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6 Credit Card Strategies for Meeting Your Award Travel Goals

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With so many great points and miles credit cards available, it can be hard to know where to start. With newer award travelers in mind, TPG Senior Points & Miles Correspondent Jason Steele walks through several popular redemption goals and outlines the best credit cards for each of them.

Are you new to the award travel game? Don’t worry — we’ve all been there. One of the first things you’ll learn about this hobby is that the best cards to use will depend on the type of award travel you have in mind.

In today’s post, I want to look at six different award travel objectives, from traveling during peak times to redeeming for premium-cabin tickets, and offer some credit card suggestions that will help get you there.

Pick a credit card that offers solid travel redemptions — and plan ahead — to get home for Thanksgiving.
Pick a credit card that offers solid travel redemptions — and plan ahead — to get home for Thanksgiving. Image courtesy of Shutterstock.

1. Domestic holiday travel 

The holidays are always a peak travel time, and domestic flights before and after major holidays can be some of the toughest awards to book with traditional frequent flyer miles. If you’ve tried to redeem your rewards for holiday travel, perhaps you’ve learned the hard way that the airlines will typically charge double or even triple for these award flights.

In response to cardholder frustration with these programs, there are now many credit cards that offer points or miles worth a fixed amount toward the price of a ticket — typically one cent per mile. Just be sure to book your flights as far in advance as possible, as ticket prices rise sharply as the holidays approach.

  • The Capital One Venture Rewards Credit Card offers double miles on all purchases, and each mile is worth one cent as a statement credit toward travel purchases. There’s a $59 annual fee, though it’s waived the first year.
  • The Barclaycard Arrival Plus World Elite MasterCard also earns double miles on all purchases, which are worth one cent each as statement credits toward travel expenses. In addition, cardholders receive 5% of their redeemed miles back toward their next redemption. There’s an $89 annual fee for this card, which is waived the first year.
  • The newest entry in this category is the Discover it Miles card, which offers 1.5 miles per dollar spent, and again miles are worth one cent each toward travel. Discover will double the miles earned by new cardholders in their first year of card membership. This card also features a $30 annual statement credit toward in-flight Wi-Fi purchases, and there’s no annual fee.
  • The Citi Prestige Card can make sense for holiday travel, as it allows you to redeem points for 1.6 cents apiece toward flights on American Airlines/US Airways. And since you can earn 3x points on air travel and hotels and 2x points on restaurants and entertainment, you can accumulate rewards very quickly. There’s a steep $450 annual fee, but that’s offset by perks such as Admirals Club access and an annual $250 airline credit.

Alternatively, you can use a credit card that offers points and miles in an airline program with a revenue-based award system. With Southwest and Virgin America, for example, the number of miles required for an award flight corresponds to the price of a paid ticket.

Earn miles toward an international trip in American's business class.
Earn miles toward an international trip in American’s business class.

2. International business class tickets

Premium-class award travel to overseas destinations is a great way to use your traditional airline miles, since the purchase price of these tickets can be extremely high. A $5,000 round-trip business-class ticket to Europe on American Airlines will cost you 500,000 miles with Capital One, Barclaycard or Discover, but can cost just 100,000 AAdvantage miles. So even when one of these cards offers double miles on all spending, it can’t match the value of a traditional airline mileage card.

If you already have some miles with a particular airline program, you may want to leverage this head start by getting the carrier’s co-branded credit card, such as the Citi AAdvantage Platinum Select MasterCard or the United MileagePlus Explorer Card from Chase. As for Delta, a series of massive devaluations means the SkyMiles program is a poor choice for most business-class award travel, especially if you’re a beginner. For more about this situation, see TPG’s post on Delta’s latest developments.

The other, more advanced strategy is to use a card that allows you to earn points that can be transferred to multiple carriers. These include the Starwood Preferred Guest Credit Card from American Express, as well as cards that earn points with Chase Ultimate Rewards, American Express Membership Rewards and Citi ThankYou Rewards. Just note that this approach takes additional skill and planning to find the best use of your points, transfer them and book your award.

