Driving in the mountains

Travel credit cards are good for lots of reasons. Some popular benefits are Global Entry fee reimbursement, trip delay reimbursement, and rental car coverage. One of my favorite benefits of luxury travel credit cards is the travel credit. Depending on the credit card, this credit may have stringent redemption criteria or it can be almost as good as cash.

True Value of Travel Credit

The main reason I like the travel credit benefit is because it helps “reduce” the cost of a high annual fee. Most of the cards with the best perks and sign-up bonuses come with a hefty annual fee. While the fee can be as high as $450, if you receive a $300 travel credit, it can help rationalize your decision to keep the card. When I think about travel credit in this manner, I never count my travel purchases as “free”, it’s merely a way to recoup money spent on the annual fee.

The deal gets even sweeter with travel credit that can be redeemed once per calendar year. In these instances, you can “double dip” on the travel credit. This means you have the opportunity to use the credit twice before the annual fee is due for the first time. In the case of Chase Sapphire Reserve, double dipping on the travel credit more than covers the $450 annual fee…you actually net $150 in pure travel credit! Depending on your timing, you may even be able to triple dip.

Credit Cards with Travel Credit

The following credit cards offer a travel credit benefit. Here’s the breakdown of the travel credit rules and restrictions for all the credit cards currently offering this benefit.

Chase Sapphire Reserve
chase-sapphire-reserve-travel-credit
You can make up the $300 with small purchases or spend $300+ to receive the credit all at once.

Chase Sapphire Reserve offers the most liberal travel credit as it can be applied to anything that codes as travel. You can use this benefit annually which actually means through the end of your December statement. For example, I already used my 2017 travel credit at the end of December since my statement closed on the 26th. The travel credit statement credit for Chase Sapphire Reserve posts the same day that the qualifying purchase posts. This card has a $450 annual fee.

Chase Ritz-Carlton Rewards

The $300 travel credit for Chase Ritz-Carlton Rewards can be used for the following: airline lounge day pass or yearly membership, seat upgrades, baggage fees, in-flight Wi-Fi or entertainment, or in-flight refreshments. You have to contact J.P. Morgan Priority Services (number on back of card) within 4 billing cycles of the purchase date to get the statement credit. The credit posts within 5-7 business days. This benefit can be used each calendar year. The credit is issued for the calendar year in which the transaction posts. For example, if you buy something on December 31, 2016 but it posts in January 2017, this will count towards the 2017 credit. This card has a $450 annual fee.

Platinum Card from American Express
American Express Travel Credit Tracker
I redeemed half of my 2017 American Express travel credit on a Southwest gift card

The Platinum Card from American Express travel credit is valid toward incidental air travel fees. You must select a qualifying airline that can be changed each year in January. I’ve had success changing the airline via the chat feature on my account. This was prior to actually using any of the $200 credit. The fees need to be charged by the actual airline, not an alliance partner or a third-party vendor. American Express states that the following do not count: airline tickets, upgrades, miles purchases, miles transfer fees, gift cards, duty free purchases, and award tickets. Gift cards do seem to work for the time being. I used my 2016 and 2017 travel credit to purchase 4 $100 Southwest gift cards. The fine print says it can take 2-4 weeks for the statement credit to show up. In my experience it’s more like 2-3 days. You can use this benefit each calendar year. This card has a $450 annual fee.

American Express Enhanced Business Platinum Card

The $200 travel credit for American Express Enhanced Business Platinum card works the same way as the personal Amex Platinum. The main thing to keep in mind when selecting a qualifying airline is that this will be the same airline used for the 50% Airline Bonus benefit. Pick carefully! This card has a $450 annual fee.

Premier Rewards Gold Card from American Express

Again, the travel credit for the Premier Rewards Gold Card from American Express is the same as that of the American Express Platinum card except you only get $100 for fee reimbursements. This card has a $195 annual fee that is waived during the first year.

Citi Prestige

Citi Prestige offers a $250 Air Travel credit. This credit can be used for airfare, baggage fees, lounges access, and some in-flight purchases. The statement credit posts 1-2 billing cycles after purchase. This benefit can be used once per year for purchases on statements from January through the following December. If a pending transaction does not post on the December statement, it will count towards the next year’s credit. This card has a $450 annual fee.

Citi EXPEDIA+ Voyager Card
Global Entry Card
You can use your Expedia travel credit to get Global Entry for free

The EXPEDIA+ Voyager card from Citi offers a $100 benefit that can be used for airline incidental fees. This includes checked bags, in-flight entertainment or refreshments, or in-flight Wi-Fi. However you can only use the travel credit on the following airlines: AirTran, Alaska, American, Delta, Frontier, JetBlue, Southwest, United, US Airways, and Virgin America. The fee also works for purchases with the following wireless hotspot providers: Boingo Wireless and Gogo Inflight Internet. A final method of redemption is for Global Entry or TSA PreCheck fee reimbursement. The statement credit will post on the same statement in which you made the purchase. This card has a $95 annual fee.

MERRILL+ Visa Signature

MERILL+ Visa Signature is a no annual fee credit card that doesn’t have a travel credit as one of its regular benefits. However, if you spend $50,000 or more in a year, you can either choose from a $200 travel credit for travel incidentals or Delta Sky Club lounge membership.

Final Thoughts

The travel credit benefit on luxury travel credit cards can help rationalize spending a lot on the annual fee. Some cards like the American Express Platinum make it more difficult to “get your money back” from the annual fee but there are ways around it (e.g., buying airline gift cards). Other cards like Chase Sapphire Reserve are more flexible with their travel and may be a better pick.

 

 

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