Best & Worst Travel Rewards Cards
Do you travel a lot? If so, you might want to check out the latest analysis of travel rewards cards done by NextAdvisor.
The site has ranked 8 big credit card rewards programs, including the massive programs offered by Hilton, Marriott, American and United, on the basis of the dollar value of every point you earn.
Their conclusion? If you're looking to earn hotel stays, the best program is offered by Starwood -- Starwood's Preferred Guest Card from American Express. If you're looking for free flights, the best card is offered by Southwest.
But understand that none of the rewards programs are knock-your-socks-off generous. Even the best of them return only about $1 to $2 for every $100 you spend. Worse many airline programs are placing more limits on the number of reward seats available, boosting the number of miles required to get a reward and adding restrictions, says Bill Hardekopf, chief executive of LowCards.com. That suggests you should twice before agreeing to pay an annual fee for one of these cards, he adds. He also cautions that even after choosing a card, you need to keep track of the ever-changing restrictions to get the best bang for your buck.
"There are plenty of rewards cards out there that don't charge an annual fee," he says. "If you do pay a fee, make sure you've considered how much you're going to get out of the deal.
NextAdvisor's survey makes that analysis a bit easier by calculating a dollar value for each point you receive and use for either a hotel stay or a free flight. Based on their analysis, Starwood ranked best for hotel stays by providing a 2.1 cent-per-point value when using points to stay in participating hotels, which include the Sheraton, Westin, W, Le Meridien and St. Regis brands.
But if you're mainly looking for flights, the best card is Southwest's Rapid Rewards, according to the survey. Southwest's card provides a value equal to 1.7 cents per dollar spent, when booking flights. That beats the Starwood program, which has a 1.2 cent per dollar value for flights, according to the survey.
Hardekopf notes that his favorite travel rewards cards weren't even surveyed. He likes the Capital One Venture and Venture One cards, which are not tied to any particular program. They simply promise to reimburse you for travel expenses on any airline or at any hotel. The Venture One card, which does not charge an annual fee, provides 1.25 points per dollar spent on the card; while the Venture card, which charges a $59 annual fee, provides 2 points. In the Capital One system each point is worth a penny.
That said, here are the top cards for hotel stays and airline flights based on the per-point value, according to NextAdvisor.
Best Hotel Rewards
1. Starwood Preferred Guest; worth $2.10 per $100 spent
2. American Airlines AAdvantage; worth $1 per $100 spent
3. Marriott Rewards; worth 0.80 cents per $100
4. United Mileage Plus; worth 0.70 cents per $100
5. Hilton HHonors; worth 0.50 cents per $100.
Best Flight Rewards
1. Southwest Rapid Rewards; worth $1.70 per $100
2. Starwood Preferred Guest; worth $1.20 per $100
3. United Mileage Plus; worth $1.10 per $100
4. Delta Skymiles; worth $1.00 per $100.
5. *Continental One Pass; worth 0.90 cents per $100
5. *American Airlines AAdvantage; worth 0.90 cents per $100
*tie
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