If you’re getting your holiday travel plans together, don’t forget that the best travel rewards credit cards can help you save money on airfare, hotels, and general travel. All of these top travel cards offer lucrative points bonuses and superb options to earn and use points for maximum value.
The best travel rewards credit card for me is Chase Sapphire Preferred® Card
It has one of the largest signup bonuses in the industry as well as great long-term rewards for travel and dining. The number of ways you can redeem points, including transferring at equal value to many partners is simply unmatched by any card. This card remains my go to travel credit card again this year. Additionally, my preferred strategy is to add the Chase Freedom® to maximize 5% back in bonus categories throughout the year. These points are transferrable via the Ultimate Rewards network.
My colleague, Holly, pointed out in a recent post that the average vacation for a family of four rang in at a staggering $4,580 in 2014. The study she sites was done by American Express. If you you’re like me and that number hit you right in the gut, pay attention because we’ve got some great ways for you get some free travel by earning points on your everyday spending. We also have some strategies to combine cards and earn even more points.
Table of Contents
- 1 The Simple Dollar’s Top Picks
- 2 Research the 42 Best Travel Credit Cards
- 3 Resources for Frequent Travelers
- 4 Strategies to Maximize Travel Rewards
- 5 Oneworld Partners (and Affiliates)
- 6 Star Alliance Partners
The Simple Dollar’s Top Picks
There is one big change we made this year compared to last year – I’ve decided to name the Southwest Airlines Rapid Rewards® Premier Credit Card as the best airline card out of the bunch. With flexible rewards and constant fare sales, I’m finding that Southwest Rapid Rewards points provide more value to the average family than comparable airline miles.
Another big difference you’ll see with most travel credit cards is the adoption of EMV technology in the U.S. This is a microchip within the card that will eventually replace the magnetic strip for better security. Europe has had this technology for years, but it’s finally making its way to the U.S. this year. As such, we wanted to include as many cards with this innovative technology as possible.
Here are the 6 best travel credit cards of 2016:
- Chase Sapphire Preferred® Card: Best Travel Credit Card
- Barclaycard Arrival Plus™ World Elite MasterCard®: Best Fixed-Value Travel Credit Card
- BankAmericard Travel Rewards® Credit Card: Best No Annual Fee Travel Credit Card
- Discover it® Miles – Double Miles your first year: Best No Annual Fee Travel Credit Card
- Southwest Airlines Rapid Rewards® Premier Credit Card: Best Airline Credit Card
- Starwood Preferred Guest® Credit Card from American Express: Best Hotel Credit Card
Best Travel Credit Card
If you travel anywhere, especially abroad, you might want to consider the Chase Sapphire Preferred® Card. There’s plenty of value packed into this smooth, thick, blue card. On top of great rewards like 2X points on travel and dining at restaurants and 1 point per dollar spent on all other purchases, cardholders can also earn 50,000 bonus points after spending $4,000 in the first three months from account opening on the Chase Sapphire Preferred® Card.
The flexible points transfer to Chase airline and hotel partners is another perk that can net you big savings. Points are transferable on a 1:1 basis for partner airlines and hotels such as United and Ritz-Carlton.
International travelers will really like that there are the no foreign transaction fees and chip-enabled technology on the card. Chase Sapphire Preferred® Card has had this technology for a while and is ready for the major U.S. changeover to EMV in October. Many international merchants have adopted this technology, and it’s more prevalent overseas.
Who Should Get It
Best Way To Use It
- International travelers – no foreign transaction fee
- Foodies and travel spenders – 2x points on dining and travel
- You want a flexible rewards program
- You’re looking to pick up the best points bonus in the industry
- Use this card for everyday purchases.
- Use this card especially while traveling and dining to earn 2 points per dollar.
- Book travel through the Chase Ultimate Rewards℠ and get 20% off your travel.
- You could also use this card exclusively for travel and dining but use a higher earnings cash back card like the Chase Freedom® Card.
Best Fixed-Value Travel Credit Card
While the Chase Sapphire Preferred® Card is often deemed superior due to its many transfer partners and affiliation with the Chase Ultimate Rewards program, the Barclaycard Arrival Plus™ World Elite MasterCard® offers a different kind of flexibility that is equally popular with travel rewards enthusiasts. With this card, you earn flexible “travel credit” that is redeemable for any type of travel for one cent per point. In other words, earning 40,000 points with the card allows you to book any type of travel worth $400 – then completely erase the purchase from your account by redeeming your rewards.
