So you want to save some money on travel expenses. Using credit cards points and perks can really help you to do that. Combining them with loyalty program benefits and rewards can make the savings even bigger. We all spend money, the key is to make that spending work for us.
But where do you start?
- Have a goal in mind
- Choose cards that make sense to help you achieve your goal
- Have a plan to make sure you earn your sign up bonus
- Always pay your card off monthly (paying interest devalues any rewards you earn)
- Start small, don’t apply for the cards with a $450+ annual fees, until you have the hang of things
- Allow 4-6 months in between new card applications to increase your approval odds
- If you are a couple, apply for new cards separately to give you more options
- Prepare to start paying for literally everything with your credit cards to earn the most points
- Know and use your credit card perks and benefits to get the most out of your card each year
Tip: Consider cards that work well together when applying for new credit cards. Choose a universal points card (Ex. Ultimate Rewards Points or Membership Rewards points) that earns points that can transfer to co-branded cards you already have or plan to get in the near future. This combination gives you more options when redeeming for a reward.
I think that Chase and American Express have some of the best travel rewards cards available. Here are a few cards that I think build a solid initial foundation for saving money on travel without breaking the bank.
Chase can be finicky and uses a 5/24 rule when approving new card applications. That means if you have applied for 5 or more credit cards (with any bank) in the last 24 months your application will more than likely be declined. So if you are going to apply for one of their cards, do it first!
They have a lot of Co-branded Travel Cards to choose from for companies like IHG Hotels, United Airlines, Southwest Airlines, Hyatt Hotels, Marriott Hotels as well as cards that earn Ultimate Rewards points. Several of the companies with Co-branded cards offer more than one option. It can get confusing.
Tip: If you are considering a Southwest Rapid Rewards card, I would choose the Priority card in order to get the most bang for your buck.
Chase Sapphire Preferred
This is an important card to have. I would make this the first card I applied for based on the 5/24 Rule and the fantastic list of Ultimate Rewards points transfer options. It also has one of the best car rental protection coverages (primary) of any credit card.
This card is currently offering a limited time 100,000 point sign up bonus (it is the biggest I have ever seen) if you spend $4,000 on the card in the first 3 months. That’s on the higher end for spend requirements so plan to apply when you will have a big purchase or plenty of expenses coming up.
- It has a $95 annual fee
- Points that can be Transferred to Southwest Airlines, IHG Hotels, United Airlines, Hyatt Hotels, Marriott Hotels and more
- Deals on Lyft, Door Dash and Peloton
- Primary Rental Car Insurance
- Travel and Purchase Protection
- No Foreign Transaction Fees
- The card Earns 1 point per dollar on most purchases and 2 points on Dining.
The biggest drawback for me is that once you have earned your sign up bonus, this card is kind of a slow earner. I pay most monthly bills by an American Express Card that earns 3 pts per $1 spent. Any that don’t accept American Express, I pay with the Sapphire Preferred in order to continue to slowly build our points.
Card Savings Example: We transferred 45,000 points from the Sapphire Preferred card to our Hyatt account for a 3 night stay at the gorgeous Hyatt Centric Waikiki. Hyatt also waives the Resort Fee ($32/nt) when you book reward nights, so this combination saved us over $850 on our stay.
Like Chase, American Express has approval rules. You may only have 4 different Amex cards of any kind at one time and you can only get a sign up bonus for a particular card once in your lifetime. They do not allow the purchase of gift cards in order to meet your spend requirement to earn your sign up bonus. In fact, they consider that a big no-no and may decide to either cancel your card or deny your bonus. This just helps them cut back on card churners and scammers.
In the Amex line up I really like the American Express Gold card and the Hilton Surpass cards to start with. I would not start out with a Delta card, but it would be a good addition later on after you have established some primary travel cards. We love that it gives us one free checked bag per person whenever we fly, but unless you fly a lot, it is another slow earner. You can always transfer Membership Rewards points from a Amex Gold card if you need them to book a Delta rewards flight.
American Express Gold Card
The American Express Gold card earns Membership Rewards points. These universal points provide great points transfer options.
The Gold card currently has a 60,000 point sign up bonus for spending $4,000 on the card in the first 3 months. This offer is on the low side and I would wait or look for a 70,000 point or more offer. Even though it is the same spend required as the Sapphire Preferred, it can be harder to earn since not all places accept American Express.
- It has a $250 annual fee
- Points can be transferred to Delta Airlines, Hilton Hotels, Marriott Hotels, Hawaiian Airlines and more
- $100 Annual Airline Fee Credit (this perk is going away and it will be missed)
- $10 Uber credit and Uber Eats Pass
- $10 Monthly Dining Credit
- No Foreign Transaction Fees
- Travel and Purchase Protection
- Rental Car Protection
- Amex Offers*
- Earns 4 points per dollar on Dining and Grocery purchases, 3 points on flights booked directly with the airline and 1 point on everything else.
