Travel Isn’t Free (So Pick Up a Little Extra Spending Cash)

Link: Barclaycard Arrival PlusTM World Elite MasterCard®

Travel is not free, even with miles and points. Even when you’re booking award tickets and reward nights, you’re still going to spend money for taxes on the ticket. If it’s an international ticket, the taxes will be significant. If it’s an international ticket using miles from a non-US frequent flyer program, the taxes and fees will almost cetainly be really significant.

Just last week a reader tweeted me for verification on taxes, she was using British Airways points to fly from the US to Barbados and was shocked that (for her family of 5…) taxes were over $100 per person. That’s not free.

There’s local transportation, you likely spend more on food when you’re away than when you are home, and do more activities too (though personally I find myself saving money on things I don’t do while I’m away – I don’t generate nearly as much dry cleaning).

There are three reasons why you would want to consider a cash back or rebate type of credit card.

  1. You can pick up extra cash to help cover the expenses of travel with a good cash back credit card, and arguably the best (with a big signup bonus too) is the Barclaycard Arrival PlusTM World Elite MasterCard®.

  2. I’m a big advocate of miles and points earning. But when you put spending on a credit card that doesn’t help you earn any bonuses, just gets you one point per dollar, you’re effectively buying miles at two cents apiece. Cash back may be better.

  3. And if you travel so much, or generate so much credit card spending, that you have more miles than you’ll realistically use in the near-term (before the miles devalue), cash back may be better.

And of course if you’re not going to be using your points for premium cabin international travel, getting cash towards travel may be a better deal especially since you won’t have to worry about capacity controls and can pick the flights you want and even earn miles flying them.

You may even be better off getting 2% of more cash back and using the cash to buy miles when there’s a sale (and they’re available at less than two cents, like you can regularly get US Airways and Avianca miles for).

The Barclaycard Arrival PlusTM World Elite MasterCard® gives you 40,000 points after 31000 in purchases within 90 days. That’s worth $400 towards travel. And the card gives you 10% of your points spent on travel back, so another $40 or effectively a $440 signup bonus.

“Travel” is airlines, hotels, cruises, train, and car rentals. So this covers the extra expense for a car on your trip.

Or use the points for an airline ticket you’d buy anyway, saving yourself the cash for spending money on your trip. (Or use the points to buy someone else’s ticket, and have them give you the cash.)

This is effectively a 2.2% cash back card, since the card earns 2 “miles” per dollar with each point worth a penny towards travel plus 10% rebated as well. That’s the highest cash back return for all spending across the board of any card I know of.

It has a $0 annual fee the first year, $89 thereafter, has no foreign currency transaction fees, and gives you complimentary TripIt Pro membership (normally costs $49).

(The Barclaycard Arrival PlusTM World Elite MasterCard® provides referral credit to me if you are approved after applying through the links in this post. I greatly appreciate it when you do choose to use them. Of course I always want to share the best available offers no matter what, so several links aren’t mine as I’ve found better offers elsewhere and share those with you instead.)

    You can join the 30,000+ people who see these deals and analysis every day — sign up to receive posts by email (just one e-mail per day) or subscribe to the RSS feed. It’s free. Don’t miss out!

About Gary Leff

Gary Leff is one of the foremost experts in the field of miles, points, and frequent business travel - a topic he has covered since 2002. Co-founder of frequent flyer community, emcee of the Freddie Awards, and named one of the "World's Top Travel Experts" by Conde' Nast Traveler (2010-Present) Gary has been a guest on most major news media, profiled in several top print publications, and published broadly on the topic of consumer loyalty. More About Gary »

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  1. @Bob – Really tired of people like you. Obtaining credit card signup bonuses is the easiest and fastest way for people to accumulate the currencies needed to travel cheaply. If you don’t like that, then find another hobby.

  2. You can get a completely free ticket (at least inside Europe) with Lufthansa Miles and More – they will let you pay the gov’t taxes/fees in miles, which can be pretty significant in Europe. This is best used with their discounted award specials. For example, you will often find an intra-Europe roundtrip to Berlin special for 15K miles + taxes. Depending on your departure airport, those taxes could be 100 euro or more. LH will let you book the flight completely free for 30K miles. It is not a great deal, but if you have buckets of LH miles it might work for you. I also don’t know if it works for their intercontinental flights. For example, they have run several NYC->Germany promos for only 38K miles roundtrip in the past.

  3. @Jonathan – we’ve all heard about the Arrival card, and pretty much every other card out there, a thousand times. Just because something’s a good deal doesn’t mean I need to hear about it 20 times a week.

    Doesn’t matter whether it’s a credit card link (affiliate or not) or something else — repetitive posts on the same ‘deal’ crowd out more interesting and useful content. I don’t subscribe to bloggers for credit card posts. I simply have to tolerate them to read the other stuff.

  4. @gbert – You don’t “have to tolerate” anything. You can choose not to follow particular bloggers if occasional posts bother you. I certainly do not mind the credit card mentions and gladly use the referral links provided by the bloggers I enjoy and learn from.

  5. One word of caution. Barclays seems to be a bit picky about approving credit cards these days. If you already have their other cards (US Airways, NFL) you might want to take a pass on this one for now. My wife and I have both cards (NFL cards acquired for the cash rebate last spring) and we were rejected for the Arrival card last month. Barclays said we had recently applied for too many credit cards. Just this month, I got instantly approved for another AMEX card and my wife got instantly approved for a new Chase card, so it would appear that Barclays is being tougher.