Since you can use your points to book with any airline or hotel chain, or even with a discount vacation site like Expedia, this card has become extremely popular for consumers who don’t want to be tied to using a specific hotel chain or airline or use a rewards portal to book their travel plans. Further, the Barclaycard Arrival Plus™ World Elite MasterCard® comes with a “no hassles” 2x miles per dollar spent on all purchases, which means there are no special categories or caveats to keep track of.
While you can redeem your points for gift cards and merchandise, it isn’t advised since you’ll only get around a half-cent per point back. That’s probably the only downside to getting this card instead of a cash back card, actually. Since the Barclaycard Arrival Plus™ World Elite MasterCard® is a travel credit card first and foremost, it is mostly geared to those who travel often and can easily redeem their points for hotel stays or airfare.
Who Should Get It
Best Way to Use It
- Those who travel overseas will enjoy the fact that the card doesn’t charge foreign transaction fees
- People who want to earn 2x miles back on all purchases, and don’t want to keep track of category bonuses
- You want to be able to redeem your rewards for travel with any airline or hotel chain
- You travel often and can easily use your points for travel
- Use this card for all of your everyday purchases to earn 2x miles back to use on travel
- Use this card when you’re overseas to avoid foreign transaction fees
- Use your points to book any type of travel you want – even travel for others. li>
Best No Annual Fee Travel Credit Cards
BankAmericard Travel Rewards® Credit Card
A new addition to this list is the BankAmericard Travel Rewards® card. This card really packs a punch for a card with no annual fee. In my initial research I was really on the hunt for huge sign up bonuses that I could capitalize on, so I kind of missed the long term value locked in this card. The 20,000 bonus point offer is weak compared to other cards, but earning 1.5 points per dollar on everyday spending more than makes up for it. This is the earnings power that other card companies easily charge an annual fee for.
Then, you can earn an extra 1.5 points per dollar on the first $6,000 spent on airline purchases made through the Bank of America Travel Center each calendar year. All other purchases made through the Travel Center earn 3 points per dollar with no limitations, so you can book hotels and rent cars without limit and earn big time.
Now, if you have an active Bank of America® checking or savings account or are a client of Merrill Lynch, you can get an additional 10% customer points bonus on every purchase. See terms and conditions for exact details.
The only real drawback I can see to this points program is that you have to redeem your points on travel for a statement credit. Meaning you actually have to make the transaction on your card and then they will credit your account afterwards. For most people this isn’t a big deal, but beware of this if you plan on carrying a balance on the card as it can impact the amount of interest you pay in a given period.
Who Should Get It
Best Way To Use It
- You want high rewards and bonuses for travel spending
- You dislike paying an annual fee
- You aren’t looking for the biggest sign up bonus out there
- You are an active Bank of America banking customer or Merrill Lynch client
- Use this card to make all purchases, especially on travel through the Bank of America Travel Center.
- Pair it with the BankAmericard Cash Rewards™ to also maximize rewards on gas and grocery store purchases.
- Link both cards to your Bank of America or eligible Merrill Lynch accounts to take advantage of all bonus point offers.
Discover it® Miles – Double Miles your first year
The Discover it® Miles card offers a unique opportunity for anyone who wants to earn a lot of rewards with minimum hassle. With this card, you earn an unlimited 1.5 Miles on all purchases without an annual fee and with no categories or exclusions to worry about.
But the good news doesn’t stop there. With the Discover it® Miles card, Discover doubles all the Miles you’ve earned at the end of your first year. This means that, instead of earning only 1.5 Miles per $1 spent, you’ll net a full 3 Miles per $1 spent on all purchases. Redeeming your rewards is also simple. You can either redeem them as a statement credit or towards any travel purchases on your statement.
Other perks that make this card stand out are a up to $30 in-flight wifi credit per calendar year, a free FICO score on your monthly statement, and of course, no annual fee.
The only drawback that comes with this card is the fact that you have to wait one full year to earn the extra 1.5 Miles on each purchase you make. If you are someone who likes to redeem your points frequently or watch your point balance grow slowly over time, it might be rather frustrating to wait a full year to achieve the full benefit.
