Never before have so many travel rewards credit cards competed so fiercely for a place in consumers’ wallets. As a result of that intense competition, the bonuses for establishing new credit card accounts are at all-time highs. In some cases, they amount to enough miles or points for a free airline ticket or hotel room night. While rewards cards still tend to come bundled with higher annual fees than non-rewards cards, the fees have come down and are sometimes waived for the first year.
Here’s a sampling of the more lucrative offers currently available.
Members of American’s AAdvantage program who sign up for a new Citi AAdvantage credit card by November 30 can earn up to 40,000 bonus miles.
Members first earn 20,000 bonus miles by charging at least $750 to the new card within the first four months. Then they can earn an additional 10,000 bonus miles by charging at least $10,000 during the first year. Finally, they can earn 10,000 more miles by charging $10,000 or more during the second year.
Annual fees for these three bonus-eligible cards range from $75 to $85, but are waived for the first year.
Southwest Rapid Rewards Visa Signature
The Southwest Airlines Visa Signature credit card offers new customers up to 16 Rapid Rewards credits, enough for a free round-trip ticket.
A bonus of eight credits is awarded after the first purchase charged to the card. Cardholders can then earn an additional eight credits for transferring $9,600 or more from another card account.
Unlike some of the offers reviewed here, however, the $59 annual fee is not waived the first year; it takes effect immediately.
US Airways Signature Visa
The incentives to pocket a US Airways Signature Visa card include a 20,000-mile bonus after the first purchase, a $99 companion certificate good for two guests, a one-time airport lounge pass, and preferred check-in and boarding privileges.
Those benefits don’t come cheap—the annual fee for the card is $90.
Choice Privileges Visa
Members of the Choice Privileges program who sign up for an affiliated Visa card by August 16 will earn 16,000 bonus points after using the card to charge $150 or more in purchases within 75 days of opening their accounts. That’s enough points for two free nights at more than 1,000 Choice Privileges hotels.
Choice Privileges is the frequent-stay program for Comfort Inn, Comfort Suites, Quality Inn, Sleep Inn, Clarion, Cambria Suites, MainStay Suites, and Suburban Extended Stay hotels. There’s no annual fee for this card.
Marriott Rewards Visa Signature
New Marriott Rewards Visa Signature cardholders will receive a certificate good for a free night at select hotels when their account is activated. They’ll also earn 20,000 bonus points after the first purchase charged to the card.
The card is free the first year but carries a $30 annual fee thereafter.
Priority Club Rewards Signature Visa
Priority Club Rewards Signature Visa cardholders receive 15,000 bonus points after using the card the first time, enough for a free night at many Holiday Inn hotels. There’s also a 10,000-point bonus that kicks in after charges reach $15,000 within a year. Cardholders receive automatic gold elite status in the Priority Club Rewards program.
The $29 annual fee is waived for the first year.
Credit card caveats
Because these promotions are designed to stimulate additional demand—not reward existing cardholders—they are only available to consumers setting up new accounts. As with any credit cards, prudence is the watchword. Any interest payments on outstanding balances or late fees can quickly offset the value these promotional offers may have.
And while promotional offers for rewards cards may be seductive, remember that choosing the best program takes precedence over choosing the best credit card. In the long run, focusing on participation in the appropriate program will be more rewarding than chasing the promotion-du-jour.
Still, with free tickets and hotel stays dangled as bait, the temptation to sign up just long enough to reap the short-term rewards will prove overwhelming to many. Marketers refer disparagingly to such opportunistic consumers as “flippers,” contrasting them unfavorably with truly loyal customers. But if the promotions they’ve created foster flipping, they have only themselves to blame for diverting focus away from long-term loyalty.
Consumers, for their part, have much to gain from marketers’ efforts to keep their credit cards on the competitive edge.