    BTW, has anyone asked them to “reconsider” after being rejected? Would it be OK if you waited a couple weeks before calling? I wouldn’t mind getting the free cash. 🙂

  6. Are we just going to ignore the opportunity cost of using a points earning card for these types of purchases? For example, I get 3x MR points for booking airlines, so why on Earth would I use a cash back card that gives me something we all value less?

  7. @Tim see the specific scenarios under which I suggest this could make sense — you have so many points that their value at the margin is low, you are using spend towards the cash signup bonus, you’re doing unbonused spending. Not ignoring at all in fact I thought I was pretty clear on this….

  8. Some on FT report buying a refundable ticket, getting the cashback, plans change and they refund the ticket.

    Gary- I wish you would cull the constant stream of posters whining about your referral links. These are making reading the comments less pleasant, and add nothing. You don’t need to be SO nice… 🙂

  9. @James – it would be a shame to filter bloggers as I enjoy many of the posts that each provide. Subscribing to Boardingarea there is no way to filter them, at least not that I have found. The rate at which posts come can be over whelming. The entire front page turns over so fast that it is easy to miss good posts. I would rather see fewer repeat blogs on credit card deals (some songs can be sung too often). I do appreciate posts letting me know when new offers exist, or reviews of how to make the most of them. I do regret that in the last year or two that I have been following boarding areas there has been a progressive shift to touting airline or hotel products over more critical review articles.

  10. @iahphx – I called the reconsideration line two days after being rejected for the same reason. They asked me why I wanted the card, looked at my credit score and payment history (over 800 and I pay all cc balances every month), then asked if I was willing to half my USAir credit (I was happy to do it since I use it very little anyway).

    I received approval over the phone and received the card within 2 weeks … with my USAir credit line in tact. Go figure!

  11. I don’t get the logic of people who follow Gary and then bash him when he posts affiliate links. He is principled and is offering the best deal he can find. You can take it or not. Sign up through his link or not.

    On a semi-related note, Gary, do you know if you can manufacture spend on a new card by making payments to friends who use Square or one of the credit card receiver apps? I’ve never seen this question asked but I need to make a few large purchases for friends on some upcoming trips and they asked me if they could make credit card payments and I didn’t know if it would count towards their mandatory spend?

  12. @Michael – square shuts down accounts pretty quickly, and you can have cash frozen for awhile, plus you’re paying the merchant fees on the square transaction so it’s both inefficient and risky.

  13. I am not the kind of reader who hates referral links. I click them and follow wherever I get the best offer (public or blog). But IMHO this blog has lot of unique conent. I just wish the credit card stories would be separated by the other stuff, 99.99 % which I like.
    In some way, this is being victim of your own success. You showed people the potential to earn through referral links and now every Tom, Dick and Harry wants to write a blog. Yeah, we have all heard stories. They start with “For the love of flying” and then soon it’s cut and paste from Premier blogs, FT and Milepoint. Oh the “Hat Tips”
    Not hating it, just some constructive criticism.

  14. The affiliate “whiners” are bad enough. The worse part is that others get on the W’s, and then the W’s feel the need to respond…ad nauseum.

    …ending up with about 1/3 of the comments really having any value.

  15. @StargoldUA, ” You showed people the potential to earn through referral links and now every Tom, Dick and Harry wants to write a blog.”
    Gary was relatively late to the referral game…. Are you fairly new to this?

  16. I’ve frequently seen bloggers who travel almost exclusively in premium cabins suggest cash back cards are good for economy flyers. I think they don’t fully study the dynamics of points and miles activity for economy flyers when they say this. I would say that beyond the signup bonus the card is of little value to me as a person who almost always flies economy.

    The first reason is that much of my spend is to meet enrollment bonuses, which is a far more lucrative thing than 2 cents cash back. Second, all my spend on most important categories – gas, groceries, dining, travel, office supplies – goes on cards that offer bonuses in those categories that bring the value over 2 cents. Third, my other cards are more valuable to keep beyond the first year, because they offer additional perks in addition to the miles per dollar spent – priority boarding, lounge access, companion pass, free bags, free hotel nights, etc. Fourth is the combinability of points earned from airline/hotel card spend with myriad other ways of earning points in those programs to reach awards quickly, compared to the fact that cash back cards build to a worthwhile reward very slowly all by themselves. Fifth, canceling most miles and points cards to avoid an annual fee does not end your participation in the related loyalty program as in the case of a cash back card. Sixth, bloggers don’t take into account their own excellent contributions in helping people understand how to maximize values of miles and points. I seldom redeem an air award that is worth less than 2 cents per mile, and often it is much more than that.

    So if I get a card like the Barclay’s Arrival, it is only for the enrollment bonus – and, in fact, I will consider it for that very purpose. There would be little spend I would put on it, and no reason to pay an annual fee to renew it. I think this card could work on an ongoing basis for a very big spender or for someone who simply has too many miles and points to know what to do with them – which is not the profile of the engaged points and miles economy traveler.

  17. Ms. M —

    Thanks for the suggestion about calling the reconsideration line. I did so. The rep said I had “too many” previous credit inquires in the past year (he said 15). So no dice. Oh, well. I’m glad the other credit card companies are happy to keep giving me cards. I suspect others reading this may run into the same problem with Barclays.

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