Who Should Get It
Best Way To Use It
- People who want to earn flexible rewards without worrying about limits or categories
- Anyone who ultimately wants to earn double miles. At the end of your first year-when other Miles cards charge an annual fee-Discover doubles all the Miles you’ve earned.*
- This card is best for people who don’t mind waiting one year to receive their full bonus
- The free FICO score makes this card a good bet for anyone who wants to monitor their credit score
- Use this card for all purchases in order to earn as many points and bonus points as you can.
- Redeem your points for any type of travel without worrying about black-out dates or capacity controls.
- Use your card to pay for in-flight wifi then redeem your credit later.
Best Airline Credit Card
With the Southwest Airlines Rapid Rewards® Premier Credit Card, you’ll earn points you can redeem for flights within the United States and to select destinations in the Caribbean. In addition, you will experience extra benefits like free checked bags, which can save up to $200 for a family of four.
Since the Southwest Airlines Rapid Rewards® program is mostly fare-based, you can usually find cheap award seats during Southwest’s frequent sales. And because there are no blackout dates or capacity controls for award seats, Southwest Airlines is truly hard to beat when it comes to family travel. Since points from the Chase Ultimate Rewards program transfer at a 1:1 ratio to Southwest, I would definitely pair this card with the Chase Sapphire Preferred® Card. By carrying both cards, you could really rack up some award miles fast.
Who Should Get It
Best Way To Use It
- People who don’t want to deal with blackout dates or capacity controls.
- Those who fly within the United States and to the Caribbean often.
- The card is good for anyone close to a Southwest hub.
- Southwest Airlines is a steal for people who travel frequently with checked baggage since your first two checked bags are free.
- You only want to use this card when you book a flight with the airline, or to take advantage of any promotional point purchases with partners.
- Pair this card with the Chase Sapphire Preferred® Card in order to maximize the number of Southwest Rapid Rewards points you have on hand.
- The easy boarding, bag check, and check-in travel perks are solid benefits you won’t find with every airline credit card.
Best Hotel Credit Card
If you’re spending a lot of time in hotels each year, why not pick a card with one of the best rewards programs around? The Starwood Preferred Guest® Credit Card from American Express earns 1 point per dollar on most purchases, but earns between 3-5 points per dollar on purchases made at a Starwood property. Starwood covers many hotel chains such as Sheraton, Westin, and W Hotels. With a total of around 1,200 properties in over 100 countries, your options to earn Starpoints are endless.
One of the best features of this card is you can transfer Starpoints to many airline miles programs, usually on a 1:1 basis, and even receive a 5,000-point bonus when you transfer 20,000 Starpoints to select miles programs.
You can also think about pairing it with the The Gold Delta SkyMiles® Credit Card from American Express to cover all your airline and hotel needs. You can link your Skymiles and Starpoints accounts via Crossover RewardsTM and double dip on points at both places.
Who Should Get It
Best Way To Use It
- You prefer American Express to Visa or MasterCard
- Frequent visitors of Starwood hotels
- You are a savvy point transferer and and can take advantage of free nights and free flights
- You spend more than $30,000 per year
- You have excellent credit
- Sign up and take advantage of up to 25,000 bonus points.
- Use for all purchases, especially at Starwood hotels.
- Swap 20,000 Starpoints for 25,000 airline miles on many airlines.
- Do not use this card for international travel because there is a 2.7% foreign transaction fee! This is the only card with this fee on the list.
- A good strategy is to accumulate points because they never expire. Then monitor your upcoming travel options so you can take advantage of promotions and can redeem up to five times their point value on hotel stays.
- Another great strategy is to pair this card with my top pick for the best airline card: The Gold Delta SkyMiles® Credit Card from American Express. With this relationship, you can max out your points on airlines and hotels, and double dip on points.
Research the 42 Best Travel Credit Cards
Below is a directory of the most popular travel credit cards. I used this directory as a starting point for my research and analysis on travel cards. The directory is updated weekly to reflect any new changes, to add new cards, and to remove expired cards.
The travel credit cards directory is a sub-directory of rewards credit cards. This directory highlights the most important features specific to travel cards and displays all important information about each card.
Travel Credit Cards Directory
The travel rewards credit card directory lists every travel credit card and high level information for each of the cards, so you can make quick comparisons. In order to rank and value each of these cards, certain features were weighted accordingly based on overall importance to the prospective cardholder.
Sort, filter, or search for what matters most to find the best travel credit card for you.
