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A new Forbes Advisor survey asked Americans about their thoughts on credit card travel rewards. As we’ve seen in the past, travel rewards remain popular, especially now that more destinations are becoming easily accessible again. More than half of respondents consider travel rewards cards important, despite ongoing Covid-19 restrictions.
Additionally, some cardholders are still willing to pay an annual fee for included card benefits on their travels, although this varies based on demographics. Card issuers have done an effective job of marketing their included benefits and our survey found that, for the most part, customers are aware of the benefits that can come with their cards.
Here’s how American attitudes and behavior toward credit card travel rewards lean today.
Respondents want to travel again and have points for doing so
Cardholders are ready to travel again, with only 12% of respondents not planning a vacation this year. That leaves the vast majority of respondents hoping for a break and, in fact, 50% said they were planning at least two trips right now.
Of those planning to travel, most plan to use points or miles from their credit cards to fund their trip. A quarter of respondents said they expect to pay for one trip using their rewards, while 36% will pay for two trips and 12% will pay for three or more. A significant portion of respondents (18%) hope to use points but don’t know how much travel it represents, which is completely understandable until official flight and hotel bookings are locked down.
If you’re wondering how cardholders can afford to fund so much travel, the answer may lie in their unspent rewards balances. Nearly three-quarters of respondents already have a reserve of miles and points available. In fact, 15% have accumulated at least 20,000 points (enough for a free return flight or a short hotel stay) and 45% have even more credit card rewards available.
These balances have been built over time. Currently, 49% of respondents indicated that they did not use their rewards because Covid-19 impacted their travel plans or hopes. Another common factor was that the value of the points didn’t seem to be worth it, another topic our survey looked at.
Rewards points are overrated, misunderstood
More and more credit card rewards programs are moving to proprietary rewards currencies, often giving customers more flexibility in how they choose to redeem their points, but also blurring the value of a point. For this reason, respondents were all over the place when asked what they thought the average credit card point was worth.
Some respondents held back, with 12% saying they thought the points were worth one or two cents each. This number matches most credit card refunds or other fixed value refunds. However, others were more optimistic: 18% said the dots were worth an average of three cents each and 42% of respondents thought the dots were worth 20 cents or more. While this is theoretically possible in some takeovers, this is venturing into needle-in-a-haystack territory.
Perhaps more telling is the number of respondents who admitted they weren’t sure about the value of points. Overall, 27% of respondents chose this option, with nearly twice as many women as men responding this way.
It should be noted that respondents tend to be more specific when thinking of points in the context of redeeming for free flights. Most airlines advertise economy flights at 25,000 miles round trip, but paying double that is fairly common for a wider selection of inventory. However, of those surveyed, most chose that a welcome bonus of 100,000 points would pay for two return domestic flights, with 17% expecting it to cover three return flights and 17% s expecting this size bonus to cover only one flight. travel.
Seniors are less likely to spend on annual fees
Although the exact offers vary from card to card, most respondents were aware that travel credit cards offer an assortment of benefits to cardholders simply by holding the card. Some of the most recognized features included airport lounge access, expedited security screening and discounts on in-flight purchases.
Despite the fact that frequent travelers could get hundreds of dollars in value by selecting a card with benefits they use, not everyone wants to pay for those benefits in the form of an annual card fee. 14% are unwilling to pay an annual fee for a travel card and that number jumps to 62% for respondents aged 58-76. Only a select few – 5% – would pay more than $500 a year for ultra-premium cards, none of whom were over 58.
As you’d expect, most respondents were willing to pay a modest fee for a card with strong travel rewards and benefits. The price range with the most selections was $51-$100 per year, which coincides with the large number of cards we typically see around the $95 price point. Almost as many respondents would consider up to $200 per year in exchange for a multi-benefit card.
Not everyone is ready to commit to travel just yet, but our survey indicates that Americans have hit a major milestone, with most ready to plan and book travel this year. The results show that many cardholders have a reserve of miles at their disposal and are willing to spend them, even if they don’t always know exactly what they are worth. This proves the value of doing your homework if you’re focused on maximizing your rewards.
This online survey of 2,000 US adults was commissioned by Forbes Advisor and conducted by market research firm OnePoll in accordance with the Market Research Society’s Code of Conduct. Data was collected February 17-18, 2022. Margin of error is +/- 2.2 points with 95% confidence. This survey was overseen by the OnePoll research team, a member of the MRS and a member of the American Association for Public Opinion Research (AAPOR). For full survey methodology, including geographic and demographic sample sizes, contact [email protected]
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