Choosing The Right Travel Credit Card
For some, travel is a desire but in Singapore, travel is as necessary to survival as air and water! Seriously, you need to travel to keep your sanity in Singapore’s demanding work environment because it’s the only way to deal with the oxymoron known as “work-life balance.”
Whether you travel a few times a year or a few times a month, one thing is certain – having the right travel credit card in your wallet can make a big impact on your travel plans, especially when you factor in perks such as cash back, mile points to redeem free flights, discounts, travel privileges and travel insurance.
However, to maximise your perks, you’ll need to choose a credit card that suits your lifestyle, spending habits and frequency of travel.
Here are a few important factors to keep in mind before choosing a credit card for travel:
The sign up bonus
Unlike other credit cards, travel credit card can offer some pretty fantastic sign up offers such as free air miles upon sign up. Sign up bonuses of 30,000 air miles or more are typically good deals to snap up.
After all, the more miles you receive when you sign up for the card, the easier it will be to redeem a free flight. Of course, that depends on which frequent flyer progamme you are a member to. If you are a KrisFlyer member, make sure the credit card allows you to convert the points to Singapore Airlines KrisFlyer miles with a good conversion rate.
It is important to find out how many air miles are needed to redeem a free flight to any number of global destinations for the airline that you are member of.
However, you should always read the fine print regarding bonus air miles. That’s because some credit cards require a spending minimum, for example. S$5,000 in the first month of activation before you can receive your sign up bonus.
How much is a mile worth?
Knowing how many air miles you can receive for every dollar spent is a surefire way to maximise your air miles accumulation. For example, if travel credit card A offers you 1.5 air miles per dollar spent and travel credit card B offers you 1.2 air miles per dollar spent, then obviously A is the better deal.
However, determining whether or not it really is a better deal isn’t always that easy, as there are other factors to consider including:
- How many points you need to accumulate before you can redeem a free flight to your preferred destination?
Different frequent flyer programmes require different number of air miles to redeem for different destinations. For example, you need 20,000 Asia Miles to redeem a round trip ticket from Singapore to Bangkok. The number of miles required depends on the frequent flyer programme.
- Do you get air miles bonuses?
Certain travel credit cards might offer bonus air miles for certain amounts charged. For example, the American Express KrisFlyer Gold Card offers a bonus of 5,000 KrisFlyer miles. Apart from that, it also offers 50% more FrisFlyer miles for accumulated spending above S$5,000 and 50% extra bonus miles for charges above S$12,000.
- Can you multiply your points for certain spending?
Depending on the credit card issuer, there may be bonus points, such as 5X or 10X points for any purchases made at a certain retailers or overseas. Check if the selected retailers are the ones you spend at frequently in order to make the most out of the offer.
If there’s a rule to adhere to when it comes to evaluating how many miles you’ll receive per dollar spent, it’s this – choose a credit card that offers you the most points within your set spending limit. Don’t go overboard with your spending just because you want to chase air miles!
Is the annual fee worth paying?
Travel credit cards tend to have annual fees ranging from S$150 to S$300, depending on the card. However, some credit card issuers will waive your first year’s annual fee, but once that waiver expires, is it worth paying more than S$300 to hold on to that card?
That depends entirely on your spending habits, travel frequency and what you define as “value.” While the thought of paying an annual fee of more than S$300+ for a travel credit card sounds absurd, the high fee isn’t without reason.
That’s because travel credit cards with higher fees tend to accelerate your air miles accumulation, offer good retailer discounts and also free perks such as complimentary hotel stays, VIP airport lounge access and travel insurance.
A simple rule to follow when it comes to determining whether the annual fee is worth paying is this – if you’re actively accumulating points, redeeming flights and taking advantage of the perks, it’s worth the expense.
Curious about what travel credit cards are available to choose from? Then check our credit card comparison page to compare and choose the travel credit card that’s right for you.