Ask an Expert: Credit Cards for Newlyweds

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A Money Talks News reader recently wrote to ask me this question…

Hello Jason,

My girlfriend and I recently got engaged and are starting to plan for the wedding. We both agreed opening a joint checking account purely for wedding expenses was a good idea. This way, we can track exactly how much it cost us in the end, and we will both be able to pay for things if we are not together. Going along with this, though, I thought it would be a good idea to open a credit card with travel rewards to build miles to help with the honeymoon. We can pay off the credit card bill with the newly opened wedding account, and we will always pay off the entire balance every month.

My question is as follows: If we are planning on setting a June 2013 wedding date, with the honeymoon sometime around January 2014, which credit card with travel rewards would you recommend we look into apply for?

Thanks,
Jeff

What should Jeff do?

First, it’s important to note all of the good things Jeff and his fiancee are doing.

Opening a new credit card to track wedding expenses is a good idea, especially if they’ll pay it in full every month. And as long as they’re avoiding all interest payments, it definitely makes sense to earn travel rewards.

Finally, they’re planning way in advance – it’s easy to run into trouble trying to use points and miles at the last minute. And since Jeff and his fiancee will take their honeymoon in January, they’ll have a much easier time using their travel rewards than they would over the summer’s peak travel season.

Less clear is the best card for their needs.

Unless they’re traveling nearby – or are spending a lot on their wedding – it’ll be hard to earn enough miles in a short time to send two people on a trip.

For example, it will take 100,000 miles on most airlines to send two people to Europe in coach, and 70,000 to the Caribbean. Since you typically earn 1 mile per dollar spent, that would be a very expensive wedding.

What you two need is a great sign-up bonus to start with the maximum possible number of miles. Right now, the British Airways card from Chase offers the best sign-up bonus: 50,000 points after your first purchase, with up to 50,000 additional points from spending $20,000. That’s enough to get the couple to Europe, the Caribbean, or Hawaii on BA partner American Airlines.

Another option would be to forgo the airline miles altogether and earn rewards directly from the bank. Capital One offers its Venture Rewards card that returns 2 “miles” per dollar spent. Each mile is worth 1 cent as a statement credit toward any travel-related expense such as hotel, airfare, or car rental. With a card like this, you essentially get 2 percent back on all purchases, and you’re not locked into any one airline.

Bottom line: The only thing better than taking a great vacation is traveling for free. And by using the best travel rewards credit card, you can save money on the trip of a lifetime.