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Barclaycard Arrival vs. Fidelity Investment Rewards Amex

by on June 1, 2014 · 23 comments

in American Express, Barclays, Chase Sapphire Preferred, Fidelity, Sunday Reader Questions, Video Blog Post

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This past week, TPG reader Manu sent me a message via Facebook:

“What is the advantage of the Barclaycard Arrival over the Fidelity Investment Rewards American Express Card, which also gets 2% cash back on all purchases, but (unlike the Barclaycard) has no annual fee?”

When it comes to cash back, the Fidelity American Express (which earns 2% across the board and has no annual fee) is hard to beat. Manu wants to know why anyone would bother the Barclaycard Arrival (an ostensibly similar product) when it has an $89 annual fee (waived the first year). There are a few reasons.

First, Arrival has no foreign transaction fees, so if you’re an international traveler, you don’t want to use your Fidelity Amex abroad. That difference alone could easily make up for the annual fee if you’re someone who puts a significant amount on your card outside the U.S.

For travel, Barclaycard is the clear winner

For international travel, Barclaycard Arrival is the winner

Beyond that, if you’re going to redeem for travel anyway, then the Barclaycard Arrival actually gives you 2.22% back on all of your spending, since you get a 10% rebate when you redeem points for travel expenditures. Barclaycard just announced that they expanded the list of eligible travel categories and increased the redemption period from 90 days to 120 days, giving you a full four months to cover your travel expenses with points. They also just launched Chip and Pin capability, which makes the card even more useful for international travel. I just traveled to France last week and was able to easily purchase train tickets at unmanned kiosks, where other Chip and Signature cards would have floundered.

Lastly, Barclaycard Arrival has a killer signup bonus! You’ll get 40,000 points after spending $3,000 in the first three months. Again, that annual fee of $89 is waived the first year, so in the short run, the Arrival card earns a TKO against the Fidelity Amex. Still, you should do the math to determine whether the annual fee makes sense for you given the extra 0.2% earnings and the added perks. I think for international travel it absolutely makes sense, but for someone who’s only going to have one card and doesn’t want to pay any fees, Fidelity is a solid choice.

Let me know if you have any other questions by messaging me on Facebook, tweeting me @ThePointsGuy, or emailing me at [email protected]

Disclaimer: The responses below are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser's responsibility to ensure all posts and/or questions are answered.

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  • iamright

    You neglect to point out the biggest difference between the cards – the Fidelity card gives you CASH back, while the Barclaycard only give you statement credit for travel expenses. You can also cash out with the Barclaycard via gift cards, but at 50 centa on the dollar. TPG has been pumping the Barclaycard very hard for months. I imagine his referral deal is very sweet for this card.

  • Lizzy

    Why are we neglecting the fact that the barclaycard arrival is a *travel* card. You’re trying to compare apples to organges, imo. Cleary the arrival is the superior choice providing you actually use it for what it’s intended for. NO FTFs, awesome sign-up bonus (worth an additional 5 years of AFs), and a great redemption rate for travel expenses. If you’re not traveling internationally, or much at all – then the arrival doesn’t make much sense unless you get it for the bonus and cancel after the 1st year. In that case, the fidelity AMEX would be a better fit, as TPG said. I actually have both; the arrival I’ll evaluate yearly and the Fidelity AMEX is obviously a staple since no AF. More spend does go on the arrival because I travel frequently as of late.

  • Nerus

    I think taxes play a role too.
    The cashback from barclaycard arrival is not taxed.
    However, as fidelity directly deposits the cash back into an IRA account, there might be taxes to consider when drawing from the IRA account.

  • Daniel

    Fidelity cash back can be directly deposited into a brokerage account as cash, rather than an IRA account.

  • HikerT

    Fidelity AMEX 2% can also be worth 3%+ for airfare. Milenomics has a good post on this: http://milenomics.com/2014/04/the-best-travel-cash-back-card/

    In my opinion folks should get both Arrival and Fidelity AMEX. The only one worth keeping past the first year is the Fidelity AMEX.

