Credit Cards for Travel- 1.3% guaranteed return

Updated 6/8/06

My passion is travel, so I thought it would be beneficial to start a thread to serve a central place to learn, question, and speculate about credit cards and finance related to travel. There are some threads about the best cards to use abroad, which I touch on a bit here, but fewer with ideas on how to get abroad (for free.) FlyerTalk.com is a good resource as well, but they are not as financially saavy. There, it is all about an allegiance to a specific airline. Here, I hope it is more of an focus on smart spending.


~~~~~~~~~~~~~ Noteworthy Travel Reward Credit Cards ~~~~~~~~~~~~~~
Here are some cards to get you on your next trip for free or cheap.

NOTES: Miles vs. Points- The term 'miles' is generally reserved for airline-affiliated programs. If you travel on, and carry the credit card of, the same airline or its partners, all of your purchase and flight miles are pooled into one frequent flier account. This will help when it comes to redeeming since all of your rewards are in one place.

While points can be similar to miles, the term 'points' is generally reserved for cards not affiliated with a specific airline. Points cards are generally the any-airline, any-seat, any-day type cards. The issuing banks generally just pay a travel agency to book reward tickets for their clients once they have enough points. The underlying problem with these cards is that you cannot pool your points with your frequent flier miles.

The Bad: 10,000 ThankYou points + 15,000 Delta SkyMiles does not equal 25,000 points, or enough for that free domestic ticket.
The Good: 25,000 ThankYou points + 25,000 Delta SkyMiles does equal a free domestic ticket on either program (really nice if one offers a better schedule, or if there are no seats available in one program)


<font color=white style="background-color: #3E3E3E;">NEW! Blue Sky from AmEx (Thanks amhidogha!)
Think of this as more of a 1.3% cash rewards card rather than a travel card. That's because unlike most travel credit cards, with Blue Sky, you can redeem points for discounts towards any travel purchase, bought anywhere! You don't have to book travel with a specific travel agency or a specific company. Just book your air travel, car rental, tour, or hotel stay however you'd like. Pay for the purchase using this card and after the charge has posted, simply redeem your points and AMEX will credit your account. You earn 1 point for every $ spent, and you can redeem 7,500 points as a $100 statement credit (or anything in multiples of $100.) As long as you occasionally travel, this program works very much like a cash reward card, but, unlike the standard 1% Cash Back, you will earn a respectable 1.3%. Many airline affiliated cards will beat 1.3% back, but you'll have a greater number of points to earn to reach a reward, plus you are limited to specific flights, airlines, etc. It's pretty simple and rewarding!


Airline-Affiliated Credit Card List
The linked site is great to compare the annual fee, bonus miles, and earning rates for each credit card. Airline cards often come with a hefty annual fee, so unless they give you elite qualifying miles, want to upgrade, or additional perks beyond the miles, I'd keep looking. They are often good cards, but look at Starwood's card before you get one.

Starwood Preferred Guest AmEx (Thanks Cbass98)
This is an excellent card now famous in the travel community. Its my only 5 smiley in any of my threads. You earn 1 point per dollar spent, but you can exchange 20,000 points into 25,000 frequent flier miles into many airline frequent flier programs. That means you are actually earning a whopping 1.25 frequent flier miles per dollar spent with a low $30 annual fee (waived for the first year). Plus you now earn an excellent 6,000 bonus points on your first purchase, and up to an additional 6,000 by staying at Starwood properties. This is beter than most airline-affiliated cards, becuase you can transfer points into just about any mileage program. Do a bit of research before you do the transfer and find the airline offering a reward requiring the least amount of miles, fewest connections, and best schedule. (You can't do this very well with an airline specific card.) This is a great pick! There is a new FW thread discussing this card in detaill. Check it out!

Norwegian Cruise Line MasterCard (Thanks slimcustomer)
Its really an excellent card if you are looking to take a cruise in the future. You earn a whopping 3% on all purchases toward a stateroom upgrade, or free cruise. Points expire in 3 years and the maximum is $1,000 in savings per year, but some have gotten multiple cards. Maybe there's more to it, but until I hear otherwise, I think this is really a great card!

