Premium Credit Cards That Are Worth It For A Frugal Consumer

Premium Credit Cards That Are Worth It For A Frugal Consumer

Premium credit cards come with many perks and are a great way to save money. However, the best credit card will depend on your spending habits. With annual fees ranging from $69 to $695, which are worth it for a frugal consumer?

It is important to evaluate the annual fee, whether it’s worth the additional benefits, and how it affects you.

This article will discuss the benefits of these credit cards and how to recoup annual fees. By the end, you’ll be able to decide if they’re right for you!

Net Positive Value of a Premium Card

The age-old question of whether a credit card is worth it is dependent on a myriad of factors. Will you recoup the yearly charge cost through perks and incentives and receive greater value than the annual fee? And does it meets the four criteria specified below:

  • Easy to use yearly perks or benefits to offset the annual fee.
  • No foreign transaction fees.
  • Some travel protection and insurance.
  • $89-$149 annual fee.

The annual fee requirement is capped at $149 because anything above requires spending that might not fit into a frugal lifestyle. For example, the American Express Gold card offers a $120 dining credit and $120 Uber cash. These credits can cause you to spend money you otherwise wouldn’t want, which is not always conducive to a frugal lifestyle. Without further ado, here are the credit cards for a frugal person.

Credit Cards

We’ll look at some plain mid-tier travel credit cards in this category recommended for average users looking for extra benefits and travel perks from their credit cards.

The Chase Sapphire Preferred, Citi Premier Card,Bank of America Premium Reward

Chase Sapphire Preferred

Chase Sapphire Preferred is the undisputed king of mid-tier travel credit cards. It comes with a sign-up bonus of 80,000 points after spending $4,000 in the first three months and an annual fee of $95. In addition, you’ll receive trip Insurance, auto rental collision damage waiver, purchase protection, and a slew of other benefits.

Highlights:
  • Earn 5x total points on travel purchased through Chase Ultimate Rewards.
  • Earn 3x points on dining, online grocery purchases, and select streaming services.
  • 2x on other travel purchases.
  • Earn 1 point per dollar spent on all other purchases.
  • Points are worth 25% more using Pay Yourself Back option.
  • $50 in hotel statement credits through Chase portal.
  • Each year you renew your card, you will receive a 10% bonus in anniversary points..

How to offset the annual fee: The $50 hotel credit reduces the annual cost to $45. If you spend a minimum $5,000, you will earn approximately $113 in pure cash back on your account, quickly covering the yearly fee. However, CSP shines in its ability to transfer points to partners, which can multiply your points by 2x-2.5x.

Citi Premier Card

I would have suggested The Citi Premier card over CSP if it had not been for its high sign-up bonus and additional perks. New cardholders can earn 60,000 points after spending $4,000 in the first three months. However, where it shines over CSP is that the $95 annual fee is waived the first year and the 24 months to a manufacturer’s warranty. Nonetheless, the lack of trip cancellation Insurance and Auto Rental CDW makes it a less than ideal choice compared to CSP.

Highlights:
  • $100 off a single hotel stay of $500 or more, excluding taxes and fees
  • Earn 3X points on restaurants, supermarkets, gas stations, air travel and hotels.
  • 1X on all other purchases.
  • Extended 24 months to a manufacturer’s warranty.

How to offset the annual fee: You get reimbursed for retaining this card if you only utilize the hotel perk once a year. If you spend around $5,000 on gasoline, food, and dining out, you’ll receive 15,000 ThankYou Points worth about $150 in cash. That can be another option to offset the annual fee.

Bank of America Premium Reward

The Bank of America Premium Rewards is another mid-level card between CSP and Citi Premier in terms of status. Consider this credit card if you are married to their banking system and are searching for a Bank of America travel credit card. New cardholders can also earn 50,000 points after spending $3,000 in the first three months. And it does offer travel protection and auto insurance which makes it a contender with the Citi Premier. However, $100 airline incidentals credits are not as simple to utilize as they appear.

Highlights:
  • Earn 2 points for every $1 spent on travel and dining purchases
  • 1.5 points per $1 on all other purchases
  • There is a $100 credit for the Global Entry or TSA Precheck application fee every four years.
  • For qualifying purchases like seat upgrades, baggage fees, in-flight services and airport lounges, you may earn airline incidental statement credits of up to $100.
  • Trip cancellation and interruption insurance & delay reimbursement.

How to offset the annual fee: If you can use your incidental credit, you might be able to recuperate the $100 annual cost. You’ll get 9000 points or $90 if you spend about $3000 travel and dinner combined and $2000 for everything else. Based on that, this might be a slightly negative net card but still worth considering.

