If you love to travel, then looking into a credit card with a great travel rewards program can be a great way to get the most value out of your adventures. Travel rewards credit cards allow you to rack up points or miles every time you swipe, but not all travel rewards programs are created equally. Some cards offer additional perks such as extra points for any purchases you make during your trip, while others are designed more like loyalty programs that reward you for spending on certain hotels or airlines.
WalletGeek's Best Travel Card Picks
How Travel Rewards Cards Work And How To Select One
General/Flexible Travel Rewards Cards –
Credit cards like the Capital One® Venture® Rewards Credit Card, the Chase Sapphire Preferred® Card, and the American Express® Gold Card are all good examples of cards that come with fairly flexible rewards systems. Their programs are designed to reward customers with flexible travel benefits that can cover things like airline travel, hotel stays, and travel related purchases. The main benefit of these types of cards is that they tend to offer more options as far as which hotel chains or airlines you can chose to redeem your points on.
Brand Specific Cards –
Cards like the United® Explorer Card and the Hilton® Honors American Express Card are specifically designed to offer points that can be redeemed through certain brands. If there is one specific hotel chain or airline that you tend prefer to use when traveling, then it may be worth doing a little research to find out whether they offer a card that will reward you for your loyalty. While it is possible in some cases to transfer the rewards on these types of cards to another brand, it will generally be at the cost of a huge slash in points value.
Which Travel Card Is Right For You?
Given that there are a huge variety of travel rewards credit cards on the market, chosing the right one for you may initially seem a bit overwhelming. That said, asking yourself a few key questions before you begin your search is a great way to help narrow things down a bit.
Some top questions to consider:
How much do you actually travel?
Though this may seem pretty basic, it’s important to consider whether a travel rewards card makes sense for you. Keep in mind that there are plenty of cards that come with rewards programs that offer cash back, rather than travel, reward options. If you travel a great deal for either business or pleasure, then chosing a travel rewards card may indeed make a great deal of sense. If you’re only an occasional traveler, however, then you may end up racking up a lot of points you never get around to using. A 2018 study found that Americans miss out on $22 billion dollars worth of travel rewards perks each year simply because they never get around to actually using them! If you don’t tend to be a frequent traveler, then looking into cards with other reward options is probably the smarter choice.
Make sure you compare various programs and how many points or dollars you earn each time you use your card. While most cards will reward you with a certain number of points for each purchase, some also offer bonus points for using your card to make certain types of purchases. For example, the Wells Fargo® Propel American Express cards offers 3x the points on travel, dining, gas stations, and select streaming services. In general, you’ll want to make sure that if you’re considering a card with no annual fee, you’ll get at least 1.5% back in rewards. For a card that does charge an annual fee, shoot for a rewards rate of at least 2%. Make sure you understand how much each point is worth and avoid any card that offers you less than 1 cent per point or mile.
While there are a few travel rewards cards out there that offer no annual fee, this tends to be pretty rare. Some annual fees can be as high as $500+, so make sure that you’re not going to end up paying more to keep the card open than you’ll earn in points each year.
Among the biggest perks of many travel rewards credit cards is their generous sign-up bonus. Some cards offer a large number of miles or points upon sign-up, but make sure you know what the conditions are for earning them. You may only be awarded the sign-up bonus upon spending a certain amount of money within a given timeframe.
General Vs. Co-Branded Cards
Deciding whether to go with a general travel rewards card or one that’s associated with a certain brand can also be a bit tricky. It’s important to weigh the pros and cons when determining which is right for you.
General travel cards may be your best bet if you like to keep things flexible while traveling. Having a greater selection of hotels and airlines to chose from can definitely be a big perk, especially if you like to travel on the fly. Some co-branded cards may leave you at the mercy of whether or not there are any rewards seats available on a given flight or available rooms at the hotel you plan to redeem your points with. General travel cards also tend to cover more travel-related expenses you may make, including dining, gas, or car rentals.
That said, co-branded cards do come with perks of their own. If you tend to book your travel plans well in advance and like to use the same airline or hotel chain, then these types of cards can come with handsome rewards. The Hilton Honors American Express Aspire Card®, for example, offers perks like 14x points on eligible Hilton purchases and 7x points on flights booked directly or through amextravel.com, as well as car rentals booked directly with select companies. So if you are up for a little brand loyalty, rest assured that it can go along way.