PremierPass MC from Citi (Non-Elite)
This no annual-fee card will give you 1 ThankYou point per dollar spent and 1 point for every 3 miles you fly. Also, you'll earn 5,000 bonus points with your first purchase. It is an interesting idea, but rarely your best choice.

PremierPass ELITE MC from Citi
This elite card still gives you 1 point per dollar spent, but unlike the non-elite, you'll also get one point per mile flown. Sure, the $75 fee is a drag, but on your next flight, just think... you'll be earning frequent flier miles AND ThankYou points at the same time toward your next trip! This benefit is probably enough to offset the annual fee associated with this card as long as you travel several times a year. The points are also good for gift cards and merchandise. Card is part of ThankYou. Get this card if you travel several times a year on various airlines, and need to travel at peak times. There is a 15,000 point bonus for signing up.

Chase Rewards Plus MasterCard OR Visa
This is a good card especially for those who don't travel all that often. While it isn't specifically a travel card, travel is still one of the rewards options. You earn an excellent 5 points per dollar spent at gas stations, supermarkets, and drug stores. You'll earn 1 point everywhere else. The Mastercard isn't mentioned on Chase's website, but follow the link to a FW thread with info on how to apply and obtain a $50 signing bonus. There is no bonus for Visa. Those who don't travel much, want to keep things simple, and want the flexibility of various rewards options beyond airline tickets will like this card.

Capital One Go Miles
This card is noteworthy because it is so bad. You earn 1.25 points per dollar spent, but the amount of points it takes to get a ticket is atrocious. It's good do have a Capital One card for purchases while abroad (it doesn't charge a foreign transaction fee) but until you're abroad, you'll be better off with other cards.

WorldPoints MasterCard from MBNA OR Visa Signature OR American Express
This card earns a standard 1 point per dollar spent, with exception of the AMEX. Thru Jan of 2007, you'll earn double points on restaurant and travel purchases with the AMEX only. When BofA takes over MBNA, lets hope that they give us some added benefits and don't devalue the points.

Foreign Currency Surcharges- "Many Banks are charging exorbitant fees when travelers use their credit cards overseas" is the first article featured in the January 2006 issue of the magazine. It explains the fees plainly and has an excellent table of the top credit cards to use while overseas..... Capital One takes the cake with no fee for purchase in a foreign currency. The article is available here online, but unfortunatly it does not include the comparison table. Nor is it verbatum of whats in the magazine. You may consider buying the magazine if you can still find it. I don't want to scan it because of copywrite issues, but it is well worth the $4.50 price tag. There is a lot more there than what can be found online.

Cards and Foreign currency charges (from Conde' Nast Traveler) adapted and abbreviated

* American Express- 2% CC
* Bank of America- 3% CC, 3% debit
* Capital One- none CC
* Citibank- 3% CC, 1% debit
* Diners Club 3%, 2% for corporate cardholders
* HSBC 1%* CC, 1% debit
* Chase 3%* CC, 3.5% debit
* MBNA- 3%* CC (although I just checked my terms and conditions, and I am not charged at all, double check pls.)
* Providian 1%* CC
* Wells Fargo 3% CC, 3% debit

*Plus these marked cards charge the fee even if the overseas purchase is charged in U.S. Dollars
Conde' Nast Traveler (US Edition) February 2006, Pg 60-62, author Wendy Perrin.


The magazine article also includes fees for an ATM withdrawl overseas

Travel Rewards Credit Cards- "I wanted to earn more frequent-flier miles. I wanted greater seat availability when trying to redeem them. But I didn't want to spend more time on the planes. The solution? A credit card makeover" is also an excellent article which deluges into the world of travel-rewards credit cards. While the tendancy on FW is that cash rewards are often better, depending on how you redeem your miles or points, travel reward credit cards may be the most rewarding for saavy travelers.