To develop an overall rating for each travel credit card, we used the features and corresponding data from the directory above. To better describe the ratings of each card, there were a number of elements to consider. Some of the valuable information is displayed in the directory, while additional information is outlined below.
Rewards Rate refers to the actual rate at which you can earn rewards using the travel rewards card. This rate, typically 2% or higher, will usually be highest on travel-related purchases. Travel credit cards usually have a base rate of at least 1% which enables you to earn points on everyday purchases as well. The very best travel credit cards will have an incentive to book travel through their own travel portals.
Some of the best rewards rates are on hotel, airline, or travel site cards. These cards try to entice you to only use that specific hotel, airline, or travel site. If you travel often and prefer one brand over others, this approach is fine. Others who prefer flexibility in how they travel will want to consider a more general rewards program that still carries a generous Rewards Rate on travel.
Rewards Categories are the spending categories in which your travel card earns greater than 1%. Most travel cards offer better Rewards Rates in certain categories. The more ways you can earn greater than 1% in rewards, the better a card will score in Rewards Categories.
For example, the Chase Sapphire Preferred® Card offers 2% rewards on travel booked through the Ultimate Rewards platforms and 2% for dining out. The card earns 1% on all other purchases. The Barclaycard Arrival™ World MasterCard® has the same structure — 2% rewards on travel booked through Barclaycard and 2% on dining.
Sign-up Bonus is the amount of extra points each card offers to a new cardmember when signing up. Sign-up Bonuses can be very lucrative on travel cards, with the best travel cards offering around 40,000 bonus points. That translates to at least $400 of cold-hard cash to spend on travel. If you’re strategic about redeeming the points, you can turn those points into much more.
The important thing to note about Sign-up Bonuses is that there are usually certain spending requirements to make before you actually earn the points. It’s common for credit card issuers to require you to spend $4,000 in the first three months you have the card before you get your Sign-up Bonus.
Sign-up Bonus carries a high importance rating because it’s a quick way to grab a large chunk of points to use for an upcoming travel adventure.
The best travel rewards cards give you a number of ways to redeem your lucrative points. These Redemption Options can dramatically impact how much your points are worth. Top cards like Chase Sapphire Preferred® Card use the Chase Ultimate Rewards platform to help you book travel. When you redeem your points through Chase Ultimate Rewards for travel, your points are worth 25% more. For example, you can redeem 40,000 points for $500 in airfare instead of the usual $400.
Most cards also allow you to redeem points for non-travel. You may redeem points for gift cards and merchandise, but this is not recommended because points on the best travel credit cards are usually more valuable when used for travel.
Your third option on several of the best travel credit cards is to transfer your points to a partner airline, hotel, or other partner. This is where the point geeks go crazy to maximize and hunt for last-minute point deals. American Express allows point transfers to many partners as does Chase Sapphire Preferred® Card.
There are some additional benefits of owning a travel credit card that become important when you’re actually traveling. A huge benefit for Chase Sapphire Preferred® Card cardholders is that foreign transaction fees are waived. The Gold Delta Skymiles® card offers priority boarding, and free checked bags.
Additional benefits of top cards include 24/7 customer service, car rental insurance, and emergency travel assistance. Benefits are of medium importance when compared to how points can be accumulated by the card, but Benefits can often swing a decision between two comparable cards.
APRs on travel credit cards are of low importance, mainly because we always recommend paying off your balance each month. Interest charges negate point accumulation, so it never makes sense to have a travel credit card if you plan to carry a balance.
Travel cards have ongoing APRs that range as low as 10.99% and go beyond 20%. The key determinant of your ongoing APR is usually your credit score and history. If you have good credit, the APR rate for you will be on the lower end. If you need a low-interest rate card, consider one of the best balance transfer cards on the market today.
Resources for Frequent Travelers
Once you master the art of credit card rewards, you might be tempted to trot all over the globe and never look back. However, it’s crucial that you understand not only how credit card rewards work, but how to protect yourself while you travel. The following resources can help you maximize travel rewards while also protecting yourself from financial losses.
Using a Travel Credit Card to Save Money
Not only do travel credit cards offer perks that can help make travel easier and safer, but most offer certain types of rewards that you can redeem for free hotel stays, airfare, or cash back. And that’s what most people have trouble understanding. If you know how to use them, travel credit cards can actually save you money.
