Bankcard Holders of America has completed an analysis of major rebate and frequent-flier credit card programs, in hopes of giving consumers definitive advice on which card might be best for a given set of circumstances.

The Herndon, Va.-based consumer watchdog group came to the general conclusion that the cards are a bad deal for the typical user.

Consumers have to charge a lot to get maximum benefits from these increasingly popular cards, the group found.

The survey illustrates when the cards can be worthwhile and in which situations a "plain vanilla" card charging low interest rates would serve better.

To help compare the cards, Bankcard Holders calculated their costs based on various spending and payment patterns.

High-Flying Rates

The association said frequent flier cards are a bad deal for two kinds of people: those who don't charge a lot and those who carry high balances.

The interest rate "outweighs the benefit of the |free' ticket," said Gerri Detweiler, Bankcard Holders' executive director. "And if it takes five years to earn a ticket, the cost in annual fees could be greater than the price of the ticket."

The average annual fee for nine airline-connected programs, which include American Airlines' Aadvantage card issued by Citibank, and United Airlines' Mileage Plus card from First Chicago Corp.'s FCC National Bank, is $49.

The average annual - interest rate is 16.5%, with the exceptions of the Diners Club and American Express programs, which require all charges to be paid in full each month.

In contrast, the survey cites low-rate issuers such as AFBA Industrial Bank, which offers a Visa card and a Mastercard with a 12.5% variable rate and no annual fee; and Wachovia Bank, which charges 8.9% with a $39 annual fee.

According to Bankcard Holders, the typical cardholder carries a balance of $1,100 and charges $2,200 a year. That volume of spending will earn only one-tenth of the price of a free ticket.

Big Spenders

On the other hand, the analysis said a high-volume convenience user who charges $20,000 a year and does not carry a balance will earn a round-trip domestic flight for the price of the annual fee.

The big spender who charges up to $20,000 a year and revolves $10,000 will also earn a free ticket, but he will also pay between $600 and $1,000 more in finance charges than Wachovia's card.

The consumer group pointed out that there are additional ways to meet the $20,000 minimum through bonus miles earned by using certain participating merchants such as car rental agencies and hotels.

Rebate programs, according to the survey, are not appropriate for consumers who revolve large credit balances from month to month.

For example, a consumer who spends $2,200 a year, carrying a $1,100 monthly balance on the Ford-Citibank Visa card would pay $53 more - before the rebate in interest and annual fees - than with the Wachovia card. The Ford card comes with a $20 annual fee and a 15.4% annual percentage rate.

But if a Citibank cardholder spends $4,000 a year and doesn't carry a balance, the cost is limited to the annual fee, and $230 in rebates can be realized. The General Motors MasterCard holder would save $200 in rebates under the same circumstances.

To earn a $500 rebate with the General Motors card, a consumer must spend $10,000 a year - or $5,000 if all of the purchases are made with the participating merchants who offer a higher rebate percentage.

And there is no limit on the amount of the rebate if the purchases are made with those partners, who include Marriott Hotels, Avis, and MCI.

The main point the consumer group underscores is that if a consumer does not make use of a card's special features, a lowerrate card would be a better deal.

Focusing on Basics

"Most people use credit cards as a personal loan, and these special cards are like frills that should not distract you from shopping for a card based on the terms of the loan," said Ms. Detweiler.

The survey, which can be purchased for $5, will be announced in the group's September-October newsletter.

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