Rewards cards for off-the-beaten-path travelers

If you hate feeling like a tourist when you travel — or you’re on a budget that puts traditional accommodations out of reach – there are still plenty of ways to utilize rewards cards. The earnings and perks may be more modest, but it’s all about the experience, right?

Consider these rewards strategies for off-the-beaten-path travel.

Alternative accommodations

Co-branded hotel cards are usually the way to go if you’re staying at the affiliated chain, thanks to their consumer-friendly redemption structures and perks.

But your destination doesn’t have American hotel chains – and, if it does, perhaps you’d avoiding them. Seeking out privately-owned inns and hostels, as well as rental properties and even campgrounds can often get you budget-friendly, less-touristy accommodations.

Luckily, flexible travel rewards cards (such as the Chase Sapphire Preferred and Barclaycard Arrival Plus) often classify many of these non-chain types of lodging (including campgrounds and RV parks) as “travel expenses” for their bonus categories, meaning you can get double points for them – and redeem those points for travel expenses later.

Keep in mind that many smaller, privately owned properties in other countries won’t accept cards (or charge a fee for paying by card) if you pay on arrival. So, if you’d like to get bonus rewards, consider purchasing your accommodations in advance via the property’s website or a third-party booking site if you can.

There’s an even bigger caveat, though: Whether you get the double points on lodging purchases depends on the merchant category code (MCC). Both the Chase Sapphire Preferred and Barclaycard Arrival terms and conditions exclude from the travel category websites or owners who rent properties. Here are Chase’s terms, as an example:

CSP travel exclusions

That would seem to rule out vacation rentals by owner (a great way to stay among locals and save money by cooking your own meals while traveling). However, travelers have reported that the CSP gives double points on vacation rentals done via Airbnb, as its merchant category code designates it as “lodging and hotels.” This is, of course, subject to change.

MCC issues can crop up even for what seem like obvious travel expenses — here are two hostel reservations I paid for online, from two travel booking sites on the same day. One earned me double points, the other did not:

Hostel purchases and rewards

Both properties were small inns tucked into neighborhoods away from the mobs of tourists, though, so I’m not sweating the loss of 17 bonus miles.

On the redemption side, American Express (a CreditCardForum advertising partner) recently started providing a more “official” way to redeem points for alternative accommodations. You can now link any American Express card that earns Membership Rewards to your Airbnb account and redeem your rewards directly for stays. Below are some examples of American Express cards that earn MR points.

Getting there

Co-branded airline cards can get you business-class seats for long-haul flights on major carriers and their partners. But if you’re looking at an out-of-the-way destination with a tiny airport, you’ll probably be traveling on a small regional carrier. Or maybe you decide to save money by taking a budget airline (plentiful in Europe) or a train.

Again, flexible travel rewards cards are worth considering. For example, the Capital One Venture card allows you to redeem your miles (with no minimum) for statement credits against flights on any airline (even small regional or budget ones) and against rail tickets. So, while a major carrier’s points may not get you all the way to the small mountain town that most tourists have yet to discover, your flexible Capital One miles might.

If you’re comfortable paying a $450 annual fee, the Chase Sapphire Reserve automatically refunds you $300 in travel purchases (via statement credit) each year. Chase defines travel broadly — so you can expect most airlines and many passenger trains to be included.

Getting around

Cruise ships and group bus tours aren’t for you – luckily, travel cards often reward you for more independent, spontaneous modes of transportation.

Renting a car is often the best way to reach out-of-the-way areas on your own schedule, and the good news is that car rentals nearly always fall within cards’ “travel” categories, for the purpose of earning bonus rewards.

Many cards also provide built-in insurance coverage against loss and damage for rental cars. For most cards, that coverage is secondary (which means you have to file a claim through your regular auto insurance first). A few cards offer primary coverage, however, including several of Chase’s premium travel cards.

If you’re renting abroad, there’s an interesting twist: Most regular car insurance policies (like the one you have for your own car) won’t cover rentals abroad anyway, so secondary insurance provided by your card may become primary. Check your card’s terms, but here’s the fine print from the World MasterCard rental car insurance benefits:

World MasterCard primary vs secondar rental car benefits

American Express also offers primary rental insurance to cardholders for a flat rate of $24.95 for up to 45 consecutive days via its Premium Car Rental Protection program.

Even if you’re armed with primary rental car insurance, note that some programs exclude certain countries – and that some overseas rental agencies may say you’re required to purchase their coverage at the counter. They may not have a leg to stand on, but try explaining that if there’s a language barrier. What’s more, certain unique vehicles are generally excluded, so if you were planning on zipping down your destination’s narrow streets on a moped, your card won’t cover you. And if you are planning on literally going off the beaten path, know that off-roading isn’t covered. Same goes if you’re traveling to an area of conflict. The World MasterCard benefits have the following exclusions:

World MasterCard offroading

Traditional rental cars aren’t the only way to get around, however. You might use short-term car rentals like Car2Go or Zipcar, bypassing the tourist traps to get to all the hole-in-the-wall bars and restaurants the locals love. The good news is, travel cards may count these short-term rentals as “travel” expenses (see our forum thread about it).

Or, you might explore your destination via a rideshare service – and take advantage of the many partnerships credit card companies are forming with Starwood’s partnership with Uber and lyft. Plus, American Express has begun offering $200 in yearly Uber credits for Platinum cardholders.

There are plenty of other alternative modes of transit that fall in the travel category. The Citi ThankYou Premier, for example, designates a variety of alternative transport options as travel expenses, including recreational vehicle rentals and houseboat rentals. For an upcoming beach trip, I got some advice from someone who lives near my destination: The popular beaches are crowded, and the roads that lead to them practically impassible. The ferries that go along the coast, though, are less crowded and have access to less-packed beaches. I bought boat passes for me and my travel companions on a tour site, and voila – double points on my travel rewards card.

The bottom line

Co-branded airline and hotel cards arguably provide better value when used strategically. But if you’re a wherever-the-wind-blows-me nomad who prefers to swim against the tourist current, you’re probably better suited to a card that provides flexibility.

Tell us in the comments: If you’re an off-the-beaten-path kind of traveler, do you still find rewards cards useful? And how do you use them?

Updated April 2017

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