Every airline and hotel loyalty program has one or more credit cards linked to its program, typically awarding one mile or point for every $1 charged to the card and two or three points per $1 spent on the program hosts’ services.
In addition to these company-specific cards, there are convertible-points cards that award points that can be redeemed for travel, for gift cards, for merchandise, and for cash, but which may also be converted into miles or points in select airline and hotel programs.
A frequent traveler would do well to carry one card from each of the three categories: a card linked to his primary airline program; another card for his primary hotel program; and a third card that earns points that can be transferred to a variety of secondary or tertiary programs.
But if we had to choose just a single travel-rewards card…? Here’s how we rated the major contenders in our Editors’ Choice Awards category for Best Travel Rewards Credit Card of 2017.
Best Travel Rewards Credit Card of 2017: The Methodology
The best overall rewards card must outshine its rivals in both utility and value. When it comes to credit cards, utility means that a card must be widely accepted, both in the U.S. and abroad; it should offer state-of-the-art security; it should award points that are readily usable; and it should have a future (not always the case—see the note on the Starwood card below).
As for value, considerations include annual fees (lower is better); earning opportunities; earning rates; flexibility in using points; points’ value when redeemed for awards; frequency of bonus opportunities; and so on. For cards that are linked to a single airline or hotel program, the utility and value of that program was also a factor. Cards were awarded bonus points for extra-generous sign-up bonuses, but the focus was on long-term card use, rather than a one-time windfall.
Best Travel Rewards Credit Card of 2017: The Contenders
Including U.S. airline cards, hotel cards, and cards linked to issuers’ proprietary programs, there are around 50 travel rewards credit cards vying for your attention. American alone has 14 different cards, with annual fees ranging from $0 to $450, and a dizzying range of features and benefits. No wonder consumers find themselves overwhelmed.
Since the goal is the best card for the most consumers, the first step was to eliminate both the top- and bottom-end cards, which cater respectively to the luxury traveler and the penny-pincher.
That left around 20 cards, from the larger airlines and hotel chains, and a handful of bank cards, most with annual fees of around $100 or less. Those are the cards that are designed to appeal to the sweet spot in the travel market, the “average” traveler.
From there, the list was winnowed down to three finalists:
With an annual fee of $95, waived the first year, this is the mid-priced card linked to American’s AAdvantage program, the oldest and largest U.S. mileage scheme. (There’s a no-fee AAdvantage card and a $450-a-year card as well, with lesser and greater benefits respectively.)
AAdvantage members earn one mile for every $1 charged to the card, and two miles per $1 spent on American Airlines purchases. So, depending on the mix of travel and non-travel charges, cardholders earn a free ticket after spending between $12,500 and $25,000. The AAdvantage program has an industry-leading roster of partners, allowing members to supplement their credit card miles with miles earned from more than 1,000 other companies.
On the redemption side, AAdvantage miles can be cashed in for flights on American or on its many airline partners, to almost 1,000 destinations worldwide.
The card comes bundled with several travel perks as well, including priority boarding and a free checked bag on domestic flights, no foreign transaction fees, and a discount on award tickets.
The Chase Sapphire Preferred Visa ($95 annual fee, waived the first year) is among the newer travel rewards cards, and among the best.
Cardholders earn two points per $1 on travel and dining expenses charged to the card, and one point per $1 for other purchases. When redeemed for travel through Chase’s Ultimate Rewards portal, the points are worth 1.25 cents apiece. Because award travel is paid, it’s not subject to the capacity controls and blackout dates that can make award bookings such a chore in traditional airline programs.
When redeemed for gift cards or cash, points are worth just 1 cent each.
What distinguishes this Chase card from most other rewards cards is an additional redemption option: Points may be converted 1:1 to miles or points in seven airline programs and four hotel programs. That transferability gives the card an extra degree of flexibility and value.
Other card features: no foreign transaction fees; primary car-rental collision-damage waiver; trip cancellation insurance.
The Southwest Rapid Rewards Premier Visa ($99 annual fee) is a solid card linked to a solid program hosted by a solid airline. Taken together, that makes for a powerful combination.
Cardholders earn one point per $1, except for Southwest bookings and Rapid Rewards hotel and rental-car bookings, which are worth two points per $1. When redeemed for Wanna Get Away tickets, Rapid Rewards points are worth around 1.5 cents apiece, so they amount to a travel rebate of between 1.5 and 3 percent. And when redeemed for free Southwest flights, there are no capacity controls or blackout dates.
Other card benefits: no foreign transaction fees and a 6,000-point anniversary bonus. There’s currently a 50,000-point bonus for new cardholders who charge $2,000 during the first three months, which counts toward the 110,000 points required to earn the airline’s coveted Companion Pass: free flights for a traveling companion.
It’s worth mentioning the Starwood Preferred Guest card, which in past years would have been among the finalists due to its widely convertible points and the 5,000-mile bonus when converting 20,000 points to airline miles, among its other strengths. But with Marriott’s acquisition of Starwood, the card’s future is in doubt, making it an iffy choice for anyone in the market for a rewards card.
Best Travel Rewards Credit Card of 2017: The Winner
Depending on your travel and spending patterns, any one of the three finalists could have a legitimate claim as the best travel rewards credit card of 2017. But if you could choose just one, it would have to be the Chase Sapphire Preferred Visa.
As good as the American and Southwest cards are, they limit cardholders to earning and redeeming points within their respective ecosystems of partner companies.
With the Sapphire Preferred card, on the other hand, points may be used on the Ultimate Rewards portal to book flights on almost any airline, or stays at most hotels, with no niggling availability restrictions to work around. And there’s a 20 percent discount on travel booked with points, so a $500 flight will cost 40,000 rather than 50,000 points.
Or, again, the points may be transferred, 1:1, to select airline and hotel programs, and redeemed through those programs. That’s a lot of flexibility, and a lot of value.
Sealing the deal is the first-year-free cost of the card, and the 50,000-point bonus for new customers who charge $4,000 during the first three months. The bonus points alone are worth $500 as a statement credit, or $625 in flights or hotel stays
If your goal is travel rewards, the Chase Sapphire Preferred card should be in your wallet. It’s the best travel rewards credit card of 2017.