I got his email from a reader recently:

Mr Credit Card

What is your opinion of the Visa Black Card. It is by far the most expensive card that I know about but it does have some additional perks that most cards lack. My wife and I take about 8 significant trips each year spending approximately 20 nights a year in hotels. We take 2 or 3 cruises each year as well. So things like trip cancellation insurance are attractive to us.

Mr. Kim Eskew

I replied with the following email asking for more information:

don’t mind me asking

which airlines, hotels and cruise you take?
how do you normally redeem points?
transfer to frequent flyer miles?
use credit card’s online booking site and redeem points automatically.
or use set number of points for certain flights?
do you fly international? if so which airlines?
do you fly coach or business or first class?
what credit card do you use now?

sorry to ask you so many things – but I really want to help you pick the right card.

And this was his reply

We fly about any airline, but mostly American depending upon the schedule out of our home airport. American and Delta/Northwest have the most flights. I currently use a Carnival Fun Points card and we redeem our points for cruises or cruise upgrades. I have an American Airlines Advantage Visa card that I use to redeem points for air travel. I do use their website to redeem points. We seldom fly internationally and we do fly coach. I tend to think the Visa Black Card is too expensive but it does come with some unique perks. We rent cars and do excursions when we travel so rental insurance and accident coverage while away from home sounds good. I am also considering the Chase Freedom Card and the Bank of America Cash Rewards Visa Signature Card. We currently have a Bank of America card of another type and we bank with them so switching to a different card from them would be easy. I use the American Airlines Card from Citi Bank for business and the Carnival Card for personal use. Recently the Carnival program was altered making it less flexible and I recently asked for an increase in my credit line which they refused so I am therefore thinking of switching cards. My credit score is 820 so I should be able to get any card I want with a liberal limit. I pay off my balance each month, just using the card to get the points.

Thanks for your assistance.

Answer – Kim – this is going to be a long answer and here is where I would start. The Visa Black Card has a trip cancellation insurance for up to $1,500. A typical trip insurance will cost about $10 to $15 person depending on the trip. If you take eight trips a year, the most you and your wife will end up spending is about $240. Given that the annual fee of the Visa Black Card is nearly double that, and that the trip cancellation is only up to $1,500 (which may be the cost of 2-3 trips for 2 airline tickets), getting the Visa Black Card for the sole purpose of trip cancellation makes no sense.

I would also like to make a couple of suggestions based on the additional information you have given us. Firstly, since you fly a lot with American Airlines, you should consider earning as much American Airlines AAdvantage Miles. Presently, you use the Citi AAdvantage Business Card for you business. I suggest that you consider getting a Starwood Preferred Guest credit card (preferably the business version). I wrote a piece about which American Airlines credit card you should get in this post. But here is the thing. Citi’s AAdvantage cards only allow you to earn one mile for every dollar that you spend on the card! And you have to pay an annual fee. Starwood allows you to transfer points for over 30 airlines (mostly at one on one ratio) and you get a bonus 5,000 miles when you transfer 20,000 starpoints into frequent flyer points. They also allow you to transfer points into Delta Skymiles on a one on one ratio.

In fact, one alternative is to get two Starwood credit cards, one for business and one for personal.

Another card to consider in your arsenal is the Delta Skymiles Credit Card. I do not know how much you fly on Delta versus American. But if you fly more on Delta (and presumably are a skymiles member), then qualifying for elite status can get you upgrades and the ability to earn more miles. One of the perks of the Delta credit cards is that if you can earn additional MQMs (which is what really qualifies you for elite status).

Yet another alternative is to get the American Express Platinum Card. Two reasons for this. Firstly, you can transfer Membership Reward Points into American Airline AAdvantage Miles and Delta Skymiles. Secondly, the Amex Plat offers lots of cruise privileges. Given that you take cruises, this may be a good card to get. It has roughly the same annual fee as the Visa Black Card. But you get much better benefits (though no trip cancellation insurance).

So to sum up, I think it is not worth getting the Visa Black Card just for the trip cancellation policy because trip cancellation insurance is cheap. Given the airlines you use and that you take cruises, I suggest you get a combination of Starwood Preferred Guest Credit Card, Delta Credit Card or the American Express Platinum Card as they would provide all the benefits you are looking for. With the Visa Black Card, the points you earn cannot be transferred to either AAdvantage Miles or Delta Skymiles and given you fly quite a bit, I think it adds another layer of complication to your reward points strategy.

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