Here are some features of travel credit cards that help you save money:
- Opportunities to earn points you can use to pay for travel
- Flexible choices for redeeming points across travel networks
- Travel insurance and extra protections
- Concierge services
- No foreign transaction fees
- Large sign-up bonus incentives
5 Steps to Use Credit Cards to Save Money on Travel
Step 1: Learn about the different types of travel credit cards available. The good news is, you’re in the right place to start your research. Cards and their benefits differ, so you need a good comparison site. For instance, if you’re more interested in free hotel stays than airfare, look for a hotel credit card that offers rewards specific to a hotel loyalty program at a chain you like. Or if you want more flexibility with your rewards, look into cards like the Chase Sapphire Preferred® Card. Make sure you understand how the rewards program works before you choose to sign up.
Step 2: Meet the minimum spending requirement. Most travel rewards cards offer a sign-up bonus to customers who can meet a minimum spending requirement during a specific timeframe, usually around three months. A typical sign-up bonus is worth $300-$500, and a typical minimum spending requirement is between $1,500 and $3,000 within the first three-month period. For most families, this is attainable — and even if you never charge another dollar after this, you’ll still receive the bonus.
Step 3: Use your card for everyday spending. In order to earn as many rewards as possible, you’ll want to use your card for all of your everyday expenses. Use it for groceries, gas, insurance, miscellaneous expenses, and anything else that you would be purchasing anyway. No matter what, always pay your balance in full in order to avoid paying interest.
Step 4: Use your rewards to pay for travel you were going to book anyway. Here’s where the savings come into play. Once you’ve earned a considerable amount of rewards, use them to book travel you planned to book regardless. Using your points for free hotel stays or airfare helps you save on the total cost of your trip.
Step 5: When traveling abroad, use a card that doesn’t charge foreign transaction fees. Most credit cards charge a foreign transaction fee, usually around 3%, on purchases made in another country. However, the best travel cards waive this fee, and this feature can save a considerable amount of money when you travel internationally.
If you want to save as much money on travel as possible, it helps to have a rough idea of where you plan to go ahead of time. That way you can tailor your strategy to your ideal itinerary. And, as I mentioned above, it is crucial that you never pay interest on your purchases if your goal is saving money. When you choose to carry a balance, the interest you will inevitably pay will likely cancel out any rewards you receive.
How Credit Cards Protect You While You Travel
Decades ago, people used a combination of cash and traveler’s checks when traveling abroad. Unfortunately, carrying around a ton of cash comes with certain risks, and exchanging currencies in each new country can be a huge pain.
Modern travelers still carry some cash, but as more of a novelty than anything else. Instead, they make the majority of their international purchases with travel credit cards that not only reward them for making purchases, but also protect them from fraudulent charges and other pitfalls. Here’s how credit cards can protect you (and save you money) while you travel:
- Use a card that offers no liability for unauthorized purchases. When traveling abroad, you want to make sure you use a credit card that won’t hold you accountable if someone gets ahold of your card and starts making purchases. The Discover it® Miles card, for example, comes with no liability for unauthorized purchases and no foreign transaction fee, making it a good option. Just make sure the country you’re traveling to is prone to accept Discover since international acceptance varies.
- Carry your credit card contact information separately from your card. Most credit cards let you call collect from anywhere in the world if your card is lost or stolen. Obviously, you won’t have access to their number if you no longer have your card, which is why most experts suggest keeping these important contact numbers separate from your credit cards in case of loss or theft.
- Choose a card with free travel insurance. If you want to take advantage of free travel insurance, make sure to book the major components of your itinerary with a credit card that offers excellent travel and trip cancellation insurance, like the Chase Sapphire Preferred® Card. Doing so can mean getting reimbursed if your trip is cancelled due to flight interruptions, a natural disaster, or other unexpected events.
Do You Need Additional Travel Insurance?
Although it’s easy to brush off travel insurance as an unnecessary expense, you should always give it a second look. With all the upheavals that can unravel your travel plans, not to mention your own personal health, you might be wise to purchase a simple travel insurance plan – or at least pay for your trip with a credit card that offers this benefit for free.
For starters, you should determine whether your health insurance will cover you if you need to see a doctor abroad. Since many policies do not cover doctor or hospital visits outside of the country, a medical travel insurance policy might be a good bet. It’s also important to note that Medicare doesn’t cover health care expenses outside of the U.S., although some Medigap policies might. Before you go anywhere, you should always verify whether or not you will have coverage and consider purchasing a policy for your trip if you do not.
