Flying for Peanuts: Which Credit Card Has the Best Travel Rewards Program
Yesterday, I gave you a list of four credit cards I recommend for their travel rewards programs. And I told you that I recommended a different one for each of the people in the office here because each person has different needs and preferences.
Today, I thought to give you some more details about my recommendations so you have a better idea about which card might make the most sense for you.
If you missed yesterday’s issue on credit card reward programs, you’ll find it here.
And here’s my detailed rundown on the cards I recommended to my staff:
Maximum Rewards Platinum Edition Visa is right for…
People like our staff writer, Bonnie Caton. Here’s why I recommended the Maximum Rewards Platinum Edition Visa for her:
** 1) It’s a Visa card. Bonnie shops in thrift stores and eats in little corner cafes. Since Visa is more likely to be accepted in these places, I recommended she choose Visa over American Express.
** 2) It doesn’t have an annual fee. Bonnie doesn’t currently use a credit card. Nor does she have a lot of expenses she can charge to one — no car insurance, no gas, no pets, no home improvement, and she’s not a big shopper. At a rate of one point per dollar, it’s not likely Bonnie will charge enough in one calendar year to claim a free flight, much less justify an annual fee.
** 3) The Maximum Rewards Platinum Edition Visa gives THREE points on every dollar spent on flights and hotel. And that’s what a large portion of Bonnie’s chargeable expenses are. Her family lives in Portland, so she flies back and forth on holidays and sometimes just for a visit. She also flies quite a bit for our workshops. And those dollars can quickly add up.
**4) With this card, even though you earn one point per dollar (and more when your charges are for airfares and hotels) your points actually trade in at a higher value. A $400 plane ticket, for example, will only cost you 32,000 points rather than 40,000.
AND the card comes with an entire catalog full of other rewards that aren’t travel-related — Starbucks gift cards, computer equipment, hot air balloon rides, and more.
Bonnie’s a “life experiences” kinda gal so she may want to accumulate points for a hot air balloon ride or a drive around the race car track. That, or trade her points in for gift certificates she can send to family and friends on their birthdays and at Christmas.
The Starwood Preferred Guest Credit Card by American Express is a good fit for…
People like Terry Frank, our product development manager and workshop coordinator. For Terry, I see two big pluses for the Starwood Card:
** 1) Terry has pets, a house, a car, a cell phone, and she spends a lot of time (and money) on her horses. In total, including reimbursable expenses she has for work, Terry will likely charge more than $20,000 a year on her credit card (without carrying a balance). But she’s not likely to reach the $25,000 mark, which is what she’d need to charge to accumulate enough points for a free flight across the U.S.
The cool thing about the Starwood card is that it gives you an extra 5,000 miles when you transfer 20,000 miles to a frequent flyer program of your choice to cash them in for a flight. This extra boost will throw Terry over into “qualifying territory” for a free flight every year.
** 2) The Starwood card will give Terry an amazing deal on Starwood property hotels. Terry can stay in a Starwood hotel for five nights for the same rate Bonnie will pay for two. And Terry’s room will likely be nicer.
Terry likes “Western” luxury, and she’ll certainly find that at Starwood hotels around the world (which include the Sheraton and Westin brands, for instance). Bonnie, on the other hand, is happy with a more “authentic” travel experience and most often opts for a “local” hotel instead of a chain. So this benefit wouldn’t mean much to her.
I recommended this card to Terry because it IS the best-value card in terms of the rewards (even when you compare it to Bonnie’s card). And Terry will charge enough in one calendar year to really take advantage of those benefits and get her annual fee’s worth.
Blue Sky from American Express is a good card for…
People like our marketing assistant, Jackie Gray. I like this card for Jackie for three reasons:
** 1) There’s no annual fee. Jackie, like Bonnie, doesn’t have a lot of expenses she can charge to a credit card. She likes to shop for clothes but she doesn’t spend enough to accumulate the minimum number of points she’d need for a free flight every year. And if she can’t cash in on the big rewards, I don’t think she should pay an annual fee.
