Best Travel Rewards Credit Cards

Should I Get an Airline or Travel Credit Card?

Many people assume that a travel credit card needs to be associated with a specific airline, but this is not the case. While there are some very impressive airline credit cards, there are also some great general travel credit cards. Which is best will depend on your preferences and travel habits.

The first thing you need to consider is if you are brand loyal to a specific airline. If you always fly Delta or American Airlines, it makes sense to have an associated credit card. This will not only allow you to earn a higher tier of points on your travel purchases, but you can also accumulate rewards for future flights with that airline.

However, if you are not brand loyal, a general travel credit card will allow you to earn the highest tier of rewards on all your travel purchases. This makes sense if you simply look for the best flight deal regardless of the carrier.

You also need to consider whether you tend to travel domestically or internationally. Some airline cards only offer some of the perks for domestic flights. For example, with the Citi AAdvantage Executive World Elite, you’ll only get your first checked bag free on domestic flights, whereas general travel cards tend to have broader perks that apply domestically or internationally.

Should I Get a Cash Back or Travel Credit Card?

This will depend on your typical habits. If you’re a serious traveler and tend to be regularly purchasing flights and hotel accommodation, a travel credit card is likely to offer the best possible rewards.

However, the compromise on these cards is that they tend to offer little or no rewards on other types of purchases. While there are some exceptions, if you want a card that offers rewards for groceries, gas and other purchases, you may find many travel cards frustrating.

If you tend to travel less frequently, a reward card with flexible categories may be better suited to your needs. For example, if you have travel plans on the horizon, you can designate travel as your primary reward category, but use it for groceries, electronics or other spending the rest of the year.

Another consideration is how you will receive your rewards. Travel cards tend to be heavily weighted towards redeeming rewards for travel. So, while you can accumulate your rewards for future travel plans, if you only travel once a year, this will take some time.

You will need to think about your typical spending practices and how often you travel. This will help you to determine which type of card is best suited to your circumstances.

When Shouldn’t You Pick a Travel Rewards Card?

• You’re an Infrequent Traveler: This may sound obvious, but while it is appealing to earn far more rewards on flights and hotel stays, if you only travel once a year, you’ll not earn the most rewards in the long term.
• You Don’t Have Set Spending Patterns: Another reason not to pick a travel rewards card is that you tend to have periods where you travel more and then don’t travel at all. In this scenario, you would be better suited with a revolving category rewards card.
• You Want Rewards On All Your Spending: While there are some exceptions, travel cards tend to offer little or no rewards on basic everyday spending purchases. So, if you want to earn rewards on all your spending, a more general rewards card is likely to be more appealing.

What Should I Look for in My Card If I Travel Abroad?

As we touched on above, many cards offer benefits that are better suited to those who travel domestically. However, if you tend to travel abroad, there are a number of things you should look for in your new card.

No Foreign Transaction Fees: Don’t assume that your travel card will have no foreign transaction fees, as many do. However, even a small fee can quickly add up if you tend to spend a lot of time abroad.

Free Checked Bags: Some airline cards only offer free checked bags on domestic flights, so you won’t be able to use this perk when you travel abroad. So, double check the small print and make sure you can enjoy free checked bags on all your flights.

Trip Delay/Interruption Insurance: Travel can always be a little uncertain, but when you’re outside the US, it can be even more complicated. If your trip is delayed or interrupted, this coverage will kick in to reimburse you for any essentials you need to purchase.

Travel Miles or Points?

Another consideration for the best travel credit cards is whether your rewards are in the form of travel miles or points. While these may appear similar, there are some crucial differences that may influence which is the better option for you.

Miles are brand specific, but are typically used for paying for flights or hotel stays. Some schemes do allow you to redeem for statement credit or gift cards, but these tend to be at a far lower redemption rate.

Points tend to be a little more flexible. While they are currency for your specific card issuer, there are often partner programs, where you can exchange your points for miles for an appropriate airline. However, you can also usually exchange your points for statement credit, cash and other rewards.

Which is best for you will depend on your habits and preferences. If you tend to be brand loyal to a specific airline, it makes sense to choose a card offering miles for this airline’s program. However, if you prefer more flexibility, a points based travel rewards card may be more suitable.

How Do the Travel Rewards Portals Work?

Once you start to explore different travel credit cards, you’re likely to see that each card issuer has a travel rewards portal. These portals allow you to get a higher redemption rate for your rewards and allow you to book flights, hotels and other vacation packages. However, each issuer portal works in a slightly different way.