Why You Need a Travel Rewards Credit Card (and Which)

Why You Need a Travel Rewards Credit Card (and Which)

Happy Travel Tuesday! Now that I’ve been back out and about in San Francisco (yeee!), I keep getting the same question — Christina, how do you afford all this travel?!

Unfortunately for me, there’s no trust fund or lifelong savings behind that answer, instead a tetris combination of things pieced together — subletting my apartment and moving back home temporarily, the support of some amazing friends’ couches, spending a heck of a lot of hours in front of this here computer and… POINTS. The most attainable and so often overlooked way to create a travel budget out of thin air is by taking advantage of America’s foundation: CREDIT and POINTS.

I’m not suggesting you rack up credit card debt with no way to pay it off to take a whimsical RTW (although this post is one of the most thought-provoking pieces of truth I’ve read in a long time — kudos to you, Kate!), but I am suggesting you invest some time and effort into managing a travel rewards credit card.

5 Reasons You Need a Travel Rewards Credit Card

1- You Need Credit

If you live in America, you need credit. It doesn’t matter if you have $500k+ in the bank, you still have to put down a credit card or fat deposit to sign up for utilities and if you want to buy a house one day that $500k is going to go real quick — especially if you get a high APR on a 30-year mortgage because you have no prior credit. You’re cheating yourself out of low interest rates (see: costing yourself money) by prolonging the inevitable.

2- The Sooner You Get Credit, the Better

I am not a financial advisor, but the three major pillars in calculating credit scores are 1- amount available, 2- utilization and 3- life of accounts. There are other influences involved, but two of the three most important factors are solely influenced by time — not income. Again, you’re cheating yourself by prolonging the inevitable.

3- It’s Safer than Your Debit Card

At SXSW in 2011, Frank Abagnale (the real Catch Me If You Can) spoke on his life story of bamboozling millions of dollars and stealing identities around the world. “But Frank, HOW did you do it without leaving a trace?,” the audience asked. “It was easy,” he said. “You can’t track cash.” In a(n unfortunate) world where identity theft is a fact of life, limiting your checking and debit accounts to minimal transactions is a safety measure. It’s a lot easier to be reimbursed for fraud when you’re not dealing with cold, hard cash (debit).

4- Since You Have to Play the Game, Why Not Earn Rewards?!

Reasons 1-3 are based on situational facts, but #4 is where this gets fun: FREE MONEY! If you have to play the game, why not earn the rewards? And since the “Rewards” are supplemental to your income and current standard of living anyway, why cash them in on day-to-day things like gas and groceries when the real reason you’re pinching those pennies is probably to save up for something “reward”ing — like travel, anyway? Use the system to your advantage!

5- Travel is the Only Thing You Buy that Makes You Richer

OK, this one’s an opinion. But travel rewards cards are an easy way to negate the #1 reason people cite for NOT traveling, cost. And, they come with benefits outside the actual points accrued like travel insurance and waived foreign transaction fees that will help save money in-action also. And, if that card becomes a symbol to you of travel because of the rewards maybe it’ll help you think twice about whether to swipe for that indulgent purchase you really don’t need (just me? that’s cool too). The deal here is earn free travel by doing nothing except running your expenses through a different banking account. Of course, minding a personal responsibility factor to not leave an unpaid balance each month.

(And Which)

The next logical step is to choose the travel rewards credit card that’s best card for you.

travelrewardscreditcard

The Points Guy is an awesome resource on all things credit card rewards, but here are the results of what I’ve found to be the best fits for me after researching all this jazz for a couple years:

Barclay Card Arrival Plus World Elite Mastercard

This is the best I’ve found for an all-around travel rewards card. I put everything but my rent on this card (what a treat it would be if I could process that payment!), and paid for my round-trip flight to Japan and taxi fare to/from LGA to upper Manhattan on points within the first 4 months thanks to the sign-up bonus. It’s my favorite because you’re flexible to book your own travel with any vendor directly and then redeem as a statement credit instead of being limited to the bank’s third-party rewards aggregate, and you earn 2 points on every dollar all the time instead of only on certain types of transactions.

Earn 2 points on every dollar ever. No foreign transaction fees. 40k bonus points when you spend $3k in 90 days ($400 Cash Equivalent credit). Redeem points for statement credits on any travel spending and get 10% back or directly through Barclay Rewards for preferred pricing.

PERKS:

-Concierge + Luxury Travel Benefits
-$250k Travel Accident, Baggage Delay, Lost Luggage + Trip Delay Insurance
-Purchase, Return, Extended Warranty + Price Protection
-Auto Rental Loss/Damage Waiver, Travel Assistance
TripitPro Subscription, Barclay Travel Community (earn points for sharing stories), Identity Theft Helpline + 24/7 FICO score access (to keep your credit in check)

*Details from Barclay Card Arrival Plus

Chase Sapphire

I don’t have this one, but it’s the preferred card of mostly all of my frequent traveler friends. It has twice the travel insurance as the Barclay but less luxe benefits and no TripIt, community or credit score tracking perks. Rewards are discounted and booked through Sapphire rewards.

Earn 2 points on travel + restaurants, 1 point on everything else. No foreign transaction fees. 40k bonus points when you spend $4k in 90 days ($500 Sapphire Credit). Preferred travel pricing is 20% off face value through Sapphire rewards.

PERKS:

-Concierge + Chase Sapphire Exclusive Events + Experiences
-$500k Travel Accident, Baggage Delay, Lost Luggage + Trip Delay Insurance
-Purchase, Return, Extended Warranty + Price Protection
-Auto Rental Loss/Damage Waiver, Travel Assistance

*Details from Chase Sapphire

Airline or Accommodation-Specific Card

The premise behind any rewards program, commitment gets you farther faster, so if your travel plans ring consistent to an airline, hotel or other travel network, run with it. Know that these cards have a higher interest rate than major bank cards, so be extra mindful to not carry a balance and negate the points earnings, but again, responsibility is the key to success here.

United, Delta and Marriott are the most popular ones I hear about for international benefits and elite-level perks for frequent travelers. I chose the Virgin America Visa because I love Virgin and fly SFO <–> FLL with them at least 8x a year anyway, so now I’m racking up 8x the reward points, a free bag and a $150 annual companion credit by having it. This one will really depend on what works best for you!

I feel it’s important to note that I am in no way affiliated with or compensated by any brand mentioned other than by being a happy customer — just want you guys to take advantage of free stuff!

Over to you — any major travel credit cards or perks I’m missing out on? Do you agree/disagree?

  • InNatsShoes

    THANK YOU! I’ve been debating this for a while.. I will definitely be looking into a more travel-centric card in the near future. My Nordy’s card is great, but do I really need rewards points for more clothes that I can’t take while traveling!? 😉

  • Ana Lia

    How about the Capital One card where they promise you can fly any airline, anytime and no blackout seats?

  • Ana Lia the Capital One Venture One is very similar to the World Arrival. looks like the Barclay sign-up bonus is slightly higher, + the 20% you get back from redeeming as  a statement credit, but another solid option!

  • InNatsShoes exactly! Victoria’s Secret rewards are nice, butttt… Machu Picchu is calling on the other line + I gotta go 🙂

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