Travelocity Rewards Card from Barclays vs Barclaycard Arrival

A reader asked me to compare the Barclaycard Arrival World Mastercard to the Travelocity Rewards American Express Card from Barclays. While I don’t normally like to write about credit cards I don’t have, there isn’t much detailed writing on the Travelocity card so I took up the challenge of doing my own analysis. Moreover, when selecting credit cards, it’s very important to consider other options and make sure you are making the right decision for yourself.

These two cards do have some similarity in the sense that the rewards points can be redeemed for flights, hotels and vacation packages and the earning rate is around 2% cash back on general spending for both. However, the Travelocity card points are only restricted to Travelocity purchases while the Barclaycard Arrival miles can be used for any travel purchase. On the other hand, the Travelocity Rewards card has no annual fee though the Barclaycard Arrival sign-up bonus is higher ($200 vs. $440). Here is how the two cards work:

Barclaycard Arrival World MasterCard

Application Link: Barclaycard Arrival World Mastercard.

• Named ‘Best for Travel Rewards’ Money Magazine, October 2013
• Earn 40,000 bonus miles if you make $1,000 or more in purchases in the first 90 days from account opening. 40,000 bonus miles equates to $400 off your next trip!
• 0% introductory APR on purchases for the first 12 months after account opening. After that, variable APR, currently 14.99% or 18.99%, based upon your creditworthiness.
• Earn 2X miles on all purchases.
• No mileage caps and no foreign transaction fees.
• Get 10% miles back when you redeem for travel (i.e. redeem 25,000 miles for travel and get 2,500 miles back)
• Easily redeem your miles for statement credits toward flights, cruises, car rentals, hotels and more.
• Complimentary FICO® Scores as a benefit to active cardmembers. Opt-in to have instant and convenient access to FICO® Scores from your Barclaycard online account.

The Barclaycard Arrival has an $89 annual fee that is waived in the first year.

Travelocity Rewards American Express Card from Barclays

Application Link: Travelocity Rewards American Express Card from Barclays.

• Earn 5,000 bonus points after your first purchase.
• Earn an additional 5,000 bonus points after spending $1,000 on purchases within the first 90 days of account opening.
• Earn 3 points per $1 spent on eligible Travelocity purchases
• Earn 1 point per $1 spent on all other purchases
• Points can be redeemed for statement credits towards Travelocity purchases for Flights, Hotels and Vacation Packages.
• No blackout dates or restrictions
• No Annual Fee

The earning rates may be a little confusing as they have different values. To put it simply, if you go for the best value when redeeming, each dollar spent on the Barclaycard is worth 2.2 cents and each Travelocity card point is worth 2 cents. The Barclaycard sign-up bonus is $440 vs. $200 for the Travelocity card. The Barclaycard does have an annual fee after the first year while the Travelocity card does not have an annual fee. Let’s do a side by side comparison:

Flexibility in Redeeming Points

The main difference between the two cards is that the Barclaycard Arrival miles can be used on any travel expense while the Travelocity card points can only be redeemed with Travelocity. Though the redemption rate for Barclaycard is slightly higher at 2.2% vs. 2% for the Travelocity card, this is not a huge amount to make a difference. For me, the one drawback for the Travelocity card is the points can only be redeemed for purchases through Travelocity and that makes the Travelocity card points somewhat inflexible. 

Flights:

While Travelocity is a viable option for redeeming points to purchase flights, the Travelocity card, in my opinion, is far from the best value for flights, in that case. The U.S. Bank FlexPerks card earns 1 point per dollar on all spending (each point worth up to 2 cents each) plus double points on groceries, gas stations or airfare, whichever category has the most spending. My grocery spending is much higher than my Travelocity expense so I can pick up points quite a bit faster this way. Moreover, while the FlexPerks travel search engine is powered by Travelocity, you can actually book any published fair by simply calling their customer service center and reading off the flights. I’ve done this a number of times when Travelocity doesn’t have the fare I want.

