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With 2016 now well underway, award-travel enthusiasts are looking forward to a new year of travel — and, as TPG Senior Points & Miles Contributor Jason Steele explains, the right credit card will be crucial to earning rewards, benefits and even elite status.
In today’s post, I’ll take a look at the wide array of credit card benefits that are offered on an annual basis — from fee credits to the opportunity to fast-track to elite status — and how you can maximize them in 2016.
ANNUAL FEE CREDITS
In the past few years, airlines have gone fee-crazy, but thankfully there’s been an increasing number of credit cards that have added an airline fee credit to their list of benefits, which are offered on an annual basis. However, it’s important to note that each credit card issuer has specific criteria for which fees are reimbursable and which ones aren’t. Here’s a brief rundown of the available cards that offer annual airline fee credits. For more information, read my post, Top Cards That Offer Credits for Airline Incidentals.
American Express — Amex pioneered this benefit by offering a $200 airline fee credit on its Platinum Card and The Business Platinum Card from American Express OPEN. More recently, it added a $100 annual fee credit to the Premier Rewards Gold Card. The fee credit for these cards resets on January 1 and is valid for most non-ticket purchases, including fees for ticket changes, seat selection, checked baggage, lounge day passes and in-flight purchases. Fees for upgrades to a different class of service are not reimbursable — and remember, Delta now considers its Comfort+ product (a coach seat with more legroom and amenities) to be a different class of service, so any fees you pay to get it probably won’t be eligible for reimbursement. Finally, you must log in to your American Express account and designate a single airline that will be eligible for fee reimbursement.
Chase — Chase offers the Ritz-Carlton Rewards Credit Card, which features an annual $300 fee credit per calendar year. In this case, the credit is not automatic and cardholders must call Chase within four billing cycles to request it. Additionally, it can be used toward charges to any airline and is not limited to one pre-specified carrier. Eligible fees include airline lounge day passes and yearly lounge memberships, baggage fees, in-flight internet and entertainment, in-flight meals and the Global Entry application fee. And unlike the American Express fee credit, you can use this one for seat upgrades.
Citi — The Citi Prestige Card offers a $250 annual airline purchase credit with an even more inclusive definition than Amex or Chase. Citi defines “purchases made with airlines” as baggage fees, lounge access and in-flight purchases, plus airfare itself. The entire $250 credit can be used to cover a single eligible expense, or multiple smaller expenses.
Unlike other issuers’ credits, Citi’s are based on the month of your statement, not the month of the charge. So if a charge appears in your January through December statements, it will qualify for that calendar year even if the date of charge happens to fall outside the calendar year. So you can begin using your annual fee credits as soon as your January statement period begins.
ELITE STATUS MILES AND SPENDING THRESHOLDS
Other credit card benefits that work on a calendar-year basis are the elite status miles you can earn through spending. For more information, see my post, Shortcuts to Earning Elite Status with Airline Credit Cards.
American — The Citi AAdvantage Executive World Elite MasterCard offers elite-qualifying miles as well as full Admiral’s Club membership — now for all authorized cardholders, not just the primary cardholder. This card offers 10,000 AAdvantage elite qualifying miles when you spend $40,000 within a calendar year. There’s a $450 annual fee for this card, and no foreign transaction fees.
Delta — Delta offers the Platinum Delta SkyMiles Credit Card and the Delta Reserve Credit Card from American Express, both of which offer Medallion Qualification Miles (MQMs) at sign-up and every year. The current offer for the Platinum Delta SkyMiles personal and Platinum Delta SkyMiles Business Credit Card is 35,000 bonus miles and 5,000 MQMs after spending $1,000 in the first three months, plus a $100 statement credit after making a Delta purchase in the first three months. Additionally, you can earn 10,000 MQMs each calendar year when you spend $25,000 on your card, and another 10,000 MQMs (20,000 total) when you reach $50,000 in purchases. This card has a $195 annual fee, and no foreign transaction fees.
The Delta Reserve Credit Card and Delta Reserve for Business Credit Card from American Express offer a sign-up bonus of 10,000 bonus miles and 10,000 MQMs after your first purchase. You’ll also earn 15,000 MQMs and bonus miles every calendar year that you make $30,000 in purchases, and another 15,000 MQM/bonus miles when you reach $60,000 in purchases each year. There’s a $450 annual fee for this card, and no foreign transaction fees.
Southwest — The Southwest Rapid Rewards Premier Card (and business version) from Chase both offer 1,500 points for every $10,000 you make in purchases up to 15,000 Tier Qualifying Points each calendar year. Since entry-level A-List status requires 35,000 Tier Qualifying Points or 25 (paid) one-way flights, qualifying for all these bonuses on one card in 2016 will get you about halfway there, and doing so on both the personal and business cards can get you most of the way toward A-List status. There’s a $99 annual fee for each card.
