Are Travel Credit Cards Worth It?

Travel2 years ago
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When it comes to cheap ways to travel, using the best travel points credit cards can be a great way to lower costs and enjoy fantastic perks as you travel. Whether you want to fund your next trip to visit family in another state or get a discount on your payments for an exotic dream vacation - collecting travel points on your everyday spending can be a great way to reduce costs.

Using the best travel points credit card to help you collect Airmiles, enjoy discounts on hotel stays, or enjoy lounge access and free baggage checking will all contribute to making your next trip more affordable and less stressful.

But some people are put off a card to collect travel points because some come with annual fees which may affect how much money you are actually saving when everything is totaled up. There are also so many on the market, and with each card coming with its own rules and regulations it can be difficult to select the best credit card for travel points.

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What are Travel Points Credit Cards?

Travel points credit cards are cards that allow you to collect and build up points that can be spent on your travel and hotel costs the next time you travel. There are different types of travel credit cards, but they generally fall under the following categories:

  • A Co-branded Airline Credit Card - Where a credit card provider has partnered with a major airline to allow you to collect Airmiles and points with your card purchases. Examples of this type of card include the United Explorer Card, Delta SkyMiles Gold American Express Card, and the AAdvantage Platinum Select World Elite Mastercard.
  • Bank Travel Points Credit Cards - These cards allow you to collect card reward points which can be spent on purchases from specific travel partners and hotel branches. Some of the most popular travel points credit cards include the American Express Gold Card and the Chase Sapphire Preferred Card.
  • Co-brands Hotel Credit Cards - Similar to airline co-branded travel points credit cards, hotel travel credit cards allow you to build up hotel rewards points with your everyday spending. Examples of this type of card include the Marriott Bonvoy Boundless Credit Card and the Hilton Honors American Express Surpass Card.

The best credit card for travel points for you will depend upon your lifestyle. For example, if you travel often for business applying for travel points credit cards which allow you to collect points on air flight bookings is a no-brainer. If you also tend to stay in one particular hotel branch, then getting a co-branded hotel credit card will help you to save up for your next trip while enjoying your current stay.

You need to look at your current lifestyle and make sure that you are aware of the rules and policies for each card works to make sure you pick the best travel points credit card for you.


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Do Travel Points Credit Cards Save You Money After Paying Annual Fees?

The annual fees for travel points credit cards can vary from $95 each year to as much as $695 per year. To decide whether a card is with an annual fee you will need to weigh up the value of all the associated benefits and savings. If the savings and points you expect to make total less than the fee, then your decision is pretty clear.

However, choosing the best travel points credit card for your lifestyle can allow you to enjoy discounts and perks across a variety of businesses and sectors which could save you enough to cover the annual fee and ensure you are making savings on your travel and accommodation bookings.

Examples of Benefits that could offset the annual fee include:

  • Airmiles and travel reward points are generated by your everyday spending in supermarkets and restaurants.
  • Annual memberships or a discount on the annual fee of TSA Precheck or Global Entry.
  • Discounts on bookings with rental car partners.
  • Travel insurance.
  • Free checking of bags.
  • Free gym membership.
  • Monthly Uber credit.

In lots of cases, the overall value of the associated perks can outweigh the annual fee. But you should make sure that you will use the perks when deciding their value. A pricey gym membership may run at $100s a year, but, if you aren't going to use it, the actual value to you may be $0.

Decide whether you would use the perks on offer, if the benefits that apply to your lifestyle total less than the annual fee, then you need to question if this is the right card for you.


How Does Using the Best Credit Card for Travel Points Help to Save You Money?

The most famous benefit of using the best credit cards for travel points is the opportunity you get each day to build up air miles and points with your everyday spending. However, you need again to make sure that your projected saving on flights is more than you spend to use the card in the first place.

Take your time to really get an understanding of the redemption rates and procedures of the travel points credit cards you are considering. Researching cards and discovering how to maximize your points potential with your daily spending can take time, but you'll reap the rewards the next time you book a flight.

But to start with, choose a card that rewards you for the spending you would make every day anyway. As the months go by, you should begin to see the points begin to build. Partners and points-building opportunities can change regularly, so make sure you keep up to date on the best ways to maximize your points with your spending choices.

Remember - The goal with getting travel points credit cards is to save money overall, so don't be tempted to make purchases you wouldn't otherwise in pursuit of points!


Summary: Are Travel Credit Cards Worth It?

If you choose the best credit card for travel points for your current spending and lifestyle, this can be a great way to reduce costs and increase benefits. However, you need to do some research before committing to travel points credit cards.

Pick a card that offers benefits and discounts which outweigh the annual fee cost of the card. You should also make sure to pick a card that rewards spending with stores and restaurants you are likely to use. Picking the travel points credit cards card which fit your lifestyle will ensure that you save the most money and are driving enough benefits to cover the initial costs.

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