Hotels:

In terms of hotel, I don’t tend to use third party booking sites that don’t offer significant discount very much. Not only can one often get far better deals with Hotwire or Priceline’s Name Your Own Price or with hotel loyalty points, third party sites are usually not eligible for revenue based promotions. As an example, for the current Marriott Rewards Megabonus Promotion awarding a free night after every two stays, a Travelociy rate would not be eligible. I can, however, book directly with Marriott and redeem my Barclaycard Arrival miles and still participate in the promotion.

Win: Barclaycard Arrival.

Sign-up Bonus

The main reason I feel the Barclaycard Arrival is a good deal is the sign-up bonus. You get 40,000 miles towards travel, which is worth $440 as a statement credit after spending $1000. The Travelocity Rewards card gives you 10,000 points worth $200 for the same spending requirement.

Win: Barclaycard Arrival.

Annual Fee

This is where the Travelocity Rewards card starts to pick up a bit of lost ground.  An attractive aspect of the Travelocity card is the fact that it doesn’t have an annual fee. The Barclaycard Arrival does have an annual fee, but you always have the option to downgrade the Barclaycard to a no annual fee version. The downside is that the Barclaycard Arrival version without annual fee only earns 1 point per dollar so the Barclaycard Arrival will turn into a 1.1% cash back card after taking this option.  It may or may not make sense for people to downgrade the card or continue to put spending on the downgraded card, but we’ll assume the holder does downgrade so that we can compare the two cards on an even playing field. 

Win: Travelocity Rewards Card.

Comparing the Value

Now that we’ve compared the two cards on a broader basis, it’s time to do the true side by side value comparison. Let’s assume that when you sign up for the Barclaycard Arrival, you downgrade to the no annual fee version after a year and earn only 1.1% cash back. That way, it’s an equal comparison since you never pay a fee. We need to see at which point the increased earning from the Travelocity card (2% cash back) makes up for the lower sign-up bonus.

To do the full comparison, we’ll consider three scenarios:

• Spending $10,000 a year on the card.
• Spending $20,000 a year on the card.
• Spending $10,000 a year on the card ($5,000 of spending is on Travelocity to earn 3 points per dollar).

We can see that, with general non-bonus spending, it takes a few years and a lot of spending before the no annual fee on the Travelocity card starts to make up for the increased sign-up bonus on the Barclaycard Arrival. But, of course, comparing regular spending doesn’t give the full story as the Travelocity card is aimed at big Travelocity users. Earning points booking travel on Travelocity is a bonus the Arrival card does not have. With Travelocity spending, the Travelocity Rewards card gets ahead of the Barclaycard Arrival in the second year, in fact. 

In conclusion, after looking at the numbers and taking into consideration how much more flexible the Barclaycard Arrival miles are than Travelocity Rewards points, the Barclaycard Arrival is the overall winner between the two cards. The exception is for those with high spending on Travelocity, in which case the triple points bonus for Travelocity purchases on the Travelcity Rewards Card is indeed lucrative.

Summary

• The Barclaycard Arrival World Mastercard and theTravelocity Rewards American Express Card from Barclays both offer the ability to earn points at around 2% cash back redeemable for flights, hotels a nd vacation packages.
• The Barclaycard Arrival is slightly more flexible in allowing to redeem for any travel expense while the Travelocity Rewards card is limited to Travelocity purchases only.
• Although the Barclaycard Arrival has a much higher sign-up bonus, the Travelocity Rewards Card gives the ability to continue to earn 2% cash back towards Travelocity purchases without paying an annual fee.
• Comparing the two cards side by side for various spending scenarios show the Barclaycard Arrival ahead for the first few years. However, for those with large purchases on Travelocity, the Travelocity Rewards card jumps ahead of the Barclaycard in the second year.

(Disclosure: I do earn a referral bonus for some cards mentioned in this post. I always include the best offer I can find regardless of referral. If anyone knows of any better offers than I have mentioned here, do let me know. As always, thank you very much for your support!)

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