Travel Rewards Cards Aren’t Right for Everyone, and That’s OK

CREDIT CARDS - TRAVEL CREDIT CARDS
Travel rewards cards can be very valuable, but certain factors have to be in place for them to make sense.
Updated April 9, 2024
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There’s no denying how popular award travel is. Between lucrative sign-up bonuses and earnings multipliers that make racking up points and miles easier than ever, travel rewards credit cards are a great way to score free or discounted travel.

As prevalent as they may be, travel credit cards simply aren’t for everyone — and that’s OK. For many people, these cards may not make the most sense or provide the most value. Let’s take a look at some situations when a travel rewards card might not make sense for your wallet.

In this article

When travel rewards may not be right for you

For many, travel rewards cards are a no-brainer, but for others, it may not be so clear cut. If you’re unsure whether this type of card is right for you, here’s some helpful guidance.

You don’t travel often

As you might expect, you’ll get the most value out of a travel rewards card by redeeming points and miles for travel. If you don’t travel often, this type of card probably doesn’t make the most sense for your wallet. Although travel rewards cards often give you several choices for how you can spend your earnings, travel redemptions typically offer the most value.

Sure, you can trade points and miles for things such as cash back and gift cards, but in many cases, you aren’t maximizing the value of your rewards this way. If you have the Chase Sapphire Preferred® Card, for instance, you can redeem your points for cash back or gift cards at a flat rate of 1 cent per point. If, however, you redeem your Chase Ultimate Rewards points for travel through the Chase travel portal, you get 25% more value from them. If you don’t travel often and don’t think you’ll use your points and miles to do so, a different card might be a better option.

You don’t want to spend the time/effort to maximize your rewards

Travel rewards programs aren’t always cut and dry, so that means it often takes some time and effort to learn how to maximize your rewards. These programs tend to have rules and loopholes, and if you don’t take the time to familiarize yourself with them, you may miss out on valuable opportunities to make the most out of your rewards.

Cashback credit cards, on the other hand, are typically pretty straightforward. Although these credit cards may vary depending on whether they offer a flat-rate, rotating categories, or tiered categories for cash back, at the end of the day, they all earn cash back. You can relax knowing there’s not much else to it. Check out our list of the best cashback credit cards to learn more about our top picks.

You don’t want to pay a high annual fee

Many travel rewards cards carry higher annual fees than those you’ll find with cashback cards. This is often the case because the rewards and perks travel cards provide are usually more valuable — lucrative sign-up bonuses and redemption options, travel perks, etc. But again, this isn’t a hard-and-fast rule.

Not using the perks and benefits of a travel rewards card may be enough of a reason to opt for a different type of card. Add to that a higher annual fee that you aren’t on board with paying, and you’ll probably decide that a travel card isn't right for you.

You probably can’t/won’t earn the sign-up bonus

Often, one of the biggest selling points of a travel rewards credit card is the lucrative sign-up bonus. To receive these sign-up bonuses, you have to meet a minimum spend threshold within a designated time period, often three months. If you probably won’t be able to meet this spending requirement or you have to overextend yourself just to hit it, you might be better off with a different type of card.

Alternatively, you can stick with cashback credit cards, which also often offer sign-up bonuses. Although these bonuses usually aren’t as high-paying as travel rewards card bonuses, the minimum spend requirement is usually much lower, which can be much more practical for many.

You need a card that serves another purpose

Travel rewards credit cards are great for what they are, but your situation may require a card that serves another purpose. If, for instance, you’re looking to consolidate credit card debt to avoid accruing interest, a credit card that provides a 0% introductory APR on balance transfers will likely be your best bet. The best balance transfer cards generally offer interest-free periods of 12 to 21 months and can be a great way to save money while repaying debt.

Similarly, you can also find cards that offer 0% intro APRs for purchases. If you have a large purchase you can’t immediately repay, a card that offers an interest-free period can save you a significant amount of money you’d otherwise pay in interest.

There’s no shame in the cashback card game

There’s absolutely nothing wrong with sticking to a cashback credit card if a travel rewards card doesn’t make sense for you. Cashback cards also often come with sign-up bonuses (though they may not be as lucrative), and you can still get rewarded for your regular spending just as you would with a travel card.