The article is published in the March issue of the magazine and is not online yet. It breaks down the different types of FFGuru's (frequent flier Guru's) into several types such as those looking to obtain elite status, upgrade, or get a free companion ticket." Just to summarize.... If you are earning just 1 point/mile per dollar spent, you should reconsider your card of choice based on the list in the article. Beware of cards offering miles that aren't really miles. The author couldn't find anything good to say about Capital One's card in terms of mileage earning potential, and she is much more diplomatic than I. (Stay away from Cap One until you are actually abroad). The starwood Preferred Guest American Express is a top pick for most of the categories. Starwood is the parent company of Sheraton, Westin, and W hotels but the rewards expand far beyond hotel stays. You can transfer 20,000 Starwood points for 25,000 frequent flier miles in many airline frequent flier programs. Plus, its low $20 annual fee even more attractive.

A Flyer's Wish List (From Conde' Nast Traveler) adapted and abbreviated

* Free Coach Seats- Consider the Starwood Preferred Guest AMEX (1.25 miles/$), or an airline-affiliated card (up to 2 miles/dollar)
* Schedule and Route Flexibility- Starwood Preferred is excellent as well, and Diners Club may be an option too
* Free Upgrades- Look for cards which offer elite qualifying miles (Such as the cards from Delta, United, and US Airways) or Starwood.
* Free Companion- Platinum AMEX, or the BA Visa are great because they offer 2 premium-class tickets for the price of one full fare ticket.

Conde' Nast Traveler (US Edition) March 2006, Pg 62-64, author Wendy Perrin.

Many people on FW love to discount the benefits of a travel rewards credit card but miles can be very valuable. Don't forget that 1 mile/point rarely equals only 1 cent.

First you need to find out how much money the card will save you by giving you a free ticket.

1) Pick a travel rewards credit card.
2) Look in the reward section of their website and choose a reward to serve as your goal (free domestic ticket, Hawaii, Europe etc.)
3) Estimate the cash value of that reward ticket. Call a travel agency or search a site like Orbitz to find out the price. Try to simulate the conditions of the time you would like to travel. (ie how much in advance will you book, are you traveling during a peak time, which day of the week etc)

-If thats too much work (or too confusing), use your last vacation for the example.


4) Take the cash value of the ticket, subtract the annual fee for the credit card for however many years it will take you to get the free ticket.
5) >>>> That is how much cash the card will be saving you.

Now you have to figure out how much money you have to spend on the credit card to get enough miles for your reward.

6) Take the number of miles your example reward requires, and subtract any bonus miles you'll earn, such as those you'll earn for signing up, staying at partner hotels, (and if you are getting an airline-affiliated card, the miles you will earn for traveling on that airline on non-reward tickets.)
7) Divide that number the amount of miles you get per dollar.
8) >>>> That is how much money you must spend to get the reward.

You are just about there!

9) Divide your answer to number 8) by your answer to number 5)
10) >>>> That's it! That is the percentage you are getting back on the money you spent on your miles credit card. Now that you are able to compare apples to apples (so to speak) compare that percentage to that of your most rewarding card currently in your wallet.

Don't forget that while your airline-affiliated cards will often give you the greatest percentage back per dollar spent, they often have the most restrictions on rewards tickets. If you want your free ticket during peak travel periods, you'll probably want to stick with a bank travel credit card (not associated with a specific airline.) Bank travel cards don't earn miles per-say, nor can you combine them with your frqequent flier miles on a specific airline, but they don't come with blackout dates, capacity restrictions etc. Some examples of these type cards are Citi's PremierPass, MBNA's WorldPoints, Chase's Rewards Plus, and Discover's Miles Card.

I share your passion for travel, especially on a shoestring budget. Thanks for putting all of this in one place...its a fantastic resource.

edit: Nice update, I wish I could give you another +2

I thought some of the MBNA cards only charge 1% for foreign currency charges.

