Travel rewards credit cards are an elusive idea for many people in debt. If you’re already in the red, should you open new credit cards that can lead to more debt? If you’re able to keep your spending under control and pay your cards off in full each month, the answer is a big yes, yes, yes!
Earning credit card rewards can be a simple way to score major deals, provided you play by the rules laid out by the card provider. Here are three cards that give you great value.
3 best travel rewards credit cards
Chase Sapphire Preferred
The Chase Sapphire Preferred has been the most important credit card in my wallet since I started travel hacking more than five years ago. This card comes with a 50,000 point signup bonus after spending $4,000 in the first three months you have the card.
You can get an additional 5,000 points by adding an authorized user who makes a purchase in the first three months. That’s enough points for two domestic round-trip flights or one round-trip to Europe if you use the points to their full value.
Additionally, you earn 2 points per dollar spent at restaurants, bars, and on travel-related purchases like airfare, train tickets, cruises, and hotels. The card comes with no foreign transaction fees, so you can use it without paying extra while gallivanting around Europe, South America, Asia, or wherever your travels take you.
In exchange for all that luxury, the card comes with a $95 annual fee, which is waived for the first year. However, if you spend enough on the card each year to earn more than 9,500 points, you’re getting your money’s worth from the fee.
You can use the points to book travel through the Chase Ultimate Rewards portal, where you get a 20 percent discount on travel bookings. You can usually get a better deal when you transfer the points to a partner airline like United, British Airways, or Southwest to get more value per point. Chase has 10 airline and hotel transfer partners.
This is my favorite card for a new travel hacker. It is arguably the best credit card for travel rewards not specific to one airline or hotel. And the card is made out of metal — badass, right?
American Express Everyday Preferred
The Everyday Preferred from American Express is the newest of the three travel rewards credit cards on this list.
This card currently comes with an underwhelming 15,000 point signup bonus after spending $1,000 in 90 days, but the benefits are solid. You earn 3 points per dollar spent at grocery stores, 2 points per dollar spent at gas stations, and 1 point everywhere else, which lets your spending turn into valuable Amex points quickly.
The real kicker is a program designed to get you to use this card as your primary spending card everywhere you go. If you make 30 or more transactions with the card each month, you get a 50 percent bonus on all points earned, including those grocery and gas station points.
The card comes with a $95 annual fee, not waived the first year, and charges a 2.7 percent foreign transaction fee.
I have this card myself and use it regularly. Amex offers a handful of member perks, but this card really only beats the Sapphire Preferred on the grocery store and gas station bonuses. In addition, American Express offers different airline transfer partners, including Delta, JetBlue, Virgin America, and high-end global airlines Emirates, Singapore Air, and Etihad.
If you spend mostly on groceries and gas or prefer any of these airlines, the Everyday Preferred card could be the best travel rewards card for you.
Barclay Arrival Plus
Barclay recently lowered the value of points earned from the Barclay Arrival Plus, but it’s still competitive in the general travel rewards credit cards category.
With a 40,000 point signup bonus after spending $3,000 in 90 days and a unique point redemption system, this card is best for people who don’t want to worry about how to use each mile and point, and just want to get free travel purchases instead — you get reimbursed as a statement credit when you use points.
The card comes with an $89 annual fee, which is waived the first year, and you earn 2 points for every dollar on all purchases. You can redeem points at .01 cent per point towards travel, but get a 5 percent bonus when redeeming. You do not get the bonus when redeeming for non-travel related statement credits.
Spending $4,227 per year is the breakeven point for the annual fee if you redeem points for travel. That’s pretty easy to do if you put all possible purchases on the card, and the ease of redeeming makes this one the best rewards credit card for travel.
When choosing between any of these three travel rewards credit cards, you can’t go wrong. The trick is to find the one with the best signup bonus, earning method, and redemption options for your spending and preferred way to travel. Bon voyage!
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