If you're a habitual traveller, it definitely makes sense to use a credit card that offers travel rewards (if you use a credit card at all). The rewards, if used effectively, can easily be worth substantially more than a 1% cash back offer. The two major genre in this field are airline rewards and hotel rewards. I personally run an overwhelming majority of purchases through my American Express Platinum Delta Sky Miles Card. It has good benefits if you're a repeat Delta passenger.
Today, in the mail I received an offer for the American Express Starwood Preferred Guest Card. It came with a decent introductory offer of 30,000 points and a waived first year annual fee. This, of course, just scratches the top layer of the surface. Almost every airline and hotel chain offers a credit card with rewards.
I personally go the route of the airline card because I almost exclusively fly Delta or another SkyTeam airline (product of living in Atlanta). And, I like the flexibility of being able to stay at a wide variety of hotels. That being said, most major hotel chains have some attractive brands these days, such as the St. Regis for Starwood.
Of course, when you're travelling overseas, I go with a card that doesn't charge a foreign transaction fee (my Delta card does). See post on the Amex Platinum Card. There are other considerations too. Most cards offered tiered rewards, so it is better to maximize your transaction on a single card to capture those bonus benefits. Then there are unbranded cards that allow you to use your rewards across airlines and hotels, such as the CapitalOne Venture Rewards Card ($59 annual fee, waived first year) and the Amex Platinum. And of course, if you're getting a new card, make sure you capture a great introductory offer.
Decisions, decisions...
