Are Travel Credit Cards Still Worth It?

Sep 9, 2020

Today’s guest post comes from personal finance and travel expert Barry Choi. His blog, is one of Canada’s most trusted sources for all things money and travel.

As everyone knows, the outbreak of COVID-19 has grounded most air traffic. While some countries are starting to open up to visitors, there’s no denying that the demand for flights isn’t high.

Most people understand that these travel restrictions are in the best interest of public health, but if you have a travel credit card, you’re probably wondering if it’s worth it anymore? What good is a travel credit card when you can’t travel, right? The decision to keep or swap your credit card really comes down to a few points that require careful consideration.

Am I still getting value out of my card?

Everyone who has a credit card likely has a different definition of value. Credit cards are meant to allow you to make purchases without having to pay for them right away. As long as you pay your bills in full and on time every month, you’ve received an interest-free loan, which is of great value when you think about it.

Admittedly, most people think of tangible benefits or rewards when they think about their credit card value. Paying $699 a year for the American Express Platinum Card likely isn’t worth it if you’re not getting access to your travel benefits such as unlimited lounge access. That said, American Express recently gave cardholders a $250 grocery credit and had double rewards and points promotion, which significantly increased the value of your points.

If you’re usually a frequent traveller, it’s probably a good idea to hang onto your credit card for now if you still find you’re getting value. If not, consider product switching to a no-fee card from the same issuer, so you don’t affect your credit score.

When will be the next time I travel?

Although there’s no vaccine for COVID-19 yet, it’s still worth asking yourself when you plan to travel next? Some people may not travel by plane for a while, but others are more open to taking trips again, whether by ground or air.

Air Canada recently announced that they’ve revamped Aeroplan, so having one of the best Aeroplan credit cards might mean free travel. Alternatively, someone taking a road trip can take advantage of the free annual night certificate that comes with the Marriott Bonvoy Card from American Express.

Most Caribbean countries have now opened to Canadians, and they’re trying their best to get you to head down. I’m not talking just about discounts, Club Med is even offering travel medical insurance for all their guests.

If you end up taking a trip, having a travel credit card can be very important due to the travel insurance benefits that come with it. Your card could include policies such as travel medical, trip cancellation, lost baggage, motel/hotel burglary and car rental insurance. All of these insurance benefits can come in quite handy and are arguably a must when you travel.

That said, it’s crucial to stay up to date with any travel advisories as it may void your credit card travel insurance. Always double check your policy details, and if you’re not 100% confident about your coverage, consider calling a travel insurance provider to see if they offer a better policy.

Are the bonuses worth it?

During the pandemic, many travel credit card providers added bonuses for the cardholders to entice them to stay. Multiple banks allowed people to redeem their points for gift cards and statement credits at a lower rate. This was beneficial to people since the offers increased the value of your points.

There were also quite a few credit card providers who increased the earn rate on grocery, restaurant and food delivery service purchases. These spending categories saw an uptick during the pandemic, so the bonus points provided were an incentive for you to keep your card.

It’s also worth mentioning that many of the best travel credit cards in Canada still come with a welcome bonus worth more than $250. If you’re going to be spending, you might as well take advantage of any bonuses available even if you can’t immediately use your points.

Are you stressed out about your finances?

If COVID-19 has directly affected your finances, it definitely makes sense to cancel or switch your travel card. Before you do that, make sure you cash in any points you have left, so you’re not leaving anything on the table.

You’ll likely still need a credit card, so take a look at some of the best cash back credit cards in Canada. As the name implies, you’ll earn cash back on every purchase, which will help you save money.

You can even be strategic about your cash back credit card. For example, people who regularly shop at Loblaw’s owned stores should have a PC Financial Mastercard as you’ll be able to earn extra PC Optimum points on every purchase. If you combine that with a PC Insiders membership, you could be claiming free groceries and merchandise in no time.

Final thoughts

Suppose you’re taking full advantage of any bonuses that credit card providers are offering or you plan on travelling in the future. In that case, it probably makes sense to hang on to your travel card. For those who plan on holding off on travel for a few years or are running into financial difficulties, switching to a cash back card might make more sense.

Thanks for reading this article on travel credit cards. Still searching for more information? Check out other insurance products that we offer:

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