Best travel credit cards for October 2020

12 Oct, 2020 John Mendoza No Comments


While the coronavirus pandemic may have you grounded right now, when you get back to hitting the road or the skies, you’ll want to be equipped with the best credit card possible. Travel credit cards come with some of the highest travel reward rates available — each time you use one, the points you earn with your travel rewards card can be used towards a future (or sometimes a past) travel purchase. 

A travel rewards card also comes in handy for travel perks such as free TSA Precheck and Global Entry, priority boarding, exclusive hotel or rental car benefits and first-class upgrades for the frequent traveler.

Read more: Airline cards vs. travel credit cards: The pros and cons — and which one’s better for you

How to pick the best travel credit card

The points and travel benefits that you accrue through a travel rewards program are often redeemed through your credit card issuer’s website (or app) or appear as a statement credit that reimburses you for past travel-related and everyday purchases you made with your travel credit card. Points or miles can also be transferred to travel partners — mostly hotels and airlines — at a fluctuating conversion rate, where they can then be used to book a flight or hotel room. More on that later. 

To choose the best travel credit card, there are a few key factors to consider: 

  • Annual fees. Every single travel rewards program reviewed here has annual fees, with some climbing as high as $550, but those fees are usually mitigated by monthly or annual credits. 
  • Exclusive perks. Some of these travel rewards card options also grant access to exclusive travel perks, like airline lounges, priority boarding or VIP welcomes at hotels. The value of those perks is subjective and something you’ll have to evaluate for your needs and wants.
  • Foreign transaction fees. None of the best travel cards make users pay a foreign transaction fee, so a foreign transaction fee is not something you have to worry about with any of the credit cards recommended below.

The best travel credit card overall for most travelers

Chase

Reward Rates: 3x points on travel and dining (begins after earning $300 credit), 1x point on all other purchases
Annual Fee: $550
Welcome Bonus: 50,000 points
Bonus Redemption Threshold: Spend $4,000 in first three months
APR: 16.99% to 23.99% variable
Foreign Transaction Fees: None
Credit Requirement: Excellent

Chase Sapphire Reserve offers great value for those who spend around $12,000 or more annually on travel. The credit card company lets you accrue rewards card points for flights, hotels, rental cars, trains, buses and either travel or dining. Consider the Platinum Card (for the frequent flyer) or the Gold Card (for high food budgets). Otherwise, I’m a big fan of the wide range of expenses that fall under the Chase Sapphire Reserve’s bonus points categories. And it’s even better for those who value its additional travel perks like travel insurance, hotel discounts and lounge access through Priority Pass Select.

Rewards details

The Chase Sapphire Reserve card gives you unlimited 3x points on travel and dining purchases, 1x points on all other purchases, and 10x points on Lyft rides through March 2022. 

While the Chase Sapphire card’s $550 annual fee is steep, the yearly travel credit of $300 brings the overall cost down to $250, making the fee more manageable. Plus, the 50,000 sign-on bonus — earned after spending $4,000 in the first three months — is worth up to $1,000, depending on how you redeem those points (below). Finally, card holders get a statement credit reimbursement for Global Entry or TSA Precheck (worth $100 for Global Entry or $85 for TSA precheck, both of which are valid for five years) plus a number of VIP-style travel perks. 

Redemption details

Chase Ultimate Rewards points can be redeemed in three main ways. 

  • Cash redemption at a 1-cent rate effectively turns your card into a 3% cash-back card for travel and dining purchases. 
  • Booking travel through Chase’s Ultimate Rewards portal gets you a rate of 1.5 cents per point, or $1.50 for 100 points, which represent a return of 4.5% on travel and dining purchases (well above most cash-back cards). 
  • Transfer points to one of 13 Ultimate Rewards travel partners at a redemption rate of up to 2 cents per point, a 6% total return according to The Points Guy’s most recent valuations.

