New Top 5 No Annual Fee Card Launched With Rich Benefits

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PenFed Credit Union has just launched its own new travel rewards-focused card: the PenFed Pathfinder Rewards American Express® Card.

PenFed has a suite of interesting and underappreciated products. For instance the PenFed Promise Visa has no fees. There’s no late fees, balance transfer fees, cash advance fees, foreign transaction fees or even penalty APR. It’s not my bag because I don’t generate fees (other than annual fees) on cards generally anyway and I’m more focused on rewards. Though of course PenFed’s Platinum Reward Visa Signature earns 5x on gas.

Here we’ve got a no annual fee card with travel rewards and protections and it’s an American Express, we haven’t seen many new cards issued by third parties using the American Express network but perhaps in this case the merchant fees in the Amex system can help cover some of the benefits.

Here are the card’s earning and other key details.

And here are the protections as well as what counts as travel spend. I inquired further with PenFed and it turns out that there is also trip delay coverage. A delay must be for at least 6 hours, and reimbursement is up to just $200 and only allowable three times per year.

This card is benefits-rich versus being the best for spend, though it’s reasonably strong there too for a no annual fee card.

There’s a $100 annual travel credit that will work for checked bag fees, upgrades, or other air travel fees. Since it posts automatically and isn’t something that must be requested we’ll see in practice just how generous it is (e.g. smaller denomination gift cards or not, purchase of miles from an airline who processes transactions themselves).

I only know of one card for instance that even has a $0 annual fee the first year which offers a $100 Global Entry credit, that’s the SunTrust Travel Rewards Credit Card. Although it’s a bit strange to offer the benefit only once every 5 years. It’s true that Global Entry lasts that long, but you’ll want to renew before it expires.

The earn-burn relationship though is average. The card seems to replace the PenFed Premium Travel Rewards American Express Card which earned five points on airfare spend. The value you’re going to get is sensitive as well to how much each point is worth.

  • You can use points for gift cards or merchandise at 0.85 cents a point, which is disappointing (that they don’t give you one cent a point especially since they’re not going to be paying full retail for the gift cards).

  • Travel redemption values vary “depending on the availability of inventory” with an “average of 1.18 for travel” they further suggest “saying as much as 1.25 is correct; we have seen it even higher than that.”

At 4x and average travel redemptions of 1.18 cents per point you’re getting a 4.72% rebate, which is good but hardly the best you’ll do in the category. Overall between benefits and earn this may be a top 5 no annual fee rewards card however.

I think the The Blue Business℠ Plus Credit Card from American Express offers the most rewards for spending on a no fee card, 2 points per dollar on your first $50,000 in purchases each year and those are Membership Rewards points that transfer to a variety of airline miles programs.

Perhaps the best comparison for this product will be the new Uber Visa which has cell phone protection, a rebate on Netflix or Spotify, and offers 4% back at restaurants and UberEATS; 3% back on airfare, hotels, travel agencies, and Airbnb; and 2% back for online purchases and Uber.

You have to be a member of PenFed to apply, and you can join if you’re a current or former member of the military or if you join the National Military Family Association or Voices For Troops — each costing $17.

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 InsideFlyer.com, 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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Comments

  1. With regards to no-annual fee cards this is very similar to the First National Bank TravElite American Express card except for the 4X points on travel earning rate for military or certain checking account customers.

    FNBO also offer $100 annual travel fund and $100 Global Entry credit (not pre-check) and 3X on travel and 1.5X on everything else and no foreign transaction fee. It has automatically credited me for in-flight meals/drinks on Alaska and Southwest, but not for Early Bird Check-in on Southwest.

    But it seems that the FNBO card which was open for applications mid-last year is now offered by targeted mail invitation only.

  2. Regarding the blue business plus American Express card: I just followed the various links and wound out at an American Express website which declares:
    “The following Cards are not eligible to transfer points:
    American Express® Platinum Credit Card
    BLUE FOR BUSINESS credit card
    Blue for Students®
    Some Blue from American Express Cards
    Business Management Account
    Gold Optima® Card
    Optima® Credit Card
    Optima® Platinum Card®
    Platinum Business Credit Card®
    ZYNC® Card”
    So I do not understand how I could use this card’s rewards to transfer to an airline program. Help anyone?

  3. @Kay – Really ….Thats very basic question for VftW.
    Id say google… But heres a hint — Get one of the cards that do transfer (Everyday for example – even with 0 AF) and all your MR points are transferrable regardless of their origin

  4. Thank you, just looking, for your kind help. I understood Gary to say that points from this particular card (blue for business) were transferable to various airline programs. Did I misquote Gary? In any case I did follow up on this through American Express which indicated that points are earned from that specific card are not transferable. As for having more than one American Express card, I find I can pay almost nothing with an AE card as opposed to Visa or MasterCard. Certainly cannot pay my homeowners/auto/business premiums. Cannot pay utility bills. My chiropractor does not take AE. Even Costco no longer accepts American Express. So, if I understand you correctly to make this work I would need to have 2 American Express cards each of which is next to useless to me. Hmmm…

  5. That’s right Kay. But where is the harm in carrying two. Both have 0 af. Blue for earn everyday for burn (transfer).
    I assume Gary assumes that most people have > 2 Amex (more like many more)

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