If you see the value in rewards credit cards but prefer the flexibility of receiving cash back for your spending, cashback credit cards may be the way to go. Whether it’s a statement credit, having the cash deposited back into your bank account, or even using the cash toward a travel expense, these cards can be a great asset. You should have no shame in adding one to your wallet.

Bottom line

For the avid traveler, adding a travel rewards credit card to your wallet is usually a no-brainer. But there are several instances in which even the best travel credit cards just don’t make the most sense. Whether you don’t travel often enough to justify an annual fee or you’re confident you wouldn’t be able to earn the sign-up bonus, travel rewards credit cards aren’t right for everyone.

In these cases, you can still immerse yourself in the world of rewards credit cards with a cashback credit card. Adding a flat-rate card such as the Capital One Quicksilver Cash Rewards Credit Card to your wallet allows you to earn an unlimited 1.5% cash back on every purchase, every day; and 5% cash back on hotels and rental cars booked through Capital One Travel (terms apply). And, just like travel rewards cards, you can snag yourself a sign-up bonus too (though with a much lower minimum spend threshold). New cardmembers can earn a one-time $200 cash bonus after you spend $500 on purchases within 3 months from account opening.

If that flat rate on cash back doesn’t sound like enough, you can opt for a category card such as the Chase Freedom Flex℠. This card allows you to earn 5% cash back on rotating quarterly categories you activate (on up to $1,500 spent) and travel purchased through the Chase Ultimate Rewards portal; 3% cash back on drugstore purchases and dining at restaurants (including takeout and eligible delivery service); and 1% cash back on all other purchases. You may also decide to add both types of cashback cards to your wallet, as this will help ensure you earn cash back on most of your spending — max out the rotating categories, and use a flat-rate card for all your other spending. 

Easy-to-Earn Unlimited Rewards

Benefits

Card Details

  • Earn 25,000 online bonus points after you make at least $1,000 in purchases in the first 90 days of account opening - that can be a $250 statement credit toward travel purchases
  • Earn 1.5 points per $1 spent on all purchases
  • Longer intro APR on qualifying purchases and balance transfers
  • No foreign transaction fees
  • Apply Now
  • Earn unlimited 1.5 points per $1 spent on all purchases, with no annual fee and no foreign transaction fees and your points don't expire as long as your account remains open.
  • 25,000 online bonus points after you make at least $1,000 in purchases in the first 90 days of account opening - that can be a $250 statement credit toward travel purchases.
  • Use your card to book your trip how and where you want - you're not limited to specific websites with blackout dates or restrictions.
  • Redeem points for a statement credit to pay for travel or dining purchases, such as flights, hotel stays, car and vacation rentals, baggage fees, and also at restaurants including takeout.
  • 0% Intro APR for 15 billing cycles for purchases, and for any balance transfers made in the first 60 days. After the Intro APR offer ends, a Variable APR that’s currently 18.24% - 28.24% will apply. A 3% Intro balance transfer fee will apply for the first 60 days your account is open. After the Intro balance transfer fee offer ends, the fee for future balance transfers is 4%.
  • If you're a Bank of America Preferred Rewards® member, you can earn 25%-75% more points on every purchase. That means instead of earning an unlimited 1.5 points for every $1, you could earn 1.87-2.62 points for every $1 you spend on purchases.
  • Contactless Cards - The security of a chip card, with the convenience of a tap.
  • This online only offer may not be available if you leave this page or if you visit a Bank of America financial center. You can take advantage of this offer when you apply now.
Bank of <span class='whitespace-nowrap'>America<sup>®</sup></span> Travel Rewards credit card
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Intro Offer

Earn 25,000 online bonus points after you make at least $1,000 in purchases in the first 90 days of account opening - that can be a $250 statement credit toward travel purchases

Annual Fee

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Why we like it

Author Details

Matt Miczulski Matt Miczulski is a personal finance writer specializing in financial news, budget travel, banking, and debt. His interest in personal finance took off after eliminating $30,000 in debt in just over a year, and his goal is to help others learn how to get ahead with better money management strategies. A lover of history, Matt hopes to use his passion for storytelling to shine a new light on how people think about money. His work has also been featured on MoneyDoneRight and Recruiter.com.

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