The best travel credit card for foodies and big grocery shoppers

American Express

Reward Rates: 4x points on dining and supermarkets, 3x points on flights (booked directly with airline or amextravel.com), 1x points on all other purchases
Annual Fee: $250
Welcome Bonus: 35,000 points  
Bonus Redemption Threshold: Spend $4,000 in first three months
APR: 15.99% to 22.99% variable
Foreign Transaction Fees: None
Credit Requirement: Good to Excellent

As the only card on this list that offers a high rewards rate on both dining and US supermarket purchases, the Gold Card from American Express is a great option for those who don’t currently spend a ton on travel every year, but would like to travel at a discount with points earned spending money on food. 

If you spend more than about $7,000 annually on dining and US supermarkets (including smaller grocery stores, but excluding big-box stores like Walmart or Target), the $250 annual fee is well worth it. Considering the average American household spent $7,923 on food in 2018, according to the US Bureau of Labor Statistics, many households could benefit from the Gold card. (If you spend a high amount on both food and travel each year, I recommend the Chase Sapphire Reserve instead.)

Rewards details

The Gold Card has a broad spectrum of rewards categories for a travel card, with 4x points on dining and US supermarkets and 3x points on flights booked through the Amex portal, the website where points can be redeemed. The $250 annual fee is partially offset by up to $120 in annual dining credits (through services like Grubhub and Seamless) and up to $100 in annual incidental flight fees, which cover things like in-flight dining, Wi-Fi and checked baggage fees. The sign-on bonus is fairly standard at 35,000 Membership Rewards points after spending $4,000 in the first three months, which is worth up to $1,000. 

Redemption details

There are two ways to redeem points with the Gold Card. The first is for travel purchases made through the American Express Travel portal, where one point equals one cent. The second option is to transfer your MR points to one of 18 airline partners or three hotel partners for a value of up to two cents per point. Since your points are worth twice as much when transferred, we highly recommend transferring to a travel partner and looking for good redemption deals in order to maximize your earned points.  

The best travel credit card for first-class fliers

American Express

Reward Rates: 5x points on flights (booked directly with airline or Amex Travel) and prepaid hotels (*booked on Amex Travel)
Annual Fee: $550
Welcome Bonus: 75,000 points 
Bonus Redemption Threshold: Spend $5,000 in first three months
APR: Not applicable (late fee up to $39 applies)
Foreign Transaction Fees: None
Credit Requirement: Good to Excellent

The Platinum Card is Amex’s top-tier travel card, offering the highest potential reward rate of any we’ve reviewed, topping out at 10%, depending on how points are redeemed (details below). This card is ideal for anyone who already spends more than $10,000 annually on flights and hotels alone and for those who value premium travel perks such as lounge access and hotel upgrades. The narrow rewards structure — which doesn’t include food or dining — and high annual fee of $550 make this a valuable card for a particular spending profile, so do the math before signing up. 

Rewards details

The Platinum Card earns 5x Membership Reward points on flights booked directly with airlines or through the Amex portal and hotels — which require prepayment — booked through the Amex portal. Flights or hotels booked through a third-party service or company, like Orbitz, don’t qualify. 

The high annual fee of $550 is offset by a $200 airline fee credit for travel incidentals, such as checked bags, in-flight food or beverage, or Wi-Fi, a statement credit for Global Entry or TSA Precheck (worth $100 for Global Entry or $85 for TSA precheck, both of which are valid for five years), and $200 in Uber credits per year. The new member bonus is on the high end at 75,000 points when you spend $5,000 in the first three months, worth up to $1,400 when transferred to a travel partner and redeemed at their maximum value. The Platinum Card also offers a number of premium travel benefits, with hotel perks including room upgrades, complimentary breakfast, early check in and late checkout, and access to the Global Lounge Collection.

Redemption details

The Platinum card offers three methods for redemption:

  • Travel purchases made through the Amex Travel portal, where one point is equal to one cent, including flights and prepaid hotel reservations
  • Transfer your MR points to one of 18 airline partners or three hotel partners for a value of up to two cents per point. Given that there’s a 100% value swing, we highly recommend transferring to a travel partner and looking for good redemption deals in order to maximize your points. 
  • A statement credit, but the rate is variable and you’ll typically get less value out of your points with this method.