Outside of major medical, you may not need to purchase comprehensive travel insurance at all. That’s because certain type of travel credit cards offer certain travel benefits to cardholders. Take the Chase Sapphire Preferred® Card card, for example. Premium travel insurance, including trip cancellation, is included as a card member benefit. If you wanted to take advantage of this perk, all you would need to do is use your card to purchase your airfare and accommodation.
Other types of travel insurance your credit card might offer include trip interruption insurance, which can reimburse you for nonrefundable travel expenses if you end up getting sick before your trip or it gets cancelled for almost any other reason. Different cards offer different versions of trip cancellation or trip interruption insurance, so make sure you understand your card’s policy before you count on it for coverage.
You can usually buy travel insurance at the same time you purchase airfare or book your hotel. If you want to compare travel insurance policies, check out our post on the best travel insurance options currently available.
Just remember, travel insurance only seems frivolous until you need it. If your trip gets cancelled, travel insurance could protect you from thousands of dollars in losses. Some common events that are covered with various types of travel insurance include personal illness or illness of a family member, natural disaster, emergency evacuations, or even lost or stolen baggage or belongings. Obviously, none of those events are ones you can plan for ahead of time, so it’s best to be adequately insured instead.
10 Questions to Ask Yourself When Buying Travel Insurance
Before you hit “buy,” on your next travel insurance plan, ask yourself the following questions:
- Is the region I plan to visit considered “high-risk?” Potential issues can vary depending on where you are going. And if you’re visiting an area deemed “high-risk,” your travel insurance policy may deny coverage altogether. Before you set sail or get on that plane, check your travel insurance policy to see if your intended destination is, in fact, covered. Also check for travel advisories that might alert you to any upcoming safety concerns you need to be aware of.
- Do I travel often enough to consider a long-term policy? If you travel more than once or twice per year, you may be better off buying a more comprehensive, multi-trip plan. This type of coverage is great for families who travel or vacation often, those planning multi-country or extended trips, last-minute travelers, or those who travel often for business.
- What will my current health insurance cover if I become injured or get sick abroad? Assuming that your health insurance will provide coverage overseas is always a mistake. The fact is, many health insurance plans don’t provide comprehensive coverage outside of your home country or territory. Medicare, for example, never provides coverage overseas. If you want to ensure that you’re covered, a travel insurance plan that includes major medical is always a good bet.
- Do I have any pre-existing conditions that might flare up? If you do purchase a travel insurance plan that includes medical coverage, it’s important to note that pre-existing conditions are rarely covered. If you have a medical condition that is prone to act up, your trip abroad might pose a greater risk than you realized.
- Do I plan on bringing anything expensive with me? Baggage insurance protects you from financial loss if your valuable items become lost or stolen. If you plan on bringing expensive items with you, it might be a good idea to buy travel insurance that includes this perk. Likewise, if you aren’t bringing anything valuable with you, you might consider opting out of this specific coverage.
- How likely is it that I will need to cancel my trip? When you’re traveling with kids or aging parents, the likelihood of a trip cancellation due to illness or injury increases. However, the risk still exists when you leave those same loved ones at home. If something happened, you might need to cancel your trip to take care of them. Trip cancellation/interruption insurance can help mitigate those risks for you.
- Do I want to be able to cancel my trip for “any reason?” Some types of trip cancellation or trip interruption insurance require you to prove your cancellation was due to unforeseen circumstances such as an illness, a death in the family, or a job loss. Meanwhile, other policies let you cancel for “any reason” — even if you just changed your mind. Make sure you know the difference, and buy a policy that offers terms you can live with.
- Will I be driving a rental car? Some travel insurance policies offer either collision coverage on rental cars or other types of rental car coverage. However, others do not. If you plan on driving during your stay and don’t have coverage otherwise, you might want to seek out a travel insurance policy that offers this perk.
- Do I plan on doing anything risky? If your trip involves any adventurous activity such as rock climbing, cross-country biking, or skiing, you need to ensure that your travel insurance provides coverage for those activities. Never assume it does, and always check to make sure.
- Do I already have life insurance? Some travel insurance policies offer extra coverage that basically amounts to life insurance that pays out only if you die. If you already have life insurance (as you should), you may not need this additional coverage and may not want to pay extra for it.
