6 Best Travel Reward Credit Cards

in Financial Planning by

KEY POINTS
  • Optimize your spending with credit card rewards.
  • Sign up for a credit card that offers reward points for everyday expenses.
  • Look for a card that waives fees.

We all know that there is more to personal finance than investing. If you truly want to get ahead, you need to master the art of effectively managing and maximizing the money you work hard to earn.

Part of that equation includes optimizing your spending, either through the use of a monthly budget, a spending plan, couponing or scouring for deals, or simply cutting back. {Related: Track Your Spending with Personal Capital}

If you want to take it a step further, you can also optimize your spending with credit card rewards. And with the summer travel season in gear and fall breaks just around the corner, there is no better time than now to find a travel credit card that can help you save on all of those family trips.

Top 6 Travel Credit Cards for 2016

While there are plenty of travel cards on the market, and each offers its own set of perks, some manage to stand out from the pack due to their generous rewards or innovative point-earning systems. Here are a few of my favorite cards that can help anyone (wh0 is responsibly paying off their balance each month, of course!) get a deal on their next family trip:

1. Chase Sapphire Preferred® Card

Time and time again, the Chase Sapphire Preferred® card is named the top rewards credit card for travel. This is partly because its rewards program, Chase Ultimate Rewards, offers so many way to redeem your points, but it’s also because the points themselves are insanely lucrative on their own.

For a limited time, you’ll earn 50,000 points after you spend just $4,000 on the card within 90 days. That might sound like a lot of money to spend on credit, but it’s really not if you’re able to charge everyday expenses like groceries, gas, utility bills, cell phone plans, and insurance, then turn around and pay those expenses off right away. In addition, you’ll earn 2x points on travel and dining and 1x points on all other purchases.

Chase Ultimate Rewards points can be redeemed for travel in a number of ways. For starters, you can redeem them for cash back at a rate of one cent per point, then redeem that cash back for any type of travel you want. To put things in perspective, the 50,000 point signup bonus on this card is worth $500.

If you use your points to book travel through the Chase travel portal, however, those points are worth around 20% more! And if you’re really creative, you can stretch those points further by transferring to one of Chase’s popular travel partners at a 1:1 ratio. There are around eleven partners to choose from, and that includes popular hotel and airline loyalty programs like Marriott, Ritz Carlton, IHG, Hyatt, Southwest Airlines, United MileagePlus, and British Airways.

Best of all, this card’s $95 annual fee is waived the first year.

Since Southwest is easily the best airline for families to travel domestically or to the Caribbean, Chase cards are the go-to cards in my wallet. For Spring break this year, I booked six flights for my family to Montego Bay with Southwest Rapid Rewards points. As an added bonus, Southwest Airlines lets you fly with your two first checked bags free. {Related: Top 10 Tips to Save on Travel with Kids}

2. Ink Plus® Business Credit Card

The only business card on this list, the Ink Plus® Business Credit Card, is the perfect companion to the Chase Sapphire Preferred® Card. The points you earn with this card fall under the same travel program as the personal preferred card, which means you can redeem them for cash back or travel through the Chase travel portal, or transfer them to your favorite loyalty program.

The big difference is how you earn your points. With the Ink Plus® Business Credit Card, you earn 5x points on your first $50,000 spent annually at office supply stores and on cellular phone, landline, internet and cable TV services each year, 2X points per $1 on the first $50,000 spent at gas stations and on rooms booked directly with a hotel, and 1X points on everything else.

A hefty signup bonus of 60,000 points will also give you a huge head start towards your travel plans. However, it’s important to note that this card’s $95 annual fee is not waived the first year.

3. Citi ThankYou® Premier Card

Although I was never a huge fan of the Citi ThankYou® program, new cards and offers within the past few years have changed my tune. One of those cards is the Citi ThankYou® Premier Card, which offers 3x ThankYou® points on travel including gas, 2x ThankYou® points on dining and entertainment, and 1x points on everything else. The fact that you’ll also earn 40,000 points after you spend $3,000 on your card within 90 days also sweetens the deal. Best of all, this card’s $95 annual fee is waived the first year, giving you 12 full months to try out its benefits.

The way you redeem your Citi ThankYou® points is similar to the Chase Ultimate Rewards program. You can either redeem them for gift cards at a rate of one cent per point (40,000 ThankYou® points = $400 in gift cards), use them to book travel through the Citi travel portal at a discount, or transfer them to one of Citi’s popular transfer partners.

4. Citi Prestige®

While I like the Citi ThankYou® Premier card on its own, I think it’s much better when paired with the Citi Prestige®. This card does come with a $450 annual fee that makes it sound crazy from the offset, but the fee is well worth it when you consider the benefits.

Not only do you earn 50,000 points after you spend $3,000 on your card within 90 days, but you also get a $250 airline credit on any airline, $100 credit for Global Entry, expensive airline lounge access, and a fourth night free hotel benefit. Best of all – and most importantly – points earned with the Citi Prestige® are worth 1.6 cents each when redeemed for flights on American Airlines. So, that 50,000 point signup bonus is worth $800 in American flights. Best of all, having both Citi cards mentioned in this post means you can pool your points in your Citi Prestige® account to get the better value on American flights.