The best travel credit card for earning miles on everyday spending

CapitalOne

Reward Rates: 2x miles on everyday purchases, 5x miles (hotel and car rental only) made through Capital One Travel
Annual Fee: $95
Welcome Bonus: Up to 100,000 miles
Bonus Redemption Threshold: Spend $20,000 in first 12 months to earn 100,000 reward miles, or spend $3,000 in the first three months to earn 50,000 miles
APR: 17.24% to 24.49% variable
Foreign Transaction Fees: None
Credit Requirement: Excellent

The Capital One Venture travel rewards credit card is a straightforward, easy-to-use option for those who would like to book travel with travel reward points generated from general spending and would rather not worry about eligible purchase spending categories. It also offers a category-high miles bonus for cardholders who spend $20,000 or more during the first year.

Rewards details

With unlimited 2x miles on every purchase, the Venture card is the broadest-earning travel card available. You can earn 50,000 Capital One Rewards miles when you spend $3,000 in the first three months (compare that to $4,000 for most other cards) — or max out with a 100,000 mile bonus for spending $20,000 in the first 12 months. That’s significant — especially given the relatively low $95 annual fee, which is waived for the first year. The Capital One Venture also gives cardholders a TSA Precheck or Global Entry credit, which is worth about $15-20 a year, as well as travel accident insurance and rental collision insurance (more on that at the end). 

Redemption details

The best way to use your Capital One Rewards miles is to transfer them to one of more than 15 travel partners at a rate of up to 1.4 cents per mile, for a potential net rewards value of 2.8%. The exact reward rate depends on the particular flight you reserve. When compared with the dollar cost of a flight, some flights may get you closer to 1 cent per mile, while others get you the max rate of 1.4 cents per mile. It’s not clear how exactly the mile cost is calculated, but keep in mind sometimes the maximum rate is only available when booking business class or first-class flights.

You can also redeem your Capital One Venture rewards miles as statement credits against past travel purchases (at a rate of one cent per mile), use them to shop on Amazon at a rate of 0.8 cent per mile, or use them to book travel through the Capital One travel portal.

The best travel credit card for low-risk, no-fee

Wells Fargo

Reward rates: Unlimited 3% cash back (3x points) on dining, travel, gas stations, transit and select streaming services, 1% (1x points) on everything else
Annual fee: $0
Welcome bonus: $200 (20,000 points)
Bonus redemption threshold: $1,000 in first three months
APR: 15.49% to 27.49% variable
Credit Requirement: Good to Excellent

The Wells Fargo Propel card is not technically a travel rewards credit card — its rewards come in the form of cash back rather than travel points or miles. Despite this, the Propel card is an easy solution for those who want to earn money back on their travel and dining spending but don’t necessarily want to use those rewards to book more travel through a credit card miles portal. 

Though the card has a lower return rate compared to the other travel cards, its $0 annual fee and lower risk make it ideal for those spending less than $10,000 a year in the qualifying categories. It’s also a good option for anyone who prefers to earn cash back directly instead of booking rewards travel. 

Rewards details

The Wells Fargo Propel earns an unlimited 3x points on dining, gas, rideshares, transit, flights, hotels, homestays, car rentals, and popular streaming services. That’s a decent rate compared to the travel rewards market, especially given its $0 annual fee. The card also offers new cardholders a sign-on bonus of $200 after spending $1,000 in the first three months. Similar to many other travel rewards credit cards, the Propel offers a few travel perks including a lost luggage reimbursement of up to $1,000, car rental loss and damage insurance, roadside assistance, 24/7 travel and emergency assistance, and emergency cash advance.

Redemption details

To redeem points with the Wells Fargo Propel card, all you need to do is click “Redeem Points” in the rewards portal. That’s it. No fussing over booking sites or comparing rewards flights. Propel’s cash rewards can be redeemed as either a deposit into a Wells Fargo account or as a statement credit. One point is equal to one cent and the minimum threshold for redemption is 2,500 points ($25).

How do travel credit cards work?

