Back to the Basics

Back to the Basics: How to Choose the Right Miles and Points Credit Card



Update: The offers mentioned in this post for the Chase Sapphire Preferred and Freedom credit cards have expired. You can view the current offers here.

My rule of thumb is that if I’m applying for a new credit card, there needs to be perks that I will benefit from and it’s not always going to be to rack up airline miles. There are different types of credit cards and depending on what your needs are that’s what you should sign up for. In today’s credit card world, there are so many great signup offers and incentives to using reward cards that you would have to be crazy to use a credit card that does not offers them.

My go to card is always a rewards card that can earn points free travel, hotel stays or cash back. Wait for a sign up bonus that can land your a hefty start to your rewards account and use the card to maximize reward earnings. Another thing to take into account is the redemption potential of the reward points or miles you will be earning, there are differing values from program to program (more on them later).

Before your start to apply for reward credit cards, especially if you are going for large signup offers and applying for multiple cards at a time, check where you credit score stands by using a free service such as Credit Sesame or Credit Karma. I like to use Credit Sesame to monitor my credit score for free and and to watch how my score changes after applying for cards.

Here are some cards and why they offer something particularly valuable:

Airline

Travel/Airline rewards credit cards are the gateway to free or extremely discounted travel. The bonuses listed here are the minimum offered through the credit card’s website. The best offers are usually not the ones that are listed on their site and are instead emailed to consumers. As we find out about better deals, we will provide information on how to snag them.

Be sure to sign up with the airline’s points program to be able to earn additional miles through their dining or shopping networks.

The most important benefits that I consider when choosing an airline credit card:

  • free checked bags
  • elite status
  • signup bonus
  • award availability
  • partner airlines
  • no foreign transaction fee
  • airline lounge access

United MileagePlus Explorer Card

United recently offered up to 65,000 sign up bonus points which is redeemable for an international round trip. However, their website says only 30,000 points are available after spending $1,000 in the first three months of sign up. Members do get two free complimentary passes to the United Airport Lounge.
Credit score needed: Excellent

Citi AAdvantage World Mastercard

With the Citi Platinum Select card you could earn 30,000 American Airlines AAdvantage bonus miles after $1,000 in purchases within the first 3 months of card membership and check in your first bag for free. This is not the best offer available by the credit card. We recently found that Citi Platinum Select was offering 50,000 bonus points for signing up after spending $1,000 is the first three months.
Credit Score needed: Excellent

Southwest Airlines Rapid Rewards® Premier Card

The offer Chase has available for Southwest is 50,000 bonus miles after spending 2,000 in the first three months. The offer is good to redeem two round trip domestic flights with Southwest as well as AirTran. Bags fly free with Southwest.
Credit score needed: Good

Hotels

Using credit cards affiliated with hotels are a great way to earn free nights at various locations around the world in different hotel categories.

The most important benefits that I consider when choosing a hotel credit card:

  • free room upgrades
  • redemption value
  • signup bonus
  • award availability
  • status upgrades
  • free nights

Citi Hilton HHonors Visa Signature Card

The Citi Hilton HHonors Visa is currently offering a 40,000 bonus with no annual fee. 40,000 points can be redeemed for 5 free nights in certain Hilton categories. Every purchase outside of any Hilton program earns 3 points per dollar at participating supermarkets, drugstore and gas stations.

Chase Hyatt Visa

With the Chase Hyatt Visa the offer is two free nights at any of the different Hyatt locations as well as an upgrade to Hyatt Gold Passport Platinum status. Also earn a free night every anniversary of having the card.

Cash back

Spend money to earn money. A perk about earning cash back rewards on items you purchased, is using that your earning cash back to pay part of your credit card bill. It’s absolutely essential to pay your credit card in full every month and using rewards to pay a portion of your bill off will help keep cash in your pocket.

The most important benefits that I consider when choosing an cash back credit card:

  • signup bonus
  • general cash back categories
  • bonus categories
  • cashback earning limits

Discover it

Discover it credit card offers 5% cash back rewards in rotating categories that change from restaurants, online shopping sites, gas to drugstores or 1% on all other purchases. Discover also let’s consumers select their own bill payment date. There is also a Discover it for students that provides the same great cash back.
Credit score needed: Excellent
Annual fee: none

Chase Freedom Visa

After making $500 in purchases within the first three months of opening Chase Freedom account, you earn $100 in bonus cash back as well as 5% cash back in rotating categories from Starbucks to Walgreens.
Annual Fee: none

JourneyStudent Rewards from Capital One

The JourneySM credit card is the perfect cash back credit card for students who want to build their credit scores. The card offers 1% cash back on purchases and for 25% for every month the bill is paid on time. There is also no annual fee.
Credit score needed: Average

Capital One Cash Rewards

Capital One Cash Rewards offers $100 after spending $500 on purchases within the first three months of signing up. This is one of the more popular cash back rewards programs. Each purchase earns 1% cash back and your earnings are redeemable at anytime. Another great thing about this credit card is there is no annual fee.
Credit score needed:Excellent

If you need more help figuring out where to start, check out our Beginner’s Guide and Top Deals sections!

What are the most important benefits to a card for you?