Credit Card Roulette: The Best Credit Cards For Travel Rewards
Statistics from a recent study by credit card comparison site CardHub.com revealed travel rewards bonuses are at an all-time high. If there’s a time to put turn your spending into a spring escape, it’s now.
But what cards to get?
CardHub analyzed more than 1,000 credit card offers, arriving at its Best Travel Cards for Spring & Summer 2014.
“All of the credit cards featured in our study have remarkable and positively surprising offers,” CardHub CEO Odysseas Papadimitriou told Yahoo Travel. “From hundreds of dollars of free money, starting at $200, to 15 free hotel night stays, these offers are coming from credit cards that have been in the industry for up to two decades.”
Gary Leff, who blogs about travel rewards at ViewFromTheWing.com, suggests considering three basic factors before jumping on a card offer:
Does the card have a very strong sign-up bonus?
Does it offer great benefits like airport lounge access and annual free companion tickets?
Is the card rewarding on an ongoing basis for the amount of money spent on it?
Here are the ones that do that — and more.
All-Around Travel Credit Cards
Winner: Barclaycard Arrival Card.
After spending $3,000 in the first 90 days, cardholders get a 40,000-mile reward bonus, redeemable for a $400 statement credit, or 2% cash back, when used for travel-related charges. “This card is strong if you want domestic coach travel,” says Leff. “It gives points versus miles to an airline mileage program. Those points are credited towards an airline ticket purchase, effectively giving a 2.2% rebate on spending towards travel, which is about as high as it gets.”
Two more features the Barclaycard has going for it: It doesn’t assess foreign transaction fees, and the annual $89 fee is waived the first year. “Foreign transaction fees can add up to a lot of money,” says Papadimitriou. “They can start before you even the leave U.S., when booking travel with a merchant abroad.”
Re-consider if… that first-class international ticket to Paris is the goal. As Leff points out, “a $10,000 ticket is going to cost you a million points.”
Runner-Up: Chase Sapphire Preferred Card
Like the Barclaycard, Chase Sapphire cardholders earn a 40,000-point reward bonus after spending a minimum of $3,000 in the first 90 days. This can equate to $500 in travel accommodations booked through Chase’s Ultimate Rewards program or a $400 statement credit. Other pluses: the Chase Sapphire waives its $95 annual fee the first year and doesn’t assess foreign transaction fees.
“It’s one of best cards out there,” Leff concurs, but for a different reason: points transfer to five different airline frequent flyer programs and four hotel programs, plus Amtrak. “This allows for flexibility when you’re looking for who has award space on specific dates.” An added bonus: double points on travel and dining purchases—business travelers can really rack ‘em up.
Airline Credit Cards
Winner: Frontier Airlines World MasterCard
Charges of $500 or more during the first 90 days net 40,000 in bonus miles—the equivalent of two free roundtrip domestic flights. Also, two miles are earned for every dollar spent on FlyFrontier.com. Other purchases equal 1 mile per $1.
Re-consider if… you can’t easily fly Frontier. “Unlike other airline credit cards, you can’t redeem for flights all over the world through partner airlines, and Frontier has no first class,” Leff points out. Plus there’s a $69 annual fee.
Runner-up: PedFed Premium Travel Rewards Credit Card
New cardholders receive a $200 initial bonus for spending $2,500 within the first 90 days, plus five points for every $1 spent on airfare and one point for non-airfare-related purchases. There is no annual fee, though a $10 fee may be charged for new enrollees who don’t meet all eligibility requirements.
Leff’s thoughts on PenFed? “It’s decent for certain categories, but it’s not an airline card. You use points to pay for travel and have to jump through the hoops of joining a credit union.”
Additional Alternatives
To supplement CardHub’s ranking, IdeaWorksCompany.com suggests additional fodder.
Southwest Premier Card (Chase Rapid Rewards Visa) — “The program is predicated on points rather than miles, where every seat is a potential Award Seat,” according to Southwest spokesman Brad Hawkins. This allows cardholders to earn and spend points like cash — and if needed, rebook awards-point flights anytime before the flight without service fees and bank the points for future use. Rapid Rewards cardholders will be able to use points for Southwest’s flights to Aruba, Montego Bay, and Nassau starting in July as the airline finalizes the AirTran merger.
Chase United MileagePlus Explorer Card — “The card isn’t just about earning miles, it’s about your lifestyle as a traveler, ” says David Gold, general manager of the Chase line, told Yahoo Travel. That means 30,000 bonus miles after $1,000 spent in 90 days, no foreign transaction fees, no membership fee the first year ($95 after), priority boarding, first bag checked free, two United Club passes per year, and a luxury hotel/resort program gives upgrades and free breakfast. You can also covert points to cash.
Other airline cards gaining high marks from IdeaWorksCompany’s report included US Airways, American, and Delta — just keep in mind overall reward availability, the downside of any co-branded card: Air Berlin, GOL and Southwest tied for first with the most available rewards. Coming in next was AirTran. United was No. 8, American came in No. 17, and Delta and US Airways tied for No. 20.
“Airline co-branded cards offer advantages for consumers seeking longer haul premium class rewards,” the report states. “However, bank travel reward cards enjoy widespread appeal because of the simple and effective promise made to consumers — ‘travel anytime on any airline.’”
The Best Hotel Card Multitasker
Starwood American Express — it’s Leff’s top choice for every wallet. You earn points good for use with Starwood Hotels including Ws, Westins and Sheratons, and you can transfer them one-to-one into more airline frequent flyer programs than anyone else. Even better: 20,000 miles gets you a 5,000-mile bonus. “You’re essentially earning 1.25 miles per dollar in any program you want to use.”
