The right hotel or travel rewards credit card is different from one person to the next. These tips can help you find the best card deal to suit your needs.
Choose a rewards scheme
Research which loyalty scheme is likely to suit you, and your family, best, in terms of the hotels you book most frequently, or the other travel rewards you’re likely to want to access.
Before you apply for a credit card affiliated to a particular hotel chain or rewards programme, take some time to check out the partner brands it works with and also how much the points are worth. Some schemes are more generous than others, so you don’t have to spend as much on your credit card before you can access the benefits and redeem the points.
Scout for a welcome bonus
You may be attracted to a hotel or rewards credit card offering a generous welcome bonus in the form of additional points. However, be aware that most welcome bonuses come with conditions, such as a minimum card spend in the first few months. While the bonus points can be an attractive prospect, don’t be tempted to spend more on the card than you would normally, just to earn the extra rewards.
If you can’t pay the card balance off in full you’ll be paying high interest on your spending, which could wipe out any reward points you’ve earned.
Check for ongoing rewards rate
The earning rates on hotel or rewards credit cards might look high, but the value of different loyalty schemes will vary widely. Consider the cash value of your points before committing to a scheme.
That said, there are some great deals to be found, especially if you’re earning points, and bonus points, on regular spending you’d be doing anyway. Plus, if you can repay your card balance in full each month so you’re not paying any interest, then you’ll further boost the value of your reward points.
Compare fees and charges
Hotel credit cards and rewards credit cards can offer generous loyalty and points schemes, but they are notorious for high annual fees and rates of interest on borrowing. That’s why these cards won’t usually suit borrowers who are likely to hold a balance for a long time on the card. High rates of interest are likely to eat into any savings you’re making through using your rewards points.
For credit cards with high annual fees, you’ll need to be sure you’re spending enough on the card and earning sufficient reward points to outweigh the fee. This might involve a bit of number crunching looking at your typical annual card spend and the savings you’re likely to make by using the rewards scheme for hotel and holiday bookings, for example.
