Is there any value in the latest crop of new credit cards?

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[edit 5/14/18: added unlimited Priority Pass Select membership to list of Ritz-Carlton card benefits.]

Several banks have let out a steady trickle of new credit cards and announcements in the last few months, so I thought I'd run through a few of them and see if there are any offers worth signing up for or keeping.

Barclays Arrival Premier

I have had an Arrival Plus card for years, and use it for all my non-manufactured, non-bonused spend, as well as manufacturing spend on it. It has an $89 annual fee, for which you can redeem 8,900 miles as a statement credit. Since it earns a 5% rebate on all the miles you redeem, it functions as a 2% cash back card when you spend "about" $85,000 per year, since when you redeem those 170,000 miles you'll earn 8,500 in rebated miles and another 425 rebated miles when you redeem those, for a total of $89.25 in rebated miles. I also use the card's chip-and-PIN functionality to buy public transit tickets overseas, and Barclays recently added a flight delay benefit.

The new Barclays Arrival Premier has a number of differences from the Arrival Plus:

  • $150 annual fee;
  • no rebate on redeemed miles. Instead, earn 15,000 bonus miles when you spend $15,000 per cardmember year, and another 10,000 bonus miles when you spend a total of $25,000 per cardmember year;
  • $100 Global Entry fee credit every 5 years;
  • transfer miles to airline partners (Aeromexico, Air France/KLM Flying Blue, China Eastern, Etihad, EVA Air, Japan Airlines, Jet Privilege, Jet Privilege, Malaysia Airlines, Qantas).

This card is strictly superior to the Arrival Plus for annual spend between $15,000 and $85,000:

  • at $15,000 in spend, you receive 15,000 bonus miles, which are enough to cover the $150 annual fee;
  • between $15,000 and $25,000, the card acts as a straight 2% cash back card;
  • at $25,000 in spend, you receive another 10,000 bonus miles, which means the card has earned a total of $600 on $25,000 in spend, or 2.4% cash back.

Only for spend in excess of $85,000 will the Arrival Plus's mileage rebate make the return on unbonused spend, after accounting for the annual fee, exceed the Arrival Premier.

Verdict: I'm not in any rush to sign up for the Arrival Premier since it doesn't have a signup bonus and it's not yet possible to upgrade from the Arrival Plus. I assume eventually Barclays will target existing Arrival Plus cardholders with an upgrade offer, which I'll likely take. If you don't have an Arrival Plus yet, the Arrival Premier seems like a perfectly reasonable way to get 2.4% cash back on $25,000 in spend each year, plus serving as a go-to card you can use when traveling internationally.

Starwood Preferred Guest American Express Luxury Card

I think this is the most interesting of the new Marriott Rewards cards that will be available in August, 2018, since it offers a higher earning rate on Marriott and Starwood purchases than the new Ritz-Carlton card, a more valuable anniversary free night award than the new Premier Plus card, and the ability to earn Platinum status after spending $75,000 during the calendar year.

If you spent $75,000 on the card per year, you'd end up paying a $450 annual fee for:

  • a free night award worth up to 50,000 points;
  • 150,000 Marriott Rewards points;
  • $300 in statement credits against purchases at Marriott and Starwood properties, which should include room charges;
  • Platinum status;
  • and an unlimited Priority Pass Select membership.

Assuming you are able to redeem your free night award at a Category 6 or off-peak Category 7 property each year, your $75,000 in spend will earn the equivalent of 200,000 Marriott Rewards points, or 2.67 points per dollar. That's not quite as good as the Starwood Preferred Guest American Express card currently earns (3 Marriott Rewards points per dollar), but it does reduce the devaluation from 33% to just 11%.

Verdict: this card is too expensive to bother with for a leisure travel hacker, but a reimbursed business traveler who can choose their own hotel, and can therefore redeem the $300 statement credit for their employer's cash, might consider manufacturing up to $75,000 in order to enjoy Platinum status on a 4-night, off-peak Category 7 vacation starting in 2019.

