MINNEAPOLIS — The summer travel season is in full swing, and although the average airfare price is down compared to last year, there are still ways to save money.
So what's the best credit card for travel rewards? Great question!
If you earn rewards based on credit card usage, the more you swipe, the more flights you can take.
“I have a United Adventure card,” Katie Converse said as she walked through Minneapolis-Saint Paul International Airport.
“The card I use is the Chase Sapphire card,” traveller Luke Bonney added.
“The first one I got was something called Capitol One Rewards,” said Rebecca Helmos, who was traveling with her daughter, Rosalie.
All three agree that redeeming miles or points for cash feels great, especially if it nets you a free flight.
The options for great plastic cards are seemingly endless, but which one is best? One that offers travel miles? Points? Cash back is tempting.
“My weakness is that the card also has the ability to remove purchases,” Hamos said of the cash back option that removes purchases from bills.
First tip: Understand the difference between airline credit cards and travel credit cards.
Airline credit cards allow you to collect miles and earn free tickets, and they also come with perks like expedited boarding, free checked bags, and the chance to earn “elite” status if you fly with an airline frequently, but they come with a downside: they tie you to a specific airline.
“There are spending limits that you can reach and sometimes you get extra miles when you hit those limits,” Converse said of her United Airlines card.
Travel credit cards are more flexible when it comes to rewards.
The points you earn can be redeemed for flights on multiple airlines, hotels, and even cash back.
“You're not locked in,” Hamos said. “What if Delta doesn't fly you where you want, when you want?”
So which is the better choice? It depends on your travel and spending habits.
According to The Points Guy, airline credit cards are a great choice for frequent flyers or if your local airport is a hub for that airline. Converse has a United Airlines card, in part because Denver International Airport is a hub for the airline.
If you fly infrequently and want to keep your options open for multiple airlines and hotel accommodations, a travel credit card may be the right choice for you.
“I know people who have Southwest Airlines cards, United Airlines cards, Delta Airlines cards,” Converse said.
Why is it a good idea to have just one or a few credit cards that earn points?
“The more you get paid, the less of a burden you spread,” Converse said.
She makes a valid point: limiting the number of rewards credit cards gives cardholders the opportunity to maximize their rewards — and also paves the way for achieving higher status with certain airlines.
Another tip to remember is to use your points quickly as they can depreciate in value over time, which is why some financial experts say cash back is the most valuable option, especially if you use them right away.
Finally, pay off your credit card balance in full each month, or the interest on your bills could end up costing you more than the card's rewards.
Some cards have hefty annual fees of $500 or more, so keep that in mind when choosing a card and consider whether the rewards you receive will offset the upfront costs.
Jeff Wagner
