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The days are growing longer and the winter months are finally behind us. With prime summer vacation season approaching, your thoughts might turn to days on the beach or a quiet retreat to a mountainside lake.
As you start planning your summer trip, consider leveraging a credit card bonus and other perks to ease the price shock. Travel credit cards can net you free flights or hotel stays, elevate your vacation experience with trip perks and offer rewards to redeem towards a future vacation.
Here are some of the best credit cards to consider as summer travel season approaches. Just make sure the card’s annual fee and other features are a good fit for your spending habits before applying.
How to pick the right travel card for your budget
As you eye your vacation spot in the coming months, you’ll need enough breathing room to reach the card’s welcome bonus through your normal spending. Match the card to your spending habits -- check to see if you spend frequently on purchases the card offers rewards for, and don’t overspend in order to get there.
Each of the above cards charge an annual fee. That will essentially cut into your rewards or take away from the value of the welcome bonus, so you’ll need to account for that. But the value of the welcome bonuses of all of the above cards are high enough to offset the annual fee, at least for the first year. Before you apply, check to see if you can earn enough rewards or use enough benefits to cover the fee.
For a premium card like the Capital One Venture X Rewards Credit Card*, you may not find its high annual fee worthwhile unless you’re a frequent traveler. However, it does feature an annual up to $300 travel credit when booking through Capital One Travel which, as long as you can use it, will help cover some of that fee.
The American Express® Gold Card also has a high annual fee, but its reward rate is good and it covers common purchases like restaurants and U.S. supermarkets. It also includes a $120 annual dining credit (up to $10 in statement credits monthly when you pay with the card at Grubhub, The Cheesecake Factory, Goldbelly, Wine.com, Milk Bar and select Shake Shack locations) plus up to $120 in Uber Cash per year (up to $10 each month) on Uber Eats or Uber rides in the U.S. when you add your Gold Card to your Uber account.
The other cards -- the Chase Sapphire Preferred® Card and Citi Premier® Card -- offer fewer credits but also don’t ask too much. Both cards charge $95, which shouldn’t be too difficult to offset with the Sapphire Preferred’s boosted rewards redemption rate and the Citi Premier’s high rewards rates in everyday spending categories.
Terms apply to American Express benefits and offers. Enrollment may be required for select American Express benefits and offers. Visit americanexpress.com to learn more.
How best to earn a welcome bonus
It’s important not to let a welcome bonus push you into spending on purchases you otherwise wouldn’t have or expenses you can’t afford. Any unnecessary spending will cut into the value you’d get from a welcome bonus.
Welcome bonuses are only beneficial if you can earn them through everyday spending. Otherwise, your bonus could quickly be overshadowed by interest.
If you can earn a welcome bonus without overspending, you can then use this bonus to help fund a large, planned purchase like a family road trip or vacation overseas.
The Gold card earns 4x points per dollar at U.S. supermarkets (on up to $25,000 per calendar year in purchases, then 1x), the Premier also earns 3x points for supermarkets and the Venture X earns a flat 2x miles for everything, which makes the cards good choices to use for your necessary spending.
You can budget ahead of time to see how much you would need to spend in those categories to reach the bonus and then plan for it. You could also see how large of a return you’d earn on that spending.
How to get the most from your travel card
There are several ways to get the best ongoing value out of your travel credit card. One is to use it to cover the purchases it earns the most rewards for -- in this instance, booking travel that earns heightened rewards through the respective credit issuer’s travel portal.
Once you earn the welcome bonus, redeem it in the way that provides the greatest value. For most of these cards, the easiest option is redeeming your bonus for travel through the travel portals. That typically guarantees a value of 1 cent per point. However, if you want to take an extra step, your points could potentially be far more valuable if you transfer to travel partners and find a good deal.
For example, the Chase Sapphire Preferred features a 1:1 transfer rate, which means 1 Chase Ultimate Reward point will always at the least transfer to 1 partner mile or point. You can then use those partner points to book a flight or hotel directly through the company’s own loyalty program.
In some cases, you’ll find a deal that nets you a value greater than 1 cent per point.
To figure out how much your miles are worth, divide the cost of the airfare or hotel by the number of miles it takes to fund it. For example, if you transfer 50,000 Chase Ultimate Rewards points to Iberia Airlines and use it to book a business class flight to Spain that would have otherwise cost $6,000 in cash, your points are effectively worth 12 cents each for this redemption.
You can see the full list of transfer partners for Chase, American Express, Citi and Capital One on each issuer’s website.
Credit card issuer travel portals
Most of the major card issuers -- barring Discover -- offer portals or platforms for booking travel and redeeming rewards. Avid travelers may scoff at the idea of booking all of their travel through a single site rather than shopping around, but in some cases, it can be advantageous.
For example, the Venture X earns 10x miles for booking hotels and rental cars through Capital One Travel and the Chase Sapphire Preferred earns 5x points for booking travel through Chase Ultimate Rewards.
The Sapphire Preferred also offers a 25% redemption bonus when you redeem your Ultimate Rewards points for travel through the portal, although doing so won’t earn you additional points on that booking. Though you might find better value for your points by transferring them to a partner airline and booking through their frequent flyer program, Chase Ultimate Rewards can be good for those who value simplicity or are paying with cash and want to earn extra rewards.
Amex Travel works similarly. You’ll get the most from your American Express membership points if you redeem for airfare through the issuer’s portal, or by transferring your points to its partners. You’ll also earn 3x points for flights booked through the portal with the American Express Gold card, though the same rate applies to airfare booked directly with the airline. The Citi Premier card also has a travel portal that lets you book travel with cash or points but doesn’t offer any boosted redemption value.
The bottom line
If you have your eye on visiting a certain place, now’s the time to consider adding a travel credit card to your wallet. With summer coming in fast (and hot), you’ll need enough time to earn a new card’s welcome bonus to help limit travel expenses. Just be sure the card has lasting value once the welcome bonus is earned and used, and that the card fits into your budget in terms of rewards, annual perks and fees.
*All information about the Capital One Venture X Rewards Credit Card has been collected independently by CNET and has not been reviewed by the issuer.
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