Credit cards are great tools for helping people buy the things the need in life. Over the years, though, they’ve become more than just a way for consumers to put off actually purchasing things. They’ve come with even more perks.
These days, it’s not hard to find a credit card that gives some sort of reward. Sometimes it’s airline miles, sometimes it’s free stays in a hotel, and sometimes it’s just straight up cash. But with so many tempting choices, you might pick one that looks good but isn’t right for you. Here are the best credit cards for travel and cash back out there.
Travel credit cards
Just like playing a good game of chess, maximizing credit card rewards requires a bit of strategy. There are certain credit cards that are great if you love to travel and can be used towards purchases like hotels, rental cars, airfare, and more. Other credit cards offer stellar cash back rewards for purchases like gas and eating out at restaurants. Whatever you love to do in life, there’s a credit card for you.
Who doesn’t love to travel? If you’re looking for a credit card that offers airline points, stick with a good all-around credit card. If you choose an airline card, make sure you stick with major carriers like American, United, and Delta, who offer the most lucrative rewards programs. You’re looking for a card with an airline that offers industry leading sign up bonus points, features like free baggage fees and the ability to use airport lounges, as well as the ability to use your points across a network of airline partners.
Chase Sapphire Reserve is a new credit card offered by Chase that has the internet buzzing. This premiere credit card offers a whopping 100,000 bonus points after you spend $4,000 in three months, which is worth $1,500 in travel rewards. You also earn three points for dining and travel and one point for every other purchase. Other perks include a $100 application fee credit for TSA PreCheck and Global Entry. The downside to this card is the hefty $450 annual fee, so you’ll want to make sure that you maximize this credit card for all that it’s worth to counteract the high annual fee.
Citi AAdvantage Executive World Elite is an example of a stellar card for those that fly American Airlines or its oneworld partner airlines frequently. With this card, you’ll earn 60,000 bonus points after spending $5,000 in the first three months and complimentary access to the Admirals Club. The Admirals Club is a membership club for American Airlines at airports around the world that offers exclusive benefits like snacks, WiFi, and travel services. The real bonus for some travellers will be that you receive your first checked bag free on domestic flights for you and up to eight travel companions. That benefit alone could be worth up to $100 if you travel with a partner.
If you're looking for a hotel rewards card, Starwood Preferred Guest is worth a look. With this card from American Express, you have access to the entire Starwood hotel chain, which includes the St. Regis brand for high-end hotels all the way down to Sheraton's for a lower-cost hotel and everything in-between. The best perk with the Starwood Preferred card is that you can redeem your Starpoints for free nights at hotels around the world or turn those points into airline miles for free flights. When you're looking for a hotel rewards card, always make sure that you have options for your points which extend beyond free nights at the particular hotel chain.
Cash back rewards
A staggering 55% of cardholders in 2015 redeemed their reward points for cash, compared to only 9% who redeemed their points for travel. When you're looking for a rewards credit card, look past sign-up bonuses and figure out based on your spending habits what types of cash back rewards would be most lucrative for you.
A favorite cash back card that many people love is the Citi Double Cash Card. This card offers you 1% cashback on all your purchases plus an additional 1% cash back as you pay for those purchases. It's like a double whammy for racking up cash back reward points. Plus, you'll enjoy the benefit of not having an annual fee to pay each year.
American Express has upped the ante with its Blue Cash Everyday card that offers 3% cash back at the supermarket for your first $6,000 in purchases, 2% cash back at gas stations, and 1% cash back on all other purchases. There's no annual fee and 0% introductory APR on all purchases and balances transfers for the first year. This would be a great card to use for a balance transfer and save on credit card interest that you’re paying on another card. For families, the Blue Cash Everyday card could provide significant cash back with all those trips to the supermarket for school lunches and trips to the gas station running around to take your kids to playdates and school.
Before you start jetsetting with your newly-earned points, be sure to read our primer on how to make the most out of your rewards credit cards – including when to sign up and how to make sure you don’t hurt your credit in the process. You’ll be able to make the most out of your rewards and minimize the consequences in the process.