Ritz-Carlton Rewards Credit Card

This card also has a $450 annual fee, but with almost nothing to show for it:

  • a $100 statement credit on two-night paid stays at the Ritz-Carlton;
  • 3 annual Club Upgrades on paid stays;
  • a $300 travel credit;
  • Platinum status after spending $75,000 per account year;
  • and an unlimited Priority Pass Select membership.

It's important to note that even if you're a reimbursed business traveler, and even if you spend $75,000 per year at Marriott Rewards and Starwood properties each year, you should be using the Starwood Preferred Guest Luxury Card for that spend since it earns 6, rather than 5, points per dollar spent on those purchases. Using the Ritz-Carlton Rewards card would be leaving 75,000 points on the table.

I know families that love using Club Upgrades to save money feeding their kids when staying at Ritz-Carlton properties, but even if you are able to cash out the $300 travel credit, there's no way I'd be willing to pay $150 to pre-commit to a paid stay at a Ritz-Carlton every single year.

Note that, as is typical for Chase, the Ritz-Carlton card's Platinum status qualification is based on cardmember year spend, not calendar year spend, while typically for American Express, the Starwood Preferred Guest Luxury Card awards Platinum status based on calendar year spend. That means if you sign up for the Ritz-Carlton card for a signup bonus and decide to hit the $75,000 spend threshold to get Platinum status, you'll want to meet the spend requirement early in a calendar year, which should get you Platinum status for the remainder of that year and all of the following year.

Verdict: skip it — nothing to see here.

Marriott Rewards Premier Plus, Starwood Preferred Guest Credit Card, and Starwood Preferred Guest Business Credit Card

In addition to the two ultra-premium cards, Chase is also launching a new Marriott Rewards-branded card with a $95 annual fee and an annual anniversary free night award worth up to 35,000 points, and adding that benefit to the existing Starwood Preferred Guest consumer and business credit cards.

On its own these card aren't very interesting, since Marriott is the worst offender in terms of category creep, seemingly deliberately targeting the few valuable properties where free night certificates can be redeemed and moving them out of the eligible redemption categories, so I would never pay $95 for what's essentially a Category 5 free night certificate (or Category 4 peak season award).

However, one strategy that could make sense for some people is to combine one, two, or three of these cards with the Starwood Preferred Guest Luxury Card mentioned above. If you carried all four cards and spent $75,000 per year on the Luxury card, you could pay $735 in annual fees and $1,500 in opportunity cost (assuming a 2% cash back alternative) for:

  • 150,000 Marriott Rewards points;
  • 3 35,000-point free night awards;
  • 1 50,000-point free night award;
  • and Platinum status.

The point is simply that once you've manufactured Platinum status with the Luxury card, you should value the free night awards earned by the other 3 cards more highly than before. A 35,000-point free night award might not be worth $95 with Silver status, but might be worth $95 with Platinum status. Likewise one 35,000-point free night award might not be worth $95, but 3 might be worth $285 (if you can avoid moving hotels or paying cash to stay in the same hotel), and if so, then they should be even more valuable with Platinum status.

Verdict: whether or not stacking free night awards with Platinum status is worth the time and trouble is going to depend on how properties shake out into Marriott's new hotel categories. If, as I suspect, the most appealing city properties start in or quickly move into Category 6 and above, then the 35,000-point free night awards offered under the new program will be as worthless as the Category 5 awards they hand out today are.

Bonus: don't forget to cancel your Citi AAdvantage cards!

Not a brand new credit card, but a few days ago Citi e-mailed to tell me that:

"As a valued cardmember, soon you’ll automatically earn 2X miles at restaurants and at gas stations with the Citi / AAdvantage Platinum Select World Elite Mastercard.

"You’ll also be able to earn a $100 American Airlines flight discount after you spend $20,000 or more in purchases during your card membership year and renew your card. Your purchases on or after ‌July 22‌, ‌2018‌, qualify toward meeting the minimum spend requirement to receive this benefit."

I didn't have to scroll very far down to also see, "The annual membership fee for this card will be increasing to $99."

The card wasn't worth keeping at $95, so don't let them squeeze another $4 out of you!