During my second Thanksgiving holiday in the US, I was shopping at Macy’s department store. When it was time to pay, the store clerk asked if I wanted to apply for the Macy’s credit card to get additional 20% off on my purchase. Delighted and uninformed, I instantly filled out the application and received my promised discount. After a couple of years of not using the credit card, I decided to close the application. Only after several years did I realize I shouldn’t have closed my longest credit record. Also, I mostly made all my purchases with a debit card knowing that money was directly debited from my account instead of borrowing credit. Well, I learned my lessons and hope to share some of those learnings with you. Read on to learn about the best credit cards for indians in the US.
Over the years, I also learned about “Travel Hacking”. This is how I sponsor many of my travels. I will share how I use credit cards to travel the world.
What is travel hacking?
Travel hacking is a well known concept among travelers. The idea is to collect airline miles, hotel points through various credit cards and redeem them for your travels instead paying a bunch of money. There is a strategy on how and which cards to apply to get the most out of your credit card expenses.
Why should you get a credit card?
1. You can build credit history easily and quickly.
Having a good credit score in the US is your ticket to easily saving hundreds, if not thousands of dollars. Assuming you always pay your balance on time (I can’t stress this enough!), you won’t end up paying any unnecessary interest and can build your credit score in no time.
Your credit score will determine the quality of your financial offerings in America, from accessing exclusive credit card offers, to lowering the interest rates on your car loans or mortgage, to giving you more favorable rental leasing options.
2. You can get cash-back on almost every purchase
That’s right. Banks will literally give you money back for the money you already are spending. Cha-ching! Let’s assume you spend $10,000 using a credit card that gives 2% cash back on the purchase. That means you get back $200 on that $10,000 expense.
3. You can redeem points earned on spending for travel
Whenever people ask how I sponsor my travel, it comes down to saving up for these trips and secondly (and equally importantly!) taking advantage of credit card sign-up bonuses. These bonuses, also known as ‘SUB’ are huge, and can easily be worth as much as $1000 or a first class ticket for simply opening up a new card and meeting the minimum spend within a certain period(3-4 months). These can be redeemed as actual cash or travel benefits such as a hotel stays, airline tickets, car rental, products, special experiences and much more.
4. You get benefits with a credit card
Credit Cards come with their own benefits. Depending on the card, some of the benefits include primary or secondary rental car insurance, trip cancelation coverage, phone theft protection, extended warranty and so on.
5. Travel in style and comfort
Premium cards have lots of travel benefits. These may include access to airport lounges, complimentary status upgrade to hotel chains such as Mariott, Hyatt, Hilton, IHG and others, early access to event tickets and so on.
6. Get protected against Fraud
This is one of the major reasons to use a credit card over a debit card. If your credit card is stolen or compromised online, and someone makes purchases on your card, the cash is not withdrawn immediately like in the case with debit cards. You aren’t liable for any fraudulent purchases made on your card during. For this, you need to immediately report your card lost or stolen to the credit card issuing bank.
Let’s say you cannot find your credit card. In such cases, there is also a feature with many banks to freeze your credit card until you find it.
7. International travel made convenient
Your credit card is your best buddy when you’re traveling(other than your travel companion of course). Hotels and rental cars are far easier to book with a credit card than a debit car. Many places won’t even accept a debit card as they need to place a hold or deposit when booking such services. This hold can be inconvenient with a debit card.
Check out some of the best credit cards for Indians in the US along with their unique benefits
This is one of the most popular cards out there. When this card was launched, there was so much demand that Chase ran out of metal for a short period.
Benefits:
- Sapphire Preferred is designed for travelers and a perfect starter card with a reasonable yearly fee. There are no international fees associated with the card. It makes travel very convenient so you do not have to carry cash with you in an unknown country.
- Car rental insurance
- Trip cancelation coverage
- Redeem points with 1% cash back or transfer to partner airlines with one-to-one ratio.
- Your Ulitmate Reward points are worth more (1.25cents each) when you combine other UR points and use Chase portal for booking.
Current bonus: 60,000 bonus Ultimate Rewards points after $4000 spend in 3 months
Fee: $95
Rewards rate: 2X points on travel and dining at restaurants
This is not a travel focused card. However, it is a good starter card and a must-have for the Chase Trifecta strategy. You will earn UR points that you can pool together with UR points that you earn with other Chase cards and redeem for higher value for travel
Benefits:
- 5x points on certain categories every quarter. 1x back on everything else
- Redeem points with 1% cash back or UR points to redeem for better value
- If you have a Chase Sapphire Preferred or Chase Reserve card along with this one, your UR points are worth more when you combine and redeem via the Chase travel portal.
Current bonus: 20,000 bonus Ultimate Rewards points ($200 cash back) after $500 spend in 3 months
Fee: $0
Rewards rate: 5X points on bonus categories every quarter. 1X on everything else
This is also not a travel-focused card. However, it is a good starter card and a another must-have for the Chase Trifecta strategy. You will earn UR points that you can pool together with UR points that you earn with other Chase cards and redeem for higher value for travel
Benefits:
- 1.5x points on everything
- Redeem points with 1.5% cash back or pool UR points for travel
- If you have a Chase Sapphire Preferred or Chase Reserve card along with this one, your UR points are worth more when you combine and redeem via the Chase travel portal.
Current bonus: 20,000 bonus Ultimate Rewards points ($200 cash back) after $500 spend in 3 months
Fee: $0
Rewards rate: 1.5x points on everything
This is a premium travel card. Amex Gold is on the similar tier as the Chase Sapphire Preferred.
Benefits:
- Amex Gold is designed for frequent travelers. The yearly fee is well worth if you know how to use the credit card to avail the most benefits
- 4x Membership Rewards per dollar spent on dining, and supermarkets.
- 3x Membership Rewards per dollar spent on flights directly booked with Amextravel
- $10 monthly Uber credits that you can redeem for Uber rides or Uber Eats
- $10 monthly dining credit which can be redeemed via orders on Grubhub, Shake Shack, Cheesecake factory, Milk Bar, Wine.com, Global Entry or TSA Pre.
- $100 experience credit on The Hotel Collection hotels booked via Amextravel
- Baggage insurance plan
- Extended warranty on purchases made with the card.
- Purchase protection on purchases made with the card.
- Transfer points to partner airlines or hotels
Fee: $250. If you hold a corporate credit card, you get a $100 credit making the annual fee $150. Ask the rep for ‘Corporate Advantage Program’
Be mindful of the Chase 5/24 rule
This is an important rule wherein Chase will automatically deny any credit card if you have opened 5 or more credit cards in the last 24 months. This includes not only the cards you open at Chase, but also cards you opened with any other issuer. If you are an additional cardholder (authorized secondary user), it may count against your 5/24. Because of this rule, I recommend starting with Chase credit cards and then move to Amex or other family of cards.
Earn points while you sleep
One way to earn miles while you sleep, shop,eat or drink is to sign up for free with Rewards Network. When you use the registered credit card to dine or shop at a participating vendor, you score bonus points. Easy Peasy!
Once you get the hang of credit card points, you can use them strategically to support your travel goals. You may find yourself spending lots of time analyzing the best credit card deals and offers to earn maximum points through churning. Involve a player 2 to reach your goals faster by refering each other and getting those referral points.
What cards do you own? Do you have any credit card strategies? Share it in the comments below