Travel credit cards turn purchases into points or miles that can be redeemed for travel purchases, like flights and hotel stays. Sometimes you can redeem those points for cash or a gift card, but you get the best rate when using them to book travel. The top cards have their own travel booking portals through which you can find flights, hotels, and rental cars; sometimes, points are worth more when used in those credit card company portals.

Airline and hotel credit cards — which we didn’t include in this list — operate like loyalty programs in that you stay in a closed loop rewards system. You earn rewards when you purchase flights or hotels through your chosen airline or hotel company, and you can use those points for perks or future bookings through the same airline or hotel group.

Read more: Best minimalist wallet for 2020

Other travel credit card benefits

Most travel credit cards — which carry hefty annual fees — include benefits that further add value to those cards. Benefits like rental car collision insurance and even lost luggage reimbursement have become standard. Here’s what’s offered for the cards chosen:

  • Travel accident insurance: Reserve, CapOne Venture
  • Trip cancellation insurance: Reserve, Platinum
  • Trip delay reimbursement or protection: Reserve, Platinum
  • Lost luggage reimbursement: Reserve, Platinum, Gold, Propel
  • Rental car collision insurance: Reserve, Platinum, Gold, Venture, Propel

How we picked the best travel credit cards

To determine our recommendations for the best travel credit card, 19 of the most popular travel rewards credit cards (listed below) were researched and selected based on the best monetary value for certain customer profiles, such as a frequent traveler, those who spend a lot on dining and groceries, or those who are looking for an easy way to travel at a discount with miles earned on everyday spending. We always hold overall net value as paramount, since choosing the right rewards credit card is about saving money and being financially responsible, not being lured by perks or offers that are flashy or irrelevant. 

To determine when a card makes financial sense, these cards were compared with the top no-fee cash-back card for dining and travel, the Wells Fargo Propel. Since the Propel card gives cardholders 3% back on travel, transit and dining with no fee, it was used as a baseline for judging the below cards. 

Cards researched

  • Platinum Card from AmEx
  • Gold Card from AmEx
  • Chase Sapphire Preferred
  • Chase Sapphire Reserve
  • CapitalOne Venture
  • Capital One VentureOne
  • Bank of America Premium Rewards
  • PenFed Pathfinder Rewards Card
  • Uber Visa Card
  • BofA Travel Rewards
  • Discover It Miles
  • Virgin Atlantic World Elite Mastercard
  • Hilton Honors American Express Surpass
  • Marriott Bonvoy Boundless
  • JetBlue Plus
  • Alaska Airlines Visa Signature
  • United Explorer Card
  • Delta Reserve Credit Card from American Express
  • Platinum Delta SkyMiles Credit Card from American Express
  • Gold Delta SkyMiles Credit Card from American Express

A note on airline credit cards

After considerable back and forth, we chose not to recommend a best airline credit card as part of this list. The five travel cards highlighted above will get you better point redemption value overall and will most often be your best option as a primary travel card, since you’ll earn points from a variety of airlines. Some airline credit cards, however, can be valuable for certain spending habits, like those who always fly with one airline and usually check bags, and can therefore be worth their low annual fees (usually less than $100) for some users. 

Choosing the best airline credit card (co-branded or not) is subjective based on your loyalty to any particular airline. The values of perks like priority boarding, seat upgrades, lounge access and airline status vary depending on which airline you’re loyal to and how often you travel with them. In many cases, airline credit cards are chosen based on which airlines operate hubs at your nearby airport.

Even if you stick to one airline for all your flights, co-branded cards are tricky when it comes to extracting value. For example the Virgin Atlantic World Elite Mastercard from Bank of America offers 3x Virgin Atlantic Flying Club miles on Virgin purchases, and 1. 5x Flying Club miles on all other purchases. With The Points Guy’s most recent maximum valuation of 1.5 cents per mile, that means you can get up to 4.5% back on Virgin purchases and 2.5% on everything else, when maximizing the value of those points. Given the difficulty of finding a perfect redemption for a specific flight, we don’t expect many users to maximize the redemption value every time. 