Because this card has a steeper $250 annual fee, I make sure to recoup that value by using all the perks associated with this card. I always use the $10 per month Dining Credit (for placing an order from Boxed) which is $120 value per year. I don’t use Uber, but my son uses my $10 per month Uber credit. That’s another $120 in value per year. I also save between $100-$150 per year by using Amex Offers* available on my account. Using all of these together I am getting at least $400 per year in savings for my $250 annual fee.
*Amex Offers are deals they post to your account. You can see 100 available offers at a time. These offers come in many different formats ranging from additional points earned to cash back on purchases from a particular merchant. Some of the offers can only be used one time, others can be used a set number of times or used during an entire date range. Always read the offer details carefully in order to understand all of the rules for earning the credit. They also list limited time card perks and available bonuses in this area. I suggest you review the list at least once or twice a month and add any offers you might use to your card.
Points Transfer Example: I was just 2,000 points short of having enough to redeem for a 5 night hotel stay at a Hilton property. The Membership Rewards points from the Gold card easily transfer to Hilton, usually within minutes to a few hours. Transfers are made in increments of 1,000 points at a ratio of 1 to 2.5. That means when I transferred 1,000 Membership Rewards points from my Gold card, it netted me 2,500 Hilton points. It was an easy decision to transfer those few points when it helped us earn a fantastic reward.
American Express Hilton Surpass card
The Hilton Surpass card is another one of our favorite credit cards. You can earn points faster on this card, however, they are not transferable like the Sapphire Preferred or the Gold Card. Points can only be used at Hilton properties. So if you sign up for this card, start planning a fabulous Hilton vacation!
The current sign up bonus for this card is 180,000 points after spending $2,000 in the first 3 months. That is a lot of points for way less spend than the other cards we discussed! This card has a lot of overall value created from it’s useful high earning categories and great travel perks.
- It has a $95 Annual Fee
- Points can only be used at Hilton properties
- Hilton Gold Status (That scores you free breakfast and you earn extra points on your Hilton stays)
- If you spend $40,000 in a year on this card you move up to Hilton Diamond Status (add Guaranteed Room availability, better room upgrade potential and earning even more points to the Gold benefits )
- Complimentary Priority Pass Select Lounge Membership (gives you Priority Pass lounge access 10 times per year or 5 times with 1 guest)
- If you spend $10,000 on this card in a year, you earn a Free Weekend Night certificate. These are like the Willy Wonka Golden ticket! No points limits or location restrictions on these certificates!!!
- No Foreign Transaction Fees
- Extended Warranty and Purchase Protection
- Amex Offers
- Earns 6 points per dollar on Gas, Grocery and Dining purchases. It also earns 12 points per dollar at Hilton and a hefty 3 points per dollar on all other purchases
This card helps you save on your hotel stays by providing you with Hilton Gold Tier status. With this Tier status you can get room upgrades (when available) and a free breakfast. On our first Hilton stay, we saved $42 per day by utilizing the breakfast benefit alone. Hilton loyalty members who book a Reward stay, can book 4 nights and get the 5th night free. That stretches your points even further. When you combine the Gold Tier points earnings from your hotel stay with the 12 points per dollar you earn by paying with your Hilton card, it nets you a lot of points when staying at Hilton properties.
Combined Savings Example: We spent 5 nights at the beautiful Doubletree by Hilton Sonoma Wine Country by using 200,000 points we earned with our card. The rooms were 50,000 points per night and we utilized the 5th night free option. This combination saved us over $1500 on our stay.
Tip: remember to charge any purchases at the hotel bar/restaurant to your room in order to get the 12 points per dollar for that spend as well.
Saving money on travel by using credit card points and perks is just smart. It takes a bit of strategy and some attention to detail, but it can truly save you a lot of money on your travel expenses. Those savings allow you to spend more on the fun stuff like dining and experiences. Plus, stretching your travel dollars further can also mean you might get to travel more often!
The cards that I presented are merely suggestions that I think create a solid travel rewards initial portfolio, but you should go with whichever cards work the best for your travel goals and your spending habits. I sincerely hope these tips are helpful to getting you started on your own travel rewards journey!
Tip: Since it is an ongoing journey, review your cards each year to make sure they are still a good value and continue to align with your goals. I also recommend following a few travel sites on social media that can alert you to new card perks/deals, and provide additional tips and tricks to help you hone your travel saving skills.
FYI: I am not being compensated to promote any of these cards. My opinions are solely based on my own experiences and preferences.