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The two best travel rewards cards

Jan 04, 2012 | | Comments Comments Off

The Capital One Venture and Chase Sapphire Preferred are two of the best travel cards on the market, declares comparison site NerdWallet.

Both offer pretty sweet deals. The Venture card has a 2% rewards rate on all purchases, and you don’t have to deal with blackout dates or other typical redemption hassles. Instead, you book your flight or hotel room directly, and use your rewards points to pay for it. The $59 annual fee is waived the first year.

The Sapphire card is offering a 50,000-point signup bonus that can be worth up to $625 of free travel. You can earn a 2% rewards rate on travel and dining purchases and 1% everywhere else. Plus, you get an annual rewards bonus equal to 7% of the points you’ve earned for the year. The annual fee of $95 is waived for the first year.

A notable feature for travels: neither card charges foreign transaction fees, which typically add 3% to the cost of spending abroad (or ordering from foreign companies at home).

I still like my Starwood Amex card–mostly because we’ve been able to wrangle redemption rates of 4%+by using our points to book Hawaiian resort hotel rooms and sleeper-car accommodations on Amtrak. But we recently added a Venture card to our mix for those occasions when a merchant doesn’t accept American Express.

Remember, rewards cards only make sense for those who pay off their balances in full every month, and you need excellent credit scores to score these deals. Also, you shouldn’t apply for new accounts if you expect to get a major loan, such as a car loan or a mortgage refinance, in the next few months. Wait until that deal closes before you seek any more credit.

If you’re trying to pay off credit card balances, and don’t have the good scores needed to get low-rate balance transfer offers you find on NerdWallet and other sites, consider getting a three-year fixed-rate personal loan from a local credit union to help you pay off your debt. FindACreditUnion.com can help you if you’re not already a CU member.

If you’re hoping to improve your scores, check out my book “Your Credit Score,” which recently came out in its fourth edition.

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