A budget traveler knows how to make the most out of one trip while keeping the expenses down. You don’t have to spend on first-class flights and five-star hotels to make a memorable experience away from home if you’re smart about your trip and plan ahead. Despite not having a lot of disposable income, many people are finding more ways to travel for less while getting the best value.
One way of getting the best value for your travels is with a travel credit card. While you’re spending on everyday purchases or tickets and other necessities for one vacation, you’re already working your way towards scoring exclusive deals for your next vacation through travel rewards. Apart from future deals, using a travel credit card over your regular credit card means that you get to avoid foreign transaction fees and secured online shopping – a useful feature if you love to shop abroad.
Various credit card companies offer different travel credit card options. Which one is the best one? We rate the top three best travel rewards credit cards.
What’s a Travel Credit Card?
If you’re the type to travel abroad for business and/or pleasure more than once or twice a year, you’ll surely benefit from a travel credit card. A regular credit card can pay for the items you buy during your travels, but a travel credit card is designed to provide perks for the regular traveler. However, it is only useful if you travel often and want to save money by earning points.
The more you charge on your travel rewards card – from all purchases, regardless of whether or not they’re for your traveling – the more you earn points towards travel perks. This can be used for both personal use and for companies whose employees are often traveling and require company credit cards to charge their expenses.
If you’re not a frequent traveler, then you might not enjoy the higher interest rates as well as the travel-related rewards. Some airlines, hotels, and other businesses in the traveling and tourism sector may limit when you can use your travel rewards.
If you earn enough points for a hotel by the beach, for example, they may refuse to honor your travel rewards during the summer (when business is at its peak) and only allow you to avail your reward during off-peak season. During this time, the weather may not be good and it wouldn’t be worth the trip getting there.
Are Travel Rewards Worth It?
They are, but only if you’re planning on racking up points, truly interested in the rewards, and are willing to accept that those rewards aren’t truly free. A travel credit card usually gets you access to lounges and other perks in airports, travel insurance, and traveler rewards: if these benefits aren’t that exciting to you, you might want to consider a different type of credit card.
You may also want to consider shopping for travel credit card options. Banks and credit card companies offer different perks for their travel rewards, and not all of these perks may fit the kind of traveling experience you’re hoping to earn.
First Place: Capital One Venture Rewards Credit Card
It’s your everyday travel credit card: plenty of travel rewards, no foreign transaction fees, and up to $100 credit for Global Entry or TSA-PreCheck. However, it stands out among the other travel credit cards on the market for its many perks, including as of writing:
- 50,000 miles after a $3,000 within the first three months from opening an account.
- Twice the number of miles with every purchase.
- Connected with, as of writing, 14 airline partners.
- Partnership with Hotels.com means that using your card to reserve a room provides you with 10x miles of the cost. This is valid until January 2020.
- Travel and shopping benefits of Visa Signature
It’s great for everyday purchases as you don’t have to keep computing: for every valid purchase, simply multiply your costs as you earn 2 miles for every dollar you spend with the Venture Rewards Card. This goes beyond the average 1:1 average other credit card companies provide. Your annual fee of $59 is a bit on the average side, but this is waved for the first year you have your card. The miles you accumulate are also not just limited to airplane tickets, and anything considered travel can be used.
It does not have the limitation of blackout dates, meaning you can avail your rewards any time of the year. Your miles also never expire, so you don’t have to pressure yourself into scheduling your vacations so your accumulated miles go to waste. In terms of APR, it’s roughly around 12.74 to 22. 74%.
Second Place: Wells Fargo Propel American Express Card
This card offers more points than Capital One Venture Rewards Card, offering three times the points for every dollar spent including on purchases made for travel (abroad or local – including ride sharing services like Uber) or for everyday purchases.
Like the Venture Rewards card, it has no annual fee for the first year and no foreign transaction fee. The strong point about the Propel American Express Card, though, is that the annual fee waiver isn’t just for the first year – the card literally has no annual fee. Spend $3,000 in the first three months to earn a sign-up bonus of 30,000 points.
Outside of purchases for food dine-in or delivery, transportation, and travel purchases, you earn 1x the amount of points for every dollar you spend. This is its turn-off point in comparison to the Venture Card’s 2x on all purchases. One could argue that you get 3x points for food, transportation, and travel (which covers nearly all the most common expenses we put on our credit cards), but as a buyer, I’d honestly rather get 2000 points after purchasing a $1,000 piece of furniture than 42 points for a $14 Lyft ride. I’d need to make 47 Lyft rides with my card to match what I could earn with Capital One’s travel credit card.
Despite this, the Propel American Express Card is actually not a bad deal. The APR remains at 0% for the first 12 months. After the first year, it increases to around 16.24 up to 27.24 percent.
Third Place: Chase Sapphire Reserve
The Sapphire Reserve has plenty of the best perks that stand out in the market, but if it weren’t for the high annual fee, it would have been higher on this list. At $450 every year, it’s not really the card a budget traveler can afford as it cancels out the whole purpose of getting more for less. The fee is waived for the first year, but if you’re on a budget, it’s not really worth the fee and you’re better off with the first two cards on this list.
It’s still a pretty good card, but if you’re looking at it in terms of budget travel, you’re better off saving $450 every year for a few years to pay for your own high-end vacation. In terms of points, you’re earning 3x the points on travel and restaurants. You also get a 50 percent bonus once you redeem your rewards. The sign-up bonus has a much higher cap at $4,000, but the payoff is there as the 50,000 sign-up bonus is not a small thing.
Chase also promises more features and benefits than the first two, including more travel partners and over a thousand airport lounges all over the world. The regular APR can range between 19 to 27 percent.
Travel credit cards are a great way to earn points towards a great traveling experience while continuing to buy the everyday purchases you’re making. Feel free to browse through all your options though and find a card that really meets the kind of expenses you’d normally make as well as all the perks and rewards you can actually benefit from, whether you’re traveling for business or pleasure.