This Week: Fireworks in Travel Credit Cards

We took the Fourth of July weekend off to celebrate the holiday with family in beautiful Williamsburg, Virginia. . .you’ll be seeing a trip report soon detailing our adventures.  Lots to catch up on, starting with major credit card news.

American Express made some major changes to its premium Platinum Card, one of our favorites for accumulating valuable Membership Rewards points.  The headline news was an increase in the annual fee from $550 to $695.  But the back story is more compelling. . .Amex added over $900 in annual benefits that dwarf the $145 fee increase, and, for some, make this card the best value proposition available.  Here are the new benefits, available now for new and existing Platinum cardholders:

• $179 annual credit for CLEAR membership fees, enough to offset CLEAR’s annual individual fee. For more info about CLEAR’s timesaving benefits, check out our blog post here.
• $300 in monthly credits (at $25 per month) for Equinox, a national fitness center. Equinox locations seem to be concentrated in major metro areas (none in Ohio, for example), but you can purchase an online subscription for home workouts for about $40 per month.
• $240 in monthly credits (at $20 per month) for select entertainment and news providers. This credit is limited to only four providers:  Sirius XM, the Peacock Network, the New York Times and Audible.
• A $200 annual credit for prepaid hotel stays booked through Amex’s travel site, good for Fine Hotels + Resorts or The Hotel Collection bookings. These include some terrific hotels all over the world and could cut your lodging cost for a weekend trip in half or better.

If you only max out one of these four new credit opportunities, the savings would more than offset the annual fee increase.  Adding these to the existing benefits, none of which were dropped or reduced, the Platinum Card now offers over $1,500 in annual credits plus several other perks, like airport lounge access, that could be worth hundreds of dollars to frequent travelers.

To top it all off, the welcome offer for new cardholders includes a sign-up bonus of 100K Membership Rewards points if you charge $6,000 to the card in the first six months, plus 10X points for US restaurants and small business spend for your first six months, up to $25,000 in charges to the card.  We think most new cardholders could accumulate 200K to 300K points in their first six months. . . those points have a value of between $2,000 and $6,000, depending on how they’re used.

Of course, your mileage may vary, or YMMV in today’s acronym parlance.  It’s very important that you can take advantage of enough benefits for any card for which you apply, and even more important for one that carries an annual fee of nearly $700.  The guys over at FrequentMiler.com are tremendous at travel analytics (travelytics?); here’s a link to their guide to valuing benefits, including a spreadsheet for your personal calculation.

We all know that major changes like these cause a reaction from the competition, although, unlike in physics, it’s not always equal and opposite.  Rumors are swirling that Chase will be making some changes to its Sapphire Preferred and Sapphire Reserve cards, primarily in the area of earnings multiples for dining, travel and streaming service charges.  Our favorite of these two, the Sapphire Preferred card, may also get a $50 annual hotel credit for bookings through the Chase travel portal and a 10% anniversary bonus for all points earned each year.  Chase has confirmed that changes are coming, but hasn’t yet disclosed the details.  They’ve also been tightlipped about whether there will be changes to the annual fees for these cards. . .unlike gravity, those fee changes always seem to go up, not down.  (For those keeping score, that’s two physics references in this paragraph.)  We’ll keep you up to speed when these changes are finalized.

So what’s Citi doing with their premium Prestige Card ($495 annual fee), which we’ve held for several years?  In a surprise move, they’re not accepting any new applications for the card, seemingly giving up on competing in the premium market.  That’s too bad, because for some (like us), there’s good value in the card’s $250 annual travel credit, free fourth night hotel benefit, 1.25 cents per point redemption rate for travel booked through their website and many other great perks.  Existing cardholders will still be able to take advantage of all of this, since the card will live on. . .for now.

Which brings us to the last of the big four credit card issuers, Capital One.  They made a big splash a few months ago when they revamped their flagship Venture card, offering 2X earnings on everything and a 100k sign-up bonus.  We liked this card a little more with those changes, but the sign-up bonus required a hefty $20K spend over twelve months and their travel partner list is second rate compared to Amex and Chase.  Now we’re hearing the story of how they unilaterally cancelled one cardholder’s account without explanation just a couple of months after approving his application.  Worse yet, they took his 60K earned miles and applied them against his existing balance at a half cent per mile; half of their published value.  You can read all the gory details in this post, because the aggrieved cardholder is Greg Davis-Kean, founder of FrequentMiler.com.

We’ve never been big fans of Capital One for several reasons, including personal experience.  But this is over the top. . .in our opinion, it’s unfair, unethical and, in some states, it might be illegal.  We’ve never heard of this kind of outcome. . .with no notice and no explanation. . .from any other card issuer.  You’re not going to see any Capital One recommendations from us for the foreseeable future.

Los Angeles sunset.  Photo by Nathan Dumlao on Unsplash

We saw a ton of articles over the last couple of weeks about great destinations around the world, and thought we’d pass several of them on to you.  Here are the links:

• Romantic destinations
• Grecian getaways
• Great travel deals through Costco
• The 50 best travel films of all time 
• 51 things to do in Europe
• The coolest US hotels opening this summer
• The best overwater bungalows in the world
• Exploring Appalachia

Last, but certainly not least, is this summary of current Covid-19 restrictions from around the world.

That’s a wrap for this week. . .hope you have a great weekend, whether you’re at home or on the road.

Ducks on the pond, Williamsburg, Virginia.