Worth checking out but not net positive card:

  •  Capital One Venture – With an annual fee of $95, Capital One Venture competes closely with Chase Sapphire Preferred. It offers a credit of up to $100 for the Global Entry or TSA PreCheck programs, which CSP does not. However, it is once every four years. Since there are no other noteworthy perks to offset the annual fee, I would count this as a net negative card.

Hotel Cards

If you are the kind of person who enjoys a weekend road trip or two, you can take advantage of these premium hotel cards. The two main things I will be focusing on:

  • Annual free night certificate to offset the annual fee.
  • Elite status with the hotel chain can lead to complimentary breakfast during your stay and room upgrades when available.

World of Hyatt Credit Card

One of the most sought-after hotel credit cards is the World of Hyatt credit card. It offers one free night at any category 1-4 Hyatt hotel or resort every year after your cardmember anniversary. These hotels’ price range per night ranges from $100 to $500, a fantastic return. The card has a $95 annual fee and gives you 30,000 bonus points for spending $3,000 within three months of opening the account. If you want a premium credit card and a hotel loyalty card, World of Hyatt is a must-have.

Highlights:
  • Complimentary World of Hyatt Discoverist status ( bottled water, premium internet, room upgrade, etc.)
  • 4 bonus points per $1 spent with your card at Hyatt hotels.
  • 2 points per $1 spent on dining at restaurants, cafes and coffee shops; airline tickets purchased through the airline; fitness club and gym memberships; and local transit and commuting.
  • 1 point per dollar spent on all other purchases.
  • Includes travel protection such as: auto rental CDW, travel accident insurance, baggage delay insurance, trip cancellation/interruption insurance and more.

How to offset the annual fee: The annual fee of $100 can be easily negated using the annual free certificate. You’ll also get an additional free night at a Hyatt hotel or resort if you spend $15,000 in one year.

Marriott Bonvoy Boundless

Marriott Bonvoy Boundless is the premium credit card worth having for any Marriott loyalist. The card has a $95 annual fee, but it comes with a free night certificate that can be used to offset the annual fee right away. You will earn 3 free night awards for a sign-up bonus after spending $3,000 on purchases from your account opening in your first 3 months.

Highlights:
  • Automatic Silver elite status gives (10% bonus points on stays, late checkout, etc.)
  • Earn 6 Marriott Bonvoy points per dollar spent on Marriott purchases.
  • Earn 3x points for every $1 on the first $6,000 spent in combined purchases each year on grocery stores, gas stations, and dining.
  • 2x Marriott Bonvoy points on all other purchases spent.
  • Includes travel protection such as: Auto Rental CDW, travel accident insurance, baggage delay insurance, trip cancellation/interruption insurance and more.

How to offset the annual fee: The annual fee of $100 can be easily recouped using the free night certificate via Marriot’s website. Also, the multipliers are good enough to make this card your everyday primary or secondary card.

IHG Rewards Premier Credit Card

The IHG Rewards Premier Credit Card offers a solid alternative to the Marriott Bonvoy and World of Hyatt credit cards. It has a $99 annual fee and earns 140,000 bonus points (2022 bonus) after you spend $3,000 on purchases in the first 3 months from account opening. It comes with a free Global Entry/TSA perk and a fourth reward night, making it a true travel and hotel loyalty card.

Highlights:
  • IHG Rewards Club Platinum Elite status.
  • Up to $50 United Airlines TravelBank Cash each year.
  • Anniversary free night with a current point redemption cap of 40,000 points.
  • 4th reward night free on award stays.
  • When you book and stay at an IHG hotel, you may earn up to 26 points total for each $1 spent.
  • You’ll earn 5 points for every $1 spent on travel, gasoline stations, and restaurants.
  • Global Entry, TSA PreCheck or NEXUS Statement credit of up to $100 every 4 years.

How to offset the annual fee: It is easy to offset the annual fee of $99 if you utilize the $50 United TravelBank and redeem the free anniversary night perk. In addition, if you use the Global Entry and TSA Precheck benefits, this card has a great return value.

Worth checking out but not net positive cards:

  • Hilton Honors Surpass Credit Card – Free Weekend night reward from after you spend $15,000, which not feasible for most people. However, it is well known card among Hilton loyalist.
  • Radisson Rewards Premier Visa Signature Card – 40,000 renewal points each year, which is good for a free night but no other travel protection

Airline Credit Cards

Flying can be expensive, and whether you’re flying for leisure or for work, chances are you’ll end up spending some money along the way. But with airline credit cards, you can make the most of your travel expenses and stay frugal at the same time. Many airlines already have no annual fee credit cards, which comes with little to no benefit. Therefore, getting a card with an affordable annual fee and added perks will make the card work for you.