Recently, I used a bunch of my Citi points to book six round-trip flights from Chicago to St. Thomas and paid just 113,000 points and $649. Why the $649? Because I was short on points and Citi lets you make up the difference in cash.

If I had paid the full sticker price, our flights would have rang in over $4,000. But doing it all this way means I could book the six flights for a price I can truly afford, bringing my two children and my parents along in the process.

5. Starwood Preferred Guest® Credit Card from American Express

Since Starwood properties are in the process of merging with Marriott, there’s no telling how long the Starwood program will continue to exist in its current form. But as longs it lasts, the Starwood Preferred Guest® Credit Card from American Express offers a stellar deal. With this card, you’ll earn 25,000 points after you spend just $3,000 on your card within 90 days.

While that may not sound like enough points to do anything meaningful, that couldn’t be further from the truth! Weekday rooms at Starwood properties start at just 3,000 points per night, and you can use your points to score free rooms nearly anywhere in the world.

My favorite Starwood redemption so far was when we used 48,000 points to book five nights at the Park Lane Sheraton Hotel in London. Not only was it swanky and close to the underground, but it was right across the street from Buckingham Palace.

Your 5th night is free when you use points to book four nights in any category 3-7 property, and other programs – such as Nights & Flights allow you to redeem your points for both free rooms and airfare. Plus, you can transfer your points to more than 30 airline loyalty programs – some of which give you 5,000 bonus miles when you transfer 20,000 points or more.

The $95 annual fee on this card is waived the first year.

6. Barclaycard Arrival Plus™ World Elite Mastercard®

If you hate keeping track of complicated travel rewards programs, I highly suggest the Barclaycard Arrival Plus™ World Elite Mastercard®. With this card, you’ll earn 2x points for every dollar you spend. And when you go to redeem your points, you can turn them in for any type of travel.

That’s because this card lets you earn “travel credit” versus regular points or miles. With travel credit, you can shop around for the best deal, book any flight or hotel stay, and not have to worry about blackout dates, capacity controls, or following along with a complicated rewards program.

The current signup bonus on this card is 40,000 points after you spend just $3,000 within 90 days. Those 40,000 points are worth $400 of any type of travel with any hotel chair or airline. Plus they’re even good for train tickets, park tickets, or entry fees into your favorite attractions.

The $89 annual fee on this card is also waived the first year, giving you ample time to see if you like the way these points work.

The Bottom Line

With warm weather travel upon us, it makes sense to think about how you can make it as affordable as possible. Obviously, your credit strategy should be part of your long-term financial plan. And with Personal Capital’s user-friendly dashboard, you can see and analyze all of your credit spending to make sure your penchant for rewards doesn’t throw you off track. {Related: A Better Way to Track Your Spending Each Month}

At the end of the day, the only way you should pursue travel rewards is if you are debt-free and determined to stay that way. If you tend to spend more when you use credit or have trouble paying off your bill, though, you should steer clear of rewards.

As someone who writes about credit for a living and uses rewards for countless trips every year, I keep an updated list of the best travel credit cards you can use as a resource if you see fit.

Good luck planning your adventures, and as always, be careful not to let rewards sink you into debt.

What is your favorite travel credit card? Have you ever used rewards to book a free trip?

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Holly Johnson

Holly Johnson is a financial expert and award-winning writer whose obsession with frugality, budgeting, and travel plays a central role in her work. In addition to serving as Contributing Editor for The Simple Dollar, Holly writes for inspiring publications such as U.S. News and World Report Travel, Personal Capital, Lending Tree, and Frugal Travel Guy. Holly also owns two websites of her own - Club Thrifty and Travel Blue Book. You can follow her on Twitter or Pinterest @ClubThrifty.

22 comments

  1. Jon @ Be Net Worthy

    Great article Holly. You’ve inspired me to check out the Chase Sapphire preferred card – that is a great promotion then have going! I’ve been a Marriott rewards card guy for years, but the Sapphire deal is definitely better, at least during the first year for sure.

    Reply
  2. Steven

    I agree with your report. I use our have used all of these cards. The SW companion pass is, in my opinion, probably the best part of any card. The reason why I like my Sapphire card the best this for two reasons. Firstly, the Sapphire card provides full primary insurance coverage for rental cars. Secondly, you always get through to a customer service representative without any waiting in line. The perks are prestigious.

    Reply
  3. OH

    Holly,

    Surprised to see that you don’t mention the BofA Travel Rewards card anywhere. As a Preferred Rewards Platinum member, I get 2.6 points on EVERY $ I spend (no matter the category) which I can apply 1-for-1 towards travel spend for cash back. Plus, there is no annual fee.