didYOUsearch said: SweetCash said: I thought some of the MBNA cards only charge 1% for foreign currency charges.yes , their cobrand cards. its in the linked thread.

So if you have a 1% Cash Back on top of that, I think you pretty much break even.

Citi Premier pass gives you 1% on travel and 1 point for every mile you fly, so if you buy a $300 ticket from chicago to san diego you get 300 points plus 3500 points for the miles! you will need equal purchase points befor you can redeem mile points. it also has a $75 annual fee and offers 15000 bonus points after first purchase. You can redeem points for GC through Thank You Network

Text

That bankrate article was posted in 2001. It is no longer correct.

Capital one is the best card for foreign purchases, but if you don't want to apply with them, you may consider a Citibank or HSBC debit card.

Both Citi and HSBC charge only 1% for debit card purchases. As for ATM withdrawls using the same card, Citibank charges only 1% at Citi, Barklay, BNP, and Deutsche ATM's (all common in Europe.) HSBC is more common in Asia from what I understand, but they still only charge 1% at their own ATM's. Both banks charge the same for out-of-network ATM's.... $1.50 plus 1%.

FFGuru said: That bankrate article was posted in 2001. It is no longer correct.

Capital one is the best card for foreign purchases, but if you don't want to apply with them, you may consider a Citibank or HSBC debit card.

excellent thread, but I do have to disagree with you there FFguru. the cobrand MBNA cards offer rewards which can fully offset the 1% fee (1.5% and 2% Fidelity cards). Also, credit union cards (penfed example) pay more rewards than the transaction fee.

I am guessing NO, you do not get 5% back on grocery/gas purchases in foreign transactions. Saw your post and needing to call Citibank on my Diamond Preferred Rewards card, so I asked the rep for you. The rep said the 5% is only good for domestic transactions. Hope that helps. Though, she also aid the 5% rebate on my DPR card is on going and is not a one year promo like stated on their site or other fat wallet posters. I am a bit skeptical on her response and will have to dig up my card agreement.

Called the Thank you redemption rep, my account do earn 5 points for each dollar spent at Grocery stores and gas station. This is a on-going deal until Citi changes or eliminates the program. Its not a 12 months limited bonus.

Above mentioned transcation charges were not there 2 yrs ago...now if u use u'r CC in another country you will pay conversion fees. Good posting and thanks for all the info.

didYOUsearch said: the cobrand MBNA cards offer rewards which can fully offset the 1% fee (1.5% and 2% Fidelity cards). Also, credit union cards (penfed example) pay more rewards than the transaction fee.
I actually recently received an offer from MBNA in the mail for the Fidelity 1.5% card. They said that new accounts established after some date (can't remember exactly, April 30 or so) would have a 3% forex fee attached. They didn't say (obviously) whether they would try to convert existing cards to the 3% rate also.

fogcitysearch said: Saw your post and needing to call Citibank on my Diamond Preferred Rewards card, so I asked the rep for you. The rep said the 5% is only good for domestic transactions.
What the rep told you is wrong. I have used both a Diamond Pref and a PremierPass Elite card overseas and earned bonus points on gas (BP, Tesco, etc.) and groceries (Sainsbury's, Tesco). I've also gotten bonus points on the PP Elite on the Paris Metro but not the London Tube.

thanks, great post

teKillah said: Nice Thread ! Wells Fargo slapped a $5.00 fee for ATM use abroad. That really stung !!~!try 13 $5 charges from bofA..ouch!

FlyerTalk's "What card should I choose?" thread

The longer Capital One waits to announce what FOREX fee they will charge, the more I think it will be more than 1%. But for now, its the best choice at 0% especially if you get an account that also earns points/miles, CashBack, or whatever.

nice thread, OP. TY! ^_^

Only wish I had known more info about the differing ranges of foreign currency charges prior to my studies abroad (2 years in the netherlands, 1 in germany). I knew that the percentages varied based upon the card, but made the common mistake of being lazy and not researching the issue (doh!).