Cancun's a popular award travel destination, and with good reason.
Your points and miles can get you far for a trip to Mexico. Image courtesy of Shutterstock.

3. Mexico/Caribbean/Central America

These destinations are popular among award travelers, as they can be far less expensive than trips to Europe or Asia, and the travel time is much shorter.

For these awards, I’d again focus on cards that are part of the fixed-value programs, such as the Capital One Venture Rewards, Barclaycard Arrival Plus and Discover it Miles. These will allow you to take advantage of discount carriers that serve this region, such as JetBlue, Spirit and Frontier — none of which have especially compelling frequent flyer programs or co-branded credit cards.

Southwest serves a small but growing number of destinations in this region, so it might be worth earning Southwest Rapid Rewards points from the Southwest credit cards, or earning and transferring points with the Chase Sapphire Preferred and Ink Plus.

It could be worth saving the miles to ride in Delta economy vs. business. Image courtesy of Delta.
It could be worth the mileage savings to ride in Delta economy vs. business. Image courtesy of Delta.

4. International awards in coach

As much as I enjoy traveling in business class, there are some compelling reasons to choose coach awards, like the lower cost in miles and the greater availability of award seats, especially for families and other groups traveling together. Plus, once you take your first flight in business class, it can be very hard to revert back to coach.

Choosing the best cards for these awards will depend on your desired route. For example, a New Yorker who wants to visit London, Paris or another major European city will find many highly discounted flights for sale, especially outside of the peak summer season. When transatlantic fares are available for less than $1,000, you won’t get the most value out of your miles if you book an award flight. Plus, you could be earning miles and credit toward elite status when you buy a ticket (even when you pay for it using miles from your Capital One Venture Rewards, Barclaycard Arrival Plus or Discover it Miles card).

Using points and miles makes more sense if you’re, say, traveling to Europe from the West Coast or between smaller cities during a peak travel time — then, your economy class ticket could easily cost $2,000 or more. To get the best of both worlds, consider a card that earns points that can be transferred to your favorite carrier. For example, points from the Starwood Preferred Guest program and the Amex Membership Rewards program will transfer to Delta. You can also transfer points from Starwood to American, and from Chase Ultimate Rewards to United.

With the Wyndham Rewards Visa, you can earn points toward a stay at properties like the Wyndham Clearwater Beach,
With the Wyndham Rewards Visa, you can earn points toward a stay at properties like the Wyndham Clearwater Beach,

5. Low- to mid-level hotel awards

While airfare is typically the largest travel expense, hotel awards can also take a big chunk out of your trip costs, and they’re much easier to redeem than award flights. If you’re not set on the fanciest accommodations, these credit cards could help you earn free nights at low- to mid-range properties:

6. Luxury hotels

The Conrad Maldives can give you terrific value for your Hilton HHonors points.
A Hilton credit card can help you rack up the points for a stay at the Conrad Maldives Rangali Island.

Many of the programs that offer the best redemptions for low- to mid-level properties can be a poor value for awards at premium properties. For example, Category 7 Starwood properties cost 30,000 points per night, which isn’t a great use of these very valuable points.

  • Hyatt Card from Chase — This card offers decent value for both mid-range and high-end hotels, the latter of which are typically 20,000 or 25,000 points per night. Additionally, the card’s sign-up bonus is two free nights at any Hyatt property (after $1,000 in purchases within three months of account opening), which is perfect when you want to stay at a luxury hotel in a major city.
  • Hilton credit cards — The Hilton brand includes some impressive luxury properties, such as the Waldorf Astoria, Conrad and Hilton Resorts. While award nights for these hotels require tens of thousands of points, there are four different credit cards to help you earn them. Citi offers the Hilton HHonors Reserve Card, which earns 5x points on all airline and car rental spending and 3x points on all purchases, and the Hilton HHonors Visa Signature Card card; while American Express has the Hilton HHonors Card and the Hilton HHonors Surpass. All these cards grant you some level of elite HHonors status, which enables you to receive your fifth night free after four consecutive award nights.

What’s your favorite use of points and miles?

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