Those rewards rates are decent, but remember that you can only redeem those miles on a short list of airline partners, and you’ll rarely get top redemption value. Also, the best redemptions are often transcontinental flights in business or first-class, such as booking a $4,000 round-trip ticket for $2,000, which is a good deal but not relevant for most American consumers. Finally, since you’re only getting the top reward rate (3x) when flying with that specific airline, you could potentially be spending more for certain flights than you would by bargain hunting. If you want to go from LAX to NYC, for example, and you spend $100 more to fly on your airline of choice, you’re sacrificing a significant portion of the rewards value you generate. 

All that said, if you fly multiple times per month with the same airline, value the status upgrades with a specific airline and could potentially maximize the redemption value with longer flights or upper-class cabins, an airline credit card could be a good option for you. They can also be helpful for occasional loyalty fliers who would like to see the checked baggage fee waived (free checked bags are a common airline card perk), but only when they don’t fly often enough to justify the high fee of a premium travel card. There are also scenarios where it makes sense to have an airline card and a non-co-branded card, but just make sure you’re keeping an eye on annual fees and you’re never letting points or miles expire. 

A note on hotel credit cards

Hotel credit cards operate similarly to airline cards in that your best reward value comes when making purchases with that hotel chain, and your redemption options are limited. As with the co-branded airline credit cards, we don’t recommend one hotel credit card over another and believe that the best travel rewards credit cards listed above outperform the co-branded cards in most scenarios. However, if you always book your hotel stays with one hotel chain, it could be worth taking a look at the cards available. 

Another important factor to note with hotel cards is that the value of their points are much different than airline points or miles. Hilton Honors points, for example, are only worth 0.6 cent at the high end, so even though the Hilton Honors credit cards have high awards rates, the value of those awards is less than Chase Ultimate Rewards points, American Express Membership Rewards points, or airline miles.

But for those who want to get a status upgrade (which usually comes with perks like free breakfast and room upgrades) with a hotel chain without having to spend above the standard threshold, a co-branded credit card will accelerate your progress and help you achieve a higher status with the chain for less spending. Just keep in mind that you’re essentially paying for those upgrades in a different way and could be sacrificing spending value by not using another travel credit card. 

What about APR?

APR stands for annual percentage rate, and it’s the amount of interest you’ll pay over the course of the year on any balance you keep on your credit card. Given that we highly recommend paying off the balance of your credit card in full every month, we don’t look at APR too closely when assessing rewards credit cards.

If you have any trouble paying off your credit card balance each month, start with cards that have a low APR and don’t worry about rewards. Any reward you generate — whether it’s a cash back, travel rewards, or otherwise — disappears quickly when you’re paying interest each month. Also, remember that while some rewards credit cards offer an intro APR for the first year, usually 0%, the travel category typically does not. 

Other types of cards to consider

If you don’t meet the minimum spend recommended for any of the above credit card options, you might consider a cash-back credit card instead of a travel credit card. Cash-back credit cards offer rewards in the form of statement credits or cash. These are fairly easy-to-use cards with rewards in the general range of 1.5% to 3%, often without an annual fee. They also offer sign-on bonuses, usually in the form of a specific amount back after a threshold spend in the first few months. 

Other types of cards are more geared toward specific situations, such as balance transfer cards if you need to “restructure” your credit card debt, credit-building cards like secured credit cards if you have a low credit score or no credit, low-APR credit cards if you have a tough time paying your bill off each month, or student credit cards for those who are full- or part-time students.

Disclaimer: The information included in this article, including rewards program features, program fees and credits available through credit cards to apply to such programs, may change from time-to-time and are presented without warranty. When evaluating offers, please check the credit card provider’s website and review its terms and conditions for the most current offers and information. Opinions expressed here are author’s alone, not those of any bank, credit card issuer, hotel, airline, or other entity. This content has not been reviewed, approved or otherwise endorsed by any of the entities included within the post.

The comments on this article are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved, or otherwise endorsed by the bank advertiser. It is not the bank advertiser’s responsibility to ensure all posts and/or questions are answered.



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