Strategies to Maximize Travel Rewards
When I was younger, I didn’t travel that much. My job didn’t require it and, aside from the occasional vacation, I was usually too busy to explore the world. I could always afford a single round trip ticket, so I was never looking to “earn” my occasional travel.
Now that I have kids, the prospect of $1,000 (coach) airfare + car rental + hotel every time I want to take my family somewhere had me scrambling to learn the ins and outs of travel rewards maximization. This guide is meant to bring a travel rewards novice into the 21st century world of travel rewards so that you can start being more strategic about accumulating and using your travel points.
Strategy #1: Start By Earning Points Everyday
Experienced business travelers already know their preferred airline, hotel, and rental car agency, and they stick with these to earn maximum points on their travel. But what if you’re just starting to increase your travel? Where should you start?
Find the Best Travel Credit Card
Getting a really good travel rewards credit card is your first step to accumulating points to use for travel. Only the best travel rewards card lets you start racking up points for everyday purchases and earn more when you finally do travel. The best travel credit cards have a base rate of 1% and the opportunity to earn at least 2% on travel. Many of these cards also have point and redemption bonuses to enhance your earnings power.
Use the guide above to research the best travel credit cards. The guide goes into great detail on each of the best travel credit cards. Use it to get an idea of which card might be best for you. Here are a few other tips to help you decide:
Tip #1: Pick One Card
Expert travelers often recommend having all sorts of cards and combining points in the most efficient manner. We want to work you up to that level, but the best starting point is to pick just one card. The main reason is that most travel cards charge an annual fee and you don’t know how much you’ll be traveling yet.
Using a secondary card to earn more points in different categories seems like a good idea, but paying two annual fees might not make sense. If you were to pay two $95 annual fees that equals $190 per year, that wipes out 19,000 points! You’d better be a big spender to justify carrying the additional card.
That’s why starting with one card is important. Any annual fee card will beat out a no annual fee card when it comes to rewards. That’s why, if you’re going to go for one card, my top pick is the Chase Sapphire Preferred® Card.
If you must have a no annual fee card, a good choice is the Barclaycard Arrival™ World MasterCard®.
Tip #2: Go for Flexibility
I often hear about people signing up for an airline miles credit card they received on a flight. For anyone other than expert flyers, these offers are usually not optimal because the opportunity to earn good travel points is usually confined to purchases on that airline. Options for redeeming points are also limited. You may be able to transfer your points to partner airlines or hotels but at less desirable transfer rates.
If you’re unlikely to have an alliance to any one airline or hotel chain, find a travel card with flexible earning and redemption programs. My absolute favorite right now is the Chase Sapphire Preferred® Card because it comes with the ultra-flexible Ultimate Rewards program from Chase.
Through Ultimate Rewards, you can book any airline and, when you do, your points are worth 25% more and it’s NOT dependent on which airline you choose. Also, through Chase Sapphire Preferred® Card, you can transfer your points to any one of its partner airline frequent-flyer programs at a 1-to-1 ratio. This is a unique feature the pros take advantage of all the time.
Tip #3: Make sure your points never expire
Working hard to accumulate points is only valuable if the points are there for you to use when you want to travel. Many frequent-flyer programs and frequent-guest programs have points that expire, blackout dates, or other restrictions on usage. If you were to solely rely on frequent-flyer or frequent-guest programs for your travel rewards, you will surely find some of your points expiring at the end of each year.
The best travel credit cards, on the other hand, usually have points that never expire so they’re always there when you need them. Some cards like Chase Sapphire Preferred® Card let you transfer points to frequent-flyer partners. This can be done to keep the balance of your frequent-flyer points fresh.
Strategy #2: Get Familiar With Loyalty Programs
Your next strategy for getting your frequent traveler training wheels off is to get familiar with loyalty programs and alliances. Frequent-flyer/guest programs are opportunities for you to double dip on points. The pros know the ins and outs of each program, where and when you can transfer points, and what the best programs are for their frequent routes and dream travel destinations.
Every airline and hotel chain has their own program. When you travel on an airline or stay at a hotel, you earn points and other perks you can use in the future. Here are some common ones:
- Starwood Hotels Starpoints
- Delta SkyMiles
- United MileagePlus
- Hilton Honors Rewards
Additionally, many of the large airlines are part of travel alliances. These alliances allow you to transfer points to other partners more easily.
Below are two of the largest programs and their partners.