  • J.D. KaPow

    Can someone explain to me why they care about the difference between cash back and statement credits? In the end, you’re spending the exact same amount of money (well, a little less with the Barclaycard, because of the 10% bonus). Sure, if you don’t spend enough on travel (maybe 5% of your total amount charged) to redeem all your Barclaycard miles easily, that’s a reason not to get it. But the difference between cash back and statement credit strikes me as no difference at all.

  • Traderlatino

    Well…this is The Points Guy…no The Cash Back Guy, I have both cards and if you are going to use it a lot and you travel the Arrival is the way to go. In addition to what Lizzy said I want to add that if you want to use the card for EVERYTHING there is still some small business that don’t take Amex. MasterCard is accepted EVERYWHERE!!!

  • dougie

    Let’s not ignore how finicky Barclay is about what they allow you to get credit for on the card. God forbid a merchant codes your transaction as something they don’t like. I stayed at a lodge in Yosemite and Barclay wouldn’t accept it as accommodation, they wouldn’t even re-consider (just look at their website, I pleaded, it’s a Lodge for tourists crying out loud!), but Barclay wouldn’t budge. I was out a bunch of money, having planned to pay for a good part of the trip using my points. No go.

  • HikerT

    Not at Costco which happens to be the merchant I shop at most.

  • Unimportant

    There’s a Visa version of the Fidelity card for those who don’t want Amex.

  • Alcwj

    If you compare both cards referral fees, you will know the reasons. :D

  • Jonathan

    The Fidelity Amex’s foreign transaction fee is 1%, so with 2% cash back you come out +1% ahead. Not a bad card to use aboard… some may be better, and certainly many that are worse!

  • Traderlatino

    True…

  • macfred

    I just cancelled Fidelity Card after I signed up two weeks ago. When there was no info on the promotion sent with the card I called. They said it wasn’t added correctly when I applied for it, and it was too late to do it now. I cancelled my card with the supervisor when I was unable to get the problem resolved. after that experience I will never do business with FIA card services again. I might even move my Fidelity Brokerage Account.

  • dande

    Can you get the bonus offer from BOTH the Arrival Card 20,000 AND the Arrival plus 40,000? Thanks

  • John Gooch

    I don’t travel at all , so it looks like the Fidelity Card is the winner for me,

  • Rusty Longwood

    Statement credit and cash are effectively the same if your travel expenses are greater than or equal to your rewards. And I’m guessing most people picking up a card like this spend at least ~2% of their expenses on travel.

  • Rusty Longwood

    You’re correct. If you owe me $100 and I gave you the option of only owing $90 or giving you $10, it’s effectively the same. I think some people have a cognitive bias where placing a check in their hand makes it feel like more money.

  • Rusty Longwood

    Surely 2-3% of your spending is on valid travel expenses, no? Also, Barclay just announced they’re expanding the valid categories.

  • Rusty Longwood

    Fewer rewards though.

  • Rusty Longwood

    Here’s a big thing you missed- it’s a Mastercard that’s accepted in more places than AMEX. You get 0% rewards at a place that doesn’t take AMEX (or whatever % your wimpy backup card offers). A lot of venues that don’t take AMEX in my area end up being some fairly high ticket merchants for me- my dentists, car mechanic and insurance for instance. Getting 2.2% on those instead of my wimpy 1.1% backup card covers the annual fee pretty quickly.

  • Rusty Longwood

    Except the acceptance of Amex internationally can be fairly poor. A low transaction fee isn’t good at all when merchants don’t take your card.

  • Rusty Longwood

    Disagree, it’s not really limited to heavy travelers. If you get 2.2% rewards, travel only has to be ~2.2% of your total expenses on the card to maximize rewards. You have to be traveling practically never (or a big spender) to not hit that. Spend $50,000 in a year and you have $1100 in credit. A single domestic flight and a couple nights in a hotel room can easily top that, you don’t need to be some frequent flyer to get he most out of the card.

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