After a long winter, you’re probably craving a summer vacation. But high costs can add stress to your otherwise enjoyable getaway. Let your credit card save you money by helping you rack up rewards you can redeem for travel expenses.
1. A big signup bonus
Many credit cards offer a signup bonus if you spend a certain amount of money within a specified time. A travel card with a competitive signup bonus may earn you a free flight or a few nights at your favorite hotel. A cash-back bonus could add an extra $50 to $150 toward your summer fun. Here are two of the Nerds’ favorite credit cards for big signup bonuses — one you can use to redeem for travel and one for cash back.
Chase Sapphire Preferred® CardChase Sapphire Preferred® Card. You’ll 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®. Plus, you can earn another 5,000 bonus points if you add an authorized user and make a purchase within the first three months.
The Chase Sapphire Preferred® Card also has high ongoing rewards: double the points on every dollar spent on dining out and travel, and 1 point per dollar on all other purchases. Points can be redeemed for travel through the Chase Ultimate Rewards site at a rate of 1.25 cents each — which is high for the industry.
Or, if you want to try to redeem at a higher rate, you can transfer your points to partner programs for a potentially higher value. Either way, you’ll be on your way to free flights in no time.
Blue Cash Preferred® Card from American ExpressBlue Cash Preferred® Card from American Express is a great option. It comes with a cash sign-up bonus: Limited Time Offer: Apply by 5/3/17 – Earn 10% cash back on purchases at U.S. Restaurants in the first 6 months, up to $200 back. Earn $150 back after you spend $1,000 in purchases on your new Card in your first 3 months. Terms Apply. It also has great ongoing rewards, with 6% back on supermarket purchases (up to $6,000 spent per year — then 1%), 3% back at gas stations and select department stores, and 1% back on everything else. The annual fee is high for a cash-back card — $95 — but if you spend at least $31 a week at the supermarket, your grocery rewards alone will more than offset it.
The card has a no-annual-fee version, the Blue Cash Everyday® Card from American Express, but the Blue Cash Preferred® Card from American Express is the better option if you spend at least $61 on groceries per week. Earn extra rewards on all of your daily purchases, then use your cash back to cover travel expenses.
2. Extra points on your summer trip essentials
Signup bonuses are great for quick cash, but ongoing rewards are more important, especially if you plan on keeping your card for the long haul. For extra cash or travel rewards for your summer trip, you should get a card that rewards you for the purchases you make the most.
Citi ThankYou® Preferred CardCiti ThankYou® Preferred Card. It offers double the points on entertainment and dining at restaurants, and 1 point on every dollar spent on everything else.
Points are redeemable for various rewards, but you’ll get more value from your points if you redeem for travel, mortgage or student loan payments, charitable contributions or $100 gift cards.
3. Dipping into rewards you’ve saved
If you have rewards saved up for a special occasion, consider using them on your upcoming trip. Depending on your card’s program, you can redeem for cash back to pay for some expenses, like a new swimsuit or souvenirs; or you can use travel rewards for things like plane tickets, hotel stays, cab rides and campground fees. You can also redeem for gift cards that you can use to buy gas or dine out.
Nerd note: Saving up rewards for a big trip or purchase is great in theory, but your miles or points may not last forever. Check your card’s benefits statement to see if your rewards have an expiration date.
The bottom line
Credit cards can cut your summer travel expenses by netting you high rewards on your purchases and offering hefty signup bonuses. Redeem your rewards to cover all or part of your trip, and continue racking up rewards with every purchase you make while you’re away.
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