I’m constantly flying around the US, so I’ve been itching to find a frequent flier credit card to help me make the most of my money.
Since I’m new to the rewards game, I rang up Brian Kelly, The Points Guy, for expert advice.
With his help, we rated a few cards based on annual fees, sign-on bonuses, miles needed for a free domestic flight, and other perks.
Kelly stresses the importance of knowing your spending habits. Dining and travel are two of my musts (after rent!), so I was good on that count.
He also suggests familiarising yourself with three basic types of travel rewards cards:
Transferable points — Kelly’s favourite, these typically come with an annual fee, meaning you get what you pay for. Points are usually transferable to many different airlines, offer the most options and the best sign-on bonuses.
Fixed value — These are for “people who don’t want to play the value game,” Kelly says. The industry standard is 1 cent per point (10,000 points = $100 towards flights/hotels/gift cards/etc). You’ll always know what you’re getting, and you’ll always earn miles for flights you book, so it’s easy to maintain an elite status.
Co-branded cards — What you lose in flexibility in terms of transferring points to different airlines, you gain in perks with these cards, says Kelly. Benefits may include lounge access, free checked bags, elite flier status, etc.
I’m not loyal to any particular airline or hotel, so I nixed the co-branded cards. And between the transferable points cards and fixed value cards, paying an annual fee might give me more options and value. I started reviewing transferable points cards.
First, I checked out the American Express Premier Rewards Gold Card.
Annual fee: $175, but currently waived the first year
Signing mileage bonus: Spending $2,000 within the first three months and enrolling in Membership Rewards earns you a cool 25,000 points.
Other perks: Dollars spent on airfare equal 3 points each. You also get 2 points for every dollar spent on gas and groceries, plus 1 point for everything else.
You can earn 2 points per dollar when you book through americanexpress.com/travel, and can transfer AmEx Membership Rewards points to your frequent flyer account.
Verdict: On the fence. I wish I could earn points upon sign-on and since I don’t drive, earning 2 points for money spent on gas is pointless. But I like the companies AmEx is partnered with, and being able to transfer points between them.
Next up was Chase’s Sapphire Preferred Card.
Annual fee: $95, but currently waived the first year
Signing mileage bonus: 50,000 points (worth $625)
Additional perks: Dollars spent on dining and travel equal 2 points. This means cabs and subways!
Cardholders can use 20% fewer points when redeeming points for travel by booking through Chase’s Ultimate Rewards (a flight worth 50,000 points requires just 40,000). You can also transfer points to other programs at a 1:1 value.
Verdict: This card rewards frequent traveller and diners, the perfect combo for me. And while my focus is on domestic travel, the card’s partnerships with several international partners is also a great asset for future visits to see family in Korea and friends in Europe. Flexible transfers between participating partners, as well as earning a 7% dividend on all new points earned, are also appealing.
The third card was Capital One’s Venture Card, a fixed-value card.
Annual fee: $59, but currently waived the first year
Signing mileage bonus: None, but for a limited time cardholders can earn up to 100,000 bonus miles (2 miles for every dollar spent last year).
Additional perks: Earning 2 points per dollar on any purchase—that’s nearly 2% back on what you spend. You can also redeem points for travel expenses other than flights and hotels.
Cardholders don’t have to book through Capital One’s site, and they can redeem points after they’ve charged their travel expenses. There’s no cap to earn points, and they’ll never expire so long as the account remains active.
Verdict: Earning 2 points per dollar on any purchase sounds like too good a deal to pass up, especially since most cards offer a 1:1 rewards ratio.
The AmEx Premier Rewards Gold Card and Chase’s Sapphire Preferred Card both offer partnerships I could easily transfer points to, but the Capital One Venture Card’s rewards are more straightforward.
At the beginning of this search my goal was to earn as many free domestic flights as possible, but this isn’t a bad card to consider. Right now, it’s a toss-up between the Chase Sapphire Preferred Card and Capital One Venture Card.