Oh well. . . I was young and ignorant then (still am), but I'm learning and am quite happy to have found resources like FW. I shudder to think of where I'd be without some of the stuff that I've learned here (even just recently).

Thanks again, OP.

FFGuru said: I am curious to see what type of experience people have had in redeeming travel rewards thru Chase and Citi. Does anyone know how much availability there is? What is the maximum value of a ticket you can get for free?

Chase on there mastercard you can transfer points directly to airlines program of your choice or redem directly from them.

As far as Citi Thank you network is concerned. People on Flyertalk.com have reported having to pay 30-40K points for tickets over Thanks Giving and Xmas when they redem points for free ticket as they were told all free invenotry was sold out but if they agreed to pay more then could still get one.

Just so you know not all Citibank charge 3% for forex fee. It seems all the Citi Mastercard charge 3% but older grandfathered Citi Visa cards only charge 1%. Other people on flyertalk.com have also verified that there old AA Visa cards only charge 1% forex fee.

madhorse2 said: And now Citi PremierPass Elite can be referred if your friends have this card, which may be good for those whose credit score is not high. Of course, you can ask whoever are generous here for help, including me .


AyresFan said: I'll second the Citi PremierPass Elite card. It's actually one ThankYou point (roughly equal to 1 cent) on all spending (not just travel) with a bonus ThankYou point on top of that for groceries/gas/drug stores/parking/transit. Flight points get matched with spending points and bonus points (including points from Citi's ThankYou Merchants program--a FatCash-like program--which effectively doubles the Cash Back on that). The flight points earned are in addition to any frequent flier points you may earn. The matching requirement means you earn about 2% back on all purchases. Other features include trip cancellation insurance, price protection, and a largely useless companion ticket program (which most of the time saves you $20 but sometimes can yield bigger savings when prices are high).

I also like Citi's flight redemption program. They have fairly reasonable availability based on what I've heard and my own experience. Last year needed to buy a ticket to Europe that would have cost $900. No airlines had mileage availability, but Citi had a flight for 50k points and on my preferred airline (which I earned miles on).

Hey, I would be interested in a referral for the Citi Premiere Elite Card, what are the prerequisites ( to be qualified ) and what do I need to do to apply under the referral program?

-Fortezza

Currently I have the MBNA Worldpoints Visa Signature. It is not the most rewarding card, but I have had it a while, so I continue to use it until my next reward.

I am a bit worried that BofA may change the program and devalue it when they take over. I haven't had terribly good experiences with BofA in the past. I called MBNA and the rep told me that while BofA and MBNA will merge, it sounds like the MBNA management team will handle the credit card side of things, and leave BofA to the banking. He said that Worldpoints has been very successful so he doubts that it will be changed much.....

Has anyone else heard anything else?

Joe1690 said: MBNA actually only charges a 1% foreign currency fee on any of their American Express cards since this is what AMEX charges MBNA and MBNA doesn't add an additional fee. I have the MBNA rewards card which is part of the worldpoints program and this card charges only 1% foreign currency.Where did you read this ? MBNA CSRs are the source of inaccurate information about their own FOREX fees. AMEX charges its own cardholders 2%, so its suprising to learn that they only charge MBNA 1%.

Many MBNA Worldpoints related CCs were converted via snail mail notification from 1% to 3% in May 2005.

bluefoot said: I didn't do any referrals for the citi premier pass card.
just went to <snip> applied and got approved.
Note that the website that you reference (snipped above) is actually an affiliate link which then forwards to Citibank. You may want to delete that (if you weren't aware of that). The real link for Citi PremierPass is here.

For people interested in applying for it, I believe CardOffers.com is offering a $30 bonus on top of the usual sign up bonus. There is no need to get a referral for the PremierPass card, and it is actually one of the easiest Citi cards to get approved for. If you do get referred, there is no additional benefit for the person getting referred.

NCL no question as they have many low priced cruises and you can play the casino for extra points to make the trip virtually free