    Ex.: $50K annual credit card spend, $1,300 of which are travel expenses -> $1,300 cash back
    So, if you spend enough on travel, you get 2.6% cash back on ALL of your credit card spending.

    Side note – booking through the BofA Travel Center, I get an extra 3 points per dollar.

    Reply
  4. AAExPlat

    Holly. On the Citi Prestige, your info is outdated. They just published that the signup bonus is reduced, that the benefits are severely curtailed (no more lounge access, 4th night free is calculated differently, and AA redemptions are now a standard 1.3 cents per point). There is no compelling reason to get that card.

    Reply
  5. Aaron

    FYI your bonuses for both Citi Thank You cards are out of date. As of today the 29th the Prestige is just giving a 40K bonus and the Citi Premier is no longer providing a sign up bonus.

    Reply
  6. Mel

    How could you overlook the CapOne card? No foreign transaction fees, and exceptional customer service!

    Reply
  7. Josh

    I have the Chase Sapphire Preferred, an Delta Gold American Express (received a $50 credit for an in-flight purchase, plus 30,000 sign-up points, the Southwest Airlines RapidRewards Premier card from Chase (warning: comes with a $99 annual fee, but 50,000 RapidRewards points as a sign-up bonus will get me approximately 3 round-trip flights) and most recently the Chase Ultimate Freedom card (no annual fee, 1.5% cash back on ever purchase, and I can transfer the points to the Chase Sapphire Preferred card to maximize the point value on Chase Ultimate Rewards portal).
    All that being said, I’m new to the Credit Card hacking game… just started 4.5 months ago. I’m in the points accumulation phase, having not had a chance to take a trip this year that was not already paid by my employer.

    Reply
  8. Dema Scott

    I would be interested in credit cards that don’t charge conversion fees for foreign currencies…such fees can be a shock on your bill. Also of interest: debit cards that allow you to get local currency in foreign countries without the added conversion fees and will reimburse the user for out of network ATM fees

    Reply
    • Cindi

      We use Schwab for our foreign ATM use….they do refund any ATM fees at the end of each month. We use Capital One to charge anything as they do not charge the foreign transaction fee. Have been using these two cards for many years with no issues.

      Reply
  9. Fred Fernandez

    The CITI Prestige card’s benefits are getting downgraded. You should disclose that given the high annual fee.

    Reply
  10. Deborah Soloway

    Rewards & fees are certainly important, but for international travelers, foreign currency transaction fees should be looked at too. A 2.75% fee on every hotel, meal, souvenir, etc. can add up!

    Reply
  11. Brett Sorge

    I would rather be able to redeem in cash like the Costco Citi card. I hate points! Another thing your missing is that most of these cards charges for currency transaction if spending overseas. In that case the Capital One card is good. Even if you get these cards free the first year you will be billed the second year which you cannot drop.

    Reply
  12. Nico

    I haven’t used the listed cards but I do own a Capital One Venture One card and it has been great. Just got credited $400 on my travel expenditures after only having the card under a year.

    Reply
  13. Tom Dickson

    Why would anyone want to pay an annual fee?

    Reply
  14. Sanjit Mandal

    I love my AMEX Business Gold, triple on certain categories, I love it! 🙂 In our household we split credit card into different categories, my wife’s work expenses, my expenses, karate club expenses, and then the family card. When it comes down to tax season, not only is it easier, but we are slowly ranking up points over a few networks.

    Reply
  15. Mike

    No mention of Capital One Venture makes me think you didn’t do your research. Easiest card to use on travel in the world.

    Reply
  16. Leeanne

    I use Capital One Venture card snd love it!

    Reply
  17. Leeanne

    Capital one venture card gives double for every dollar spent.

    Reply
  18. Henry Lee

    Another person who is surprised there was no mention of the Capital One Venture card, with 2% back on any purchase that can be used toward travel. There was a huge 40k bonus and you don’t pay annual fee until year 2.

    The other top cards are the new Costco Citi (a whopping 4 percent back on gasoline and 3 percent on dining, plus 2 percent on everything else) and the Amex Blue Cash Back card.

    Honestly I think all 3 of these trump your list of 6, which makes me think this is less a blog and more a sponsored as trying to get clicks.

    Reply
  19. Samean

    No way, transaction fees and annual fees are not a rewarding card. Prefer cash back.

    Reply
  20. Marcus

    As expats, an international friendly card is a must and the two we use are CapitalOne Quicksilver & AMEX Platinum. Both have great reward programs. Quicksilver has no annual fee. AMEX Platinum does have a high annual fee, however it doesn’t take many international purchases to offset this. It also includes membership in Priority Pass global lounge program, Global Entry, and a host of travel benefits/reimbursements – many of which very easy to use as they simply show up as a credit on your statement once a qualifying charge is recognised. The Quicksilver again has no fees, no transaction fees neither and it’s reward program is cash back to spend or apply to statement balance.

    Reply
  21. Drew

    Annual fees have always intrigued me because I never understood the point but I guess I’ll have to look into it a bit more. Thanks for sharing.

    Reply

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