Oneworld Partners (and Affiliates)
|American Airlines (AmericanConnection, American Eagle®, US Airways, and US Airways Express)|
|British Airways (BA Cityflyer, British Airways (BA) Limited, Comair, OpenSkies, and SUN-AIR of Scandinavia)|
|Cathay Pacific (Dragonair)|
|Finnair (Flybe Finland)|
|Iberia (Iberia Regional Air Nostrum, and Iberia Express)|
|Japan Airlines (JAL Express, J-AIR, and Japan Transocean Air)|
|LAN (LAN Argentina, LAN Colombia, LAN Ecuador, LAN Express, and LAN Peru)|
|Quantas (QantasLink and Jetconnect)|
|S7 Airlines (Globus, LLC)|
Star Alliance Partners
|Air New Zealand|
|LOT Polish Airlines|
|South African Airways|
Strategy #3: Upgrade or Add a Card As Needed
Once you travel a few times and get a handle on how you spend your travel dollars, you’ll have a much better feel for you preferred airlines, hotels, and some of the tricks of the trade. You can use this information to add a second travel rewards card to your arsenal. You have two objectives with a secondary travel rewards card:
- Capitalize on other spending categories your current card does not max out.
- Capitalize on carrier-specific deals with airline or hotel credit cards you use exclusively for your travels.
Cover Your Spending Categories
Travel credit cards do a great job of earning points on travel but are usually limited when earning rewards in other spending categories. For instance, my top pick, the Chase Sapphire Preferred® Card, earns 2X points on travel and dining, but only 1X on everything else. You could earn much more travel rewards if you find another card that earns in different categories like gas or groceries too.
Personal + Business Cards
A great strategy is to open a business credit card. Many people are self-employed, but you don’t need to own a business to qualify for a business credit card; you simply use your Social Security number. I use the Chase Ink® line of cards to supplement my Chase Sapphire Preferred® Card spending. The Ink Plus® card earns 5X on cable/Internet, landline, and cell phone bills and at office supply stores. It also earns 2X on gas and hotel stays. This combination of cards maps well to my spending categories so I’m able to max out my non-travel related points and sock them away for my next trip.
The best part of this strategy is that both cards use the Chase Ultimate Rewards program, so my points can be combined and used together, netting me a 25% savings when I redeem them for travel.
Combine General Travel Rewards With Carrier-Specific Cards
You also have an opportunity to combine your general travel rewards with more targeted travel cards that airlines and hotels offer. These cards often have upgrades like first-class boarding or room upgrades, which can make travel more pleasant. These cards also let you earn much more for purchases on their airlines or at their hotel properties.
Two great programs are:
- Delta Skymiles
Starwood offers up to 5 points per dollar spent on Starwood properties, which include Westin and W Hotels. I have already pointed out how you can double dip between Delta and Starwood.
Several airline cards are perfect to combine with Chase Sapphire Preferred® Card because you can transfer Chase Ultimate Rewards points 1:1 to airline miles programs like British Airways, United and Southwest.
Add a No Annual Fee Card
As I said before, the main reason not to add multiple cards when you first start out is because most travel credit cards carry an annual fee, and having multiple fees can knock out a lot of points. A notable exception is the Barclaycard Arrival™ World MasterCard®. This card does not have an annual fee and earns 2X points on travel and dining just like the Chase Sapphire Preferred® Card.
I do not use this card because Chase Ultimate Rewards points are much more flexible and worth more when redeemed for travel. However, if you already have a carrier-specific card such as a Starwood Hotel card, adding the Barclaycard Arrival™ World MasterCard® with no annual fee is a great option to boost your rewards with no additional cost or commitment.
Bringing It All Together
If you take anything from this guide of tips, take this: The travel rewards landscape is difficult to understand, so you need to be armed with a strategy and then learn as you go.
The best way to avoid getting travel credit cards you don’t use, or committing to an airline you will come to hate, is to do the following:
- Start earning travel points with the most flexible travel rewards card
- Learn about loyalty programs and find your preferred airlines and hotels
- Add a more targeted travel credit card using what you’ve learned
By keeping it simple and taking it slow, you’ll graduate from being a novice traveler in no time, and you’ll soon be experiencing first-class travel for less — just like the pros!
About this resource:
Created on: November 05, 2015
Updated on: February 01, 2016
Edited by: Sarah Ban, Mike Jelinek
Research by: Michael Gardon, Mike Jelinek