Travel Credit Cards

           I had a real hard time deciding if I should write this post.  Misuse of credit cards can lead to financial ruin.  But, in the right hands, credit cards can also generate value to the cardholder.  As someone who has a good understanding of the credit card market, I’m frequently asked about credit card options.  And it’s a pain in the buttocks to try to list a bunch of possible options for prospective card holders.  So, I’m providing some options here. 

            The value of each card depends on your needs.  The AAdvantage Aviator Red World Elite Mastercard (below) is a great card for those that plan to fly (especially internationally) within the next year and live near an American Airlines hub and are probably best for those that happen to find a flight that can be purchase with 50,000 or fewer points that would cost a lot of USD (often referred to as a redemption “sweet spot”).  For those that have no plans to fly within the next year, this card sucks! 

            I’m providing some options here, but if you really want to take advantage of the credit card game, plan to allocate significant time to learning about various reward systems and card offerings.  This game gets more lucrative as your spending increases.  As your spending naturally increases (due to increased salary and/or increased family size), it will become easier to find value.  But don’t let the tail wag the dog; don’t increase your spending to generate rewards.  Furthermore, recognize that chasing travel rewards could inherently lead to increased spending.  If you’re already flying to London next summer, then using a credit card to pay for the flight with points can offer significant savings.  Alternatively, if you go to London just because you already have the points, then the extra costs (hotels, dining, experiences, etc.) will strain your budget.  Be smart and responsible.

            If you don’t have a full-time job, the most lucrative cards will likely reject your application.  The same is true if you have a low credit score (in which case, I’m not sure I’d advise chasing rewards anyway—get your act together first!). 

            Almost every successful adult I know plays the credit card points game.  Some are more aggressive than others.  My wife and I apply for about 6 credit cards each year and use the points to take extravagant vacations.  Do credit cards ultimately save us money?  Probably not.  But they enable us to cheaply take long vacations and frivolous short jaunts that would otherwise be prohibitively expensive.  They help make our lives more interesting. 

Disclaimer:  I have included referral links for two cards (Chase Sapphire Preferred and Capital One Venture X).  If you select these, I get a small kick back.  Any revenues generated from these kickbacks will be used to cover my hosting fees and other costs (e.g. travel to schools and universities to spread information on the importance of financial literacy).  I am not advertising cards in hopes of collecting money.  I am simply providing you with a list of the cards that are best.  Two of these cards offer referral bonuses.  I would be stupid not to include the links for those, right?



Easiest Card for Free Flights (Low Monthly Spending)

Aviator Red World Elite Mastercard



Best Cards for General Travel (Moderate to High Monthly Spending)

Chase Sapphire Preferred: 




Good for Travel and Lounge Access (High Monthly Spending)

Capital One Venture X




Good for Renters who want flexible redemption options

Bilt Mastercard



 

Useful Resources

Card Recommendation Flowchart

The Points Guy