Is the Arrival Plus Card Better than 2% Cash Back Rewards?

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TPG Reader Maxwell emailed to ask about why one cash-back card doesn't get more attention:

"Why the love for Barclaycard Arrival Plus, when Citi Double Cash offers 1% back initially plus another %1 with no annual fee?"

The Barclaycard Arrival Plus World Elite Mastercard has been one of the most popular travel rewards credit cards since the sign-up bonus hit 40,000 miles in the spring of 2013. The card earns 2 miles per dollar spent on all purchases, and you can redeem miles for roughly one cent apiece toward travel expenses ranging from flights and hotels to tolls and taxis. Along with a few added benefits (like EMV chip technology), the flexibility of Arrival miles has been one of the card’s major selling points.

However, when it comes to flexibility, nothing beats cash in your pocket. The Arrival program's recent devaluation has lowered the overall return on the card to right around 2%, putting it in line with several cash-back credit cards like the Fidelity Investment Rewards Card.

Given that these cash-back options have no annual fee (compared to $89 for Arrival Plus after the first year), and since more cards are adopting features (like no foreign transaction fees) that used to make the card stand out, it’s fair to ask whether Arrival Plus has lost its appeal. My short answer is no, and there’s still one major reason why this card should be on your radar: the sign-up bonus.

Arrival Plus currently offers 40,000 bonus miles after you spend $3,000 on the card in the first three months. Even after the recent negative changes, you’ll have at least $430 worth of free travel once you meet the spending requirement. Most cash-back cards offer relatively meager bonuses, and Citi Double Cash Card offers none. Since you pay no fee for Arrival Plus in the first year, the card is still an easy win for award travelers.

All that said, I do think Arrival Plus has fallen from among the top travel credit cards, and there isn’t much incentive to keep it beyond the first year. I would much rather have the Chase Sapphire Preferred Card or Citi Premier® Card, both of which allow you to redeem points for travel directly, but also give you the flexibility to redeem with airline and hotel partners for greater value. With the right redemption strategies, you'll get better value out of those cards than you will from a flat 2% cash back.

If you strongly prefer to have no annual fee, I’d go with Chase Freedom, which comes with lucrative 5% bonus categories, but also lets you transfer points to partners if you hold one of the more premium Ultimate Rewards cards. Even without counting the sign-up bonus, you'll do better with Freedom than with a 2% cash-back card if at least 25% of your spending is in those bonus categories. (The Chase Freedom is no longer open to new applicants)

If you have any other questions, please tweet me @thepointsguy, message me on Facebook or send me an email at info@thepointsguy.com.