Should you renew your travel credit card for 2021?

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Many people sign up for credit cards based on reward programs, notably those tied to airlines or hotels to rack up points for flights and stays even faster. But with so many people not traveling this year due to the pandemic, these cards might not seem as valuable as they once did, especially as many of these credit cards come with pricey annual fees.

Consumers now have to decide if it’s worth it to maintain those accounts (with their fees) for another year or research if it would be more prudent to find a new credit card with programs that offer loyalty points that might reward business closer to home, like for gas stations and grocery stores.

“If you actually have a travel credit card, chances are you’re an avid traveler, and you’ll want to be ready as soon as borders open again,” says Sheree Mitchell, founder of Immersa Global, an upscale tour operator for bespoke trips in Spanish and Portuguese-speaking countries. “What you should do now is go over how much you’ve taken advantage of your travel credit card’s benefits in the past—pre-pandemic, of course—to make sure that the current program is right for you. Now is the perfect time to see what other card issuers and airlines are offering to attract new clients.”

Canceling a card is a personal decision, but there are a few things to consider.

“First, I’d recommend waiting until the annual fee comes due. If you paid your annual fee last fall, in the winter or in the spring, there’s probably no benefit to canceling now,” advises Brian Kelly, founder and CEO of The Points Guy. “However, if the annual fee has just hit, look at what—if any—additional perks have been added to your card. Delta, for example, just added new bonuses to many of its American Express cards, while Chase has launched targeted bonuses for United and Southwest cardholders. Citi also announced annual fee credits for select holders of its high-end American Airlines card.”

After that, consider additional existing perks on your card, whether it’s an annual companion certificate or help qualifying for elite status. Are these compelling enough to keep the card?

“Switching cards is always an option, but there are new incentives and bonuses to keep travel cards now more than ever,” says Stephen Oddo, CEO of Walks, a walking tours operator in the U.S. and Europe. “Especially if you managed to rack up a ton of points, with airfares being lower, you can take the trip of a lifetime that would otherwise be out of reach if you stopped accumulating travel points.”

Finally, if you think you want to cancel, call the customer service number on the back of your card and see if they have any incentives for you to keep the card. These are typically called retention offers and may include a waived (or discounted) annual fee or bonus points or miles.

“Even if you’re not planning a big trip in the immediate future, most credit cards are currently offering appreciation credits, hotel certificates, and travel credits that can be used towards restaurants, groceries, and gas, and higher multipliers giving you the opportunity to accumulate points faster than ever to use in the future,” says Anthony Melchiorri, CEO of consulting firm Argeo Hospitality and host of Travel Channel’s Hotel Impossible. “Contact your credit card company to see how your perks may have changed, chances are they will still be relevant.”

If you have a credit card that’s no longer conducive to your lifestyle (especially one that involves less traveling) or would like to explore other rewards programs, there are options for 2021 you can look into now.

Kelly’s top recommendation is to focus on flexible, transferable currencies, as seen with credit cards such as Chase Ultimate Rewards, American Express Membership Rewards, and Capital One Venture Miles.

“Since you aren’t locked into a single loyalty program, these points or miles offer an array of flexibility, much more so than rewards with a given airline or hotel program. You’re in the driver seat with these currencies and have a much lower risk of them suddenly becoming less valuable,” Kelly explains.

For instance, an airline may suddenly decide that a flight from New York to Florida should cost 60,000 miles instead of 30,000 miles, even if the price doesn’t materially change; Kelly says his team has seen examples of this practice—even during the pandemic. “By focusing your earning on credit card rewards with more flexibility, you’ll likely have more valuable options when travel does start to return in earnest,” he says.

And one last bit of cautionary advice for those who might want to change cards: “Bear in mind, too, that some issuers have tightened their standards for approval given the pandemic, so applying for a new card offers no guarantee that you’ll be approved,” Kelly notes.

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