Virgin Atlantic — The Virgin Atlantic World Elite MasterCard from Bank of America offers one tier point for every $2,500 you spend on the card, with a maximum bonus of 2 points per month. There’s a $90 annual fee for this card. The Virgin America Premium Visa Signature Card from Comenity Capital Bank offers up to 15,000 status points per calendar year at a rate of 5,000 points for every $10,000 spent, and it allows you to roll over any unused points toward qualifying in the next year. There’s a $149 annual fee for this card.
ELITE HOTEL STATUS POINTS AND SPENDING THRESHOLDS
Just as you can earn elite airline status by meeting credit-card spending requirements, you can spend your way to elite hotel status.
Hilton — The Citi Hilton HHonors Visa Signature Card with no annual fee allows you to earn an upgrade to HHonors Gold status after you make $20,000 or more in purchases each calendar year. Both the Hilton HHonors Surpass Card from American Express ($75 annual fee) and the Citi Hilton HHonors Reserve Card ($95 annual fee) offer an upgrade to HHonors Diamond status through the end of the next calendar year when you use it to spend $40,000 on eligible purchases in a calendar year.
Hyatt — The Hyatt Credit Card from Chase offers two stay credits and five night credits toward Diamond status after spending $20,000 in a calendar year, plus an additional three stay credits and five night credits after spending $40,000 total in a calendar year.
Starwood Hotels — Both the Starwood Preferred Guest Credit Card from American Express and the Starwood Preferred Guest Business Credit Card from American Express offer Starwood Gold status when you spend $30,000 each calendar year. Gold status offers room upgrades, late checkouts and additional points per dollar spent at Starwood properties. There’s a $95 annual fee for these cards that’s waived the first year, and no foreign transaction fees.
CATEGORY SPENDING BONUSES
Finally, in 2016 you can take advantage of credit-card category spending bonuses that have annual spending limits.
American Express — The Amex EveryDay Credit Card (with no annual fee) has an annual limit of $6,000 for 2x points at grocery stores, while the EveryDay Preferred has a $6,000 annual limit on 3x points at grocery stores. Plus, when you use your EveryDay Preferred at least 30 times in a statement period, you receive a 50% points bonus, making the card’s grocery bonus worth 4.5x. There’s a $95 annual fee for the EveryDay Preferred. Additionally, the Business Gold Rewards Card offers 3x points on your choice of several different spending categories, and 2x on the rest, on a combined $100,000 of spending each year. This card has an annual fee of $175 that’s waived the first year.
- 1st Quarter (January-March): Gas stations and local commuter transportation
- 2nd Quarter (April-June): Grocery stores
- 3rd Quarter (July-September): Restaurants
- 4th Quarter (October-December): Holiday shopping
In addition to the common annual benefits of airline fee credits, elite status offers and category spending bonuses, some credit cards offer cardholders some more novel benefits each year. Below are a few examples.
IHG Rewards Club Select Credit Card — Cardholders get a 10% rebate on IHG Rewards Club point redemptions, with a limit of 100,000 points back each calendar year.
Citi / AAdvantage Platinum Select MasterCard — Cardholders get a 10% mileage rebate on redeemed miles, with a maximum annual benefit of 10,000 miles per calendar year.
Which annual credit card benefits are you most looking forward to using this year?
While this premium card has one of the highest annual fees on the market, it has several valuable perks that could make it worthwhile, depending on your travel patterns. These include a $200 annual airline rebate, lounge access, free Hilton Gold status and free Starwood Preferred Guest Gold status.
- Earn 40,000 Membership Rewards® points after you use your new Card to make $3,000 in purchases in your first 3 months.
- 5X points for flights booked directly with airlines or with American Express Travel.
- $200 Airline Fee Credit, up to $200 a year for baggage fees and more at one airline. Terms Apply.
- As a Platinum Card Member, you can enjoy access to the Global Lounge Collection, the only credit card airport lounge access program that includes proprietary lounge locations worldwide. Terms Apply.
- Enroll to enjoy the benefits of complimentary Hilton HHonors™ Gold Status with your Platinum Card.®
- No interest charges because you pay your balance in full each month.
- Terms and Conditions apply.
- See Rates & Fees
With great transfer partners like United and Hyatt, 2x points on travel & dining and a 50,000 point sign up bonus, the Chase Sapphire Preferred is a great card for those looking to get into the points and miles game.
- Earn 50,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. That's $625 toward travel when you redeem through Chase Ultimate Rewards®
- Named Best Credit Card for Flexible Travel Redemption - Kiplinger's Personal Finance, July 2016
- 2X points on travel and dining at restaurants worldwide & 1 point per dollar spent on all other purchases.
- Earn 5,000 bonus points after you add the first authorized user and make a purchase in the first 3 months from account opening
- No foreign transaction fees
- 1:1 point transfer to leading airline and hotel loyalty programs
- Get 25% more value when you redeem for airfare, hotels, car rentals and cruises through Chase Ultimate Rewards. For example, 50,000 points are worth $625 toward travel
- No blackout dates or travel restrictions - as long as there's a seat on the flight, you can book it through Chase Ultimate Rewards