, according to www.WebFlyer.com. But by the end of 2004, passengers had accumulated 10.2 million unused frequent-flier flights, up from 9.7 million a year earlier.
For many families, tuition at public and private schools is another prime opportunity to rack up miles, although some institutions have debated the practice in recent years because of the transaction costs.
The University of Illinois at Urbana-Champaign started taking credit cards in December 2001. It collected $14 million in tuition and housing fees for the recently completed school year, up 50 percent from the previous year, a jump largely attributed to new Internet payment options.
"I think for the most part it's been fairly consistent until we went online and then it seems to have really exploded," said Joe Creek, the university's director of customer service and cashier operations.
Some car dealers also allow consumers to pay for at least a portion of their purchase by credit card.
"Some people would put the whole car on a credit card, if they could," said Vladimir Irkhman, a sales manager at a Toyota dealership where consumers are allowed to charge up to $2,000.
Grocers, who have accepted credit cards for years, say frequent-flier programs are one of the driving factors for increased usage. "We are experiencing an increase in electronic payments: debit cards, credit cards and gift cards as a percent of sales year after year," said Laurie Sanders, director of public affairs at Jewel-Osco. "We do see an increase in credit-card use as a result of the perks that are being given or offered to credit-card customers by those companies."
The National Apartment Association, based in Alexandria, Va., reports that in the past few years several major apartment companies have also begun to accept credit cards for rent payments, sometimes through online, third-party rent collectors.
No more bonds
Sadly for investors, one of the easiest ways to earn large blocks of miles ended in 2003, when the U.S. Treasury Department stopped accepting credit cards for online savings-bond purchases, an option that allowed bond buyers to add up to 30,000 miles per year.
Although paying property taxes by credit card is increasingly common, experts say mortgage companies usually do not allow consumers to make their home payments on plastic.
"Philosophically it's just inconsistent with sound financial management," said Fraser Engerman, a spokesman for State Farm Bank. "We believe it would typically result in meeting a mortgage payment with more expensive borrowing on the part of the consumer."
The Chicago Tribune is a Tribune Publishing newspaper.