JetBlue Plus Card

If you’re a frequent traveler, the JetBlue Plus Card is a must-have in your wallet! This card offers great benefits, like free seat changes and priority boarding, so you can breeze through your travel experience. In addition, the JetBlue Plus Card comes with a range of additional benefits that make it an excellent choice for travelers on the go.

Highlights:
  • Earn 60,000 bonus points after spending $1,000 and paying the annual fee.
  • Earn 6X points on eligible JetBlue purchases 2X points at restaurants and eligible grocery stores and 1X points on all other purchases.
  • Free first checked bag, up to 3 companions on the same reservation.
  • 5,000 ($65 award flights value) bonus points every year after your account anniversary.
  • When you use your JetBlue Plus Card to purchase a $100 or more JetBlue Vacations package, you’ll receive a $100 statement credit.
  • World Elite Mastercard benefits: DoorDash, Lyft, Shoprunner, Mastercard ID Theft Protection, etc.

How to offset the annual fee: If you fly more than twice on JetBlue and check luggage, the card will pay for itself. In addition, the 5,000 anniversary points and the $100 credit for JetBlue Vacations package benefits makes this card great for a frugal flyer.

United Explorer Card

Looking for an airline focused that can also double as your travel card and everyday card? You should consider the United Explorer Card. In addition to earning miles on your regular purchases, you can also earn 2 United Club one-time passes ($59 value) per year and up to $100 Global Entry, TSA PreCheck or NEXUS fee credit.

Highlights:
  • 70,000 miles sign up bonus with $0 intro annual fee for the first year, then $95.
  • After spending $6,000 on purchases in the first six months, you’ll get an extra 10,000 bonus miles
  • Free first checked bag for you and a companion.
  • 2 United Club one-time passes per year.
  • 2x miles on United purchases, 2x miles on dining and hotel, and 1x mile on all other purchases.
  • Travel and purchase protection such as: auto rental CDW, travel accident insurance, baggage delay insurance, trip cancellation/interruption insurance, extended warranty protection
    and more.

How to offset the annual fee: The United Club passes alone helps you recoup the annual fee. However, the additional checked bag perks, Global Entry/TSA PreCheck credit, and the many protections provided by this card make it a very competitive card.

Southwest Rapid Rewards Priority Credit Card

Don’t be put off by the steep annual charge of $149. The 7,500 anniversary points and $75 Southwest yearly travel credit can easily make up for it. Southwest Rapid Rewards is the perfect credit card for travelers who value convenience and speed. From free travel insurance to unbeatable rewards rates on flights, you’ll be able to maximize your travel experience time and time again.

Highlights: 
  • Earn 40,000 points after you spend $1,000 on purchases in the first 3 months from account opening ( not the best intro bonus, they had better offer).
  • $75 Southwest annual travel credit.
  • 7,500 anniversary points.
  • 4 Upgraded boardings per yearWhen available.
  • 3 points per dollar spent on Southwest purchases. 2 points per dollar spent on Rapid Rewards hotel and car rental purchase, local transit and commuting, internet, cable, phone services and select streaming. 1 point per dollar spent on all other purchases.
  • Travel and purchase protection such as: auto rental CDW, travel accident insurance, baggage delay insurance, trip cancellation/interruption insurance, extended warranty protection
    and more.

How to offset the annual fee: You’ll earn a $75 Southwest travel credit just for having the card, which you may spend toward flights. You will also receive 7500 anniversary points each year, which will cover the $149 annual charge.

Worth checking out but not net positive cards:

  • Delta SkyMiles Gold American Express Card ($99 AF) – Depending on how many delta flights you take, first checked bag and priority boarding may make sense. The $100 credit after spending $10,000 is hardly an appealing choice for frugal travelers.
  • Frontier Airlines World Mastercard ($89 AF) – If flying on a shoestring budget is your thing, this card is for you. The offer of a $100 flight voucher every anniversary after spending $2,500 is more appealing than Delta’s. Family pooling and priority boarding can come in handy for short domestic flights.

None of the American Airlines credit cards were enticing in terms of providing benefits that cancel out the annual fee, except for the free checked bag.

When you choose to apply for a premium credit card, what you’re looking for is the ability to reap these benefits over a period of time. Although the annual fee may seem high when you’re first looking at the card, you have to consider its usefulness throughout the year.The primary benefit of these cards is in their rewards program. You’ll often get increased rewards on purchases that you’re already making.

I hope you have found this article helpful and provided some valuable insight on how you can find a credit card worth keeping.

Featured image via Clay Banks & bharath/ Unspalsh 

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