** 2) The Blue Sky card operates on a reimbursement system rather than a transfer or tier rewards system.
Unlike the Starwood card — where you have to transfer points into a frequent flyer program to get the free flight — the American Express Blue Sky Travel card gives you points that are exchangeable for travel dollars.
With this card, Jackie can buy her airline ticket wherever she wants and charge it to her card. Then she can decide whether or not she wants to use her points to reimburse herself for all or part of the ticket.
This is great for Jackie because she’s not likely to charge more than $7,500 worth of expenses every year and 7500 points earns her $100 worth of travel dollars.
** 3) Jackie’s more of a once-a-year-big-trip kind of traveler than she is a several-times-a-year-small-trip gal. She’ll save all year for a two-week trip to Australia, Asia, or Spain (those were her last three trips) and when she gets there, she’s likely to stay with friends or family. So she rarely, if ever, needs hotel accommodations.
I might have recommended to Jackie the same Visa card I recommended to Bonnie. But I don’t think Jackie will get the same kind of satisfaction from the rewards that Bonnie will.
Jackie, I can see, would much prefer $100 off her big trip airfare than she would a couple small gift certificates she can give away as presents. (Remember, neither woman spends a considerable amount of money on credit, so neither will qualify for a free trip with one year’s worth of purchases.)
The difference is that Bonnie is more likely to hold out for a domestic ticket, which she can trade in to see her family in Portland. Whereas Jackie would need to wait a few more years to rack up the 50,000-60,000 points she’d need for her bigger international fare.
Delta Platinum American Express is right for…
People like me.
For me, I decided to stick with the Delta Platinum American Express I already have. Even after doing all this research.
Now, it’s true that occasionally I find myself in a place where they don’t take American Express… and it’s true that this card comes with a $150 annual fee… but here’s what I get in exchange…
** 1) A free companion ticket once a year when I renew and pay the $150 fee.
This is a great deal for me because, as you know, I travel a lot for work. AWAI reimburses me for my flights to and from workshops and conferences. But they don’t pay for my husband to tag along. So once a year, it’s nice that I can extend a work trip by a few days and my husband can come for free.
** 2) Double miles on flights. I fly Delta a lot… more than any other airline. So it’s nice to get double points on those flights. Not as nice as the triple points Bonnie will be earning. But nice.
** 3) Now the number one reason I’m sticking with this card is because between me and my husband, we charge A LOT to our credit cards. We never carry a balance. But we charge over $50,000 a year when you add up all our personal expenses plus the expenses we charge that are reimbursable by his company or mine (travel, computer equipment, client lunches, etc.).
The Delta Platinum card gives me an extra bonus when we charge $20,000 or more in a calendar year and an extra extra bonus if we charge $50,000 or more. And that bonus helps me maintain my status as a Medallion Member at Delta (which affords me free upgrades to first class on domestic flights, priority boarding, waived baggage fees and more).
Now, if you’re not charging that much to a credit card or you’re not traveling at least 15,000 miles a year, then I wouldn’t recommend this card.
But I fly just enough miles on Delta every year to just miss the cutoff in Skymiles I need to remain my Medallion Member status based on my flights alone. So this extra boost I get from the credit card points is enough to qualify me. Couple that with the free companion pass, and I feel like this card is my best bet.
If I flew just a little more often on Delta (if, say, I stopped buying my tickets based on price alone and decided to fly Delta exclusively or I discovered that the trees outside were made of money) then I’d likely cancel this card. Because in that case, I’d no longer be riding the cusp of Medallion Membership, I’d have it on flights alone.
I hope these little vignettes help you find the card that’s right for you.
These days, with the cost of jet fuel soaring higher and higher and with fewer planes traversing the skies, air travel is getting more expensive. At least, that’s what all the headlines say.
[Editor’s Note: Learn more about opportunities to profit from your travels (and even from your own home) in our free online newsletter The Right Way to Travel.]